PR(08)06: Iceland fails to incorporate legislation concerning international financial reporting standards

The EFTA Surveillance Authority has decided to send a reasoned opinion to Iceland for failure to incorporate into its internal legal order Commission Regulation (EC) No 1329/2006 amending Commission Regulation (EC) No 1725/2003 adopting certain international accounting standards[1]as regards the International Financial Reporting Interpretations Committee’s (IFRIC’s) interpretation 8 and 9.

International Financial Reporting Standards (IFRSs) are developed by the International Accounting Standards Board (IASB). The International Financial Reporting Interpretations Committee (IFRIC) is IASB’s interpretative body.

Commission Regulation (EC) No 1725/2003 and the subsequent Commission Regulations amending it adopt the international accounting standards - IFRSs, IASs and the related Interpretations - set out in their Annexes and make them part of the Community law. International accounting standards are adopted and used in the EEA with a view to harmonising the financial information presented by publicly traded companies. The aim of such harmonisation is to ensure a high degree of transparency and comparability of financial statements and hence an efficient functioning of the EEA capital market and of the Internal Market.

The Commission Regulation that Iceland has failed to incorporate into its internal legal order concerns two IFRIC’s interpretations.

Issuing a reasoned opinion is the second stage in infringement proceedings. The EFTA Surveillance Authority could bring the matter before the EFTA Court if Iceland fails to produce a satisfactory reply within two months of receiving the reasoned opinion.