Company registration in Iceland

Situated in Europe's far northwestern corner, Iceland presents itself as a strategically positioned launchpad for international ventures, ideally located to bridge the gap between North American and European markets. Despite its relatively small population of approximately 350,000, the nation boasts a high quality of life and a robust economy, fostering a conducive environment for investment. Iceland stands out among its European peers due to its minimal corruption and notable level of economic liberty, securing the 22nd position among 180 nations in this regard in 2017. Establishing a business entity in Iceland unlocks access to European Union markets via a network of bilateral trade agreements and free trade agreements, including a unique pact with China. This positions Iceland as a compelling destination for international entrepreneurs seeking to leverage the nation's position as a gateway for trade with major economic powers.

This article examines the key facets essential to comprehend when launching a business venture in Iceland, with a primary focus on the legal, economic, and fiscal frameworks shaping the country's business climate. Various organizational and legal forms of companies, registration procedures, as well as tax and financial conditions fostering favorable opportunities for international investors and entrepreneurs, will be analyzed.

Overview of Icelandic economic situation and business environment

Iceland exhibits a distinctive economic structure, centered around tourism, fishing, and aluminum processing. These sectors constitute the bedrock of the country's export activity: tourism accounted for 26% of total goods and services exports in 2022, industrial products comprised 23%, and seafood constituted 26%. Imports primarily consist of industrial goods (28%), capital goods (23%), and fuel and lubricants (15%).

Tourism, as a pivotal sector, has undergone significant transformations in recent years. In 2018, the number of tourists peaked at 2.3 million, but in 2020, it plummeted to 486 thousand due to the pandemic. Recovery commenced in 2021, and by 2022, the tourist influx surged to 1.8 million. Projections for 2024 indicate the attainment of pre-pandemic levels at 2.3 million tourists.

The Icelandic economy, driven by tourism, exhibited a 4.2% GDP growth rate in 2017 and 4.9% in 2018, albeit the pandemic induced a contraction of 7.1% in 2020. Subsequent years witnessed a resurgence: GDP growth stood at 4.3% in 2021 and 6.4% in 2022.

The distinctive feature of Iceland's economic structure is its significant share of high-tech and innovative sectors, including IT, biotechnology, and alternative energy production. The country attracts investors with favorable tax conditions: the corporate tax rate is 20%, while IT companies benefit from a reduced tax rate of 5%. This creates attractive prospects for expanding entrepreneurship in high-yield and fast-growing sectors.

Advantages of establishing a company in Iceland

Iceland presents a gamut of advantages for business, rendering the initiation of commercial ventures in this jurisdiction enticing for international investors and entrepreneurs. Key benefits encompass:

The stability of the economy and political course. Iceland is characterized by its stable economic environment and minimal corruption. Political stability and clarity of action by state structures contribute to the creation of favorable conditions for commercial activities in Iceland.

Strategic positioning. Situated between North America and Europe, Iceland serves as a strategic bridge for trade and commerce, providing convenient access to two major markets.

Iceland offers competitive tax rates, including a relatively low corporate tax and special tax provisions for scientific research and development, as well as for new investments in the country's economy.

Renewable energy and environmental initiatives. The country is renowned for its utilization of renewable energy sources, not only reducing operational expenses but also enhancing the ecological image of companies domiciled in Iceland.

Iceland boasts a highly educated and multilingual populace, ensuring access to high-caliber human capital resources.

Assistance in the realization of innovative ideas and technological endeavors. The Icelandic government actively stimulates innovative initiatives and technological ventures through various financing programs and grants, thereby creating optimal conditions for conducting scientific research and development.

Despite Iceland's non-membership in the European Union, it is part of the European Economic Area (EEA), granting Icelandic companies the opportunity to conduct business in the European market without imposition of customs duties and other restrictions.

Support for international trade. Iceland actively develops international trade relations and has a number of trade agreements that facilitate the export and import of goods and services.These factors render Iceland one of the most appealing jurisdictions for establishing a firm, particularly for companies seeking a stable, contemporary, and environmentally oriented environment for international business.

Requirements for establishing a business in Iceland

Thriving business practices in Iceland hinge upon compliance with a comprehensive set of regulations outlined by Icelandic law. These conditions ensure the authenticity and openness of business operations while safeguarding the concerns of investors and other pertinent stakeholders.

Below are the main requirements for registering a company in Iceland.

Company name

Every company intended to be established in Iceland must possess a distinctive appellation inscribed in Latin characters. This designation must receive the Registrar of Companies' approval and must not replicate or mislead regarding existing appellations. Additionally, the company's form, such as "Ehf." or "Hf.," must be incorporated into the appellation.

Registration of legal address

Each corporation must have a registered lawful domicile in Iceland, utilized for official communication and obligatory upon company establishment. This legal domicile must be a physical, tangible site.

Features of corporate governance

Icelandic companies necessitate the appointment of at least one director, who can be either domiciled domestically or internationally. Publicly traded corporations must additionally establish a board of directors composed of a minimum of three individuals. The board is entrusted with the formulation of strategic direction and the exercise of overarching control over the company's operations within Icelandic borders.

Authorized fund

The initial capital necessity fluctuates depending on the organizational structure. For a private limited company (Ehf), a minimum of 500,000 ISK is necessary, whereas for a public limited company (Hf), a minimum of 4 million Icelandic krónur is required. Prior to initiating the official incorporation application of the company in Iceland, it is imperative to deposit these funds into a specified bank account.

Provisions for foreign companies

Foreign enterprises planning to set up their activities in Iceland are obliged to institute a branch or subsidiary, guaranteeing adherence to all indigenous statutes and ordinances. Overseas company branches in Iceland must nominate a domiciled individual to act as their mandated agent for conducting affairs within the nation.These requirements establish a structured and secure environment for conducting business in Iceland, ensuring confidence amongst foreign and domestic investors in the legality and sustainability of their operations.

Main types of business structures in Iceland

Within the Icelandic market, a spectrum of business vehicles exists, each offering distinct characteristics and benefits aligned with the venture's objectives and the founders' risk tolerance.

• Private enterprise with limited liability (Ehf. – einkahlutafélag)

The Ehf business structure, prevalent among small and medium-sized enterprises in Iceland, demands an initial capital of 500,000 ISK ($4,000 USD), serving as a bulwark against financial liabilities for shareholders. With the capacity for solitary directorship and exemption from mandatory annual general assemblies, this form of enterprise provides a shielded avenue for business endeavors.

• Open JSC (Hf. – hlutafélag)

Suitable for large-scale operations and enterprises planning to attract significant investments, the Hf requires a minimum registered capital of 4 million ISK (approximately $31,000 USD). This legal entity allows for the issuance of shares, which may be sold or offered publicly, with shareholders' liability limited to their contributions.

• Individual enterprise (SP – einstaklingsfyrirtæki)

An individual enterprise is suitable for a single owner and requires no initial capital. The owner bears full responsibility for their obligations to creditors, implying unlimited personal liability, including the use of personal assets to cover the enterprise's debts in Iceland.

• Partnerships

In Iceland, prevailing are two distinct forms of partnerships: the general partnership (SF - sameignarfélag) and the limited partnership (SLF - samlagsfélag). In the former, all partners assume unrestricted liability, whereas in the latter, certain partners enjoy restricted liability while others remain subject to unlimited liability.

• Branches of foreign companies

Foreign enterprises can engage in commercial activities in Iceland by setting up a branch office. The branch office lacks the standing of an independent legal entity and functions as an inseparable extension of the foreign company, bearing full responsibility to its headquarters.

• International Trading Company (ITC – alþjóðlegt viðskiptafélag)

This corporate structure is tailored for engaging in commercial activities and trade outside the jurisdiction of Iceland. ITC offers targeted tax advantages and could prove advantageous for enterprises aiming to streamline their global operations.Each of these legal entities possesses its own set of prerequisites and benefits. Consequently, the selection of the most suitable structure hinges on the granularities of the operation, aspirations for business expansion, and investment objectives. A comprehensive grasp of these elements is paramount for the efficacious registration and stewardship of a corporation in Iceland.

Company registration process in Iceland

Registering a company in Iceland necessitates adherence to all legislative norms and regulations. Understanding each stage will assist entrepreneurs in successfully establishing an enterprise in this jurisdiction.

Main stages of the registration procedure and corresponding deadlines

• Determining the company name

Initially, it is necessary to determine a unique appellation for your organization, which must be formulated in Latin characters. It is imperative to ensure that the chosen denomination is not already applied by another registered entity in Iceland. The process of verification and reservation of the appellation is conducted through the Registrar of Companies of Iceland.

• Development and provision of constituent documents

You require the preparation of articles of association and memorandum of association, containing essential particulars regarding the organization in Iceland, encompassing details about founders, directors, business activities, and the amount of registered capital. These documents must be drafted in Icelandic or English language and duly notarized.

• Determination of legal address

Every company is required to possess a legal domicile within Iceland. This address shall serve as the designated point for official correspondence and must be stipulated within the company's founding documents.

• Opening a corporate bank account

Prior to filing the paperwork for enrollment, it's imperative to initiate the establishment of a corporate bank account within an Icelandic financial institution and transfer the required share capital. Substantiation of the capital injection must be provided to the Registry Office during the company enrollment procedure in Iceland.

• Submitting documents to the Registration Office

All prepared documents are to be submitted to the Register of Enterprises of Iceland. All documents will be scrutinized for compliance with Icelandic legislative requirements.

• Obtaining a certificate of incorporation

Upon verification of all documents and payment of fees, the Registration Bureau will issue a certificate of company registration in Iceland.

Time frame for registering a company in Iceland

The process of registering a company in Iceland can take anywhere from 1 to 2 weeks depending on the completeness and accuracy of the documents provided, as well as the current workload of the Registration Office.

Documents required to establish a company in Iceland

Main documents for establishing a company in Iceland:

1. Registration application. Includes basic information about the company, its name, legal address, information about managers and founders.
2. Constituent document (Articles of Association). Describes the organization's governance structure, the responsibilities and rights of shareholders, and other important corporate provisions.
3. Company Charter (Memorandum of Association). Contains information about the company's goals, type of activity, amount of authorized capital, as well as details about the contributions of each of the founders.
4. Proof of payment of the authorized capital. Confirmation from the bank that the required amount of authorized capital has been deposited into the company’s temporary bank account in Iceland.
5. Documents appointing directors and secretary (if applicable). Includes approval of positions filled and copies of identification documents.
6. Passport data or identification numbers of founders and managers. Copies of passports or national ID cards of all founders and leaders.
7. Legal address of the organization. The document establishing the legal address of the organization in Iceland may contain a lease or ownership deed.

All essential documents, including the founding and statutory agreement, must be notarially authenticated within the territory of Iceland or by an Icelandic consular mission abroad if prepared outside the country. Following notarization, the documents are deemed ready for submission to the Icelandic Registration Office.

Optimal areas for business initiatives in Iceland

Iceland offers a plethora of opportunities for entrepreneurs looking to establish a company in a jurisdiction with high growth and development potential. Below are the key sectors where company registration is particularly advantageous:

Tourism. An industry demonstrating significant growth in recent years. Establishing a company in Iceland in the tourism sector, such as hotels, resorts, or tourist agencies, could prove highly profitable due to the increasing influx of tourists and Iceland's unique natural and cultural heritage.

Food products and natural resources. Iceland is rich in natural resources, making launching a business in the agricultural sector or in the field of processing natural products an attractive investment. Thanks to strict quality standards, Icelandic products are in demand in international markets.

Establishing a firm in Iceland in the renewable energy sector, particularly focusing on geothermal and hydroelectric energy, could prove exceptionally lucrative given the prevailing global shift towards green energy.

Iceland vigorously fosters the advancement of innovative technologies, encompassing biotechnology and information technology. Establishing an Icelandic firm in this realm pledges access to qualified resources and state support in the form of tax incentives and grants.

Fisheries. One of Iceland's traditional and largest sectors of the economy, where establishing a company may be geared towards exporting seafood, enhancing sustainable fishing methods, or developing new food products.

The creative and pharmaceutical sectors command attention due to their innovativeness and potential for international growth. Establishing a firm in pharmaceuticals or within Iceland's creative industries, such as media, art, and design, presents unique opportunities for development on both domestic and international arenas.In each of these sectors, Iceland offers unique competitive advantages, including high quality of life, a stable economic environment, and active state support. This creates favorable conditions for those wishing to register a company and start a successful business in one of the most innovative countries in the world – Iceland.

The best locations to start a business in Iceland

Iceland, although a relatively small country, offers diverse opportunities for those wishing to establish a company in various regions, taking into account the specifics of their economic activities.

Here are the main cities and regions that offer attractive conditions for starting a business activity in Iceland:

Reykjavík

The capital and largest populated area of the country, Reykjavík, serves as the primary economic, governmental, and cultural hub of Iceland. This city represents an optimal locale for establishing enterprises within the realms of tourism, technology, and service provision. It hosts the majority of leading Icelandic and international corporations, thereby fostering the development of business connections and access to professional labor resources.

Akureyri

The second most significant city in Iceland, located in the north of the country. This region is ideal for companies engaged in fishing, agriculture, and ecotourism. Akureyri is also actively developing infrastructure to support innovative industries, including renewable energy.

Hafnarfjörður and Kópavogur

Near Reykjavík, these cities are attractive for establishing a firm in the realm of industry and high technology. The region is renowned for its industrial parks and favorable business environment, rendering it conducive to manufacturing and research enterprises in Iceland.

Keflavík

Located near the international airport, Keflavík offers excellent conditions for logistics and transportation firms in Iceland. This strategic location is ideal for organizations oriented towards the export and import of goods.

Vestmannaeyjar

This insular district is ideal for establishing enterprises specializing in fishing and processing marine products. Its geographical location provides access to extensive resources and a well-developed infrastructure supporting maritime and port operations.The choice of location for establishing a company in Iceland should depend on the nature of the business and the specific requirements of the enterprise. Each region has its unique advantages that can align most effectively with various business strategies and objectives.

Registration authorities and their roles in the company formation process in Iceland

In Iceland, the establishment of a company is governed by several state agencies, each of which performs specific functions to ensure the legality, transparency, and efficiency of the procedure. Understanding the roles of these bodies helps simplify the process of founding a firm and ensures compliance with all requirements.

Register of Enterprises of Iceland

This entity functions as the primary regulatory body for the incorporation of all businesses in Iceland. The registration office is tasked with meticulously examining and authorizing company names, filing amendments to articles of association, and upholding the integrity of the corporate data repository through ongoing maintenance and processing activities.

To the Registration Bureau, it is imperative to submit all requisite documentation for the incorporation of a legal entity in Iceland, including articles of incorporation and bylaws, information on executives and founders, as well as confirmation of the contribution of the registered capital. Upon successful registration of the organization, the office issues a registration certificate and other associated documents confirming the company's legal status.

The registration bureau also bears responsibility for effecting all amendments to the company's articles of incorporation, appointment of executives, or modifications to the capital structure. All such modifications must be officially registered and documented at the office to uphold transparency in managerial processes.

The bureau provides access to information on all registered companies through its online portal. This encompasses details regarding the financial standing of enterprises, their official address, executives, and founders. Such information is paramount for ensuring transparency in business conduct and can be utilized by prospective investors, business partners, and regulatory authorities.

Icelandic Tax Office (Directorate of Internal Revenue)

This entity is responsible for registering Icelandic enterprises for taxation purposes and issuing a unique tax identification number (kennitala). The tax administration also oversees companies' compliance with tax legislation.

Following registration with the Registration Bureau, the company must proceed to register with the Tax Authority to obtain a tax identification number, which is utilized in all financial and tax-related transactions.

Iceland Chamber of Commerce

While not directly involved in the registration of companies in Iceland, this organization plays a pivotal role in furnishing resources, information, and business support. The Chamber of Commerce offers consultations on matters concerning registration and business operations in Iceland, aids in networking with fellow entrepreneurs, and orchestrates educational programs for companies.

Role and functions of Business Iceland in supporting business

The agency Business Iceland (Íslandsstofa) plays a pivotal role in Iceland's economic development, serving as a conduit between the government and the business community, offering resources, information, and services to enhance the business environment and accelerate economic growth for both local and foreign entrepreneurs interested in establishing and expanding operations within the country.

The main functions and services of the Business Iceland agency:

Export support

Business Iceland actively supports Icelandic exporters by providing informational and advisory services aimed at promoting Icelandic goods and services in international markets. The agency facilitates the establishment of contacts with potential foreign partners and organizes participation in international exhibitions and trade missions.

Attracting investments

The agency plays a pivotal role in attracting foreign investments to Iceland, providing comprehensive information on the country's investment climate, tax incentives, available grants, and other incentives for foreign investors. Business Iceland also aids prospective investors in navigating the legal and economic aspects of conducting business in Iceland.

Marketing and promotion of Iceland

One of the key tasks of the agency is to market Iceland as an attractive destination for tourism, investment, and cultural exchange. Business Iceland develops and implements comprehensive marketing campaigns aimed at strengthening Iceland's positive image on the international stage.

Innovation support

Business Iceland actively supports innovative startups and projects, particularly in areas such as green technologies, renewable energy, and biotechnology. The agency provides assistance in accessing financing, research resources, and emerging technologies.

Networking and trainingThe agency organizes various seminars, working meetings, and educational programs aimed at providing entrepreneurs with the knowledge and skills necessary for the successful management and expansion of businesses in Iceland. These events also facilitate networking among entrepreneurs, which may lead to new business partnerships and opportunities.

Legislative regulation of commercial activities in Iceland

The legislative framework of Iceland in the field of commercial activity ensures clear and transparent rules for conducting business, thereby fostering entrepreneurship development and protecting the rights of market participants. It is important to be aware of the key laws regulating the business environment in the country to ensure compliance with Icelandic norms and requirements.

Company Law - "Lög um hlutafélög" (No. 2/1995)

This law serves as the principal document governing the activities of joint stock companies in Iceland. It encompasses all aspects of corporate operations in Iceland, including registration, corporate governance, financial reporting, and liquidation.

Law on Private Enterprises - "Lög um einkahlutafélög" (No. 138/1994)

This regulatory enactment delineates the stipulations for limited liability joint-stock companies, encompassing criteria pertaining to initial capital, governance, and the functions of executives.

Accounting Law - "Lög um bókhald" (No. 145/1994)

Establishes requirements for accounting, mandatory audit scrutiny, and submission of financial statements. According to the law, all firms in Iceland must organize their accounts according to recognized standards and submit an annual report.

Law on Corporate Income Taxes - "Lög um tekjuskatt" (No. 90/2003)

Defines the rules for taxation of corporate profits in Iceland. This legislation encompasses provisions for calculation and payment of corporate taxes, tax incentives, and exemptions.These laws establish the foundation for conducting commercial activities in Iceland, ensuring compliance with the rights and interests of all stakeholders. Understanding and adhering to these legislative requirements are critically important for any company seeking to establish an enterprise in Iceland.

Licensing of specific activities in Iceland

Engaging in specific business activities within Iceland necessitates the procurement of specialized licenses or permits. This safeguards adherence to established quality benchmarks, operational safety, and dependability, while concurrently prioritizing the protection of public welfare. When launching a business venture in Iceland, it is paramount to meticulously evaluate the requirement to secure the pertinent licensing permits, contingent upon the designated field of operation.

Financial services:

• Establishing a firm in Iceland to provide banking or credit services requires licensing from the Central Bank of Iceland. This encompasses a thorough examination of the business plan, capitalization, and qualifications of the managerial personnel.
• Insurance. Organizations wishing to commence operations in the insurance sector must obtain a license from the Financial Supervisory Authority of Iceland. Presentation of insurance policies, calculation of premiums, and information on reserve funds are required.

Healthcare and Pharmaceuticals:

• The delivery of medical services and the inauguration of medical facilities in Iceland necessitate prior authorization from the Ministry of Health. This authorization hinges on verification of medical equipment adhering to established benchmarks, the accessibility of qualified personnel, and the fulfillment of requisite patient care standards.
• The production and distribution of pharmaceutical products. Registration of an Icelandic company in this sphere requires a license from the Icelandic Medicines Agency, confirming the conformity of the products to international standards of safety and efficacy.

Tourism and Hospitality:

• For the organization of tourist trips and excursions, a license issued by the Icelandic Tourist Board is required. The safety of routes, the qualification of guides, and the presence of insurance for clients are verified.
• Hotels and restaurants. Opening a company in the hotel or restaurant business requires licenses from local municipalities, as well as compliance with strict sanitary service standards and safety conditions.

Energy

• Companies engaged in the production of electricity from alternative sources (geothermal, wind, hydro energy) must obtain approval from the Ministry of Industry and Innovation. The project's impact on the environment and its sustainability are under consideration.

Construction and Engineering:

• Accreditation or licensing issued by local municipalities or professional associations is required for conducting construction or engineering activities. Proof of compliance with construction norms and standards, personnel qualifications, and the availability of necessary equipment are necessary.

Fisheries and marine activities:

• It is particularly crucial for countries with developed fisheries. Fishing licenses are issued by the Ministry of Fisheries and Agriculture. Confirmation of compliance with environmental norms and standards for sustainable use of marine resources is required.

Transport services:

• Enterprises in Iceland engaged in passenger and freight transportation are required to obtain a license from the Ministry of Transport and local authorities. Evidence of the availability of technically sound transport vehicles and the qualification of drivers is necessary.

Tax system and benefits in Iceland

Iceland offers a structured tax system that supports both local and foreign companies. Understanding this system will assist entrepreneurs in efficiently managing and optimizing their company's tax obligations within Iceland's jurisdiction.

Corporate Income Tax:

• The standard corporate tax rate in Iceland stands at 21%, applying universally to all companies registered within its jurisdiction, encompassing profits generated both domestically and internationally.
• International Trading Companies (ITCs) benefit from a reduced tax rate of 5% in Iceland, incentivizing the establishment and utilization of ITCs for international trade operations.

VAT:

• The standard VAT rate in Iceland stands at 24%. The levy applies to all services and goods with certain exceptions.
• A preferential VAT rate of 11% is provided for certain services and goods, including hotel services, books, and musical works.

Dividends and interest:

• The dividend tax rate for resident firms stands at 20%. For non-residents, this rate can be reduced to 0% provided that a tax declaration is submitted and there exists a corresponding double taxation avoidance agreement.
• The interest earned by residents is subject to taxation at a rate of 20%, whereas for non-residents, the rate stands at 10%, thus ensuring a degree of tax optimization for foreign investors.

Royalties and licensing fees:

• For non-residents, the tax rate on royalties is 20%. This encompasses payments for the utilization or right to utilize copyrights, patents, trademarks, designs, or models.

Stamp duty:

• In Iceland, a heraldic levy of 2% is also levied on certain transactions, thereby incurring additional expenses during the registration of property rights or other registrational activities.

This tax structure renders Iceland appealing across various business modalities, encompassing high-tech enterprises, international trade, and investments in renewable energy. Fiscal incentives and reduced rates foster the influx of foreign investments, bolstering economic development and innovative endeavors within the nation.

Audit and financial reports for companies in Iceland

Icelandic firms are subject to rigorous compliance with auditing standards and financial reporting protocols. These mandates are in place to guarantee transparency throughout corporate activities and engender trust among stakeholders and other relevant parties.

Audit obligations

In Iceland, all statutory share capital companies, encompassing both private limited liability companies (Ehf) and public limited liability companies (Hf), are mandated to undergo an annual independent audit. This audit must be performed by a duly authorized auditor or a licensed auditing firm.

Small enterprises may be exempted from mandatory auditing if they do not exceed the prescribed thresholds for asset size, turnover, and number of employees.

Financial statements

All Icelandic enterprises are mandated to prepare an annual financial statement comprising a balance sheet, income statement, cash flow statement, and explanatory notes. The reporting period typically concludes on December 31st, with companies required to submit their statements within six months following the end of the fiscal year, i.e., by June 30th of the subsequent year.

Although Icelandic legislation does not mandate quarterly reporting for all companies, large enterprises and public corporations may opt to prepare quarterly reports for internal purposes and investor disclosure.

Compliance with accounting standards

Companies should maintain accounting records in accordance with International Financial Reporting Standards (IFRS) or Icelandic Accounting Standards, where applicable, to ensure comparability and consistency of financial information.

Tax reporting

In addition to submitting financial statements, corporations are obligated to file an annual tax return. The timeframe for legal entities in Iceland to submit their tax filings is four months subsequent to the conclusion of their fiscal year, falling on April 30th.

Recording changes in financial position

Any significant alterations in the financial standing of an enterprise, such as modifications to its authorized capital or the restructuring of the firm, must be duly recorded and reflected in its accounting documents.

Maintaining accuracy and timeliness in financial reporting and conducting regular audits are critically important for any enterprise in Iceland. This not only facilitates compliance with legislative requirements but also enhances trust in the enterprise among investors, creditors, and other stakeholders.

Icelandic banking sector: services for corporate clients

The banking system of Iceland distinguishes itself with a high degree of development and adaptation to the needs of both local and international businesses. It encompasses major Icelandic banks as well as branches of foreign financial institutions. In this section, we will explore the key aspects of banking services in Iceland, including an overview of leading banks, their services for corporate clients, and the process of opening a business account.

Major banks in Iceland:

Arion Banki offers an extensive array of financial services for corporate clientele, encompassing loan provision, asset management, investment, and advisory services. The bank also actively engages with representatives of small and medium-sized enterprises, offering specialized products such as revolving credit lines and project financing.

Íslandsbanki stands out with its integrated banking solutions for large corporate clients and international companies. The bank provides services for corporate finance management, consultancy on mergers and acquisitions, as well as specialized accounts for various sectors of the economy, including tourism and cutting-edge technologies.

Landsbankinn offers comprehensive banking services, including corporate lending, risk management, currency operations, and international payments. This bank also develops innovative digital solutions to optimize corporate financial management.

Opening a business account in Iceland:

Opening a corporate bank account in Iceland is a pivotal step for conducting business. The process entails several stages:

• Bank selection

Explore services offered by various banks and select the one that best aligns with the needs of your company.

• Preparation of documentation

Banks require a set of documents typically comprising the articles of incorporation of the enterprise, the certificate of incorporation of the firm, confirmation of the legal address, passports, and other identity credentials of the directors and shareholders.

• Meeting at a financial institution

In the majority of cases, a personal visit to the banking institution is required to finalize the procedure of registering a business account. During such meetings, the bank will conduct a KYC verification, which is a standard procedure for preventing financial crimes.

• Signing bank forms and agreements

Upon verification of documents and successful completion of KYC procedures, you will be invited to execute banking forms and agreements to activate the account.

Most banking institutions offer supplementary features, including online banking, mobile application services, proprietary credit cards, and a variety of financial management tools and cash flow planning instruments.

In the contemporary economic milieu of Iceland, the banking sector holds a pivotal position, facilitating business sustenance and expansion through the provision of comprehensive and innovative financial services to corporate clientele.

Conclusion

The establishment of a company in Iceland represents a promising avenue for entrepreneurs aiming to expand their business on the international stage. With its stable economy, attractive tax policies, and high level of innovative development, Iceland fosters conducive conditions for business operations. A crucial aspect is the diversity of economic sectors, offering ample opportunities for investment, spanning from tourism and energy to high technology and international trade.

The process of registering a company in Iceland is characterized by transparency and efficiency, allowing investors to swiftly commence their operations. The country's banking system provides requisite support for corporate clients, offering comprehensive financial services conducive to the sustainable growth and development of commercial projects.

To fully leverage Iceland's jurisdictional potential for business endeavors, entrepreneurs may require professional assistance in navigating local legislation and regulatory frameworks. TK DEAL offers invaluable support in registering Icelandic companies, optimizing tax obligations, and managing corporate finances. Such collaboration facilitates not only successful market entry in Iceland but also ensures the long-term and sustainable development of your enterprise.