Competition Authority Approves Debt Relief Plan Skip to content

Competition Authority Approves Debt Relief Plan

The Competition Authority approved yesterday the government’s new action plan on easing the debt load of small and medium-sized businesses, which was presented on Wednesday. Financial companies, interest associations on the employment market and the Ministries of Finance and Economic Affairs cooperated on the project.

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Iceland’s financial district. Copyright: Icelandic Photo Agency.

Among resources are taxation remission and writing off debts. “The goal is for financial companies to have completed their review of the financial situation of these companies and made those likely to survive and face debt problems an offer on resolving these problems by June 1,” a statement on the project reads, according to Fréttabladid.

Minister of Economic Affairs Árni Páll Árnason said companies can now concentrate on more than just making ends meet. “They can start rebuilding their operations and hire people rather than letting them go.”

“Therefore I believe that this action is important in battling the unemployment that has already occurred, creating conditions for economic growth next year and increasing investment already in the first part of next year,” he added.

Úlfar Steindórsson, chairman of the Iceland Chamber of Commerce agreed, saying the action will free companies from “a prison of debt”. “We believe this is among the quickest economic actions which can be undertaken at this time,” he added.

According to the tenth paragraph of the competition laws, cooperation between companies that are in competition with each other on the market is prohibited.

However, the 15th paragraph of the same laws states that exceptions can be made to the aforementioned ban, provided certain conditions are fulfilled, visir.is reports.

These include that closer cooperation on pricing and trade terms than stated in the agreement will not be allowed without consulting the Competition Authority first, a representative of the government is to attend all meetings and only financial companies can take advantage of the exception on cooperation.

Click here to read about the government’s action plan for indebted households.

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