A boat was launched at the Port Glasgow yard on Tuesday

The European Competition Commissioner Neelie Kroes is to investigate how a Polish shipyard is able to undercut the Ferguson yard on the Clyde.

A delegation of SNP politicians and representatives from the yard has met the commissioner.

The executive said later it would delay the award until it could consider the scope and scale of the investigation.

Ferguson, which launched its second last boat on Tuesday, said the work on the two new contracts was crucial to keep the yard going.

Ministers have insisted that their hands are tied by EU rules which mean they must open up the tendering process to European yards.

Having had this meeting with the commission, I believe that these boats should be exempt from tender Alyn Smith SNP MEP

They have argued that legally they have to allow European yards to bid because the boats in question are not military ships.

The Rementowa yard is alleged to have been given illegal subsidies, allowing it significantly to undercut its rival's bid.

But the Scottish National Party MEP Alyn Smith said it was made clear at the meeting with the commissioner on Tuesday that the contracts could have been exempt from the competition rules.

Mr Smith said that the ships could have been reclassified as military or "grey" ships, and that would have eliminated competition from Polish yards.

It is nonsense to suggest that the Scottish Executive could classify fisheries protection vessels as military ships Scottish Executive spokesman

He added: "Having had this meeting with the commission, I believe that these boats should be exempt from tender.

"I think the executive has yet again misinterpreted EU rules and interpreted them against our own while other countries interpret them in their own favour.

"I will be writing to the Scottish minister Ross Finnie with my advice and calling upon him to halt this flawed tender process now.

"He has the power to save Fergusons and if he reverses his position on the basis of the SNP findings nobody will applaud him louder than I will."

But an executive spokesman said: "It is nonsense to suggest that the Scottish Executive could classify fisheries protection vessels as military ships.

There are fears for the future of the business

"The Scottish Executive does not procure HMS vessels, that rests with the MoD. Fisheries protection has no secret dimension nor any requirement for a military capability.

"The EU procurement rules are clear. Civil contracts must go to open tender.

"Nonetheless, we are making our own enquiries of the commission and will listen to their views with interest, both in respect of any alleged illegal state aids in Poland and any scope that we might have within the EU public procurement regime to assist Fergusons."

Last week, the commission announced it would undertake an investigation into alleged illegal subsidy of three Polish state owned yards.