This is an English translation.
The original Icelandic text, as published in the Law Gazette (Stjórnartíðindi), is the authoritative text. Should there be discrepancy between this translation and the authoritative text, the latter prevails.
Act No. 76/2011 on services in the internal market of the European Economic Area
Purpose, scope and definitions
The purpose of this Act is to facilitate the free movement of services and ensure equality between service providers in the European Economic Area, while maintaining a high quality of services.
This Act applies to all services that are not specifically excluded from its scope. The following services shall be exempt from this Act:
- non-economic services of general interest;
- financial services;
- electronic communications services and networks, and associated facilities and services;
- services in the field of transport and related activities falling within the scope of Chapter 6 of Part III of the EEA Agreement, cf. statutory provisions on the European Economic Area;
- temporary work agencies;
- healthcare services;
- audiovisual services;
- gambling activities, that is any type of game whose outcome is partly or wholly determined by chance and which involves a pecuniary benefit;
- activities which are connected with the exercise of official authority;
- social services;
- private security services;
- services provided by notaries and bailiffs, who are appointed by an official act of government.
This Act applies to service providers:
who are established in another EEA Member State and wish to become established in Iceland;
who are established in another EEA Member State and wish to provide services in Iceland without being established there;
who are established in Iceland.
The provisions of this Act do not cover:
- the liberalisation of services of general economic interest, whether provided by public or private bodies, nor the privatisation of public service providers;
- the abolition of monopolies providing services;
- state aid granted by an EEA Member State falling within the scope of the competition rules of the EEA Agreement, cf. statutory provisions on the European Economic Area;
- the freedom of the authorities to define, in conformity with EEA rules, what they consider to be services of general economic interest;
- the organisation and financing of services of general economic interest, in conformity with EEA rules on state aid, and what specific obligations they should be subject to;
- measures, in conformity with EEA rules, to protect or promote cultural or linguistic diversity or media pluralism;
- criminal law;
- labour law, that is any legal or contractual provision concerning employment conditions, working conditions, health and safety at work, the relationship between employers and workers, the rights and obligations of workers employed in Iceland on a long or short-term basis, or social security legislation;
- the exercise of fundamental rights, nor the right to negotiate, conclude and enforce collective agreements and to take industrial action in accordance with national law and practices which respect EEA rules;
- the freedom of the authorities to determine whether an employment relationship exists between an employer and an employee or whether work is performed in a self-employed capacity, based on the applicable Icelandic laws and collective agreements;
- tax law;
- private international law.
If the provisions of this Act conflict with a provision of another law or regulation which is established for the purpose of transposing EEA rules into Icelandic law and governs access to or provision of a service, the provision of the other law or regulation shall prevail. This applies to the transposition of the following EEA acts:
- Directive 96/71/EC of the European Parliament and of the Council of 16 December 1996 concerning the posting of workers in the framework of the provision of services;
- Council Regulation (EEC) No 1408/71 on the application of social security schemes to employed persons, to self-employed persons and to members of their families moving within the Community;
- Council Directive 89/552/EEC of 3 October 1989 on the coordination of certain provisions laid down by law, regulation or administrative action in Member States concerning the pursuit of television broadcasting activities;
- Directive 2005/36/EC of the European Parliament and of the Council of 7 September 2005 on the recognition of professional qualifications.
For the purposes of this Act, the following definitions apply:
- Service: any self-employed economic activity relating to the provision of a service, normally for remuneration, cf. Article 37 of the EEA Agreement and statutory provisions on the European Economic Area.
a. any natural person who is a national of an EEA Member State and provides a service, b. any legal person who is established in an EEA Member State and provides a service.
a. any natural person who is a national of an EEA Member State or benefits from rights conferred upon him by EEA acts and uses or wishes to use a service,
b. any legal person who is established in an EEA Member State and uses or wishes to use a service.
- Establishment: the actual pursuit of an economic activity by the provider for an indefinite period and through a stable infrastructure from where the business of providing services is actually carried out.
- Authorisation scheme: any procedure under which a provider or recipient is required to take steps in order to obtain from a competent authority a formal decision, or an implied decision, concerning access to a service activity or the exercise thereof.
- Requirement: any obligation, prohibition, condition or limit provided for in the laws or administrative provisions of the EEA Member States or in consequence of case-law, administrative practice, the rules of professional bodies, or the collective rules of professional associations or other professional organisations, adopted in the exercise of their legal autonomy. Rules laid down in collective agreements negotiated by the social partners shall not be seen as requirements within the meaning of this Act.
- Competent authority: any body or authority which has a supervisory or regulatory role in an EEA Member State in relation to service activities, including courts acting as such, professional bodies, and those professional associations or other professional organisations which, in the exercise of their legal autonomy, regulate in a collective manner access to service activities or the exercise thereof.
- Regulated profession: professional qualifications earned by virtue of education or skill and attested by a competent authority by the issue of a licence, certificate or special accreditation, as further detailed in law.
- Professional liability insurance: insurance taken out by a provider to protect himself against potential liability to recipients and, as the case may be, third parties arising from the service.
- Multidisciplinary activities: where a provider engages in more than one type of activity.
- Commercial communication: any form of communication or other action designed to promote, directly or indirectly, the goods, services or image of an undertaking, organisation or person engaged in commercial, industrial or craft activity or practising a regulated profession.
Access to services, documentation requirements and right to information
Procedures by electronic means
Providers can apply for authorisation to exercise their service activities in Iceland and receive a response from the competent authorities by electronic means. This applies to all necessary formalities and procedures relating to the application process.
The provisions of the first paragraph on electronic procedures shall not apply to processes that by their nature cannot be completed electronically, such as the inspection of premises on which the service is provided or of equipment used by the provider or the physical examination of the capability of the provider or of his responsible staff.
The Minister may, by regulation, establish more detailed rules on measures that need to be taken in connection with procedures by electronic means.
Where the authorities granting authorisation require a provider or recipient to supply a certificate or any other document proving that a requirement has been satisfied, they shall accept any document from another EEA Member State which serves an equivalent purpose and from which it is clear that the requirement in question has been satisfied.
They may not require a document from another EEA Member State to be produced in its original form, as a certified copy or as a certified translation, unless such a requirement is justified by an overriding reason relating to the public interest.
The authorities granting authorisation may require a provider or recipient to supply non-certified Icelandic translations of documents.
The Minister may, by regulation, decide that certain types of documents shall be exempt from the requirements of this Article.
Right to information
The following information shall be accessible to providers and recipients by electronic means:
- the requirements that providers must meet to be able to provide a service in Iceland;
- the contact details of the competent authorities responsible for granting authorisation to exercise service activities;
- the means of, and conditions for, accessing public registers and databases on providers and services;
- the means of redress which are generally available in the event of dispute;
- the contact details of the associations or organisations, other than the competent authorities, from which providers or recipients may obtain practical assistance;
- details of collective agreements and other information concerning rights and obligations on the Icelandic labour market.
Providers and recipients are entitled to receive assistance by electronic means consisting in information on the way in which the requirements referred to in point 1 of the first paragraph are generally interpreted and applied. Such assistance does not include the requirement to provide legal advice in individual cases. The information shall be accurate and up to date and provided in a clear and unambiguous manner. The competent authorities shall respond as quickly as possible to any request for information.
Freedom of establishment for providers and the granting of authorisation
Scope of the Chapter
The provisions of this Chapter apply where a provider established in the EEA area wishes to provide a service in Iceland and become established there.
Conditions for the granting of authorisation
If the exercise of service activities covered by this Act is subject to authorisation, the criteria for the granting of such authorisation shall be non-discriminatory, justified by an overriding reason relating to the public interest and comply with the principle of proportionality.
The conditions for granting authorisation for a new establishment shall not duplicate requirements and controls which are equivalent or essentially comparable to those which the provider is already subject to in Iceland or another EEA Member State.
If an authorisation for providing a service is to be limited to certain regions, this shall be justified by an overriding reason relating to the public interest.
Duration of authorisation
An authorisation granted to a provider shall not be for a limited period, except where:
- the authorisation is being automatically renewed or is subject only to the continued fulfilment of requirements;
- the number of available authorisations is limited by an overriding reason relating to the public interest;
- a limited authorisation period can be justified by an overriding reason relating to the public interest.
Notwithstanding the provisions of the first paragraph, the authorities granting authorisation may require a provider
to actually commence his activities within a certain period after receiving authorisation.
Providers are required to inform the relevant competent authorities of:
- the creation of subsidiaries whose activities fall within the scope of the authorisation;
- changes in their situation which result in the conditions for authorisation no longer being met.
Where the number of authorisations available for a given activity is limited because of the scarcity of available natural resources or technical capacity, the authority granting authorisation shall publish the procedure for evaluating potential candidates in advance in order to ensure impartiality and transparency in the selection process. Where the number of authorisations is limited, authorisation shall be granted for a limited period and may not be open to automatic renewal nor confer any other advantage on the provider whose authorisation has just expired or on any person having any particular links with that provider.
Notwithstanding the provisions of the fourth paragraph, the authority granting authorisation may take into account, in granting authorisations, considerations of public health, social policy objectives, the health and safety of employees or self-employed persons, the protection of the environment, the preservation of cultural heritage and other overriding reasons relating to the public interest.
This Article shall be without prejudice to to the competent authority's ability to revoke authorisations when the conditions for authorisation are no longer met.
The procedure for granting authorisations shall be clear, objective, transparent and accessible. The authority granting authorisation shall release details of the authorisation procedure in advance.
Authorisations shall be granted within a period which is fixed and made public in advance. The authority granting the authorisation may extend the time period once for a limited time if justified by the complexity of the issue. The decision to extend the time period shall be reasoned and notified to the provider before the original period has expired. An application for an authorisation shall be deemed to have been made when all necessary documentation has been submitted.
Failing a response within the time period set, authorisation shall be deemed to have been granted unless otherwise provided for by law.
The procedures set out in the third paragraph may be deviated from where justified by overriding reasons relating to the public interest.
The receipt of applications for authorisation shall be acknowledged as quickly as possible. The acknowledgement must specify the following:
- the period referred to in the second paragraph;
- the available means of redress;
- where applicable, a statement that in the absence of a response within the period specified, the authorisation shall be deemed to have been granted.
When an application for authorisation is rejected or if it is incomplete, the applicant shall be informed thereof as quickly as possible, as well as of any possible effects on the period referred to in the second paragraph of this Article and the available means of redress.
Access to a service or the exercise of a service activity by a provider established in Iceland may not be made subject to compliance with any of the following:
- discriminatory requirements based directly or indirectly on nationality or, in the case of legal persons, the location of the registered office;
- a prohibition on having an establishment in more than one EEA Member State or on being entered in the registers or enrolled with professional bodies or associations of more than one EEA Member State;
- restrictions on the freedom of a provider to choose between a principal or a secondary establishment;
- conditions of reciprocity, save in the case of conditions of reciprocity provided for in acts of the EEA Agreement concerning energy, cf. statutory provisions on the European Economic Area;
- the case-by-case assessment of the existence of a market demand for the service in question, of the economic effect of the service or of the appropriateness of the service in relation to the authorities' economic plans. This prohibition does not apply to plans set by the authorities which serve overriding reasons relating to the public interest;
- the involvement of competing operators in the decision-making process in individual cases;
- in cases where the provider is required to be insured, an obligation to take out insurance from an Icelandic insurance undertaking or provide a guarantee from a body operating in Iceland;
- an obligation to have been pre-registered, for a given period, in the registers held in Iceland or to have previously exercised the activity for a given period in Iceland.
Freedom to provide services without establishment
Scope of the Chapter
The provisions of this Chapter apply where a provider established in the EEA area wishes to provide a service in Iceland without being established there.
Freedom to provide services
A provider who is established in another EEA Member State has the right to provide a service in Iceland without being established there.
The competent authorities may only make the provision of a service without establishment subject to special requirements if necessary for reasons of public policy, public security, public health or the protection of the environment.
The provision of a service without establishment may not be made subject to requirements which lead to direct or indirect discrimination on grounds of nationality or state of establishment. The requirements which providers must
meet in order to be allowed to provide a service in Iceland without establishment must not go beyond what is necessary to attain the objectives being pursued.
The freedom to provide services without establishment may not be restricted by imposing any of the following requirements:
- an obligation on the provider to have an establishment in Iceland;
- an obligation on the provider to obtain an authorisation from its competent authorities, except where provided for in this Act or special laws;
- a ban on the provider setting up a certain type of operation which the provider needs in order to supply the services in question;
- the application of specific contractual arrangements between the provider and the recipient which prevent or restrict service provision by the self-employed;
- an obligation on the provider to possess a document issued by its competent authorities confirming its capability to exercise the service activity in question;
- requirements, except for those necessary for health and safety at work, which affect the use of equipment and material which are an integral part of the service provided;
- requirements involving discrimination based on the recipient's nationality or place of residence, cf. Article 14.
The provisions of the first to fourth paragraphs shall not affect the right of the competent authorities to exercise the powers conferred by collective agreements.
The Minister may establish general exemptions from the requirements laid down in this Article in a regulation.
Notwithstanding the provisions of Article 13, the competent authorities may, in exceptional circumstances, take special measures relating to the safety of services in respect of a provider intending to provide services without establishment in Iceland.
The competent authorities may only take the measures referred to in the first paragraph of this Article if the following conditions are fulfilled:
- they have sought assistance from the competent authorities in the state in which the provider is established, in accordance with the provisions of a regulation on administrative cooperation of the national authorities in the EEA area in relation to services, established by the Minister on the basis of Article 21;
- the measures in question on the safety of services have not been subject to harmonisation in the EEA area;
- the measures provide for a higher level of protection of the recipient than would be the case in a measure taken by the state of establishment;
- the state of establishment has taken measures which are insufficient;
- the measures are proportionate.
Rights of recipients of services, assistance for recipients, etc.
Rights of recipients of services
The recipients of services shall not be made subject to discriminatory requirements based on their nationality or place of residence, and providers are prohibited from including in their terms of service discriminatory provisions relating to the nationality or place of residence of recipients. In exceptional circumstances, different conditions of access to a service may be established, provided that the differences are justified by objective criteria.
Assistance for recipients
It shall be ensured that recipients can obtain in Iceland the following information:
- general information on the requirements applicable in other EEA Member States relating to access to, and exercise of, service activities, in particular those relating to consumer protection;
- general information on the means of submitting complaints in the case of a dispute between a provider and a recipient;
- the contact details of the associations or organisations, including the centres of the European Consumer Centres Network, from which providers or recipients may obtain practical assistance.
Information shall be accurate and up to date and be accessible by electronic means.
The Consumer Agency is responsible for providing assistance to providers pursuant to this Article.
Information on providers
Providers shall make the following information available to recipients:
- name, legal form, address and other details necessary for the recipient to be able contact the provider;
- where the provider is registered in registers, as well as details of the provider's registration number or other means of identification in a register;
- where the activity is subject to an authorisation scheme, the particulars of the relevant competent authority;
- VAT number;
- in the case of the regulated professions; any professional body with which the provider is registered, the professional title and the EEA Member State in which that title has been granted;
- the standard contractual clauses used by the provider, including clauses concerning the law applicable to the contract and the competent courts;
- the existence of an after-sale guarantee not imposed by law;
- pre-determined price;
- the main features of the service;
- professional indemnity insurance and guarantees, the contact details of the insurer or guarantor and the territorial coverage.
The information referred to the first paragraph shall appear in any information documents supplied to the recipient by the provider which set out a detailed description of the service he provides. The information shall also be accessible to the recipient electronically and at the place where the service is provided.
If requested by the recipient, providers shall supply the following information in addition to that referred to in the first paragraph:
- where the provider cannot give the price in advance, the price of the service or the method for calculating the price;
- as regards the regulated professions, a reference to the professional rules applicable to the provider in the Member State of his establishment;
- information on their multidisciplinary activities and partnerships which are linked to the service in question and on the measures taken to avoid conflicts of interest;
- any codes of conduct to which the provider is subject and the address at which these codes may be consulted by electronic means, specifying the language version available;
- information on the available non-judicial means of dispute settlement, the characteristics of those means and conditions for their use.
The information referred to in this Article shall be made available in a clear and unambiguous manner before the conclusion of a contract. Where there is no written contract, the information shall be made available within a reasonable period before the service is provided.
Providers shall respond to information requests or complaints from recipients as quickly as possible and shall endeavour to find a solution which is acceptable to them.
Providers may not be required to obtain professional indemnity insurance or other type of guarantee in Iceland if they are already covered by a guarantee or insurance issued by a credit institution or insurer which has a licence to operate in another EEA Member State and is authorised to provide services in Iceland, provided that such insurance is equivalent, or essentially comparable, to the insurance required. Where equivalence in only partial, a supplementary guarantee may be required to cover those aspects not already covered.
Commercial communications by the regulated professions
A total prohibition may not be imposed on commercial communications by the regulated professions which are covered by this Act. However, a prohibition may be imposed on commercial communications by the regulated professions if justified by an overriding reason relating to the public interest, subject to compliance with the principles of equality and proportionality.
Providers are entitled to exercise multidisciplinary activities by themselves and in partnership with others. In such cases it shall be ensured that conflicts of interest are prevented, that the independence and impartiality of each individual activity is not in doubt and that the rules governing the relevant professions are compatible with one another, especially as regards matters of professional secrecy.
Notwithstanding the provisions of the first paragraph, the following providers may be made subject to multidisciplinary limitations:
- the regulated professions, in order to guarantee compliance with the rules governing professional ethics and to ensure their independence and impartiality;
- providers of certification, accreditation, technical monitoring, test or trial services, in so far as is justified in order to ensure their independence and impartiality.
Processing and dissemination of information
The Icelandic authorities shall cooperate with the authorities of other EEA Member States with respect to the supervision of providers and dissemination of the information necessary to ensure the free movement of services.
The authorities responsible for granting authorisations and supervising providers may disseminate the necessary information through the Internal Market Information system.
The authorities may also receive information through that system and keep it in a register. Dissemination by other means is prohibited.
The Minister may establish more detailed rules on administrative cooperation of national authorities in the EEA area in relation to services.
Transposition and entry into force.
This Act transposes the substantive provisions of Directive 2006/123/EC of the European Parliament and of the Council on services in the internal market,
as incorporated into the EEA Agreement by the Decision of the EEA Joint Committee No 45/2009 of 9 June 2009.
Entry into force
This Act shall enter into force immediately.