Restaurant closures could leave suppliers and landlords unpaid

Restaurant closures and bankruptcies could leave landlords, suppliers and service providers with significant unpaid claims, the Association of Restaurant Companies (SVEIT) said in a statement reported by mbl.is.

The association’s statement followed reports that police had sealed Hlöllabátar at Bíldshöfði and Hamborgarafabrikkan at Höfðatorg on Wednesday. The companies operating the two restaurants are not members of SVEIT, which said it did not know the grounds for the police action or have information to assess it.

SVEIT said restaurant operators linked to Fridays, Adesso, Veislan and Grillhúsið had also closed or gone bankrupt in recent months. According to media reports cited by the association, the companies behind those businesses and the two restaurants sealed on Wednesday are connected in some way through owners and shareholders. None of the companies mentioned is a SVEIT member.

The association said the closure of Minigarður, a restaurant in Skútuvogur, was a separate matter. Munnbitinn ehf., the company operating it, ceased business and sought bankruptcy proceedings. According to information provided by its owners, they made the decision to limit further losses. The closure did not involve police or action by the authorities, SVEIT said.

Employees of bankrupt companies may be covered by the Wage Guarantee Fund if legal conditions are met, the association said. That protection does not extend to landlords, suppliers or service providers left with unpaid claims. SVEIT said families could face uncertainty when a business stops operating, while other companies may have provided goods, services and facilities expecting payment.

The association called for public discussion of the closures and bankruptcies to also consider the interests of businesses and individuals who may suffer financial losses despite having met their own obligations.