Reykjavík Grapevine - 25.07.2003, Síða 6

- the reykjavík grapevine -6 july 25th - august 7th, 2003
A N A LY S I S
HE WHO LAUGHS LAST:
THE OIL COMPANIES AND ICELANDIC BUSINESS
For the past few days news of illegal
price collaboration between the three
main oil companies has dominated the
Icelandic media, the latest in a long line
of scandals relating to things such as
insider trading, bribery, embezzlement
and more. Not many years ago a
report was published showing Icelandic
companies to be some of the most
honest and trustworthy in the world.
Well, while that pretty image has been
ruined, the revelation was not that we
got so spoiled overnight, but rather that
before, nobody bothered to check if
something illegal was going on.
And when I think about it, it’s incredible
that no one saw anything wrong with
that pretty picture. In a small country
where everyone knows each other and
where a handful of companies rule the
market, the birth of the Icelandic mafia
seemed to go unnoticed. Among the first
warning signs was price collaboration
among the insurance companies. This
was first brought to attention when a
new insurance company emerged on
the market, offering car insurance for
only half of what everyone else was
charging. The insurance mafia was quick
to respond and lowered their price to
match this new rival. Ecstatic over this,
people praised the competition, but
since they were getting the same price
at their old insurance company nobody
moved over, the new company got no
business and quit.
And what happened then? Well, the
price went up, and got higher than ever
before.
And people just accepted this, and said
nothing.
Icelanders don’t seem to be too
bothered when they’re told that the oil
companies might have stolen several
billion krónur from them, sure we’re
angry and shocked, but we all need to
move on, some say, why cry over milk
spilled and money lost? And even if the
companies are fined, the money is going
to the government and not back in our
pockets.
There has been surprisingly little
discussion about this, and the fact that
this has been going on for years. Most
people probably knew there was never
any competition, there was something
fishy about how all the oil companies
charged exactly the same and raised
or lowered their price always at the
exact same time. But nobody really
complained, and nothing was done.
As deafening in its silence has been
listening to members of the government
refuse to comment on the matter while
members of the minority parties have
been happy enough to give their opinion,
and while most of them talk, rightly,
about the incredibly low moral standards
of the oil companies leaders, their
political opponents seem to turn away
in shame. The interesting thing here and
the awkward part for the government
is that the president of one of the oil
companies is married to the minister
of justice, the highest ranking woman
in the government, and probably the
least liked politicians in the country. The
government seems to attract scandals,
earlier this year, the prime minister
accused the owner of one of the largest
companies in the country of trying to
bribe him, the accused said it was a
joke because he had heard that the
prime minister could be bought. After
all, what kind of a politician promises
one of his best friends the guarantee of
the government for a loan of 20 billion
to a company only worth 6 billion? The
bribery matter died out in only a few
days, and is long forgotten now. Much
like this scandal will be in a few weeks.
I don’t think that this investigation now,
however good and useful, is going to
change anything in the long run, some
companies may be fined, somebody
might even go to jail. But the bottom
line is that customers are going to get
cheated as long as someone wants their
money and thinks it’s possible.
And I’d love to go and say to the
presidents of the oil companies that they
can take their gasoline and pump it up
their *****. But because lack of usable
public transport forces me to own a
car, and since the oil companies were
all in on it together, I guess the joke is
on me.
FILIPPA
GU
ÐM
U
N
DSDÓTTIR
BY
Capitalism, as Castro realises, doesn´t work on
small islands. For it to function, in theory, it needs
competition, and in a small economy it seems
inevitable that a few companies come in possession of
a virtual monopoly, which is probably why everything
here is so damn expensive. Attempts have been made
to stop this trend with legislation, but for some reason
the it doesn´t seem to be working very well. Is there
any hope that we will one day see free and fair trade
in this country?
article
A report on the cartelizing of Icelandic
oil companies has been released.
Authorities raided the headquarters of
the companies and made away with
large amount of files. The files show
that the oil companies Olís, Esso and
Shell were engaged in various illegal
activities in price manipulation and illegal
collusion. There were also attempts at
a cover-up and the management seems
to have been well aware of its wrong-
doing. Some MP´s have gone so far
as to demand police investigate the
matter, but no charges have been filed.
Competition seems to have increased
slightly after the raid.
City authorities claim they may press
charges, but the Mayor is the former
marketing director of Shell, and some
have demanded his resignation.
A man in his 30´s was sentenced to
5 months in prison for grabbing his
spouse by the throat. 3 months were
suspended, but in addition he had to pay
a fine of 200.000 krónur.
The US Army man accused of stabbing
a local in downtown Reykjavík has been
sent back to base for custody. At first he
was free to roam about the base but not
leave it, but after complaints by Icelandic
authorities, he has been grounded in his
room. The Ministry of Foreign Affairs has
requested that the man be tried by US
authorities, but the Icelandic Supreme
Court has overruled this, insisting he be
tried in Reykjavík.
3 of the 5 US Navy helicopters at
Keflavík have been sent to West Africa
in case of US intervention in Liberia. US
public relations officers claim the move
is temporary, whereas an MP for the
Alliance Party claims it worrying that
the US is acting unilaterally in what is
supposed to be negotiations.
Weather has been intermittedly good
in the capital, bringing tremendous joy
and the beginnings of a tan to residents.
Weather reporters say it is the best
summer of the postwar era.
Greenland days were held at Flateyri. A
kayak was stolen, but was found by the
side of the road.

Iceland’s most expensive foal
disappeared without trace. Its brother
won a world championship in Germany
in 1999, and was sold for 12 million
krónur. The horse was found dead in a
ditch the day after, probably the victim of
an accident.
A fire was reported in a residential area
in Hafnafjörður. The fire department
showed up, only to find a man barbecuing
in his garden, with the result that a lot of
smoke formed.
Police in Hafnafjörður stopped a man
driving at 202 km/h in a 90 zone. He
was stripped of his licence on the spot.
Lord Robertson, head of NATO, is coming
to visit his friends Davíð and Halldór on
Monday. Apparently, when he heard that
the US intended to move its fighters
away, he called them and told them that
for God’s sake, this wasn’t the right time,
causing the US to cancel its action, at
least for now. Commentators speculate
whether Halldór might actually break with
habit and smile when they meet.
A NASA space station is to be built near
Krafla to so that scentists can research
what life would be like on Mars, since
conditions there are thought to be
similar
500 pensioners currently await placing
in homes. The chairman of the society
of senior citizens says the situation is
intolerable.
The 250 kilos of dynamite that were
stolen near Rauðavatn were found by
a group of filmmakers. The explosives
were untouched apart from one box that
had been opened. The culprits have not
yet been found.
A Romanian family that has been here
for 6 months is to be deported from
the country, and will not be granted
residence in any other Schengen
country. The family belongs to a
Hungarian minority group, and claim
to be persecuted because of events
in the 1989 revolution. The EU has
ruled that Romanian authorities do not
persecute minorities, and hence they
have been denied residence. A lawyer
for the cultural house calls the decision
inhumane.
NEWS IN BRIEF
Esso and Shell, side by side in perfect harmony.
Photo: Aldís