Iceland. A. Definitions and sources of data

Transcription

1 Iceland A. Definitions and sources of data Data on the stock and flow of foreign direct investment (FDI) in Iceland are compiled by Sedlabanki Islands (Central Bank of Iceland). Quarterly and annual statistics on the aggregated flow and stock of FDI are published in the Bank s annual report and the quarterly publication Monetary Bulletin (which replaced Economic Statistics) and are published on the Bank s website ( Data compilation by Sedlabanki Islands is in line with international standards. Inward and outward flow and stock data are compiled through annual surveys and are available, from 1988 onwards, with a breakdown by region and by industry. FDI data by region are classified according to the concept of ultimate beneficial ownership. The industry classification follows the United Nations International Standard of Industrial Classification and represents the economic activity of the non-resident direct investment enterprise (outward) and the resident direct investment enterprise (inward). Data do not include bonds and money market instruments, financial leases, and financial derivatives. Cross-border transactions in real estate by non-resident investors are not included. Stock data are reported as book values. The Invest in Iceland Agency, an independent agency of the Ministry of Industry and Commerce, the National Power Company and the Trade Council of Iceland, operates as a one-stop shop for foreign companies interested in investing in Iceland and provides information on investment opportunities and the business climate. In 2000, there were a number of 18 Icelandic parent companies, owning 212 affiliates abroad, and 55 affiliates of foreign transnational corporations operating in Iceland, as reported by Sedlabanki Islands. No further information are presently available on the operations of transnational corporations in Iceland, their affiliates abroad nor foreign affiliates in Iceland. Posting date: 19 September 2005

2 B. Statistics on FDI and the operations of TNCs

3 UNCTAD WID Country Profile: ICELAND Page 3 of 22 Table 1. Summary of FDI (Millions of kronur) Variable Inward Outward 1. FDI flows, (annual average) FDI flows as a percentage of GFCF, (annual average) FDI stocks, FDI stocks as a percentage of GDP, Sources : Based on tables 3a and 4; UNCTAD, FDI/TNC database. Notes : Table 2. Summary of international production Variable Home-based TNCs Affiliates of foreign TNCs in Iceland Foreign affiliates of home-based TNCs abroad 1. Number of foreign affiliates, Source: Based on estimates provided by Sedlabanki Islands (Central Bank of Iceland).

4 UNCTAD WID Country Profile: ICELAND Page 4 of 22 Table 3a. FDI flows, by type of investment, (Millions of kronur) Inward investment Outward investment Intra- Intra- Reinvested company Reinvested company YEAR Equity earnings loans Total Equity earnings loans Total Source : Sedlabanki Islands (Central Bank of Iceland), Economic Statistics, Bulletin, various issues and unpublished data. various issues, Monetary

5 UNCTAD WID Country Profile: ICELAND Page 5 of 22 Year Equity Table 3b. FDI flows, by type of investment, Inward investment Reinvested earnings Intracompany loans (Millions of dollars) Total Equity Source : International Monetary Fund, Balance of Payments CD ROM, March Outward investment Intracompany Reinvested earnings loans Total

6 UNCTAD WID Country Profile: ICELAND Page 6 of 22 Table 4. FDI stocks, by type of investment, (Millions of kronur) Inward investment Outward investment Intracompany Intra- YEAR Reinvested Reinvested company Equity earnings loans Total Equity earnings loans Total Sources : Sedlabanki Islands (Central Bank of Iceland), Economic Statistics, various issues; Monetary Bulletin, various issues; and unpublished data.

7 UNCTAD WID Country Profile: ICELAND Page 7 of 22 Table 5. FDI flows in the host economy, by industry, (Millions of kronur) Sector / industry Total Primary Agriculture, hunting, forestry and fishing Mining, quarrying and petroleum Secondary Food, beverages and tobacco Textiles, clothing and leather Wood and wood products Chemicals and chemical products Non-metallic mineral products Metal and metal products Machinery and equipment Office, accounting and computing machinery Tertiary Construction Trade Hotels and restaurants Transport, storage and communications Transport and storage Post and communications Finance Financial Intermediation Insurance and Pension Funding Business activities Computer and related activities Research and development Other business activities Other services Unspecified Source : Sedlabanki Islands (Central Bank of Iceland), unpublished data. Note : Textiles refers also to wood products. Chemicals refers also to petroleum and rubber and plastics. Metal refers also to machinery.

8 UNCTAD WID Country Profile: ICELAND Page 8 of 22 Table 6. FDI flows in the host economy, by geographical origin, (Millions of kronur) Region/economy Total world Developed countries Western Europe European Union Austria Belgium / Luxembourg Denmark Finland France Germany Ireland Netherlands Spain Sweden United Kingdom Other Western Europe Faeroe Islands Gibraltar Norway Switzerland North America Canada United States Other developed countries Australia Israel Japan Developing economies Latin America and the Caribbean South America Chile Asia West Asia Cyprus Central and Eastern Europe Latvia Russian Federation Source : Sedlabanki Islands (Central Bank of Iceland), unpublished data.

9 UNCTAD WID Country Profile: ICELAND Page 9 of 22 Table 8. FDI flows abroad, by industry, (Millions of kronur) Sector / industry Total Primary Agriculture, hunting, forestry and fishing Secondary Food, beverages and tobacco Textiles, clothing and leather Wood and wood products Chemicals and chemical products Rubber and plastic products Metal and metal products Machinery and equipment Office, accounting and computing machinery Motor vehicles and other transport equipment Other transport equipment Tertiary Electricity, gas and water Trade Transport, storage and communications Transport and storage Post and communications Finance Financial Intermediation Business activities Computer and related activities Research and development Other business activities Unspecified Source : Sedlabanki Islands (Central Bank of Iceland), unpublished data. Note : Textiles refers also to wood products. Chemicals refers also to petroleum and rubber and plastics. Metal refers also to machinery.

10 UNCTAD WID Country Profile: ICELAND Page 10 of 22 Table 9. FDI flows abroad, by geographical destination, (Millions of kronur) Region/economy Total world Developed countries Western Europe European Union Belgium / Luxembourg Denmark Finland France Germany Greece Ireland Netherlands Portugal Spain Sweden United Kingdom Other Western Europe Faeroe Islands Guernsey Isle of Man Jersey Norway Switzerland North America Canada United States Other developed countries Australia Japan New Zealand Developing economies Africa Namibia Latin America and the Caribbean South America Chile Falkland Islands (Malvinas) Other Latin America and Caribbean Antigua and Barbuda Belize Greenland Mexico Panama Asia West Asia Cyprus South, East and South- East Asia India Central and Eastern Europe Bulgaria Estonia Latvia Lithuania Poland Russian Federation Slovakia Source : Sedlabanki Islands (Central Bank of Iceland), unpublished data.

11 UNCTAD WID Country Profile: ICELAND Page 11 of 22 Table 11. FDI stocks in the host economy, by industry, (Millions of kronur) Sector / industry Total Primary Agriculture, hunting, forestry and fishing Mining, quarrying and petroleum Secondary Food, beverages and tobacco Textiles, clothing and leather Wood and wood products Chemicals and chemical products Non-metallic mineral products Metal and metal products Machinery and equipment Office, accounting and computing machinery Tertiary Construction Trade Hotels and restaurants Transport, storage and communications Transport and storage Post and communications Telecommunications Finance Financial Intermediation Insurance and Pension Funding Business activities Computer and related activities Research and development Other business activities Other services Unspecified Source : Sedlabanki Islands (Central Bank of Iceland), unpublished data. Note: Chemicals and chemical products inclued petroleum refining as well as rubber and plastic products. Textiles includes wood products.

12 UNCTAD WID Country Profile: ICELAND Page 12 of 22 Table 12. FDI stocks in the host economy, by geographical origin, (Millions of kronur) Region/economy Total world Developed countries Western Europe European Union Austria Belgium / Luxembourg Denmark Finland France Germany Netherlands Spain Sweden United Kingdom Other Western Europe Faeroe Islands Gibraltar Jersey Norway Switzerland North America Canada United States Other developed countries Australia Israel Japan Developing economies Latin America and the Caribbean South America Chile Other Latin America and Car British Virgin Islands Asia West Asia Cyprus Central and Eastern Europe Latvia Russian Federation Source : Sedlabanki Islands (Central Bank of Iceland), unpublished data.

13 UNCTAD WID Country Profile: ICELAND Page 13 of 22 Table 14. FDI stocks abroad, by industry, (Millions of kronur) Sector / industry Total Primary Agriculture, hunting, forestry and fishing Secondary Food, beverages and tobacco Textiles, clothing and leather Wood and wood products Coke, petroleum products and nuclear fuel Manufacture of refined petroleum products Chemicals and chemical products Rubber and plastic products Metal and metal products Machinery and equipment Electrical and electronic equipment Office, accounting and computing machinery Motor vehicles and other transport equipment Other transport equipment Tertiary Electricity, gas and water Trade Transport, storage and communications Transport and storage Telecommunications Finance Financial Intermediation Business activities Computer and related activities Research and development Other business activities Source : Sedlabanki Islands (Central Bank of Iceland), unpublished data. Note: For the years Chemicals and chemical products inclued petroleum refining as well asrubber and plastic products. Textiles includes wood products.

14 UNCTAD WID Country Profile: ICELAND Page 14 of 22 Table 15. FDI stocks abroad, by geographical destination, (Millions of kronur) Region/economy Total world Developed countries Western Europe European Union Belgium / Luxembourg Denmark Finland France Germany Greece Ireland Italy Netherlands Portugal Spain Sweden United Kingdom Other Western Europe Faeroe Islands Guernsey Isle of Man Jersey Norway Switzerland North America Canada United States Other developed countries Australia Japan New Zealand Developing economies Africa Namibia Latin America and the Caribbean South America Chile Falkland Islands (Malvinas) Other Latin America and Caribbean Antigua and Barbuda Belize Greenland Mexico Panama Asia West Asia Cyprus South, East and South- East Asia India Central and Eastern Europe Bulgaria Estonia Latvia Lithuania Poland Russian Federation Slovakia Source : Sedlabanki Islands (Central Bank of Iceland), unpublished data.

15 UNCTAD WID Country Profile: ICELAND Page 15 of 22 Table 86. Largest home-based TNCs, 2001 (Millions of kronur and number) Company Industry Sales Employees A. Industrial Samherji hf Fishing a Marel hf Food Össur hf Precision instruments Bakkavör hf. Food Pharmaco hf Pharmaceuticals Grandi hf Fishing Hampiðjan hf. Machinery and equipment Sæplast hf Machinery and equipment B. Tertiary SÍF/ÍS hf Trade SH hf Trade Baugur hf Trade a Flugleidir hf Transport and storage Eimskip hf (The Iceland Steamship Company Ltd) Transport and storage Landsíminn hf (Iceland Telecom) Telecommunications Samskip hf Transport and storage C. Finance and Insurance Assets Employees Landsbanki Íslands hf (The National Bank of Iceland L Finance Kaupþing hf (Kaupthing Investment Bank) Finance Source : Sedlabanki Islands (Central Bank of Iceland), unpublished data. a 1999.

16 UNCTAD WID Country Profile: ICELAND Page 16 of 22 Table 87. Largest foreign affiliates of home-based TNCs, 2001 (Millions of dollars and number) Company Host Economy Industry Sales Employees A. Industrial SIF France (SIF hf) France Food SIF Canada Ltd (SIF hf) Canada Food Carnitech AS (Marel hf) Denmark Machinery and equipment 23.. Iceland Seafood Corporation (SIF hf) United States Food Marel USA United States Machinery and equipment 3 4 Iceland Seafood France SA (SIF hf) France Food 1.. Balmar - Fios, Cordoaria E Redes Lda (Hampiðjan hf) Portugal Textiles.. 76 Katsouris Fresh Foods (Bakkavör Group hf) United Kingdom Food.... Bakkavör Sweden (Lyse) Sweden Food.... Trawl Investments (Hampiðjan hf) Ireland Textiles.... Balkanpharma (Pharmaco hf) Bulgaria Pharmaceuticals.... Icelandic Iberica SA (SH hf) Spain Food.... Coldwater Seafood Corp. (SH hf) United States Food.... SH UK (SH hf) United Kingdom Food.... Iceland Seafood Spain (SIF hf) Spain Food.... SIF Ltd. (Iceland Seafood Limited) United Kingdom Food.... Ossur USA United States Prosthetics.... B. Tertiary Eimskip UK Ltd United Kingdom Transport and storage 4 70 Arcadia Group plc. (Baugur hf) United Kingdom Trade.... Bonus Stores Inc (Baugur hf) United States Trade.... Eimskip Nederland BV. Netherlands Transport and storage.... C. Finance and Insurance R Raphael & Sons Plc (Íslandsbanki hf) United Kingdom Finance 1 9 BI International SA Luxembourg (Bunadarbanki Islands) Luxembourg Finance.... Heritable and General Investment (Landsbanki Íslands hf) United Kingdom Finance.... Kaupthing Bank Luxemburg Luxembourg Finance.... Sources: The Banker's Almanac, 2001 (London, Reed Information Services Ltd, 2001); City Guide to Hungary (Budapest Business Journal/ITD Hungary, 1999); Classic Ratings Database, 2001 (New York, McGraw-Hill Companies, 2001); Foreign Investment in Latin America & the Caribbean (ECLAC, United Nations 2000); Thomson Financial Piranhaweb ( Who Owns Whom, 2001 (London, Dun and Bradstreet Ltd, 2001); Worldscope Database, June 2001, World Investment Directory Asia and the Pacific (Geneva, United Nations, 2000); World Investment Directory Central & Eastern Europe (Geneva, United Nations, forthcoming); Wright Company Analysis ( various company websites, and Sedlabanki Islands (Central Bank of Iceland), unpublished data.

17 UNCTAD WID Country Profile: ICELAND Page 17 of 22 Table 88. Largest affiliates of foreign TNCs in the host economy, 2001 (Millions of kronur and number) Company Home Economy Industry Sales Employees A. Industrial Íslenska járnblendifélagið hf. Norway Metal and metal products Íslenska álfélagið hf. Switzerland Metal and metal products Norðurál hf. United States Metal and metal products Kísiliðjan hf. United States Metal and metal products.. 51 Ísaga ehf. Sweden Chemicals and chemical products.. 29 AFA JCDecaux Ísland ehf. Denmark Printing and publishing.. 6 B. Tertiary Skeljungur hf. United Kingdom Trade Olíuverslun Íslands hf. Denmark Trade Íslensk erfðagreining hf. United States Research and development C. Finance and Insurance Source : Sedlabanki Islands (Central Bank of Iceland), unpublished data.

18 UNCTAD WID Country Profile: ICELAND Page 18 of 22 C. Legal framework for FDI 1. National policy framework Iceland has a welcoming attitude towards FDI. As of December 2001, the main features of the national FDI regime includes the following: Entry and establishment: Non-residents may invest in a business enterprise in Iceland with some limitations, which are stipulated in the Act on Investment by Non-residents in Business Enterprise or in specific legislation, and upon the fulfilment of other conditions and acquisition of licences required by law. Restrictions apply in the energy area where only Icelandic entities and entities domiciled in another member state of the European Economic Area, are permitted to own energy exploitation rights as regards waterfalls and geothermal energy for other than domestic use. The same applies to enterprises which distribute energy. Ownership and control: Foreign ownership of business is basically unrestricted. There are however a few ownership and control restrictions in specific fields of strategic importance, such as fishing operations and fish processing. Also, the maximum total shareholding owned by non-residents (except residents from the EEA) in Icelandic airline companies is 49 per cent. Special permission must be obtained in the case of investment in Icelandic enterprises by foreign states, foreign municipalities or other foreign authorities. Board membership of Icelandic companies by individuals resident outside the EEA/OECD is subject to restrictions but the Ministry of Commerce may grant exemptions. Operational conditions: Private individuals and companies domiciled in other EEA countries may purchase property if it is to be used as a permanent residence or business premises. Non-residents need permission from the Ministry of Justice to purchase real estate. A company domiciled in any of the other member countries of the EEA or OECD has essentially the same right to operate in Iceland as an Icelandic-domiciled company. Citizens of EEA countries do not need a work permit in Iceland. New foreign enterprises operating in Iceland that set up a branch or subsidiary are obliged to register with the Register of Limited Companies. Specific licences may be requested for certain types of operations in Iceland. Foreign exchange controls: No restrictions are imposed in Iceland on buying or selling of foreign exchange. Investment Incentives: Broadly speaking, Iceland does not offer direct subsidies for foreign investment. Its prime incentives lie in low corporation tax, competitive labour costs and payroll costs, and low electricity prices. Industrial sites are available around Iceland at competitive cost. Local communities may offer certain incentives. However, as a member of the EEA, Iceland has access to European Union research funds for R&D programmes and joint ventures undertaken with companies from at least one other EEA country. Grants are issued for specific projects on a case-by-case basis by bodies including the New Business Venture Fund and Science Fund. Starting in 1999, special incentives are granted for film and TV production in Iceland. Source: Ministry of Industry and Commerce of Iceland, Invest in Iceland (2001). Internet ( 1D0BF7F2BFA75BE EE44). Main legislations relating to FDI

19 UNCTAD WID Country Profile: ICELAND Page 19 of 22 Industrial Act No 42 of 1978; amended by Act No. 23 of 1991; Act No. 70 of 1993; Act No. 40 of Patents Act No. 17 of 1991; amended by Act No. 67 of 7 May 1993; Act No. 36 of 10 May 1996; Act No. 91 of 29 May Design Protection Act No. 48 of 1993; amended by Act No. 36 of 1996; effective 1 June Registration of a Design Regulation No. 178 of 1994; amended by Regulation No. 285 of Trade Marks Act No. 45 of 1997; effective 1 June Investment by Non-residents in Business Enterprise, Act No. 34 of 25 March 1991; amended by Act No. 121 of 27 December 1993, Act No. 46 of 22 May Operation and Marketing of Non-resident Undertakings for Collective Investment in Transferable Securities (UCITS) in Iceland Regulation No. 369 of 31 August Foreign Exchange Act No. 87 of 17 November 1992; Foreign Exchange Regulation No. 679 of 29 December Activities of Stock Exchanges and Regulated Over-the-Counter (OTC) Markets Act No 34 of 6 April Obligation to Provide Information Regarding Foreign Exchange Transactions and Capital Movements between Countries Rules No. 13 of Branch and a Representative Office of a Credit Institution Established in a Country Outside the European Economic Area Regulation No. 307 of 25 May 1994; Regulation No. 308 of 25 May Establishment of the Icelandic Investment Bank Ltd Act No. 60 of 26 May Competition Act No. 8 of 25 February 1993; amended by Law No. 24 of 1994; Law No. 83 of 1997; and Law No. 82 of Private Limited Companies Act No. 138 of 1994; amended by Act No. 2 of Establishment of Limited Liability Companies to Operate Landsbanki Islands and Búnaoarbanki Islands Act No. 50 of Industrial Act Regulation No. 620 of Official Supervision of Financial Operations Law No. 87 of 16 June Securities Transactions Act No. 13 of 28 March The European Economic Interest Grouping Act No 159 of New Business Venture Fund Act No 61 of 26 May International Trading Companies Act No. 31 of 10 March International framework a. Multilateral instruments

20 UNCTAD WID Country Profile: ICELAND Page 20 of 22 Paris Convention for the Protection of Industrial Property of 20 March 1883, as amended and revised. Convention on the Settlement of Investment Disputes between States and Nationals of Other States of 18 March 1965, signed on 25 July 1966, effective 14 October ILO Tripartite Declaration of Principles Concerning Multinational Enterprises and Social Policy, adopted on 16 November The Set of Multilaterally Agreed Equitable Principles and Rules for the Control of Restrictive Business Practices, adopted on 5 December 1980 by the General Assembly of the United Nations (resolution 35/63). Convention Establishing the Multilateral Investment Guarantee Agency of 11 October 1985, signed on 24 July Agreement on Trade-Related Investment Measures, signed on 15 April 1994; in force on 1 January General Agreement on Trade in Services, signed on 15 April 1994; in force on 1 January Fourth Protocol to the General Agreement on Trade in Services of 15 February Fifth Protocol to the General Agreement on Trade in Services of 12 December Agreement on Trade-Related Aspects of Intellectual Property Rights, signed on 15 April 1994; in force on 1 January b. Regional instruments Convention Establishing the European Free Trade Association, signed in Stockholm on 4 January 1960, in force on 3 May The Convention was amended on serveral occasions. Code of Liberalisation of Capital Movements, adopted by the Council of the Organization for Economic Cooperation and Development on 12 December The Code was amended on several occasions. Code of Liberalisation of Current Invisible Operations, adopted by the Council of the Organisation for Economic Cooperation and Development on 12 December The Code has been amended on several occasions. Declaration on International Investment and Multilateral Enterprises, adopted by the Council of the Organisation for Economic Cooperation and Development on 21 June The Declaration and the Guidelines for Multinational Enterprises attached to the Declaration were revised on several occasions (1979, 1984, 1991 and 2000). Energy Charter Treaty of 17 December 1994; effective since16 April c. Bilateral treaties 1. Bilateral investment treaty for the protection and promotion of investments with China 31 March 1994; Latvia 11 June 1998; Lithuania 20 Sept 2002; Slovakia 05 April 2002; Viet Nam 20 Sept 2002.

21 UNCTAD WID Country Profile: ICELAND Page 21 of Bilateral treaties for the avoidance of double taxation with Belgium 23 May 2000; Canada 19 June 1997; Canada 17 Dec 2003; China 03 June 1996; Czech Republic 18 Jan 2000; Estonia 16 June 1994; France 29 Aug 1990; Germany 18 March 1971; Greenland 05 July 2002; Ireland 17 Dec 2003; Italy 10 Sept 2002; Latvia 19 Oct 1994; Lithuania 13 June 1998; Luxembourg 29 April 1975; Luxembourg 04 Oct 1999; Netherlands 25 Sept 1997; Poland 19 June 1998; Portugal 02 Aug 1999; Russian Federation 26 Nov 1999; Slovakia 15 April 2002; Spain 22 Jan 2002; Switzerland 03 June 1988; United Kingdom 27 April 1928; United Kingdom 27 April 1997; United Kingdom 30 Sept 1991; United States 27 Dec 1962; United States 07 May 1975; Viet Nam 01 April 2002.

22 UNCTAD WID Country Profile: ICELAND Page 22 of 22 D. Sources of information Official Sedlabanki Islands Invest in Iceland Agency Secondary 1. Economist Intelligence Unit, Country Profile: Iceland 2000/2001 (London, Economist Intelligence Unit, 2000). 2. Economist Intelligence Unit, Country Report: Iceland (London, Economist Intelligence Unit, 2000). 3. Kelly, Robert C., Debra Ewing, Stanton Doyle and Denise Youngblood (ed.), Iceland Country Review 2000 (CountryWatch.com, 1999), 80 p. 4. Lyons, Maryanne B. Investment in Iceland, Marketing on Iceland, Overseas Business Reports (US Department of Commerce, September 1992), pp Reina, Peter and Jonathan Barnes, "Largest Iceland investment draws environmentalist fire", ENR, April 7, 2003, 250 (13), p USA International Business Publications, Iceland Business & Investment Opportunities Yearbook, 3 rd ed., vol. 1 (USA: International Business Publications, forthcoming) 350 p. 7. WTO, Trade Policy Review: Iceland (Geneva: WTO, 2000).