Hoyvík Agreement
Encyclopedia
The Hoyvík Agreement is a free trade
agreement between the Faroe Islands
and Iceland
that was signed 31 August 2005 in the town of Hoyvík
in the Faroe Islands.
It is the most extensive free trade agreement that either nation has entered into. It guarantees almost complete freedom of goods, services, persons and capital. It also deals with competition and government subsidies and prohibits any kind of discrimination based on nationality except when it is specially provided for by the agreement. The agreement is unique for Iceland as it the first such agreement establishing free trade in agricultural products, a sector that usually sees a lot of protection from the Icelandic authorities.
A notable exception to the free trade agreement is the special status of the fisheries industry. Pre-existing restrictions on foreign investment in the industry present in both countries will not be abolished.
In addition to free trade, the agreement also provides a framework for increased cooperation between the nations regarding all the common interests of the nations. Especially mentioned fields of cooperation include: culture, education, sports, health care, transportation, communications, tourism, environmental issues, energy and resource management.
The Faroese Løgting
ratified the agreement on 2 May 2006 and the Icelandic Alþingi did the same on 3 June.
On 21 August 2006, a statement was made by the annual general meeting of the West Nordic Council
that the possibility of extending the agreement to include Greenland
(thus creating a West Nordic free trade zone) should be seriously studied. It was noted at Løgting that the agreement could be extended to Norway
and Canada
in the future.
Free trade
Under a free trade policy, prices emerge from supply and demand, and are the sole determinant of resource allocation. 'Free' trade differs from other forms of trade policy where the allocation of goods and services among trading countries are determined by price strategies that may differ from...
agreement between the Faroe Islands
Faroe Islands
The Faroe Islands are an island group situated between the Norwegian Sea and the North Atlantic Ocean, approximately halfway between Scotland and Iceland. The Faroe Islands are a self-governing territory within the Kingdom of Denmark, along with Denmark proper and Greenland...
and Iceland
Iceland
Iceland , described as the Republic of Iceland, is a Nordic and European island country in the North Atlantic Ocean, on the Mid-Atlantic Ridge. Iceland also refers to the main island of the country, which contains almost all the population and almost all the land area. The country has a population...
that was signed 31 August 2005 in the town of Hoyvík
Hoyvík
Hoyvík is the third largest town in the Faroe Islands. It has grown in size for many years and is now merged with Tórshavn becoming a northern suburb of the Faroese capital. A person from Hoyvík is known as a hoyvíkingur....
in the Faroe Islands.
It is the most extensive free trade agreement that either nation has entered into. It guarantees almost complete freedom of goods, services, persons and capital. It also deals with competition and government subsidies and prohibits any kind of discrimination based on nationality except when it is specially provided for by the agreement. The agreement is unique for Iceland as it the first such agreement establishing free trade in agricultural products, a sector that usually sees a lot of protection from the Icelandic authorities.
A notable exception to the free trade agreement is the special status of the fisheries industry. Pre-existing restrictions on foreign investment in the industry present in both countries will not be abolished.
In addition to free trade, the agreement also provides a framework for increased cooperation between the nations regarding all the common interests of the nations. Especially mentioned fields of cooperation include: culture, education, sports, health care, transportation, communications, tourism, environmental issues, energy and resource management.
The Faroese Løgting
Løgting
Løgting is the unicameral parliament of the Faroe Islands, a self-ruling dependency of Denmark.The name literally means "Law Thing" - that is, a law assembly - and derives from Old Norse lǫgþing, which was a name given to ancient assemblies. A ting or Þing has existed on the Faroe Islands for over...
ratified the agreement on 2 May 2006 and the Icelandic Alþingi did the same on 3 June.
On 21 August 2006, a statement was made by the annual general meeting of the West Nordic Council
West Nordic Council
The West Nordic Council is a cooperation forum of the parliaments and governments of Greenland, the Faroe Islands and Iceland. It was initially founded in 1985 as the West Nordic Parliamentarian Council of Cooperation but the name was changed in 1997. The council comprises six MPs from each...
that the possibility of extending the agreement to include Greenland
Greenland
Greenland is an autonomous country within the Kingdom of Denmark, located between the Arctic and Atlantic Oceans, east of the Canadian Arctic Archipelago. Though physiographically a part of the continent of North America, Greenland has been politically and culturally associated with Europe for...
(thus creating a West Nordic free trade zone) should be seriously studied. It was noted at Løgting that the agreement could be extended to Norway
Norway
Norway , officially the Kingdom of Norway, is a Nordic unitary constitutional monarchy whose territory comprises the western portion of the Scandinavian Peninsula, Jan Mayen, and the Arctic archipelago of Svalbard and Bouvet Island. Norway has a total area of and a population of about 4.9 million...
and Canada
Canada
Canada is a North American country consisting of ten provinces and three territories. Located in the northern part of the continent, it extends from the Atlantic Ocean in the east to the Pacific Ocean in the west, and northward into the Arctic Ocean...
in the future.