Appledore Shipyard wants compensation for its bid costs

Appledore Shipyard had been selected as the preferred bidder. It would have secured jobs for two years.

But politicians in Scotland ruled the tender process did not meet EU rules.

Torridge and West Devon MP Geoffrey Cox is calling on the office of the Auditor General for Scotland to investigate the conduct of all parties involved.

Compensation bid

The deal was cancelled two weeks ago when politicians in Scotland ruled that the procurement process did not meet EU rules.

The Scottish Fisheries Protection Agency admitted mistakes were made.

It said shortcomings in the process meant "it would not be possible to provide a fair assessment of the tenders".

Conservative MP Mr Cox said: "We need an investigation. I'm calling for an inquiry, and I hope it will be carried out.

"I will certainly be pressing for it in the House of Commons and up in Scotland for somebody to look into what has occurred in this case."

Meanwhile, Appledore is seeking compensation for the costs of preparing the bid, running into hundreds of thousands of pounds.

Up to 90 jobs are at risk because of the cancellation. The yard has struggled to find new work since it was taken over by Plymouth Devonport Dockyard owner DML in 2004.