Plans by a Chinese investor to acquire a large farm, Neðri Dalur which is located next to Geysir Geothermal area on the Golden Circle have caused a significant stir, raising calls for a review of the law governing foreign purchases of land. The investor has said he plans to use the 1,200 hectare property to build up various tourism related activities.
Neðri Dalur farm is located right on the Golden Circle to the west of Geysir geothermal area. It has hot springs, and studies indicate there is significant amount of geothermal energy to be found on the land. According to the sources of the local news site Vísir the purchase price of the land is at least 1.2 billion Icelandic Króna (11.5 million USD/9.6 million EUR).
Political backlash
The plans have caused a significant stir in Icelandic society. Lilja Alfreðsdóttir, the vice chairman of the center-right Progress Party told Vísir that the plans by the Chinese investor raised questions about foreign investments in Iceland. She pointed out that the law governing foreign investments is flawed and its application lacks transparency.
She also called upon the government to compile and issue a list of all foreign purchases of land.
Limits on land purchases by foreign nationals
According to Icelandic law Icelandic real-estate and land can only be purchased and held by Icelandic citizens or citizens of the European Economic Area. People from outside the European Economic Area can purchase and hold property in Iceland if granted an exception from the law by the Ministry of the Interior.
These exceptions are granted in cases where the foreign individual is authorized to operate a business in Iceland and the property is either connected to the business or intended as a private residence.
The Ministry of Justice has only granted exemptions from the law for properties which are smaller than 25 hectares. Lilja argues in an Op-Ed in the local newspaper Fréttablaðið that the rules do not address the issue of natural resources, like geothermal heat, and that their the application has lacked transparency.
Neighbours opposed to Chinese investment
The farmer at a neighboring farm, Efstidalur, told the local radio station Bylgjan that he was opposed to any foreigners acquiring Neðri-Dalur. He said that while he was opposed to any foreigners acquiring land in Iceland, he was particularly concerned about Chinese investments. We only need to think of the size of their society, he told Bylgjan.
He explained that if large farms are sold to foreign investors Icelandic farmers would at some point be forced to become cottagers for wealthy foreigners.
We have to take action and protect the rights of future generations of Icelanders to farm their own land.
Plans by a Chinese investor to acquire a large farm, Neðri Dalur which is located next to Geysir Geothermal area on the Golden Circle have caused a significant stir, raising calls for a review of the law governing foreign purchases of land. The investor has said he plans to use the 1,200 hectare property to build up various tourism related activities.
Neðri Dalur farm is located right on the Golden Circle to the west of Geysir geothermal area. It has hot springs, and studies indicate there is significant amount of geothermal energy to be found on the land. According to the sources of the local news site Vísir the purchase price of the land is at least 1.2 billion Icelandic Króna (11.5 million USD/9.6 million EUR).
Political backlash
The plans have caused a significant stir in Icelandic society. Lilja Alfreðsdóttir, the vice chairman of the center-right Progress Party told Vísir that the plans by the Chinese investor raised questions about foreign investments in Iceland. She pointed out that the law governing foreign investments is flawed and its application lacks transparency.
She also called upon the government to compile and issue a list of all foreign purchases of land.
Limits on land purchases by foreign nationals
According to Icelandic law Icelandic real-estate and land can only be purchased and held by Icelandic citizens or citizens of the European Economic Area. People from outside the European Economic Area can purchase and hold property in Iceland if granted an exception from the law by the Ministry of the Interior.
These exceptions are granted in cases where the foreign individual is authorized to operate a business in Iceland and the property is either connected to the business or intended as a private residence.
The Ministry of Justice has only granted exemptions from the law for properties which are smaller than 25 hectares. Lilja argues in an Op-Ed in the local newspaper Fréttablaðið that the rules do not address the issue of natural resources, like geothermal heat, and that their the application has lacked transparency.
Neighbours opposed to Chinese investment
The farmer at a neighboring farm, Efstidalur, told the local radio station Bylgjan that he was opposed to any foreigners acquiring Neðri-Dalur. He said that while he was opposed to any foreigners acquiring land in Iceland, he was particularly concerned about Chinese investments. We only need to think of the size of their society, he told Bylgjan.
He explained that if large farms are sold to foreign investors Icelandic farmers would at some point be forced to become cottagers for wealthy foreigners.
We have to take action and protect the rights of future generations of Icelanders to farm their own land.
