Alternatives to the HFF system mintaszakaszok

Alternatives to the HFF system. In the procedure leading up to the annulled Decision, the Icelandic Government discussed possible alterna- tives to the HFF system. The Icelandic Government stated, inter alia, that abandoning Government interven- tion in house financing would lead to considerable changes for lower and middle income families, increase division between the Reykjavik area and the rest of the country and dramatically reduce the number of fami- lies able to purchase housing on the market. Alternatively, entrusting banks to lend with the same favourable conditions would not be possible without massive direct State aid. The Icelandic Government discussed, in the initial notification of 20 November 2003, the following alterna- tive models: – The HFF would be turned into a limited liability company, wholly owned by the State, either as a profit or a non-profit entity. This was considered the most obvious solution in order to dispense with the State aid. In the Icelandic Government's view, interest rates would increase — more if the company was supposed to earn profits — but the change would not have any effect on competition between credit institutions, except the change would raise the HFF's interest rates so much as to make bank loans or bonds issued by the banks competitive. In the Icelandic Government's view, this would have no effect on trade among the Contracting Parties.