Iceland Country Commercial Guide
Learn about the market conditions, opportunities, regulations, and business conditions in iceland, prepared by at U.S. Embassies worldwide by Commerce Department, State Department and other U.S. agencies’ professionals
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Most Icelanders live in the capital city of Reykjavik and the suburbs surrounding it (around 60 percent), extending out to Keflavik International Airport on the Reykjanes Peninsula.  There are other populated coastal towns such as Akureyri (population 20,000), which is in the North of Iceland.  There are no population centers in the center of the country.  Distribution is concentrated around the capital, but cargo to other areas can be transported by air, ship, or truck.  There are no railroads in Iceland.  The biggest port in Iceland for cargo is Sundahofn in Reykjavik where Eimskip, the largest cargo shipping company in Iceland, has their headquarters and shipping docks.  From the docks to the destination products are either handled through the mail for individuals or wholesalers and their distribution channels.

Using an Agent or Distributor

Importing and distributing consumer and industrial goods in Iceland is generally handled by Icelandic wholesalers or agents, who often also handle the marketing of products, or by regional sales offices elsewhere in Europe.  For U.S. business representatives visiting Iceland, a direct approach to importers and wholesalers is usually the best way to introduce a new consumer product to the Icelandic market.  The Embassy’s Economic and Commercial Section can provide lists of importers and sellers of particular products.

Establishing an Office

The most common enterprises in Iceland are limited companies, either public or private.  For an outline of the procedure see Invest in Iceland Agency’s publication “Doing Business in Iceland.”  For the latest Investment Climate Statement (ICS), which includes information on investment and business environments in foreign economies pertinent to establishing and operating an office and to hiring employees, visit the U.S. Department of Department of State’s Investment Climate Statements website.

Franchising

Icelanders are open to American franchises.  U.S. fast food franchises in Iceland include KFC, Taco Bell, Subway, Pizza Hut, Dominos, and Quiznos, among others.  Non-food U.S. franchises include Avis, Hertz, Enterprise, and RE/MAX.

Direct Marketing

Direct marketing is practiced in Iceland but not to the same extent as in the United States.  Methods include delivering leaflets to homes, television infomercials, and telemarketing.  The best source of contact information for telemarketers used to be the Icelandic phonebook but is now rivaled or even exceeded by their online counterpart www.ja.is.

Joint Ventures/Licensing

Joint ventures may be subject to merger control.  The Competition Authority (ICA) is responsible for achieving the objectives of the Competition Act by opposing unreasonable barriers and restrictions on freedom in economic activities.  The ICA monitors the development of competition and trade practices in individual market sectors in Iceland.  The ICA can block mergers.

Express Delivery

UPS, FedEx, and DHL have representation in Iceland.

Due Diligence

Companies should perform appropriate due diligence on their business partners and agents.  The U.S. Embassy in Reykjavik, in conjunction with the U.S. Foreign Commercial Service in Oslo, offers the International Company Profile program which provides background reports on potential agents, distributors, and other Icelandic firms.

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