From Iceland — Independent Magma Committee Formed

Independent Magma Committee Formed

Published July 28, 2010

In the wake of yesterday’s news that the government will not confirm Magma Energy’s purchase of HS Orka, an independent committee has been established to examine the privatization of power companies in the past few years.
The reason why Magma Energy was able to get as far as they did in purchasing HS Orka is because the previous right-wing government privatized many energy companies in Iceland. This left them vulnerable to purchase by whoever had the money, without any real regulation in place about who can purchase these companies, and under what conditions.
Apart from the committee, a legal expert will also examine the legality of Magma Energy – a Canadian company – purchasing an Icelandic company through the use of a puppet company in Sweden. His findings will be submitted on 15 August.
In addition, a bill will be submitted that is intended to limit the amount of control private individuals can have over public companies. This bill will be submitted no later than October.
Prime Minister Jóhanna Sigurðardóttir added that they would also need to look at what sort of reparations, if any, would need to be paid to Magma Energy if their purchase of HS Orka was rejected. She would not confirm or deny that the sale would ultimately be stopped, however.

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