But the latest figures show that last year overseas processors bought around 4,143 tonnes - around four per cent of the 98,000 tonne total sold in the auction markets in 2007. That proportion is expected to increase as the demand for fresh cod and haddock increases.

Around a dozen overseas companies were involved, mostly from Europe and the UK and most of the fish purchased is exported unprocessed.

Icelandic auction markets differ from most in the UK in that there is usually no display of fish and all transactions are carried out electronically.

Until recently, Iceland has fiercely resisted foreign involvement in its fishing industry which has always been regarded as an 'untouchable' national asset to be protected at all costs. But there are things that things may be loosening a little.

A few weeks ago, Bjorgvin G. Sigurdsson, Iceland´s Minister of Commerce, announced he was setting up a working group to revise Icelandic legislation on foreign investment in fisheries. The current legislation was passed by Iceland's Parliament, the Althing in 1991, and does not allow direct foreign investment in the Icelandic fishing sector.

Indirect foreign investment is admissible, but this must never exceed a share of 33 per cent. In a newspaper interview, the Minister has said that the time had come to revise the present legislation. He wanted the ad hoc group to work fast and has indicated that a bill may be presented to the next session of Althing.

The country is now engaged in a debate over whether it should become a full member of the EU. The coalition government, fiercely divided on whether the country should join, has said a commission would weigh the pros and cons of membership. At the moment, only the Social democratic Alliance favours membership, with the right wing and centre right parties firmly against.

Although Iceland has belonged to the European Economic Area since 1993, full union has always been resisted because of what most see as a negative impact on the country's fishing industry - and its rich fish stocks in particular.

But public opinion is moving towards Brussels. A survey conducted on behalf of the Federation of Icelandic Industries reveals that 58 per cent of respondents are in favour of taking up membership negotiations with the European Union, while 25 per cent are opposed. Many also want to ditch the krona in favour of the euro.

www.fishupdate.com is published by Special Publications. Special Publications also publish FISHupdate magazine, Fish Farmer, the Fish Industry Yearbook, the Scottish Seafood Processors Federation Diary, the Fish Farmer Handbook and a range of wallplanners.

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