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Monday, May 23, 2022
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Parliament passes legislation to restrict foreign ownership of real estate in the Faroe Islands

A bill has been passed in the Faroese parliament the Løgting to curb the ability of non-resident foreigners to buy up property in the Faroe Islands. The ability of foreigners to purchase real estate in the islands has thus been restricted by law.

During his Ólavsøka address to the Faroese parliament in July 2020, Prime Minister Bárður á Steig Nielsen said that the government intended to present a legislative proposal with that aim.

The Prime Minister recently expressed his concern over what is reportedly a growing interest among foreigners to buy property in the Faroe Islands. “I think the purpose of introducing [new] regulations in this area should be about securing that those who own property in the Faroe Islands are [genuinely] connected to the Faroe Islands,” he stated earlier in reply to a parliamentary question. 

With the ‘Parliamentary Act on Purchase of Real Estate in the Faroe Islands’ now signed into law, foreigners require a specific, government-issued purchase permit to buy property in the Faroe Islands. 

“With [the passing of this legislation] the total number of persons able to buy property without a purchase permit from the Government reduced from 8 billion to 6 million,” a statement from the Prime Minister’s Office read.

“Henceforth, foreigners can buy property in the Faroe Islands only with a permit from the Government,” the statement further noted, adding: “People living in the Faroe Islands, or who have lived here yearlier [as residents] for at least 5 years, can still buy property here without a permit from the Government. The same principle applies to Danish citizens who have lived in other parts of the Kingdom [of Denmark] for at least 5 years. The purpose of this [legislation] is to make sure in the Faroe Islands that citizens [of the Kingdom of Denmark] resident in the other parts of the Kingdom enjoy the the same rights as residents of the Faroe Islands enjoy in the other parts of the Kingdom [i.e. Denmark and Greenland].”

“Companies headquartered in the Faroe Islands are also eligible to buy property in the Faroe Islands without a purchase permit from the government,” the statement added, however, on condition that such companies be “operated from within the Faroe Islands.” 

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