2008 Annual Report

Foreword

The year 2008 brought dramatic changes for the world economic outlook that will also have a bearing on the EFTA Surveillance Authority's agenda for 2009.

There is a real danger that the crises in the financial sector will lead to a serious economic recession. Iceland has been particularly hard hit. Compared with the size of the country's economy, Iceland had a large financial sector, which had grown fast and with major expansions abroad. In October the three largest Icelandic banks experienced major liquidity problems and were taken into public administration. National authorities have taken drastic measures in order to control the situation. The Authority is monitoring the developments in Iceland closely with a focus on aspects of potential discrimination and state aid issues.

Questions regarding energy and the environment were also high on the political agenda in 2008. Important decisions were taken by the Authority in this area, among others, the approval of the Norwegian governments participation in the carbon capture and storage (CCS) test centre at Mongstad. The Authority has given a green light to a full scale CCS facility at Kårstø in Norway. These projects have an important European and climate change dimension. Moreover, national allocation plans (NAPs) of the EFTA States for CO2 quotas have to be approved by the Authority before such states can participate in the European emission trading system (ETS). The Authority decided last summer to raise objections to the Norwegian plan and an amended draft law is now under assessment in the Authority. The Liechtenstein NAP was already approved at the end of 2007.

In 2008 the EFTA Surveillance Authority issued a high number of letters of formal notice and an unprecedented high number of reasoned opinions. As in 2007, these figures were largely driven by infringement cases concerning the incorporation of regulations in Iceland.

The Authority is particularly mindful of its responsibility to ensure that the monitoring of the EEA Agreement is carried out in a consistent and coherent way. This notwithstanding, the Authority must be expected to continuously endeavour to make improvements when it comes to both efficiency and quality. In 2008 we were able to reduce further the number of old cases, but still had a high number of pending cases. Lead time for the processing of new cases, was also shortened.

In an effort to enhance public confidence, the Authority revised its policy on transparency by adopting new rules on access to documents and launching a public document register. A highly qualified and well trained staff from 16 nations also contributes to the Authority's standing and independence.

The year ahead can be expected to be eventful and challenging. A common understanding of relevant legislation and a level playing field within all 30 EEA States is not less important in a period of recession.

Per Sanderud
President