setting up a business in greenland

7/30/2019 Setting Up a Business in Greenland

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Setting up a business in GreenlandA guide for investors


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Setting up a business in Greenland

This publication was prepared by the Ministry of Industry, Labour and Mineral Recourses

in cooperation with NIRAS Greenland A/S

Disclaimer

The Information and data contained in this publication, including, without any limitation, any conclusions or recommenda-tions by the authors, represent the authors' professional judgement in light of the knowledge and information available to

them at the time that this publication was prepared.

The authors accept no responsibility and deny any liability whatsoever to parties who may make use of the information

contained herein, including any injury, loss or damages suffered by such parties arising from their use of, reliance upon, or

decisions or actions based on this publication or any of the information that it contains.

For further information, contact:

The Ministry of Industry, Labour and Mineral Recourses

P.O. Box 1601

3900 NuukGreenland

Phone: +299 34 5000

Fax: +299 32 5600

Publisher:

The Ministry of Industry, Labour and Mineral Recourses

Nuuk, Greenland, 2010

Edited by: NIRAS Greenland A/S

Photos:

M indfres nr lay out er frdigt


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Table of contents

1. GREENLANDS POLITICAL SYSTEM AND INTERNATIONAL RELATIONS 6

11 Self-government 6

12 Inatsisartut the parliament 6

13 Naalakkersuisut the government 6

14 Legislation 7

15 International relations 8

2. GREENLANDS ECONOMY 11

21 Macroeconomic issues 11

22 Standard of living and income distribution 1323 Major industries and businesses 15

24 Political stability 16

3. GREENLANDS INFRASTRUCTURE 18

31 Geography 18

32 Administrative districts 20

33 Towns and settlements 21

331 Utilities 22

332 Sewage and waste disposal 23

333 Harbours 24334 Airports and heliports 27

34 Sea trafc 28

341 Cargo transport 28

342 Domestic passenger service 31

35 Air trafc 32

351 International 32

352 Domestic 33

353 Cargo 34

354 Charter 35

36 Petroleum products 3537 Telecommunications 36

38 Overnight accommodation 37

4. ESTABLISHING A BUSINESS 40

41 Types of businesses 40

42 Establishment procedure 41

43 Corporate taxation 41

44 Personal taxation 42

45 Indirect taxes 42

46 Business customs 42


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5. LABOUR MARKET CHARACTERISTICS 44

51 Employers associations: 44

52 Labour unions 44

53 Employee benets 45

54 Foreign employment 4655 Employing trainees 47

56 Education levels 47

57 Unemployment and availability 48

58 Working environment 49

6. LOCAL PRIVATE COMPANIES 50

61 Contractors 50

62 Consulting engineers and architects 50

63 Lawyers and chartered accountants 50

64 Banks 5165 Insurance companies 51

7. HOUSING, OFFICES AND INDUSTRIAL FACILITIES 52

71 Building new facilities 52

711 Title of land 52

712 Building administrative case handling 52

713 Financing 53

72 Leasing of facilities 54

721 Accommodation 54

722 Ofces and other buildings 54

8. FAMILY LIFE 55

81 Cost of living 55

82 Educational institutions 56

821 Pre-School 56

822 Schools 57

823 Universities tertiary education 57

83 Cultural and leisure facilities 57

831 Culture 57

832 Sport facilities 59

84 Healthcare 60


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9. CONSTRUCTION AND OPERATING COSTS 62

91 Introduction 62

92 Wages 62

921 Skilled and unskilled workers 62

922 Salaried employees 6293 Building materials 63

94 Petroleum products 64

95 Cost of construction projects 65

96 Operationalal costs 66

961 Utilities 66

962 Cargo freight charges 6 7

963 Air fares 68

97 Import duties 69

98 Building codes and standards 69

981 Greenland Building Code 69982 Eurocodes and Greenlandic annexes 69

983 Working environment 70

984 Other regulations and recommendations 70

Appendices

A Composition of the parliament and the government 71

B Conference hotels 72

C Construction and operation costs 73

Setting up a business in Greenland A Guide for Investors 5


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Greenland's economy 1

1. Greenland's political systemand international relations

From as early as 1857, Greenlanders have been involved i n the decision-making process, and the Statute of 1908 introduced municipal and provincialcouncils with democratically elected representatives.

In 1953, Greenland's status as a Danish colony was terminated and the coun-try became an integral part of the Kingdom of Denmark. At the same time, theDanish constitution was amended to encompass Greenland, and two Green-landers were elected to the Danish parliament (Folketinget).

In 1979, Home Rule was introduced, comprising the parliament(Landstinget), the government (Landsstyret) and the administration. In ac-cordance with Home Rule, Greenland gained extensive powers of self-government while remaining under the Danish Crown. The Danish parliamenthas transferred most legislative duties to the parliament of Greenland, butstill retains control over foreign affairs, administration of justice and severalother areas.

1.1 Self-government

In June 2009, Greenland's Home Rule was extended to include autonomy,which gives Greenland the right to decide when to take over the remaining

areas of jurisdiction.The government of Greenlandic is called Naalakkersuisut and the parliamentis referred to as Inatsisartut. A general electio n to the parli ament is held atintervals of no more than four years.

1.2 Inatsisartut the parliament

Inatsisartut comprises 31 representatives and is headed by a chairman whois elected by this legislative chamber. The parliament is responsible for alllegislation with the exception of jurisdictions remaining under the control ofthe Danish parliament.

The parliament holds two to three sessio ns every year, each lasting approxi-mately two months. The composition of the parliament is shown in AppendixA.

1.3 Naalakkersuisut the government

The government is led by the premier and a number of ministers. The presentcomposition of the government is shown in Appendix A.

Setting up a business in Greenland Greenlands political system and international relations 6


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2 Setting up a business in Greenland

1.4 Legislation

The parliament is Greenlands legislative body and its powers are defined bythe Act on Self-Government. In addition, Greenland is covered by the consti-tution of the Kingdom of Denmark as the Danish constitution applies to all

parts of the Danish kingdom.A number of administrative areas are under Greenlandic control and the par-liament adopts laws required to govern the areas in question. These laws arereferred to as acts of parliament (landstingslove) . In addition, a range ofadministrative regulations are generally i ssued under the provisions of theacts of parliament. These are referred to as executive orders (bekendtgrel-ser) and are issued by the government.

Areas that have not yet been taken over by Greenland are under the jurisdic-tion of the Danish state. According to the Act on Self-Government, bills pro-posed by the Danish government that either encompass Greenland or wouldcome into force in Greenland shall be submitted to the government of Green-

landic for comment before being presented to the Danish parliament. TheDanish government shall wait for the comments of the government of Green-landic before proposing a bill to parliament that contains provisions thateither exclusively apply to Greenland or are of particular significance toGreenland. Similar consultation procedures apply to administrative regula-tions (executive orders). The government of Greenland shall comment onconditions specific to Greenland that may apply to the area in question, e.g.,whether it would be relevant to implement the legislatio n in Greenland at all .

A list of Greenlands acts, executive orders and regulations adopted by theparliament from 1979 to date is available at: www.lovgivning.gl

There is a complete list of acts and executive orders applicable to Greenlandin Greenlands Table of Statutes 2008. Amendments to Greenlands legisla-

tion since 2008 may have resulted i n changes to the validity o f the registeredacts etc.

Acts of parliament Rules shall be laid down in an act of parliament when the government ofGreenland takes over an additional area of responsibility from Denmark, andthe government of Greenland shall cover all costs related to the handling ofthat area (self-funding).

Executive orders If an act of parliament or a parliamentary regulation contains a provisionstipulating that the government shall define rules governing citizens legalstatus, imposing duties on citizens or conferring rights in relation to publicauthorities, these rules shall be defined in an executive order. Such executiveorders are referred to as self-government executive orders.

As a general rule, an executive order should only contain provisions directedtowards citizens. Rules of an official nature, which are purely binding forauthorities, and comments of a purely advisory nature, should not to be in-cluded in an executive order. Official regulations should be noted in a circu-lar. Information of an advisory nature should be included in a set of guide-lines.



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The parliament of Greenland. Photo

Circulars The circular format is used for general directives, i.e., bindi ng regulationspurely aimed at authorities. Thus, a circular shall b e used when it i s necessaryto specify that a regulation is binding for the recipient authority.

A circular may not contain provisions governing the legal status of citizens.The circular should only contain information of an advisory nature if thescope of said information is limited such that it may not reasonably be ex-pected to constitute a separate set of guidelines.

Guidelines The guideline format is used for the publication of information that is notbinding. Thus, the guideline format shall be used to provide information onthe content and background of rules when conveying information about theinterpretation and administration of rules. Guidelines may also provide in-structions on ways in which to comply with rules such as a specific bindingregulation.

1.5 International relations

Denmark Greenlands representation in Denmark acts as an embassy and plays animportant role in the significant number of activities related to the common-wealth with Denmark. The representation was established in 1981 when sev-

eral areas of responsibility were taken over from the Danish state. One of itsresponsibilities is to maintain contact with authorities and decision-makersin Denmark.

USA Relations between Greenland and the United States date back to the SecondWorld War when American forces assumed responsibility for the defence ofGreenland. During the war, a number of air force bases were established inGreenland, two o f which are still used as airpo rts, i.e., Kangerlussuaq andNarsarsuaq. These are now under Greenlands civil aviation authority.

After the war, the Thule Air Fo rce Base in Pituffik was established and stil lserves as a US military installation.



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Recently, a new partnership between Greenland and the United States wasestablished and recorded in the Dundas Memorandum of Understanding in2003 and the Igaliku Agreements in 2004.

These agreements resulted in the establishment of the Joint Committee and,

in 2006, a memorandum of understanding was signed concerning energy andscientific coo peration between Greenland, the United States and Denmark.This co llaboratio n covers areas such as trade and tourism, environmentalsurveys and climate change, education and English language programs, tele-medicine, culture and energy.

European Union Greenland is not included in Denmarks membership of the EU, although thereis cl ose collaboration with the EU via the commonwealth with Denmark.Greenlands representation in Brussels was established in 1992 in collabor-ation with the Danish Foreign Ministry.

In order to enhance the potential for collaboration on projects and for theexchange of knowledge across borders in Europe, the EU has set up a seriesof support programmes to strengthen regional collaboration relating tocommercial development, education, innovation, environmental issues, re-search etc.

Due to its OCT status (Overseas Countries and Territo ries), Greenland hasaccess to these EU pro grammes, and Greenlandic businesses and i nstitutionscan apply for grants on an equal footing with businesses and institutions inthe EU countries.

Greenland also participates independently i n the Northern Periphery Pro-gramme (NPP), which is an EU programme relating to issues common tosparsely populated regions in the Arctic and North Atlantic in connectionwith commercial and industrial development, innovation, transport, tourism,sustainable develop ment, research, education etc.

Greenland is also participating in a large EU project on cli mate change.

Nordic council Greenland is a full member of the Nordic Council. The West Nordic Councilwas formed in 1985 and includes Iceland, the Faroe Islands and Greenland.The main objective of the West Nordic Council is to cooperate on commonproblems and collaborate with both the Nordic Council and other organisa-tions on West Nordic and North Atlantic issues.

Arctic Council The Ottawa Declaration of 1996 formally established the Arctic Council as ahigh-level i ntergovernmental forum. The aim was to provide a means for pro-moting cooperation, coordination and interaction among the Arctic states,with the involvement of indigenous communities and other inhabitants of theregion, on common issues (in particular, issues relating to sustainable devel-

opment and environmental protection in the Arctic).

The member states of the Arctic Council are Canada, Denmark (includingGreenland and the Faroe Islands), Finland, Iceland, Norway, the Russian Fed-eration, Sweden and the United States of America.



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The Parliament building. Photo: H. Mai, 2004

ICC Greenland coo perates with the Inuit peopl es of Canada, Alaska and Russia.The Inuit Circumpol ar Conference (ICC) has the status of an NGO observer atthe United Natio ns and is a permanent member of the Arctic Council.

United Nations Since 1992, the parliament of Greenland has provided two members of theDanish delegation to the United Nations General Assembly. Greenland andDenmark also work actively on the United Nations Human Rights Council to

establish a permanent forum for indigenous peoples.Consulates The following countries have consulates or honorary consulates in Greenland:

Norway, Iceland, Finland, Sweden, Italy, Germany, France, Holl and, Belgiumand Canada.

Passport and visas Passport and visa regulations are generally the same as those for individualsapplying to travel or stay in Denmark. Greenland is a party to the SchengenAgreement.

Visitors from a country requiring a visa to enter Denmark also require a visafor Greenland. A visa that is valid for Denmark is not automatically valid forGreenland. Therefore, a separate visa application is required for Greenland.Visas can be applied for at Danish embassies and agencies.

Residence permits Residence permits are required if you are staying in Greenland for over threemonths. Permits can be obtained from the local police.

Languages Both Greenlandic and Danish are used in publi c administration.Administrative cases cannot be expected to be handled in English. All Nordiccitizens have the right to have cases handled in their own language.



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Greenland's infrastructure 7

2. Greenland's economy

Greenlands economy differs from other Western economies due to its ge-ography, climatic conditions and low population density. The domestic mar-ket is relatively limited and highly dispersed.

2.1 Macroeconomic issues

The fishing industry is the leading sector with derived effects on the rest ofthe economy. This makes Greenland highly d ependent on developments inprawn and fish stocks as well as the world market price of fish and fisheryproducts. Developments within the fishing industry have thus contributed to

the relatively l arge cyclical fluctuations experienced by Greenland, cf. Figure2-1.

Figure 2-1 Annual real GNP growth, 1995-2006Source: Statistics Greenland, National Accounts

The dependency on fishing is also reflected in the fact that fishing and fisheryproducts make up almost 90 percent of Greenlands exports, cf. Figure 2-2.

In addition to fishing, the economy is dependent upon subsidies from

Denmark, known as the "block grant," which amounts to appro x. DKK 3.4 bil-lio n a year. Abo ve and beyond that the Danish Government also financesother administrative areas, such as fisheries inspections, the police and thejudicial system, arctic research and meteorolo gy.

These expenses total approx. DKK 700 million a year, bringing the totalannual subsid ies from the Danish Go vernment to a little more than DKK 4bil lio n. Block grants and other government subsidies have, on the whole, re-mained constant in real terms since the late 1980s.

Setting up a business in Greenland Greenlands economy 11


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Figure 2-2 Exports distributed on goods, 2006Source: Statistics Greenland, Foreign trade, 2007:3

Greenland also receives subsidies from the EU amounting to a little morethan DKK 300 million a year. About half of this constitutes payment for thefishing quota, enabling foreign vessels to fish in Greenland waters, whereasthe other half is budgetary support.

These subsidies mean that Greenlands gross disposable national income(disposable GNI) is significantly larger than its total production (GDP). Froma growth perspective, the fact that the subsidies constitute such a large part

of the total economy and have remained constant in real terms illustratestheir importance as a stabilising factor in the economy.

Although exports of fish and fishery pro ducts are large, imports are evenlarger, and Greenland has seen a deficit in the balance of goods and servicesof between 20 and 30 percent of GNP during the period 2000 to 2005. Asurplus in connection with subsidies (in particular the block grant) totalsapprox. 40 percent of GNP, meaning that the surplus on the balance of pay-ments has been 5-15 percent of GNP, however, this figure is showing a down-ward trend, cf. Figure 2-3.

In contrast to other small economies that depend on exports of fish pro-ducts and/or raw materials, i nflation has been moderate for a number of

years, although it has increased recently. For l ong periods it has been belowthe rate of inflation in Denmark, cf. Figure 2-4.



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Figure 2-3 Balance of payments in percent of the GNP, 2000-2005.Source: Statistics Greenland, Balance of Payments 2005

Figure 2-4 Inflation in Greenland and DenmarkSource: Statistics Greenland and Statistics Denmark

2.2 Standard of living and income distribution

The total income per inhabitant is only a little lower than in the other Nordiccountries, cf. Figure 2-5. Ho wever, prices are relatively high, which results in alower purchasing power for Greenland than indicated in the graphic.



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Figure 2-5 GNI per inhabitant for selected countries, 2003Source: Statistics Greenland, Statistical Yearbook 2007

The fact that income per inhabitant is at a relatively high level does not meanthat everyone in Greenland is well off. The Gini co efficient1 shows that theincome distribution2 is somewhat more uneven than in the Nordic as well asWestern European countries, cf. Figure 2-6.

Figure 2-6 The Gini coefficient for selected countries 2003Source: Statistics Greenland, Statistical Yearbook 2007

There are also differences within Greenland's borders, cf. table 1. For in-stance, the average income is far greater in the East-west district where Nuukis the main town than in the other large districts, and it is considerably higher

in the towns than in the settlements. This reflects the fact that throughoutmany years growth has been concentrated in the four largest towns (Nuuk,Sisimiut, Ilulissat and Qaqortoq).

1 The Gini coefficient is a measurement of the degree of income inequality. It has thevalue 0 if everyone has the same income and the value 1 if one person has all the in-come.

2 There are methodical problems attached to this type of comparison. It must, forexample, be presumed that many persons in the remote districts with low incomelive partly from hunting and fishing for their own consumption. Furthermore, the pub-

lic sector in Greenland provides a large number of services (such as education, medi-cal or dental treatment) for free.



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AreaNo. of personsliable to pay tax

Average income Gini coefficient

Whole country 41,580 169,000 0.47

South (Qaqortoq) 5,860 142,000 0.45

East-west (Nuuk) 14,787 208,000 0.48

Mid (Sisimiut) 7,158 165,000 0.44

North (Ilulissat) 13,398 133,000 0.43

All towns 34,467 177,000 0.46

All villages 6,461 111,000 0.44

Table 2-1 Average income in the future large municipalities 2006Source: Statistics Greenland, income statistics 2006, income 2008:1

2.3 Major industries and business

Figure 2-7 shows that the public sector and bl ock grants etc. make up approx.half of the total income. The fishing industry is the largest single sector.Apart from that the building and construction sector and other land-basedactivities play an important role.

Abbildung 1

Figure 2-7 Distribution of total incomeSource: Grnlandsbanken, Annual Report 2007

In recent years, there has been a great deal of focus on oil and mineral ex-plo itation, with many promising proj ects. So far, however, raw material ex-

traction does not constitute a major sector of the economy.



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The role of tourism is modest, measured in relation to the total economy.However, it is very important locally.

The government of Greenland is the (co-)owner of a number of enterprisesthat would normally be privately owned in other countries, cf. Table 2. The

large public sector can be explained by historical factors and is partly due tothe fact that many Greenlandic enterprises play a key domestic ro le, for in-stance, aviation, shipping and telecommunications, which are natural mo-nopolies.

CompanyGovernment of Greenland

ownership shareNet turnover in 2007,

DKK million

Royal Greenland A/S 100 5,096

Royal Arctic Line A/S 100 793

Air Greenland A/S 37.5 1,075

Tele Greenland A/S 100 668

KNI A/S (retail etc.) 100 2,068

Table 2-2 The larg est government-owned companiesSource: Government of Greenland (2008): Proposal for the Parliament Finance Act 2009

2.4 Political stability

Since the introduction of Home Rule in 1979, Greenland has made itself

steadily l ess dependent on external subsidies, as the economy has beengrowing in real terms and subsid ies from Denmark have been virtually con-stant cf. Figure 2-8.

Figure 2-8 Subsidies from Denmark in percent of GNPSource: Statistics Greenland data bank.

Thus the economy has gradually become more self-sustaining, and incomegenerated in Greenland makes up a steadily increasing share of the country's

total revenues.



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On the whole, Greenland can be described as a stable country, both politicallyand economically.

Since the introduction of Home Rule, the government coalition has consistedof different parties, and all parties represented i n the parliament (Inatsisar-

tut) have, to varying degrees, been part of the ruling coalition, cf. Chapter 1.The great interest in and focus o n self-government has contributed to moreresponsible economic policies in Greenland, and over the course of the lastten years a number of structural po licy initiatives have been implementedthat focus on a more self-sustaining economy.



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Business establishment 15

3. Greenland's infrastructure

3.1 Geography

Though geographically and ethnically an arctic island nation associated withthe continent of North America, Greenland has close political and historicalties to Europe, specifically Iceland, Norway and Denmark.

Figure 3-1 Greenland's Geography. Google 2008

Populatio n Greenland has a population of 56,194 (January, 2009), 84 % of which lives inthe towns.

Setting up a business in Greenland Greenlands infrastructure 18


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Most towns and settlements are situated along the West Coast, with a fewsmall to wns to the east and northwest. The most populated area is the WestCoast south of 70 latitude.

The country is divided into four administrative districts (called kommuner in

Danish). The capital is Nuuk with 15,105 inhabitants (January, 2009). Theother towns have between 500 and 6,000 inhabitants.

The municipalities include a large number of settlements with between 20 and500 inhabitants. These settlements are called "nunaqarfiit" in Greenlandicand "bygder" in Danish. Smaller populated locations include farms, especiallyin the South, and hunting and weather stations.

Geography Greenland is the largest island in the world with a total area of2,415,100 km2, one-fourth the size of the USA or more than six times the areaof Japan. The Greenland ice cap co vers more than 85 percent of the island.The adjacent offshore shelf has an area of app rox 825,000 km2.

The coast is characterized by archipelagos and small rocky islands with a

large number of deep fjords. Many of the towns and settlements are locatedon islands or close to fjords where natural harbours are found.

Climate As a whole, the climate is arctic with a mean temperature in the warmestmonth below 10C, however, the climate is subarctic deep within pro tectedfjords in the South.

The mean annual temperature on the West Coast varies from 2.4 C in theSouth to -2.6C in Ilulissat on Disco Bay (6913' N). Farther north and on theEast Coast the mean annual temperature is about -5 C. In coastal areas thereis only minimal variation between summer and winter temperatures; in Nuuk7.7 C in July and -7.9 C in December. This variation increases further inland,e.g., at Kangerlussuaq international airport, where temperatures vary between10.7 C in July and -17.8 C in December.

Wherever the mean annual temperature is below -2 to -4C, permafrost mayoccur. North of Paamiut sporadic permafrost may be found at sea level, andin Sisimiut and to the north continuous permafrost prevails. Continuous per-mafrost is found farther inland, at high altitudes and north of Disco Bay atsea level.

Annual precipitation varies between 2,000 mm in the South to 100 mm in thefar North. Precipitation decreases with increasing distance from the coast,e.g., Kangerlussuaq is an arctic desert with only 150 mm precipitation peryear. On the West Coast the highest amount of precipi tation falls in Augustwhile the highest level of precipitation on the East Coast is during the winter.

The seas around Greenland The waters around Greenland are dominated by sea ice in the winter and byicebergs in the summer. In the early summer, June and July, the cold IrmingerCurrent on the East Coast carries multi-year ice and icebergs from the ArcticOcean to the South. South Greenland's waters is do minated by this drift iceand pack ice, which floats with the current around Cap Farewell and then upalong the West Coast. On the West Coast the sea ice stretches down toSisimiut in the winter, and in the summer the waters north o f Sisimiut aredominated by icebergs. [A][B][C][D]

In General, the harbours north of Sisimiut are closed i n winter due to ice, andharbours to the south, i.e. Qaqortoq and Narsaq, may be closed for periods inJune-July due to drift ice.

On the West Coast the maximum tidal range varies from 3.5 m in the South to

5.1 m in Nuuk. The tide decreases farther north. [E].



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For more information about ice monitoring and navigation of the harbours cf.Section 3.3.3.

Traffic structure There are no roads connecting any two towns or settlements, andtransportation of cargo and passengers is dependent upon sea routes, cf.

Section 3.4.2, and domestic air traffic, cf. Section 3.5.2.Midnight sun The Arctic Circle passes through Greenland just south of Sisimiut (6632' N).

Midnight sun and po lar night can be experienced north of the Arctic Circle.The winter darkness sets limits on aircraft operations, cf. Section 0.

3.2 Administrative districts

Greenland is divided into four administrative districts: Kujalleq, Sermer-soo q, Qeqqata and Qaasuitsup. The north-eastern part of the country doesnot belo ng to any district, but constitutes the Northeast Greenland Natio nalPark, the largest in the world.

Kujalleq Kujalleq district covers the southernmost region with three towns, elevensettlements and 7,632 inhabitants (January, 2009). Unlike the rest of thecountry, towns and settlements in South Greenland are all cl ose to each othermaking it easy to get around by boat or helicopter.

The administrative centre is Qaqortoq with 3,200 inhabitants. Kujalleq dis-trict i s Greenland's farming district, focusing mainly on sheep farming. Green-land's agricultural research station is based near Qaqortoq. Crops like pota-toes, turnips and hay are harvested. Fishing is stil l the main industry, but newbusinesses are starting up in the mining sector.

Sermersoo q Sermersooq district covers a large area, from the West across the ice cap tothe towns on the East Coast. Greenland's capital Nuuk is the administrativecentre of this district. With approx. 15,000 inhabitants, Nuuk is by far the

biggest town in the country and an important centre for education, hospitalservices and home to some of the biggest industries in the country.

The district has two towns and three settlements on the West Coast and twotowns and five settlements on the East Coast, with a total of 20,954 inhabit-ants.

In East Greenland the main industry is fishing and traditional hunting, buttourism is gaining in importance thanks to flight connections to Iceland, andmany tourists visit the region every year.

Qeqqata Qeqqata district covers the area around the Arctic Circle on the West Coastand includes two to wns, Sisimiut and Maniitso q, and five settlements with atotal of 9,686 inhabitants. The ports are free of ice all year round, whichmakes it easy to supply the region via sea routes.

Fishing is the main industry in the region primarily prawns, crabs and cod.Hunting for musk ox, reindeer and seal are also important for the local econ-omy.



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The town of Maniitsoq. Photo: H. Mai, 2009

The settlement of Kangerlussuaq, a former U.S. Air Force base, now serves asthe largest airport and traffic hub i n the entire country, cf. Section 3.5.Kangerlussuaq is very di fferent from o ther Greenlandic settlements in that itonly i ncludes the airport and related areas, such as conference and touristfacilities. It also has also developed a well functioning service sector thatprovides support to military and scientific operations.

Qaasuitsup Qaasuitsup district covers the northernmost regions on the West Coast. The

district includes eight towns from Aasiaat in the South to Qaanaaq in theNorth and 31 settlements with a total o f 17,679 inhabitants.

The area is known for summer nights with midnight sun, winter days with dogsledding and traditional Inuit culture mixed with modern daily life. The ad-ministrative centre is in Ilulissat, known throughout the world for its amazingice fjord, which was declared a UNESCO World Heritage Site in 2004. Thefjord attracts thousands of visitors from abroad and has made Ilulissat oneof Greenland's leading tourist destinations.

Fishing and hunting is the main industry, and many towns have fishing in-dustries. The main products are prawns and Greenland halibut.

3.3 Towns and settlementsThere are a total o f 18 towns and about 50 settlements with more than 20inhabitants along the Greenlandic co ast. All towns and settlements are"islands" of civilisation in the country, often separated by deep fjords andglaciers. They are only accessible by sea or by air and all centres of popula-tion depend on their own facilities and utilities.

Most modern facilities can be found in the major towns, including shops forconsumer goods, clothes, furniture, building materials, as well as hospitals,schools etc. There are local companies providing services for building main-tenance, construction, repairs and so o n.



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Smaller towns and most of the settlements have grocery sto res run by thepublic supply company, Pilersuisoq, and health care stations with nurses orsocial workers and periodic visi ts by doctors.

3.3.1 Utilities

Nukissiorfiit (Greenland's energy provider)3 is responsible for supplyingelectrical po wer and water to all towns and settlements, and district heatingin some towns. Nukissiorfiit is a government-owned company.

Power Due to the remoteness of most communities, it is generally not possible tosupply power via a large transmission grid, so most towns and settlementshave their own po wer plants.

Each town and settlement traditionally has its own diesel-generator stations,which supply the necessary electricity fo r the area. Owing to the isolatednature of Greenlandic communities, each power plant has back-up generatorsfor the largest units.

Kangerluarsunnguaq Hydropower Station near Nuuk.Installed capacity: 45 MW in three units.Photo: Nukissiorfiit 2003

In the early 1990s, after 20 years of preliminary studies, Greenland began todevelop hydropower. As of 2010, five towns have been designated to besupplied with hydropower: Nuuk (1993), Tasiilaq (2004), Narsaq and Qaqor-toq (2007) and Sisimiut (2010). Additional hydropower schemes are planned.

The hydropower plants supply electricity for heating as well, either directlyto electrical radiators (in Nuuk only) or to electrical boilers with oil burnersas a back-up. In any case, a full capacity back-up is necessary in each town.

Power distribution within the towns is at 60 kV, 10 kV or 6 kV levels. Thevoltage for individual consumers is 400/230 V, 50 Hz. Distribution lines areeither buried o r laid in steel sleeves at ground level.

3 www.nukissiorfiit.gl



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In 2007 the total consumption of electricity in the towns was 185 GWh. [B][F]

Water Almost all towns and settlements have a water supply based on surfacewater. Only very few places have access to ground water or spring water. Atsome lo cations, where there are no alternatives, reverse osmosi s is used to

produce dri nking water from seawater.The water is treated to meet Greenlandic drinking water standards [G] , whichare comparable to the EU standards.

The water is distributed in insulated, heat traced pip elines or, in smaller set-tlements, available from tap houses.

In 2007 the total production of water in public waterworks was 6,146,000 m3[B].

District heating plant, Sisimiut. Photo: H. Mai 2007

Public heating Apartment blocks have central heating plants or are supplied by districtheating from oil or hydropower heating plants and waste heat from dieselgenerator stations and waste incinerator plants. 13 out of 18 to wns havedistrict heating utili zing waste heat or heat from hydro power. Five of these

towns also use waste heat from i ncinerator plants.

Most private houses are heated with oil burners, except i n Nuuk, where directelectrical heating from hydropower is available.

In 2007 Nukissiorfiit's total production for public heating was 221,938 MWh[B].

3.3.2 Sewage and waste disposal

The municipalities are responsible for the disposal of wastewater and solidwaste.



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Wastewater Most areas in towns have insulated sewers, which convey untreatedwastewater to the sea. These sewers have electrical trace heating, and areeither buried o r laid on the surface.

There are ongoing discussions on wastewater treatment in sensitive areas,

but so far no treatment facilities have been established.

Nuuks incinerator plant. Photo: H. Mai 2009

Solid waste There are various solutions used in towns and settlements for household and

industrial waste: Disposal at dumps, where the waste is sometimes burned in the open Burning in incinerator plants Baling of waste and transport to other towns for burning

Waste is collected by the municipality or by private contractors.

Scrap metal and hazardous and toxic waste is collected and shipped toDenmark for safe treatment and disposal.

The Action Plan for Waste Treatment 2009-2012 covers controlled, envi-ronmentally safe waste disp osal, i ncinerator plants in towns and settlements,source separation and receiving facilities for problematic waste.

3.3.3 Harbours

Harbour data All towns have commercial harbours of various sizes, see Table 3-1.

Harbour authority Nearly all harbours are owned by the government, of which 13 major ports areoperated by Royal Arctic L ine A/S4 (RAL), which also acts as the harbourauthority on behalf of the government.

4

Royal Arctic Line A/S (RAL) is a 100 percent government-owned public limited com-pany, www.royalarcticline.com



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TownInhabit-

ants2009

3

Waterdepth atM.L.W.S

[m]

Meanspringrange

[m]

ContainerTerminal

Annualcargo[m]

Nanortalik1

2,259 7.3 3.0 Yes 13,100

Qaqortoq1 3,496 6.6 2.8 Yes 42,200

Narsaq1

2,000 8.3 3.0 Yes 18,500

Paamiut1

1,877 8.6 3.8 Yes 20,800

Nuuk1

15,721 10.0 4.4 Yes 382,2004

Maniitsoq1

3,451 8.0 4.2 Yes 42,300

Sisimiut1

6,176 7.8 3.8 Yes 108,8004

Kangaatsiaq2

1,387 3.2 2.9 No 3,100

Aasiaat1

3,044 7.8 2.6 Yes 151,9004

Qasigiannguit

1

1,201 8.0 2.8 Yes 16,200Ilulissat

15,037 6.9 2.8 Yes 52,800

Qeqertarsuaq2

1,020 6.9 2.4 No 9,300

Uummannaq1

2,412 4.2 2.0 No 16,600

Upernavik1

2,935 4.2 2.0 No 17,300

Qaanaaq2

831 - 3.0 No 5,300

Tasiilaq1

3,043 8.7 3.8 Yes 15,200

Ittoqqortoormiit2

513 - 2.0 No 3,600

Table 3-1 Harbo ur data for major towns [B][H] [I]

1) Operated by RAL2) Operated by KNI3) Town incl. settlements4) The harbour serves as container terminal for other towns

Nuuk's Atlantic Port and container terminal. Photo: RAL 2001



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Harbour fees All commercial ships pay a fee for docking at government-owned harbours.This fee is based on the ship's gross to nnage [J].

Cruise ships p ay a harbour usage fee of DKK 525 per passenger at their firstport of call in Greenland regardless of how many ports are visited.

Navigation With the exceptio n of port facilities in the towns of Paamiut, Nuuk, Maniitsoqand Sisimiut, Greenlandic harbours are only navigable part o f the year due tosea ice and drift ice, cf. Section 3.1 and Figure 3-2.

Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct. Nov. Dec.

Nanortalik

Qaqortoq

Paamiut

Nuuk

Maniitsoq

Sisimiut

Aasiaat

Qasigiannguit

Ilulissat

Qeqertarsuaq

Uummannaq

Upernavik

Qaanaaq

Tasiilaq

Ittoqqortoormiit

Navigation not possible

Navigation only with Ice Class 1A Super

Navigation only with Ice Class 1A

Figure 3-2 Navigation of harbours due to ice [E] . In recent years, ice condi-tions have posed fewer constraints due to the warmer climate.Sisimiut is usually navigab le all year round. Narsaq is not in-cluded in this source material, but navigation conditions aresimilar to Qaqortoq

Most years Narsaq and Qaqortoq are only navigable with Ice Class 1A Supervessels in early summer due to heavy pack ice, but in some periods it is not atall possible to access the harbours.

The East Coast is navigable to Tasiilaq and Ittoqqortoormiit during the sum-mer. To the north of Ittoqqortoormiit the coast is navigable most years up to

about 76 north, and farther north icebreaker assistance is necessary.

It is recommended that you obtain further information from RAL 5.

The ice situation in Greenlandic waters is monitored by the Ice Patrol, whichis run by the Danish Meteorological Institute6. The Ice Patrol operates out ofNarsarsuaq in South Greenland.

A general ice map for all of the waters surrounding Greenlandic is i ssued oncea week. During the drift ice season a detailed map of the waters around CapFarewell is issued three to five times a week. The ice maps are based o n satel-lite images and observations made from the Ice Patrol's own helicopter.

5 www.royalarcticline.com 6 www.dmi.dk. Contact: mailto:[email protected] or phone +299 66 5244



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Water depth for the deepest quay and the tidal range are given in Table 3-1.Further information and the actual tide table can be obtained from The Dan-ish Maritime Safety Association7.

3.3.4 Airports and heliports

Most major towns have airports with runways of various lengths. Other townsand major settlements are serviced by helico pter, see Table 3-2.

The airports and heliports are operated by Mittarfeqarfiit8, Greenland'sairport administration, which is a government-owned company.

The airports accommodate IFR/VFR traffic and are normally open Mondaythrough Saturday during the daytime. Outside normal operating hours, air-ports can be opened for an extra fee.

Heliports only permit VFR traffic during the daylight or during civil twilight,in other words, the time between the moment of sunset, when the suns appar-ent upper edge is just at the horizon, until the centre of the sun is 6 directly

below the horizon. In northern areas, helicopter traffic is limited to a fewhours of twilight in the winter, e.g., four hours in Ilulissat at mid winter.

Nuuk Airport features a 950 m asphalt paved runway. The airport is the mainhub for Air Greenland's administrative and maintenance facilities.Photo: H. Mai, 2008

7 http://frv.dk8 www.glv.gl



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TownType offacility

Nearestairport

Runwaylength [m]

Runwaysurface

Nanortalik Heliport Narsarsuaq 1830 Concrete

Qaqortoq Heliport Narsarsuaq 1830 Concrete

Narsaq Heliport Narsarsuaq 1830 Concrete

Paamiut Airport - 799 Asphalt

Nuuk Airport - 950 Asphalt

Maniitsoq Airport - 799 Asphalt

Sisimiut Airport - 799 Asphalt

Kangerlussuaq Airport - 2810 Asphalt

Aasiaat Airport - 799 Asphalt

Qasigiannguit Heliport Ilulissat 845 Asphalt

Ilulissat Airport - 845 Asphalt

Qeqertarsuaq Heliport Ilulissat 845 Asphalt

Uummannaq Heliport Qaarsut 900 Gravel

Upernavik Airport - 799 Asphalt

Qaanaaq Airport - 900 Gravel

Tasiilaq Heliport Kulusuk 1199 Gravel

Ittoqqortoormiit Heliport Nerlerit Inaat 1000 Gravel

Table 3-2 Airports and major heliports. Towns without airports have heli-copter service to the nearest airport. Kangerlussuaq is rated as

a settlement but is the main gateway to Greenland.

3.4 Sea traffic

Sea traffic is of the utmost importance for isolated towns and settlementsthroughout the country. Although some harbours are closed during the winter,sea traffic is the principle means of supplying goods to Greenlandic commu-nities.

Domestic p assenger traffic is mainly by air but supp lemented by passengerliner services in certain areas. There are no international sea connections forpassengers.

3.4.1 Cargo transport

All commercial transport of cargo to, from and within Greenland must beconducted by licence from the government [K]. Excluded from this regulationis transport related to activities covered by the Mineral Resources Act andtransport to other destinations other than those for which an exclusivelicence has been granted. Furthermore, transport of petroleum products andbulk is exempt.

The government has granted an exclusive licence to R oyal Arctic L ine A/S forthe transport of cargo by sea between 16 destinations in Greenland, seeTable 3-3, and between these destinations and Aalborg (Denmark) and Rey-

kjavik (Iceland). Furthermore, this licence covers transport of cargo i n transit



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via Reykjavik and Aalborg to/from a number of overseas destinations inNorth America and Europe.

Excluded from this licence are:

1. Oil transport in tankers

2. Transport of own cargo on own vessels related to other businesssectors than transport

3. Transport o f homogeneous or unusual ship ments which for technicalor economical reasons require other means of transport.

Regarding project cargo as mentioned in bullet point 3 above, RAL has the"right of first refusal". This means that RAL must be offered an opportunityto effect the transport at, to a significant degree, the same terms as can beobtained from other shipping companies.

Figure 3-3 Main shipping routes by Royal Arctic Line.

International liner services Nuuk, Sisimiut and Aasiaat are the main import/export harbours. Some of theinternational routes also include Narsaq, Qaqortoq and Nanortalik.

Connections to o ther towns are by feeder routes or by international routes asshown in Table 3-3.

In cooperation with the Icelandic shipping company Eimskip, Greenland hasconnections to Argentina, Everett/Boston, Richmond and Halifax once amonth in May, June and July.

All international liner services are containerized.

Domestic feeder services The other towns on the West Coast up to Ilulissat are served by a feeder

route on a weekly basis during the navigational season. These feeder servicesare also containerized.



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The other towns and major settlements north of Ilulissat, incl. Qeqertarsuaq,are serviced by a general cargo ro ute on a biweekly basis during the summerseason.

Settlements Royal Arctic Bygdeservice A/S, a subsidiary of RAL, services the settlements

on a weekly o r bi weekly basis from the nearest town, often in connection withpassenger services.

Town Services Season Schedule

Nanortalik Int. container - 2-3 weeks

Qaqortoq Int. container - Biweekly

Feeder - Weekly

Narsaq Int. container - Biweekly

Feeder - Weekly

Paamiut Feeder - Weekly

Nuuk Int. container - Weekly

Maniitsoq Feeder - Weekly

Sisimiut Int. container - Weekly

Aasiaat Int. container Apr.-Dec. Weekly

Qasigiannguit Feeder Apr.-Dec. Weekly

Ilulissat Feeder Apr.-Dec. Weekly

Uummannaq General cargo May-Nov. Weekly

Upernavik General cargo May-Nov. Weekly

Qaanaaq General cargo Jul.-Aug. Twice a year

KangerlussuaqAirport

Container andgeneral cargo

Jun.-Sep. 2-3 times a year

Tasiilaq Int. container Jul.-Oct. Every three weeks

Ittoqqortoormiit General cargo Jul.-Aug. Twice a year

Table 3-3 Royal Arctic Line liner service for major ports1)Harbours may be closed due to ice in May-July

2) Harbours are accessib le in Jan.-March. ice conditions permit-ting3) Schedules vary according to the season



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M/V Mary Arctica, the newest ship in RAL's fleet. Photo: J.K. Jensen, RAL.gl

Royal Arctic Line's fleet RAL operates a number of ships, both ocean-going and for local traffic. Theocean-going fleet consists of five modern ice-class vessels built speciallyfor operations in Arctic waters in winter conditions.

During the peak season RAL also uses chartered vessels.

Name Capacity Draft[m] Crane capacity[tonnes] Cruise speed[knots]

Nuka ArcticaNaja Arctica

782 TEU 8.00 70 16.5

Mary Arctica 558 TEU 7.00 70 15.3

Arina Arctica 283 TEU 6.24 60 14.5

Irena Arctica 424 TEU 6.50 70 14.5

Pajuttaat26 TEU

1349 m

3.71 25 13.0

Table 3-4 Major vessels in RAL's fleet1) Twin lift

3.4.2 Domestic passenger service

Coastal service Arctic Umiaq Line9 operates a coastal passenger service between Narsaq andIlulissat on a weekly basis from April to December with the M/S Sarfaq Ittuk.The vessel's capacity is 246 passengers including 104 cabins with privatebathrooms. It has a cruising speed of 11.5 knots.

9 www.aul.gl



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M/S Sarfaq Ittuk, Arctic Umiaq Line's coastal service.Photo: Arctic Umiaq Line, 2007

All towns and two major settlements en route are serviced when the ship isnorthbound and southbound.

Disco Bay area Disco Line10 has scheduled passenger traffic between Ilulissat, Qasigiannguit,Aasiaat, Qeqertarsuaq and some settlements in the Disco Bay area. The com-pany operates several small vessels with a capacity of 36-60 passengers.

Settlements Royal Arctic Line has scheduled services between towns and settlements onthe West Coast between Qaqortoq and Sisimiut, and in the Tasiilaq district

on the East Coast. The services are carried out by combi ned cargo and pas-senger ships on a one- to two-week basis, depending on the season and thedestination. The capacity of the ships is 12 passengers.

In 2006 the total number of passengers was 41,536 b etween towns and 1,912between towns and settlements.

3.5 Air traffic

3.5.1 International

The main scheduled route is fro m Copenhagen Airport to Kangerlussuaq. The

national airline, Air Greenland A/S11

, operates the route with an Airbus 330four times a week year round and up to nine times a week during the summerpeak season.

A secondary scheduled route is from Copenhagen to Narsarsuaq.

In 2007 there were a total of 74,237 international passengers.

10 http://diskoline.gl11 www.airgreenland.com



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Figure 3-4 Scheduled international air routes. Red routes are operated byAir Greenland and yellow routes are operated by Air Iceland onlyduring the summer season.

Air Iceland12 has (2009) five scheduled routes from R eykjavik (Keflavik) withDash-8 airplanes. The connection to Kulusuk and Nerlerit Inaat is year round,

while the other routes are only during the summer season: Nuuk three times aweek from May to September, Narsarsuaq twice a week from July to Septem-ber, and Iluli ssat twice a week in July and August.

The scheduled ro utes by Air Iceland may vary from year to year.

3.5.2 Domestic

Air Greenland uses Dash-7 airplanes to operate a network of scheduledflights between all towns with airports.

Towns with no airport are serviced by Air Greenland helicopters: in SouthGreenland out of Narsarsuaq with Sikorsky S-61s, and in the Disco Bay out ofIlulissat with Bell 222s.

In 2007 the total number of air passengers was 74,237 with airplanes and91,599 with helicopters.

The frequency depends on the destination and season, and varies from 8times a day between Nuuk and Kangerlussuaq during the peak season to twicea week for the most remote destinations.

12 www.airiceland.is



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Figure 3-5 Domestic scheduled routes with Air Greenland Dash-7

3.5.3 Cargo

Transportation of cargo by air is possible to all towns and to settlementswith heliports.

The capacity from Copenhagen to Kangerlussuaq is very high with the Airbus330-200, which has a payload of approx. 36 metric tonnes.

On domestic ro utes, some of the DHC-7 aircraft have a wide cargo door,which makes it possible to transport large units. The payload without pas-sengers is approx. 7 metric tonnes.

For towns serviced by helicopters, the payload is limited to approx. 2.5tonnes with a S-61 and approx. 1.8 tonnes with a Bell 212 without passen-gers.



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3.5.4 Charter

Air Greenland has a fleet of aircraft for charter13 .

Aircraft

Airplane

Helico

pter

Passen

gers

Cargo

Slin

g

Number ofseats

Cruise

speed[km/h]

Number infleet

DHC-7 x x x 50 450 6

Super King Air x x 7 480 1

Twin Otter x x x 18 290 2

Sikorsky S-61N x x x x 25 220 2

Bell 212 x x x x 9 185 7

Bell 220U x x 8 240 4

AS 350 x x x 5 234 13

Table 3-5 Air Greenland's charter fleet

Air Iceland's charter fleet includes Fokker 50s, Dash-8s and Twin Otters.

3.6 Petroleum products

Petroleum products are supplied by Polaroil14 , a division of KNI A/S, which isa 100 percent government-owned public limited company.

Supply obligations Polaroil is by agreement with the government under obl igation to supplyarctic grade gasoil (diesel and fuel), petrol (gasoline), kerosene and Jet-A1

from their tank farms in most towns and settlements. This service agreementdoes not include bunkering of cruise ships, cargo ships in international tradeand offshore trawlers, as well as construction sites outside populated areas,mines, and airport facilities.

Nuuk tank farm. Photo: U.R. Petersen, 2008

13 www.airgreenland.com/charter 14 www.kni.gl



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The service agreement does not include an exclusive right to import petro-leum products.

Petroleum products covered by the service agreement are delivered toconsumers at a fixed pri ce for the whole country. Sales to other consumers

are on a commercial basis.Storage facilities and products Each town has its own storage facilities for petroleum products, which are in

turn used for distribution to settlements using small tankers.

All products delivered by Polaroil are non-standard, but produced to speci-fications in accordance with low temperatures. The gasoil (diesel) is low-sulphur and gasoline is unleaded.

Heavy fuel oil and other petroleum products not mentioned above are notavailable.

3.7 TelecommunicationsExclusive rights The government holds the exclusive right to provide telecom services in, to

and from Greenland and to establish and operate a telecommunicationsinfrastructure in Greenland which facilitates electronic communications be-tween network termination points in or between towns and settlements andto foreign countries. This exclusive right does not apply to installationswhich are used solely within the boundaries of a property or b etween prop er-ties having the same owner, provided that they are situated in the same town[L].

Figure 3-6 International telecom connections; the Greenland Connect is inblack. Tele Greenland

Tele Greenland Tele Greenland A/S15 , a 100 percent government-owned public limitedcompany, is granted an exclusive concessio n in accordance with the rightsmentioned above. Tele Greenland is responsible for telecommunications,postal services and coastal radio services.

International connections Telecommunications to and from Greenland consist of a number of satellitelinks to Copenhagen Teleport and the "Greenland Connect" submarine cableto Canada and Iceland, commissioned in March 2009.

15 www.tele.gl



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Domestic infrastructure The basic infrastructure consists of a digital radio link from Nanortalik in theSouth to Uummannaq in the North and satellite co nnections which ensure thecoverage of the rest of North Greenland and the East Coast.

The 1,500 km long radio link supplies approx. 80 percent of the population

with telephony, ADSL, radio and television. Mobile phone telephony is avail-able in all settlements with more than 70 inhabitants.

All in all, more than 98 percent of the population is offered digital telecomservices of a high international standard.

Satelli te connections Tele Greenland provides small and mobile satellite communication solutions:VSAT, BGAN and Iridium for telephony and data transmission. For largerrequirements Tele Greenland can offer tailor-made satellite solutions.

3.8 Overnight accommodation

There is a wide variety of accommodation available throughout Greenland.

Hotels are found in most towns and major settlements. Other types of ac-commodation i nclude hostels, B&Bs, guesthouses, and huts and cabins, espe-cially in the tourist areas around Disco Bay and in South Greenland.

In major ci ties you may also find apartments and seamen's hostels.

Hotels Some of the hotels are rated according to the Danish Hotel Association(HORESTA) classification system, with five stars as the best rating. Thecountry's four-star hotels are Hotel Arctic in Ilulissat, Hotel Qaqortoq andHotel Hans Egede in Nuuk.

Major hotels have conference and meeting facilities. A list is shown in Ap-pendix B.

Hotel Icefjord, Ilulissat. Photo: H. Mai, 2008

Seamen's hostels There are four seamen's hostels in the country. They were ori ginally used ascheap and basic overnight accommodation primarily for sailors, but in recentyears have been modernised and today meet hotel standards. All seamen'shostels have a cafeteria where you can enjoy the dish of the day or a cup ofcoffee and a pi ece of homemade cake. If yo u stay overnight, breakfast is al-

ways included in the price.



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Nuuk***:41 rooms conference rooms for 20 persons and for 10 persons.Sisimiut***:30 rooms conference room for 30 persons.Aasiaat:36 rooms conference room for 25 persons.www.soemandshjem.gl

Bed and Breakfasts In the major towns the tourist office can arrange a B&B, where you live with aGreenlandic family and gain excellent insights into everyday life in Greenland.Often, for a small additi onal charge, you will be able to eat with the family andtaste some homemade Greenlandic speciali ties. In South Greenland severalsheep farmers offer basic overnight accommodation.

TownHotel

Seamen's

hostels

Apart-

ments

Hostels

B&B

Other

Nanortalik *** x x x

Qaqortoq **** x x x x

Narsaq x x x x

Narsarsuaq ** x

Paamiut x x x

Nuuk **** *** x x x

Maniitsoq *** x

Sisimiut *** *** x x

Kangerlussuaq *** x

Kangaatsiaq x x

Aasiaat x x x

Qasigiannguit x

Ilulissat **** x x x x

Qeqertarsuaq x x x x

Uummannaq x x

Upernavik x

Qaanaaq x x

Tasiilaq x x

Ittoqqortoormiit x

Table 3-6 Overview of accommodation in towns. For a complete list ofaccommodation, see www.greenland.com



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References

A Topographical Atlas of Greenland (in Danish: Topografisk Atlas Grn-land). Det kongelige Danske Geografiske Selskab, Copenhagen 2000.

B Statistical Yearbook 2008 (in Danish: Statistisk rbog 2008). Grn-lands Statistik, Nuuk 2009.

C Greenland in figures 2009. Statistics Greenland, Nuuk 2009D The observed climate of Greenland, 1958-99 with Climatological

Standard Normals, 1961-90. Danish Meteorological Institute TechnicalReport 00-18, Copenhagen 2001

E Sailing Directions, West Greenland (in Danish: Den Grnlandske Lods I,Vestgrnland). Det kongelige skort-arkiv, Copenhagen 1966

F NIRAS Greenland: Energy Master Plan 2020 (in Danish: Energiplan2020). Department of Industry, Nuuk 2005 (unpubli shed)

G Greenland Government Executive Order No. 7, of March 17, 2008 on

water quality and inspection of water supply plants bkg_nr_07-2008H NIRAS Greenland: Development Plan for Harbours in Greenland (in Dan-

ish: Udbygningsplan for Grnlandske Havne). Dep. of Infrastructure.Nuuk 2002

I Sailing Directions for Harbours (in Danish: Den grnlandske havnelods).National Survey and Cadastre. 1990

J Greenland Government Executive Order no. 5 of March 7, 2003 on har-bour and cruise ship charges bkg_nr_05-2003

K Greenland Act of Parliamentary no. 16 of October 30, 1992 on seatransport o f cargo to, from and i n Greenland with amendments of June 6,1997 and November 12, 2001 ltf_nr_16-1992

L Greenland Act of Parliament no. 17 of November 20, 2006 on telecom-munications and telecom services ltf_nr_17-2006



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Labour market characteristics

4. Establishing a business

If you want to gain better access to Greenlands resources and the Green-landic market, you will have to set up a company in Greenland or at least es-tablish solid contacts with the Greenlandic business community. The Green-landic business community is also open for joint ventures with foreign com-panies.

The following chapter offers a brief description that covers different typesof businesses and establishment procedures, but it is also strongly recom-mended that you retain the services of a legal consultant.

Companies considering a possible business venture in Greenland should be

aware that very little official information is available in English, so manyproblems can be avoided by having a Danish or Greenlandic-speaking personon the team.

4.1 Types of businesses

Companies may be operated under any of the following legal forms: a publiclimited company (in Danishaktieselskab or A/S), a private limited company(in Danish Anpartsselskab or ApS), or as a sole proprietorship. Other possi-bilities include cooperatives and partnerships.

The Public Limited Companies Act (2002) and the Private Limited CompaniesAct (2002) lay down specific conditions, but generally there is a high degreeof freedom in the choice of the legal form under which your business shall beconducted.

A foreign corporation may establish a company in Greenland as a subsidiarycorporation, a registered branch office, a representative office or a jointventure.

There are special rules fo r business requirements under the Mineral Re-sources Act.

Public limited companies An A/S may be founded by a resident of Greenland, a legal entity in Greenlandor as a subsidiary o f a foreign company. In each case, the manager of the com-pany must be a resident of Greenland. The share capital of an A/S must be noless than DKK 500,000, and the company may hold up to 10 percent of itsown shares.

Private limited companies The same rules apply to an ApS, except that the share capital must be no lessthan DKK 125,000. An ApS cannot hold any of its o wn shares.

Branch offices Foreign companies may under certain condi tions establi sh a branch office.Permission is normally only granted to parent companies registered in theEU, the Nordic co untries, the US or Canada. The manager of the branch officemust be a resident in Greenland, but exceptions may be granted.

Setting up a business in Greenland Establishing a business 40


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4.2 Establishment procedure

Before establishing a business a memorandum of associ ation must be pre-pared and signed b y the founders. The memorandum must contain a draft ofthe articles of association.

Articl es of association The draft of the articles of association must include information about thename of the company, the location of the registered office, the objectives ofthe company, the share capital, the board of directors, general meetings, thechartered accountant and the companys fiscal year. The articles can beamended subsequently, if desired, but the shareholders must authorize theamendments at a general meeting.

The formal decision to found the company is made at the first general meet-ing of the shareholders. When the foundation has been adopted, the share-holders adopt the articles of association and elect the members of the boardof d irectors and the chartered acco untant.

Registration Public limited companies, private limited companies and branch offices of

foreign corporatio ns must apply for registration with the Danish CentralBusiness R egister (CVR)16 within six months (two months in the case of anApS) fro m the date on which the memorandum of asso ciation was si gned.

All companies established in Greenland must also register with the GreenlandBusiness R egister (In Danish Grnlands Erhvervsregister or GER)17

Residency requirements In order to trade and conduct business within Greenland, a trading licencemust be obtained from the government administration.

The Greenland Trade Act (2001) states that persons who wish to obtain atrading licence must possess Danish citizenship or have a work permit forGreenland and be a resident of Greenland, unless an international agreementvalid for Greenland states otherwise or the Greenland Government grants a

waiver. Citizens of Denmark and other Nordic countries do not need a workpermit and a residence permit.

Companies and branch offices can obtain a trading licence if they are regis-tered i n Greenland and if the management resides i n Greenland. For publicand private limited companies, half o f the companys actual managementmust reside in Greenland.

Further information may be obtained from Greenland Tourism & Business

Council18

or the Ministry of Industry,Labour and Mineral Recourses19

.

4.3 Corporate taxation

Corporate tax is generally levied at a flat rate of 31.8 p ercent, but there are afew exemptions.

Private companies and a registered branch office of a foreign company arealso subject to taxation.

Depreciation Buildings and related installatio ns are depreciable by 5 percent per year.Aircraft and vessels are depreciable by a maximum 10 percent per year. All

16 http://www.cvr.dk17 http://www.ger.gl/or mailto:[email protected] http://www.inussuk.glor mailto:[email protected] mailto:[email protected]



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Labour market characteristics

other items are depreciable by a maximum of 30 percent per year by thepooled declining balance method.

If a taxable gain is achieved on the sale of buildings, vessels or aircraft, thetax-payer may enter a special amortization/depreciation to help offset the

calculated gain.Dividends Dividends are deductibl e from the taxable income. The divi dend tax rate is

from 42 to 44 percent, depending on the recipient's district of residence, and37 percent if paid by a company under the Mineral Resources Act. Retainedearnings are not subject to taxation.

Tax losses A tax loss may be carried forward for five years and offset against taxableincome.

Payment to other countries Payments made from Greenland to other countries under inter-companyagreements, such as interest, royalties etc. are tax deductible in Greenlandprovided that the payments are consistent with the arms length principl e.This is also applicable for subsidiary and parent companies in Greenland; i.e.,

all trading between companies with mutual interests.

4.4 Personal taxation

Individuals are subject to a flat income tax rate that consists o f state andmunicipal taxes. Each tax payer is granted a personal and basic allowance ofDKK 58,000 (2007). The tax rate is approximately 43 percent, but variesslightly from d istrict to district. Individuals pay tax according to the districtwhere they are registered.

Persons regarded as residents in Greenland are fully liable to p ay tax toGreenland on their global income. Non-residents are in general subject tounlimited Greenlandic taxation if they stay in Greenland for a consecutive

period of six months or more. The taxation is due from the first day of thestay.

For non-residents working in the country there is limited personal tax lia-bility to Greenland on the salaried income from the first day of work. How-ever, this is not the case if this persons stay in Greenland does not exceed 14consecutive days20, and the work is performed for, and paid by, the usualemployer.

The rules of taxation can be complicated and it is recommended that youretain the services of a professional consultant.

4.5 Indirect taxes

No VAT, energy taxes or similar taxes are applicable in Greenland.

Import duties are paid on various products, e.g., cigarettes, alcohol, coffee,meat and vehicles, cf. section 9.7.

4.6 Business customs

Business life in Greenland is very informal and influenced by the countryssmall communities. People tend to know each other. You wil l o ften encounterthe same people as managers and board members in several different com-panies.

20 187 days within 12 months.



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With the exception of the large government-owned public li mited companies,most firms are rather small and lo cally oriented, although some have branchoffices in other towns.

Most people work Most people work 35-40 hours per week, often from

8:00/9:00 a.m. to 4:00/5:00 p.m., five days a week. Lunch breaks normally l asthalf an hour and in private companies the time used for breaks is not paid forby employers.

However, the working hours are often influenced b y the seasons. In winter it isnot unusual to work Saturdays, which is compensated for by taking longweekends during the summer for hunting, fishing and camping trips to thesurrounding area. Many residents take long holi days in the period from mid-June to mid-August.

In the construction sector, it is not unusual to work long hours in the summerseason, often up to 60 hours per week. This i s most common among expatri-ates.

In the mineral sector and at remote construction works, it is normal to workintensively for a period of three to six weeks, interrupted by two to fourweeks leave, when employees travel to their hometown or abroad.



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Local private companies 41

5. Labour market characteristics

The Greenlandic and Danish labour markets have very similar characteristicswith regard to legislation and regulations established through agreementsbetween the employers and the employees' unions.

The main differences arise from the greater influence of the public sector andgovernment-owned enterprises as well as the longer distances betweentowns.

5.1 Employers associations:

Sulisitsisut The Emplo yers' Association of Greenland (in Danish Grnlands arbejds-giverforening or GA) is the oldest and biggest employers association inGreenland tod ay. It has approximately 400 member enterprises employingaround 5,500 workers within all trades that consolidate a central position inthe labour market.

GA provides daily legal and financial counselling to its member companiesand compiles statistical information based on lines of business and guide-lines for relevant legislation.

As an employers association the GA contributes to ensuring decent condi-tions on the labour market. This i s do ne through a basic agreement and fivecollective agreements with the SIK labo ur union. The collective agreementscover the sector of building trades and the like, the commercial and clericalsector, the production sector, and the transport and service sector.

Similar co llective and basic agreements exist with Atorfillit Kattuffiat (AK)and the Financial Services Union in Denmark (Finansforbundet) www.ga.gl

NUSUKA NUSUKA is a service organisation for Greenlandic businesses.

NUSUKA was establi shed as a unified organisation to represent and promotethe views and interests of employers. A broad representation at all levelsplaces NUSUKA in a strong position as the voice of Greenlandic business www.nusuka.com

5.2 Labour unions

From a private enterprise perspective, the main Greenland labour unions are:

SIK The blue-collar workers union SIK is the flagship of the labour unions with astrong emphasis on the development of the entire country for the benefit ofthe Greenlandic people www.sik.gl (in Greenlandic only)

ASG The Academics' Society of Greenland (in Danish Akademikernes Sammen-slutning i Grnland; in Greenlandic Ilinniagartuut Kattuffiat) is a coop er-ation between Danish unions for peopl e emplo yed in Greenland. ASG repre-sents The Danish Confederation of Professional Associations (AC) in Green-land www.asg.gl

Atorfillit Kattuffiat AK is a white-collar workers union representing civil servants in the

government, and government-owned and private enterprises www.ak.gl

Setting up a business in Greenland Labour market characteristics 44


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Finansforbundet Finansforbundet is the Danish union for employees in the financial sector.The Greenland financial market is part of the Danish market and is regulatedby the same rules and regulations www.finansforbundet.dk

Other labour unions IMAK teachers union www.imak.gl

PK nurses union www.pk.gl

PIP youth teachers union www.pip.gl

5.3 Employee benefits

The labour market is generally regulated via collective agreements betweenthe employers' associations and employees' unions. This provides greatflexibility in how the agreements are drawn up and in the benefits to which theemployees are entitled.

Greenland has no salaried employees act as in Denmark, but most agreementsand employment contracts refer to the Danish Act21 .

White-coll ar employees under the Danish Salaried Employees Act have theright to payment during sick leave and the term of notice varies between threeand six months, depending on the length of employment.

Blue-collar workers have no right to payment during sick leave, but mostagreements include conditio ns for sickness pay. Terms of notice vary ac-cording to the agreements made. For members of SIK it varies from one to sixweeks, depending of the length of employment.

Most agreements include provisions for leave payments in connection withthe first day of a childs sickness and serious illnesses among close relatives,as well as funerals. Such leaves of absence often last up to five days due tothe extended travelling times required between Greenlandic towns.

Maternity and paternity leave

All citizens have the right by l aw to maternity leave two weeks before and 19weeks after delivery. However, most agreements have up to eight monthsmaternity leave. Paternity leave is three weeks. After the maternity leave thetwo parents share six weeks of parental leave.

Holidays According to Greenlandic law, all employees in the private and public sectorshave the right to five weeks holiday and holiday bonuses or salary duringholidays

22per year. Employees have the right to hold three consecutive

weeks of hol iday during the holiday season from February 1st

to Septem-

ber30th

.White-coll ar employees with monthly salary payments receive their salariesduring holidays and a holiday bonus of 1.5 percent of the total income.

Blue-collar workers receive a holi day bonus of 12 percent. Agreements canspecify a higher bonus, cf. Section 9.2.

21 Consolidation Act no. 81 of 3 February 2009 on legal matters between employersand salaried employees

22 Act of Parliament no.10 of 12 November 2001 on holidays



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Pension All residents of Greenland may apply for a state pension from the age of 65.Furthermore, agreements may include provisions for employer-paid pensionsavings:

SIK: 6.7 percent

AK: 10 percent emplo yer + 5 percent employee

Photo: Lars Svankjaer, 2005

5.4 Foreign employment

Visas and working permits As Greenland is part of the Kingdom of Denmark, albeit not an EU member, itadheres to Danish visa rules and regulations. However, Greenland also has itsown rules, so there are two sets of rules that regulate entry into the Green-landic labour market.

Some of the main points are:

Foreigners who require a visa to enter Denmark also require a special visa toenter Greenland. Likewise, they must have a special residence permit in orderto stay for a longer period in Greenland. Neither the visa nor the residencepermit for Greenland grants the holder the right to reside outside of Green-land, including Denmark.

Foreigners who are not No rdic citizens must have residence and work per-mits for Greenland. Applications for residence permits in Greenland can bemade to a Danish representation in another country. If the applicant is resid-ing legally in Denmark, the application can be made with the nearest munici-pality service centre, or if the applicant is residing in the Greater Copenhagenarea, with the Danish Immigration Service.

In Greenland applications can be filed with the police, who will send them onto the Danish Immigration Service.

The following sites provide further information on Greenlandic and Danishregulations: www.greenland.com, www.nyidanmark.dk (Visa),

www.nyidanmark.dk (Work p ermit)



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To ensure local participation in projects in Greenland, the government re-quires mandatory municipal approval for hiring foreigners for the followingtypes of employment23 :

Unskilled labour

Labour with basic vocational education or apprenticeship

Social workers

Jobs demanding higher maritime education

These laws do not distinguish between the nationalities of the employingcompanies. If the workplace is within Greenland's borders, a permit is manda-tory. It is the employers responsibility to obtain a permit from the munici-pality. If the employer does not get a negative answer within two weeks ofsubmitting the appli cation, it can be assumed that a permit has been granted.If a permit i s granted, the employer shall, within eight days of the beginning ofthe term of employment for the foreign worker, serve notice to the munici-pality.

5.5 Employing trainees

Trainees are employed by companies, which in return receive public fundingto help cover the costs. The first year is free for the companies, but in returnthey pledge to pay the salary for the remainder of the trainee period. How-ever, they do receive public funding for part of the salary. The maximum costsper month per trainee for the employer are:

1st

year 2nd

year 3rd

year 4th

year 5th

year

DKK 0 DKK 6,500 DKK 8,400 DKK 9,200 DKK 10,300

Table 5-1 Maximum cost per month per trainee

A company has to be approved to be able to hire trainees. This is done byfilling out the application form from the local vocational training centre,Piareersarfik http://dk.nanoq.gl, which can also help to recruit trainees andothers.

5.6 Education levels24

For many years, efforts have been made to bring the education level o f thepopulation up to European standards. Currently the aim is to ensure that in

2020 two-thirds of the workforce have educational qualifications, comparedwith about one-third today.

23 Act of Parliament no.27 of 30 October 1992.

24 Greenland in figures from Statistics Greenland shows several relevant figures abouteducation levels and the labour market.



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Education level Men Women Total

Basic training 126 152 278

setting up a business in greenland

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