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Halldór Karl Halldórsson
Managing Partner

Tel: +354 550 0504

Þorbjörg Ásta Leifsdóttir

Tel: +354 550 0528

No new regulation adopted or proposed

Note that relevant regulations may be changed before your contemplated transaction is completed. and our national experts keep information on regulations up to date and even provide alerts on adopted or proposed changes that have not come into force yet but may come into effect before the transaction is completed. When this field is green, we have no knowledge of such imminent changes to the relevant regulations.

Confirmed up-to-date: 09/04/2024

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Relevant legislation and authorities

1) Is a merger control regulation in force?

Yes. Merger control regulation was introduced in Part 5 of the Icelandic Competition Act in 1993.

2) Which authorities enforce the merger control regulation?

The Icelandic Competition Authority (ICA) enforces the Icelandic Competition Act including the merger regulation contained therein.

Decisions of the ICA may be appealed to the Icelandic Competition Appeals Committee.

3) Relevant regulations and guidelines with links:

Original Icelandic version Unofficial English translation


Competition Law (has not been updated)

Reglur um málsmeðferð Samkeppniseftirlitsins

Rules of Procedure of the Competition Authority

Reglur um markaðsrannsóknir Samkeppniseftirlitsins

Rules on the market investigations carried out by the Competition Authority

Reglur um tilkynningu og málsmeðferð í samrunamálum

Regulation on notification and procedure pertaining to mergers (has not been updated)

4) Does general competition regulation apply to mergers or ancillary restrictions?

Icelandic competition law is interpreted in accordance with EU competition law in this respect.

Generally, restrictions of competition that are ancillary to the merger are considered inherent parts of the merger and are not subject to separate scrutiny under the general competition regulation. However, restrictions that go beyond what may be considered objectively necessary, proportionate and directly related to the merger may be caught by the general prohibition on anti-competitive agreements.

5) May an authority order a split-up of a business irrespective of a merger?

Yes. The ICA may order a split-up of a business, for instance if it can demonstrate with sufficient justification that a dominant company’s position on the market constitutes a serious distortion of competition. Structural remedies may only be imposed if it is shown that no effective behavioural remedy exists or if an equally effective behavioural remedy will be more burdensome for the business.

6) Other authorities that also require merger filing or may prohibit transaction
(Note that this may not be an exhaustive list and that industry-specific legislation should always be considered. Furthermore, a merger will often require change of registrations with – but not approval from – the companies register, land register and authorities that have issued permits for the activities of the merging parties.)

Financial undertakings

The Icelandic Financial Supervisory Authority must be notified and provide an approval prior to mergers of financial undertakings. The transfer of individual operating units of financial undertakings to other undertakings by other means, such as sale, is also subject to the consent of the Financial Supervisory Authority.

Electronic Communications

The Icelandic Post and Telecom Administration must be notified if a merger concerns an electronic communications undertaking with rights to use frequencies.

Foreign investment control

Iceland is part of the common European market, via the European Economic Area Agreement (EEA Agreement). All residents and entities within the European Union and EFTA, enjoy in most cases the same rights to invest as Icelanders do. There are some sector based restrictions that apply to all non-residents (including EEA residents) and some requirements are made regarding investment of residents outside EEA.

Sector based restrictions

In accordance with the Act on Investment by Non-residents in Business Enterprises, investment by non-residents in Iceland is subject to the following restrictions:

  1. Only the following may conduct fishing operations within the Icelandic fisheries jurisdiction or own or run enterprises engaged in fish processing: a) Icelandic citizens and other Icelandic persons; and 2) Icelandic legal persons which are wholly owned by Icelandic persons or Icelandic legal persons which: (i) are controlled by Icelandic entities; (ii) are not under more than 25% ownership of foreign residents calculated on the basis of share capital or initial capital; (iii) are in other respects under the ownership of Icelandic citizens or Icelandic legal persons controlled by Icelandic persons.
  2. Only Icelandic citizens and other Icelandic persons are permitted to own energy exploitation rights as regards waterfalls and geothermal energy for other than domestic use. The same applies to enterprises which produce or distribute energy. Individuals domiciled in another member state of the European Economic Area and legal persons which are domiciled in another EEA member state shall have the same right.
  3. The combined share of non-residents in Icelandic airline companies may not at any time exceed 49%. Individuals domiciled in another member state of the European Economic Area and legal persons there domiciled are exempted.

Public Foreign Ownership

Investment in Icelandic enterprises by foreign states, local authorities or other foreign authority involved in enterprises is prohibited except with a special permission from the Minister of Commerce.

Business enterprises

An individual domiciled within the EEA and/or OECD may run a business or take part in a business enterprise with unlimited liability in Iceland, while those from non-member countries need to apply for permission from the Ministry of Industries and Innovation or the relevant authority.

Limited liability companies and other legal entities with domicile outside the EEA and the OECD may operate in Iceland provided that this is permitted in an international treaty to which Iceland is a party or if permission is granted by the Ministry of Industries and Innovation. Board membership of Icelandic companies by individuals with residence outside the EEA/OECD is subject to restrictions (residence requirements) but the Ministry of Industries and Innovation may grant exemptions.

The right to own and control property

Non-residents may acquire title to real estate in Iceland for direct use in an enterprise in accordance with the provisions of the Act governing the ownership and utilization rights of real estate.

7) Are any parts of the territory exempted or covered by particular regulation?

The Icelandic Competition Act only covers Iceland.

Voluntary or mandatory filing

8) Is merger filing mandatory or voluntary?

Merger filing is mandatory, provided the thresholds are met.

Types of transactions to file – what constitutes a merger

9) Is there a general definition of transactions subject to merger control?

Yes, according to the Icelandic Competition Act a merger subject to merger control is defined as a transaction whereby:

  1. two or more previously independent undertakings or parts of undertakings are merged;
  2. an undertaking takes over another undertaking;
  3. one or more persons already controlling at least one undertaking, or one or more undertakings - by an agreement to purchase securities or assets or by any other means -  acquire direct or indirect control of the whole or parts of one or more other undertakings; or
  4. a joint venture performing on a lasting basis all the functions of an autonomous economic entity is established.

10) Is "change of control" of a business required?

Yes, generally a merger will only be considered to take place if the transaction results in a change of control over a business.

However, transactions that result in the establishment of a new business (a joint venture) controlled by two or more businesses or persons already controlling one or more businesses will also constitute a merger.

11) How is “control” defined?

The Icelandic Competition Act states that “control” is constituted by rights, contracts or any other means which, either separately or in combination and having regard to the considerations of fact or law involved, confer the possibility of exercising decisive influence on an undertaking, in particular by:

  1. ownership or the rights to use all or part of the assets of an undertaking; or
  2. rights or contracts which confer decisive influence on the composition, voting or decision of the organs of an undertaking.

Control is acquired by persons or undertakings which:

  1. are holders of the rights or entitled to rights under the contracts concerned, or
  2. while not being holders of such rights or entitled to rights under such contracts, have the power to exercise the rights deriving therefrom.

Joint control may be established between a majority and a minority shareholder on the basis of veto rights regarding decisions that are essential for strategic operation of the business. A merger will occur both when the joint control is established and again when it is dissolved; for instance, if a majority shareholder gives up certain essential veto rights so that the majority shareholder gains sole control.

12) Acquisition of a minority interest

Acquisition of a minority interest in an undertaking, that does not result in anyone gaining control is not subject to merger control.

However, if acquisition of a minority interest confers someone with de facto control of a business, the transaction will be subject to merger control. This is, for instance, the case if the buyer is provided with veto rights regarding decisions that are essential for the strategic behaviour of the business or if the remaining shares are spread over a large number of shareholders and the acquired shares de facto confer the buyer with a decisive influence on general meetings.

13) Joint ventures/joint control – which transactions constitute mergers?

The following transactions involving joint control over a business may be subject to merger control if the joint venture is "full function":

  1. Establishment of a joint venture, including through changes in control (from no control or sole control to joint control).
  2. Change from joint to sole control.
  3. Dissolution – provided (part of) the business of the joint venture is transferred to one or more of the businesses controlling the joint venture or a third party.
  4. Change in or extension of the activities of a joint venture – provided that further assets, contracts, know-how, rights etc. are transferred to the joint venture to form the basis for the new activities. On rare occasions a change in for example agreements between parent companies may also imply that an existing joint venture that is not "full-function" becomes "full-function" and thereby subject to merger control.
  5. Change in participants/owners – for instance if one of the controlling businesses sells its share in a joint venture to another business, or if one of the controlling businesses is acquired by another business. In the latter case, the ICA may consider that the transaction results in two separate mergers and that these should be assessed separately with respect to who are parties to the transaction and whether the thresholds for merger filing are exceeded.
Thresholds that decide whether a merger notification must be filed

14) Which thresholds decide whether a merger notification must be filed?
(Unless explicitly stated otherwise, the thresholds described under one threshold category are not cumulative with those described under another category. Thus for instance if there is a market share threshold and a turnover threshold, it is sufficient to meet one of these, unless stated otherwise.)

a) Turnover thresholds

A merger notification is required when:

  1. the combined turnover of the undertakings in question in Iceland is ISK 3 billion or more; and
  2. at least two of the undertakings participating in the merger each have a minimum annual turnover of ISK 300 million in Iceland.

Turnover shall include the turnover of parent undertakings and subsidiaries, undertakings within the same group of undertakings, and the turnover of undertakings directly or indirectly controlled by the parties to the merger.

If the ICA is of the opinion that a merger falling below these thresholds will substantially impede effective competition, it may require the merging parties to submit a notification of the merger, provided that the combined annual turnover of the undertakings concerned exceeds ISK 1,5 billion.

b) Market share thresholds


c) Value of transaction thresholds


d) Assets requirements


e) Other


15) Special thresholds for particular businesses

The thresholds stated in topic 14 apply to all transactions.

However, all mergers involving at least one media service provider with an annual turnover of at least ISK 100 million in Iceland must be notified to the ICA, notwithstanding the combined aggregated annual turnover of the relevant undertakings. The Media Act also provides that if the Media Commission believes that a merger that does not meet the relevant turnover threshold can substantially impede pluralism or diversity in the media, it may request that the competition authority demands a notification from the merging parties.

16) Rules on calculation and geographical allocation of turnover

The turnover shall comprise the amounts derived by the undertakings concerned in the preceding fiscal year or, if appropriate, turnover during the 12 months preceding the merger. Turnover shall include the turnover of parent undertakings and subsidiaries, undertakings within the same group of undertakings, and the turnover of undertakings directly or indirectly controlled by the parties to the merger.

Turnover is the net turnover from the sale of products and the provision of services falling within the undertakings' ordinary activities after deduction of (i) sales rebates and of value added tax and other taxes directly related to turnover, and (ii) internal turnover, i.e. sale of products or the provision of services between any of the undertakings included in the calculation of turnover.

Regarding the geographical allocation of turnover, the general rule is that turnover should be attributed to the place where the customer is located.

Is the seller/seller's group turnover relevant in a standard acquisition of sole control?


17) Special rules on calculation of turnover for particular businesses

State-owned undertakings

Calculation of a turnover of an undertaking in the public sector needs to take account of undertakings making up an economic unit with an independent power of decision, irrespective of the way in which their capital is held or of the rules of administrative supervision applicable to them. Therefore, for the purposes of calculating turnover of State-owned undertakings, account is only taken of those undertakings which belong to the same economic unit, having the same independent power of decision.

18) Series of transactions that must be treated as one transaction

Transactions that are interdependent because they are linked by conditions must be treated as one if control in each transaction is acquired ultimately by the same undertaking(s).

Furthermore, if the same parties enter into different transactions that are not interdependent regarding the sale of different businesses or different parts of a business, all such transactions within a two-year period must be treated as one and the same merger.

Exempted transactions and industries (no merger control even if thresholds ARE met)

19) Temporary change of control

Merger filing is only required if there is a change of control on a lasting basis.

In accordance with the European Commission’s Consolidated Jurisdictional Notice change of control may be considered temporary – and therefore not require merger filing – if a transaction is divided into steps.

20) Special industries, owners or types of transactions

The Icelandic Competition Act does not provide any special exemptions from filing a merger.  

21) Transactions involving only foreign businesses (foreign-to-foreign)

There is no exemption for foreign-to-foreign transactions. All transactions that meet the thresholds are subject to merger control regardless of where the undertakings concerned are registered, operate or own assets.

22) No overlap of activities of the parties

There is no exemption for transactions with no overlap of activities, but there is a simplified procedure available if there is no overlap (see topic 33).

23) Other exemptions from notification duty even if thresholds ARE met?

As a consequence of the EU "one-stop shop" principle, the Icelandic merger control rules do not apply if the thresholds for EU merger control are exceeded and the European Commission has not referred the merger to the Icelandic Competition Authority.

Merger control even if thresholds are NOT met

24) May a merging party file voluntarily even if the thresholds are not exceeded?

Yes, parties that do not fulfil the thresholds in topic 14 can notify the ICA in writing that the merger has taken place. The Authority then has 15 working days to decide whether to exercise the powers provided in topic 25.

25) May the competition authority request a merger notification or oppose a transaction even if thresholds are not met?

Yes, the ICA can require the merging parties to submit a notification of the merger, provided that the combined annual turnover of the undertakings concerned exceeds ISK 1,5 billion. The Icelandic Competition Authority can only do that if it is of the opinion that there is a significant probability that a merger which has already taken place, and failed to meet the thresholds in topic 14, may substantially reduce effective competition.

Referral to and from other authorities

26) Referral within the jurisdiction


27) Referral from another jurisdiction

When an acquisition trigger merger filing obligations to the European Commission (or in theory the EFTA Surveillance Authority), the ICA will not consider the merger. However, the ICA may assist the Commission in their inquiry or, handle the case in whole or in part in case of a referral. A case will typically be referred to the ICA if it primarily affects Icelandic interests.

In the case of a partial referral, the European Commission will handle certain (international) aspects of the merger, whereas the ICA will handle the strictly Icelandic aspects.

A referral of a merger from the European Commission may be requested either by the ICA or by the merging parties.

28) Referral to another jurisdiction

According to the referral rules in the EEA Agreement, there is a more limited scope for the EFTA States than for the EC Member States to request the referral of a case to the Commission.

The EEA Agreement provides for pre-notification referrals from the EFTA States to the Commission, by allowing the parties to a concentration to request the Commission to examine a concentration which is capable of being reviewed under the national competition laws of at least three EC Member States and at least one EFTA State.

As regards post-notification referral of cases to the Commission, an EFTA State may only join a referral request made by an EC Member State; it may not initiate such a request itself. This is consistent with the two-pillar system of the EEA-Agreement and means that the powers of the EFTA States are in this regard somewhat more limited than those of the EC Member States.

The competition authorities in Denmark, Iceland, Sweden, Finland and Norway may exchange information with each other through a Nordic co-operation agreement. This includes non-confidential information, confidential information that is necessary for an ongoing investigation, and notifications on general changes to a country's law. The authorities do not need to seek permission from the parties involved to share such information.

Iceland is part of the International Competition Network (ICN). The ICA is not a formal member of the European Competition Network (ECN), but attends meetings about policy issues and receives information that is exchanged in the network.

29) May the merging parties request or oppose a referral decision?

If a merger is subject to EU merger control, the parties may – prior to an EU merger notification – request that the merger is referred to the ICA, provided that the merger may significantly affect competition in a distinct market in Iceland. If the ICA does not oppose such referral, the European Commission may decide to refer the merger in whole or in part.

The European Commission must decide whether to refer a merger within 25 working days of receipt of the request (reasoned submission).

The European Commission may also, on its own initiative or upon request from the ICA, decide to refer a merger that has already been notified to the European Commission to the ICA. The merging parties cannot oppose such a referral decision.

Filing requirements and fees

30) Stage of transaction when notification must be filed

The ICA shall be notified of a merger after the conclusion of an agreement on the proposed merger, the public announcement of a takeover bid or the acquisition of a controlling interest in an undertaking. A merger cannot take effect while it is being examined by the ICA unless it provides a special exemption.

31) Pre-notification consultations

The ICA encourages pre-notification talks. The purpose of the talks is to prepare the possible merger case and to ensure that all necessary information the merging parties possess is available when the merger is filed.

32) Special rules on timing of notification in case of public takeover bids and acquisitions on stock exchanges

Mergers that are a consequence of acquisition of securities on a stock exchange or a public takeover bid must be notified after the acquisition/publication of the takeover bid.

Mergers that fall within the scope of the provisions of the Icelandic Competition Act shall not take effect while they are being examined by the ICA. The Authority can, on request, grant an exception from the stand-still period, if it is established that delaying the implementation of the merger could harm the undertakings concerned or its business partners and threaten competition.

33) Forms available for completing a notification

The Icelandic Competition Authority does not provide a special notification form. However, in the Regulation on notification and procedure pertaining to mergers, in Annex I and II, there is a list of information which must be set forth in a notification to the ICA in a merger file, both in a normal notification (long) and simplified (short).

Merging parties are allowed to file a short merger notification (simplified filing) if one of the following conditions is met:

  1. the parties are not active on the same markets;
  2. two or more of the parties to the merger are engaged in business activities in the same product and geographic market (horizontal merger), provided that their combined market share is less than 20%;
  3. parties to the merger are not operating in the same product market (vertical merger), provided that their individual market share is less than 40%;
  4. the merger is a creation of a joint venture which has limited effect in Iceland;
  5. a party acquires sole control of an undertaking over which it already had joint control.

Further, the ICA can approve a simplified filing were none of these conditions are not met if the merging parties have initiated pre-notification talks with the authority prior to filing.

34) Languages that may be applied in notifications and communication

The notification and communications with the Icelandic Competition Authority must be in Icelandic. The documents that are supplied with the notification may however be in English.

35) Documents that must be supplied with notification

The following documents should always be supplied with a merger notification:

  1. Copy of a final or most recent version of all documents relating to the merger;
  2. Copies of the Annual Accounts for the two preceding years of the companies involved in the merger;
  3. When at least one affected market is specified: copies of analyses, reports, research, surveys, memoranda or similar documentation which in some manner relates to the merger;
  4. Copies of analyses, reports, research, surveys, memoranda or similar documentation which parties to the merger have prepared or have had prepared during the past two years in respect of their possible plans to initiate or increase activity in markets where previously they have had limited or no activity.

36) Filing fees

The filing fee for each simplified notification is ISK 200,000.

The filing fee for each full notification is ISK 500,000.

There is no filing fee if the Authority requests a merger notification in accordance with topic 25.

Implementation of merger before approval – “gun jumping” and “carve out”

37) Is implementation of the merger before approval prohibited?

Yes. The merging businesses must be run separately and independently until the merger has been approved.

38) May the parties get permission to implement before approval?

Yes, the ICA can, on request, grant an exception from the stand-still period, provided that it is established that delaying the implementation of the merger could harm the undertakings concerned or their business partners and threaten competition.

39) Due diligence and other preparatory steps

Due diligence must be conducted in a way that prevents sensitive market information from being used for purposes other than assessing the viability of the merger.

An explicit exemption is not required for standard due diligence and other preparation measures without effect on the market.

40) Veto rights before closing and "Ordinary course of business" clauses

An "ordinary course of business" clause that prevents the target company from taking decisions outside the course of its ordinary business until the closing date is generally considered acceptable. However, it must be assessed on a case-by-case basis to what extent the parties may discuss – or provide each other with veto rights concerning – any decisions in their respective businesses.

41) Implementation outside the jurisdiction before approval – "Carve out"

There are no specific rules on “carve out” of the Icelandic part of a transaction to avoid delaying implementation in the rest of the world pending approval in Iceland.

It must be assessed on a case-by-case basis whether it is possible to carve out the Icelandic part of a transaction. If the Icelandic part of the transaction and the rest of the transaction are interdependent, it is advisable to request a specific permission to implement outside Iceland from the Icelandic Competition Authority (see topic 38).

42) Consequences of implementing without approval/permission

The parties may be fined if the merger is implemented before approval is obtained. The amount of the fine will be fixed based on the nature, gravity, and durations of the infringement, and the fine cannot exceed 10% of the parties’ worldwide turnover.

Furthermore, the merger may be prohibited, and the ICA can require a dissolution of the merged undertakings or assets or the cessation of joint management or any other action that may be appropriate in order to restore conditions for effective competition.

The process – phases and deadlines

43) Phases and deadlines



Pre-notification talks

The ICA offer merging parties pre-notification talks. The purpose of the talks is to prepare the possible merger case and to ensure that all necessary information the merging parties possess is available when the merger is filed.

There are no formal rules on pre-notification talks. The talks can be used to assess if the parties are obliged to notify the possible merger, discuss market definitions, possible competitive problems, and solutions to them.

No set duration or deadline.

Phase I:

The merger is either approved or it is decided to initiate a phase II investigation of the merger.

25 working days from the date when the notification was complete.  

(The ICA has 15 working days from the receipt of a simplified notification to require a longer form if the conditions for simplified notification listed in topic 33 have not been met or if the authority considers it necessary for the merger control assessment. If the ICA requests a long notification, a new deadline for the phase I investigation starts when the ICA receives the long merger notification.)

Phase II:

The merger is either approved, approved with conditions/commitments, or prohibited.

The investigation is likely to involve market surveys, economic analysis and possibly negotiations of commitments that may eliminate the concerns that the authority may have regarding anti-competitive effects of the merger.

90 working days from the date when phase II was initiated.


There are two possible extension options (which may be combined):

  1. 15 working days if commitments are offered by one of the parties at a time when 55 work days have passed since the decision to initiate phase II. Commitments offered later than 90 days after initiating phase II will normally not be considered
  2. Up to 20 working days if the parties request or consent to the extension.
Assessment and remedies/decisions

44) Tests or criteria applied when a merger is assessed

It is assessed whether the merger will significantly impede effective competition – in particular, due to the creation or strengthening of a dominant position.

A range of factors may be taken into consideration, including efficiencies that may be gained from the merger (efficiency defence) and whether one of the parties is likely to fail as an independent business (failing firm defence).

45) May any non-competition issues be considered?


46) Special tests or criteria applicable for joint ventures

The assessment for joint ventures is the same as for other merger, but if the joint venture also has coordination between owners as object or effect, it will also be assessed whether such coordination is acceptable under the general prohibition against anti-competitive agreements.

47) Decisions and remedies/commitments available

A merger may be approved, approved with conditions/commitments or prohibited.

If the Icelandic Competition Authority expresses serious concerns about the merger, it is important that the parties enter into negotiations of possible commitments well before the expiry of the deadlines, as the authority will normally only consider an approval with conditions if the parties have offered commitments.

Commitments may take any form and they can be either structural or behavioural and with or without time limitations.

The authority may revoke an approval if at any time it becomes aware that incorrect or misleading information has been provided by the parties or if the parties do not comply with the conditions/commitments contained in the approval.

If a merger has been implemented without approval, the Authority may prohibit the merger and order a separation of the businesses or any other measure capable of restoring competition.

Publicity and access to the file

48) How and when will details about the merger be published?

The Icelandic Competition Authority will generally make a public announcement when a decision has been taken. The announcement will include a non-confidential version of the decision. The level of detail of decisions varies considerably.

To protect business secrets, the parties are requested to provide a non-confidential description of the transaction with the notification and to identify any confidential information in the notification and the final decision.

49) Access to the file for the merging parties and third parties

The merging parties:

The merging parties have a right to access to the file, which includes correspondence with third parties that the ICA may have had, including market survey questionnaires as well as an overview of all documents/correspondence in the file. However, the authority may redact third parties’ confidential information. The right to access to the authority’s internal documents is limited.

Third parties:

Third parties can request access to a non-confidential version of all notifications filed with the ICA. Third parties are not entitled to access business secrets in a notification or other documents prepared for the authority’s internal use. Consequently, the parties have to enclose a proposal for a public version of the notification when submitting a notification.

Judicial review

50) Who can appeal and what may be appealed?

All decision of the Icelandic Competition Authority can be appealed to a separate committee, the Icelandic Competition Appeals Committee. A written appeal must be received within four weeks from the time the party in question was informed of the Authority’s decision.

A party, including the Icelandic Competition Authority, not willing to accept the decision of the Competition Appeals Committee may instigate legal action for annulment before the courts of law. Such action shall be brought within six months after the party obtained knowledge of the Committee's decision.

Third parties may not appeal any decisions.

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