At the time of the occupation, the Faroe Islands had the status of an amt (county) of Denmark. Following the invasion and occupation of Denmark on 9 April 1940, British forces launched "Operation Valentine" to occupy the Faroe Islands. On 11 April, Winston Churchill — then First Lord of the Admiralty — announced to the House of Commons that the Faroe Islands would be occupied:
We are also at this moment occupying the Faroe Islands, which belong to Denmark and which are a strategic point of high importance, and whose people showed every disposition to receive us with warm regard. We shall shield the Faroe Islands from all the severities of war and establish ourselves there conveniently by sea and air until the moment comes when they will be handed back to Denmark liberated from the foul thraldom into which they have been plunged by German aggression.
On 12 April, two destroyers of the British Royal Navy arrived in Tórshavn harbour. Following a meeting with Carl Aage Hilbert (the Danish Prefect of the Islands) and Kristian Djurhuus (President of the Løgting, the Faroese Parliament), an emergency meeting of the Løgting was convened the same afternoon. Pro-independence members tried to declare the independence of the Faroe Islands but were outvoted. An official announcement was later made announcing the occupation and ordering a nighttime blackout in Tórshavn and neighbouring Argir, the censorship of post and telegraphy and the prohibition of the use of motor vehicles during the night without a permit.
On 13 April, the Royal Navy cruiser HMS Suffolk arrived at Tórshavn. Colonel T B W Sandall (the British military commander) and Frederick Mason (the new British Consul to the Faroe Islands) then met with the Danish Prefect. The Prefect responded with what Sandall took to be a formal protest, though Hilbert maintained that owing to the occupation of Denmark he was unable to formally represent the Danish government. He duly accepted the British terms on the basis that the UK would not seek to interfere with the internal affairs of the islands. A formal protest was however made by the Løgting, though expressing the wish for friendly relations. 250 Royal Marines were disembarked, later to be replaced by other British troops. In practice, cordial relations were maintained between the British forces and the Faroese authorities.
In May, the Royal Marines were replaced by soldiers of the Lovat Scouts, a Scottish Regiment. In 1942, they were replaced by the Cameronians (Scottish Rifles). From 1944, the British garrison was considerably reduced.
A notable visitor to the Faroe Islands during World War II was the author Eric Linklater, then serving as an officer in the British Army. His 1956 novel The Dark of Summer was set in the Faroe Islands during the war years. He also wrote The Northern Garrisons: The Army at War (HMSO, 1941) and the foreword to Kenneth Williamson's 1948 book The Atlantic Islands: a Study of the Faeroe Life and Scene.
A plaque has been erected by British veterans in Tórshavn Cathedral expressing thanks for the kindness shown to them by the Faroese people during their presence. Approximately 170 marriages took place between British soldiers and Faroese women. The British Consul Frederick Mason (1913-2008) also married a local woman, Karen Rorholm. They subsequently left the Faroe Islands; in 1943 he was appointed British Consul in Colón, Panama. He would later, as Sir Frederick Mason CMG, become British Ambassador to Chile (1966-1970) and finally British Permanent Representative to the Geneva Office of the United Nations (1971-1973).
The Faroe Islands received occasional attacks by German Luftwaffe aircraft in the course of the war, but a full-scale invasion was never attempted. Drifting sea mines proved to be a considerable problem and resulted in the loss of numerous fishing boats and their crews. The trawler Nýggjaberg was sunk on 28 March 1942 near Iceland; 21 Faroese seamen were killed in the worst single loss of Faroese lives in the war. During the war, Faroese ships had to hoist the Faroese flag and paint FAROES / FØROYAR on the sides thus allowing the British Royal Navy to identify them as "friendly".
To prevent inflation, Danish banknotes in circulation on the islands were overstamped with a mark indicating their validity only in the Faroe Islands. The Danish Krone (in the Faroe Islands) was fixed at 22.4 DKK to £1 Sterling. Emergency banknotes were issued, and specially-issued Faroese banknotes were later printed by Bradbury Wilkinson in England; see also Faroese króna.
During the occupation, the Løgting was given full legislative powers, albeit as an expediency given the occupation of Denmark. Although Iceland became an independent republic in 1944, Churchill refused to countenance a change in the constitutional status of the Faroe Islands whilst Denmark was still occupied. Following the liberation of Denmark and the end of World War II in Europe, the occupation was terminated in May 1945 and the last British soldiers left in September. The experience of wartime self-government did, however, mean that a return to the pre-war status of an amt (county) was unrealistic and unpopular. A referendum on independence was held in 1946; subsequently formal autonomy was established in 1948 (albeit within the Danish realm).
The largest tangible sign of the British presence is the runway of Vágar Airport. Other reminders include the naval guns at the fortress of Skansin in Tórshavn, which served as the British military headquarters. A continuing reminder is the Faroese love of fish and chips, and British chocolate such as Dairy Milk (which is readily available in shops throughout the islands, but not in Denmark).
In 1990 the Faroese government organised British Week, a celebration of the 50th anniversary of the friendly occupation. The celebration was attended by HMS Brilliant and a Royal Marines band. Sir Frederick Mason, the former wartime British consul to the Faroes, was also present.
The only airfield on the Faroe Islands was built in 1942–43 on the island of Vágar by the Royal Engineers of the British Army. The majority of the British personnel in the Faroes were stationed at Vágar, mostly working on the construction of the airfield. Although disused after the war, it was reopened as the civilian Vágar Airport in 1963. Left-hand driving was in force on the roads of the island of Vágar until the British troops left the Faroe Islands.
Following the occupation of Denmark by Germany, Faroese vessels were no longer permitted by the British Admiralty to fly the Danish flag. This was of considerable significance given the importance of the fishing fleet to the Faroese economy. Following some intensive discussions between the British occupation authorities, the Faroese authorities and the Danish Prefect, as well as discussions between the UK Foreign Office and the Danish Embassy in London, on 25 April 1940 the British authorities recognised the Faroese flag — the Merkið — as the civil ensign of the Faroe Islands. The traditional Faroese coat of arms was, however, not reintroduced until the formal introduction of home rule on 23 March 1948.