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State Aid

State aid: Investigation of an investment incentives scheme in Iceland opened



The EFTA Surveillance Authority opened a formal investigation into an Icelandic regional aid scheme today. The Authority will look into whether the scheme is consistent with the State aid provisions in the EEA Agreement.

The scheme is aimed at promoting investment in Iceland and provides for direct grants, tax exemptions and allows the sale of real estate below market value. It is based on Act No 99/2010on Incentives for Initial Investment in Iceland.

The Authority approved the scheme in October 2010. Since then it has been amended twice; once by an act which was notified to the Authority, and once by a regulation which was not notified. The Authority has decided to undertake an investigation of the scheme as amended.  

Under the scheme as amended, the Icelandic authorities have entered into six investment agreements since 2010. The Authority has doubts as to whether certain elements of these agreements are compatible with EEA law.

The Authority is under a duty to open a formal investigation when, on the basis of a preliminary examination, it has doubts as to the compatibility of state aid measures. The decision to open a formal investigation procedure is without prejudice to the final decision of the Authority.

The Authority will now call for further comments from the Icelandic authorities and third parties with an interest in the case. A non-confidential version of the Authority's Decision to open a formal investigation will shortly be published on the Authority's website and in the Official Journal of the European Union.

For further information, please contact:

Mr. Per Andreas Bjørgan
Director, Competition and State Aid Directorate
(+32) 2 286 18 36

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