The purpose of this thesis was to identify the reasons behind internalization of the global value chain activities in the salmon farming industry. Despite the tendency of internalizing value chain activities in leading salmon farming MNC is evident, there were significant gaps in the existing literature of internalization which mention the instrumental factors decision makers have to consider when implementing internalization strategies. The literature discusses transaction cost, economies of scale, and resources as a reason behind internalization. However, the contexts of the industry, institutions, geographic location, and global events such as Covid-19 pandemic are neglected in the existing literature of internalization. To determine the reasons for internalizing value chain activities, the analysis was conducted using the lens of critical realism and consequently using methods such as Case Study and data triangulation. These methods enabled the researchers to use expert qualitative interviews from the head of marketing from the case company Bakkafrost and from an influential member of the Faroese parliament. Furthermore, secondary data, and participant observation were included in the thesis, to further validate and cross-examine the evidence. In accordance with existing literature and obtained data, it was found that internalization activities can be influenced by the context of the industry, institutions related to the industry, geographical location of the MNC, transaction costs, and resource dependency. Furthermore, the implications of the Covid-19 pandemic have in light of the case study evidence proved to speed up internalization efforts of international salmon farming companies, especially in organizations from geographically isolated locations. The findings shed light on the key determinants of internalization of value chain activities. Additionally, the thesis highlighted the significant implications of institutional actors within the market. It further reflected on quality assurance by gaining control over most of the value chain aspects from the companies operating in the salmon farming industry.