Iceland Wins Case on 2008 Refusal to Cover Foreign Deposits

Iceland was found to have acted within its rights in its 2008 refusal to cover U.K. and Dutch depositors in a failed Icelandic bank, escaping damages as high as 20 percent of its economic output.

The European Free Trade Association Court in Luxembourg today dismissed a case brought the EFTA Surveillance Authority, which claimed the island had breached European Economic Area law. A loss would have allowed the Netherlands and the U.K. to seek damages of much as 335 billion kronur ($2.6 billion), according to International Monetary Fund estimates.