The judgment of the EFTA Court in the so-called Icesave case will be delivered on the 28th of January. The case, which was brought before the EFTA Court by the EFTA Surveillance Authority in December 2011, seeks to establish whether Iceland breached its obligations according to the EEA Deposit Guarantee Directive as Iceland‘s guarantee scheme had not paid depositors in the London and Amsterdam branches of the Icelandic bank Landsbanki in the wake of the banking crash that occurred in October 2008.
Iceland argued that its measures during the 2008 crash actually made sure that all depositors in the Icelandic banks will receive all their deposits. This was made possible by changing the ranking of such claims in case of winding up of the banks, securing distributions ahead of general unsecured creditors. This has proven to be a necessary and successful measure as the UK and the Netherlands have already received approximately 50% of their total claims and stand to be paid in full. Payments from the estate will continue regardless of the finding of the EFTA Court.
The EFTA Court case is an infringement case, where the Authority seeks a general declaration from the Court. No claims are made against Iceland for immediate payment of any deposits or funding of its deposit insurance scheme.
An oral hearing took place before the Court on September 18 last year.
For further information, see http://www.mfa.is/tasks/icesave