What legal mechanisms in the 2009 Self‑Government Act govern the reduction of the Danish subsidy when Greenland earns mineral revenues?

1. The headline formula — “first DKK 75 million to Greenland, then split 50/50”

The Act establishes a simple arithmetic rule: Greenland keeps the first DKK 75 million of annual mineral‑resource income; any amount above that threshold reduces the Danish subsidy by half of the excess — effectively a 50/50 split between Greenland and Denmark for revenue above DKK 75 million, as reflected in official summaries and U.S. and Danish government explanations ^{[4] [1] [2]}.

2. The legal vehicle — the Self‑Government Act and its sections

The mechanism is written into the Self‑Government Act itself (Act no. 473 of 12 June 2009) and implemented through provisions that fix the annual subsidy, define included revenues, and prescribe payment and adjustment rules; the Act fixes the subsidy in 2009 price and wage levels and provides for annual inflation adjustments and monthly advance payments, thereby operationalizing how reductions are applied against a standing monthly flow ^{[5] [3]}.

3. What counts as “revenue” — a broad statutory definition

The Act (and its explanatory notes) enumerates the revenue categories that feed into the calculation: direct and indirect taxes related to mineral activity, revenue from government stakes in companies operating in Greenland, and other income items tied to mineral exploitation are included in the revenue definition — a definition deliberately modelled on prior mineral‑law formulations to capture the various ways resource wealth can reach public coffers ^{[6] [5] [7]}.

4. The political safeguard — negotiations if the subsidy falls to zero

A built‑in political safeguard converts a numerical threshold into a treaty‑level moment: if the Danish subsidy is reduced to zero under the formula, the subsidy is discontinued and the Self‑Government authorities and the Danish Government must open negotiations on future economic relations — a clause that transforms a fiscal rule into a bilateral bargaining trigger over the broader economic relationship ^{[1] [5]}.

5. Implementation detail and gaps — adjustment, timing and delegated rules

Practical details are addressed in the Act: the subsidy is payable monthly in advance and adjusted annually for general price increases, and the Minister for Finance may — in agreement with Greenland’s Naalakkersuisut — set further rules for implementation; however, the Self‑Government Act did not itself cover all administrative procedures for mineral take‑over and later Greenlandic Mineral Resources legislation filled many procedural gaps ^{[5] [8]}.

6. Competing framings and political intent

Observers frame the rule variously as a revenue‑sharing compromise that both rewards Greenlandic resource control and preserves Danish financial ties, and as a mechanism that cushions Denmark’s fiscal exposure while enabling Greenlandic fiscal autonomy; some academic and policy sources underline that the Act is also a legal step toward possible independence, so the revenue rule doubles as an instrument of political transition — an implicit agenda visible in both Danish summaries and Greenlandic commentary ^{[9] [10]}.

7. Limits of the reporting and remaining open questions

The available sources consistently report the 75‑million threshold and the 50 percent reduction rule and enumerate included revenue types, but full operational specifics — for example precise accounting methods for complex corporate stakes, timing of when revenues are booked versus paid, and dispute‑resolution steps for contested revenue items — are handled in implementing rules or later statutes and are not exhaustively detailed in the materials consulted here ^{[6] [8]}.