Iceland to Face EU Pressure on Icesave, Fishing Rules in Membership Talks

Iceland will come under pressure to resolve the dispute over Icesave accounts and overhaul its fishing policies in talks to join the European Union that are scheduled to start next week, a draft EU document showed.

Negotiations are slated to begin on July 27 as Britain and the Netherlands seek compensation for losses of as much as $5.1 billion suffered by their investors in the 2008 collapse of Landsbanki Islands hf, which offered the high-yielding Icesave Internet accounts.

“Serious efforts will be required particularly in the areas of fisheries, agriculture and rural development, environment, free movement of capital, and financial services in order to meet the accession criteria,” according to a draft EU statement obtained by Bloomberg News.

EU governments sped the talks from a planned September or October start to counter the growing anti-EU mood in Iceland. Opposition to EU membership rose to 60 percent in June from 54 percent in a November poll, according to a Capacent Gallup poll published July 1 by Iceland’s RUV state broadcaster.

While the EU draft doesn’t mention the bank-compensation clash, it points out that any EU country could halt the talks at any time. The draft also doesn’t explicitly call on Iceland to give up whale hunting, a demand made by the European Parliament in a non-binding resolution this month.

Plans to open the negotiations require approval by EU foreign ministers on July 26. The first step would be for the European Commission to assess the compliance of Iceland’s laws with EU standards. Detailed talks in 35 EU policy areas would start in early 2011, with no deadline set for membership.

To contact the reporter on this story: James G. Neuger in Brussels at jneuger@bloomberg.net

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