Having lost its case against the Icelandic state at district court level, high-tech processing systems producer Vélfag is preparing its appeal, stating that the court ruling was unexpected. This latest setback has led to the company giving its entire workforce notice.
‘This decision has been taken because the basis of the company’s operations has been halted due to the actions of the Ministry of Foreign Affairs and Arion Bank, which have made it impossible for the company to continue its normal activity,’ a Vélfag representative stated.
The company has been subject to sanctions that were placed against Russian fishing and processing group Norebo, despite assurances that Norebo no longer has any part of the shareholding in Vélfag, since sold to Swiss-based businessman Ivan Kaufmann. These assurances do not appear to have been sufficient to convince the Ministry of Foreign Affairs, which has stated that insufficient evidence has been presented to demonstrate there is no connection with sanctioned entities.
‘Despite repeated attempts to obtain explanations, corrections and fair-handed treatment in this case, the situation has not improved,’ Vélfag’s representative stated.
‘The company’s accounts are frozen and therefore its regular operations have stopped. For this reason the company has been in difficulties to meet its obligations to staff and customers.’
According to the company, Vélfag will continue to pursue its case before the courts.
