Court rules agricultural law exemptions unconstitutional in Reykjavik

A district court in Reykjavik has ruled that amendments made to agricultural laws, which exempt meat processing facilities from competition laws, are unconstitutional and therefore lack legal validity. This verdict is significant as it marks the first judicial examination of the legitimacy of these changes implemented in the spring, which granted extensive exemptions to meat manufacturers.

The court found that the revisions contravene Article 44 of the constitution, which mandates that no legislative proposal may be approved without undergoing three readings in Parliament. The ruling was not unexpected, according to Ólafur Stephensen, the director of the Employers’ Association, who noted that various business, labor, and consumer organizations had raised concerns since these modifications were proposed by the Parliamentary Agriculture Committee.

The judge compared the original proposal from the then Minister of Food, Bjarkeyjar Olsen Gunnarsdóttir, with the alterations made by the parliamentary committee, stating that they had little in common beyond the bill number and title. Ólafur described the parliamentary procedures as entirely unacceptable, highlighting that a completely different issue was being passed without any assessment of its impact on competition and the interests of businesses, consumers, and farmers.

Moreover, Ólafur expressed that the implications of this ruling may render all contracts made under the now-invalidated laws null and void. This situation has far-reaching consequences for contracts made by meat processing facilities based on those unlawful exemptions, which allowed significant transactions, such as the purchase by Kaupfélag Skagfirðinga of Kjarnafæði Norðlenska, to proceed without oversight from the competition authority.