Britain to sue Iceland for Icesave money

Apr 11, 2011

Business digest: Treasury to take legal action after Icelanders reject second plan in a referendum

Britain's Treasury has said it will take legal action against Iceland after a second, more lenient, repayment plan for Iceland's debts was defeated in a referendum.

Roughly 60 per cent of the Icelandic people voted against a repayment deal with a 3.3 per cent interest rate. This follows an earlier 5.5 per cent interest rate deal that was rejected by 90 per cent of the country in January.

Both the British and the Dutch government will now lodge a complaint against Iceland at the European Free Trade Association in Luxembourg.

Britain and the Netherlands were forced to bail-out their citizens to the combined sum of £3.5bn when Icelandic bank Landsbanki, which owns Icesave, collapsed at the height of the credit crunch in 2008.

Read a full report at the Daily Telegraph.

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