It seems the Icelandic President has in effect vetoed legislation that would hold the citizens of Iceland responsible to pay back billions of Euros to former Icelandic bank depositors in the U.K. and The Netherlands.
The Icesave deal is deeply unpopular with the Icelandic population and there is widespread feeling that taxpayers are being left to foot the bill for mistakes made by financial firms operating under the watch of other national regulators. Critics say the bill would lumber Icelanders with an extra debt burden equivalent to 40 percent of gross domestic product or $18,000 per citizen, including interest payments.
Britain and the Netherlands have veto power over Iceland's EU membership bid and could block the entry negotiations.
Since the Icelandic bank's deposit liabilities were priced in Euros, it looks like the Icelandic Government has committed the country to collectively pay almost 5 months worth of their annual output back to former foreign depositors, pending legislation. I'll bet the 250,000 voters in Iceland vote against the referendum.