The legality and widespread acceptance of electronic signatures in Iceland are exceptionally robust, primarily due to the country’s proactive adoption of digital identification technologies and the implementation of relevant European legislation. Iceland follows a tiered legal model, where the level of security determines the legal weight of the signature.
Overview and Legal Framework
Electronic signatures have been legally recognized in Iceland since 2001 with the passage of Act No. 28/2001 on Electronic Signatures. As a member of the European Economic Area (EEA), Iceland has since incorporated the EU’s landmark eIDAS Regulation (Regulation (EU) No 910/2014) into its national law, notably through Act No. 55/2019.
The Foundational Principle (Freedom of Form)
Icelandic contract law is based on the principle of freedom of contract (similar to other Nordic countries), meaning contracts are generally valid and enforceable if legally competent parties reach an agreement, regardless of the medium (verbal, paper, or electronic). A wet-ink signature is therefore not a universal requirement.
The Tiered eIDAS Model
The Icelandic legal framework, mirroring eIDAS, defines three types of electronic signatures, each with distinct legal and evidentiary weight:
| Signature Type | Description | Legal Effect | Evidentiary Status |
| 1. Simple Electronic Signature (SES) | Basic digital data, such as a typed name, a scanned image, or an “I accept” click. | Admissible as evidence in court (Act on Civil Procedure No. 91/1991). | The legal effect is not denied solely because it is electronic, but the burden of proof of authenticity lies with the party relying on it. |
| 2. Advanced Electronic Signature (AES) | Uniquely linked to the signatory and capable of identifying them. Any subsequent change to the data is detectable. | Highly enforceable for standard business use cases. | Offers stronger evidence of authenticity and integrity than SES. |
| 3. Qualified Electronic Signature (QES) | An AES that is created by a Qualified Signature Creation Device (QSCD) and based on a qualified certificate issued by an EU/EEA-accredited Qualified Trust Service Provider (QTSP). | Legal equivalent to a handwritten signature (full equivalence). | Presumed authentic and accepted across the EEA. This is the required standard for documents mandating a “written signature” by law. |
Documents that Can Be Signed Electronically
For the vast majority of commercial, corporate, and administrative transactions, a Standard Electronic Signature (SES) or an Advanced Electronic Signature (AES) is legally sufficient. However, due to the high level of trust and adoption of national digital ID schemes (like those used for issuing a QES), Icelandic parties often opt for a QES even when it is not strictly mandated.
Documents typically validly signed with SES/AES include:
- i. Corporate Agreements: Non-disclosure agreements (NDAs), standard commercial leases (short-term), service agreements, purchase orders, and general procurement documents.
- ii. Human Resources: General employment contracts (where QES is not specifically mandated by collective agreements), onboarding documents, benefits enrollment, and employee policies.
- iii. Consumer Contracts: General sales terms, online service agreements, software licenses, and consumer consent forms.
- iv. General Administrative Filings: Many internal company documents and low-risk agreements.
Documents that Require a Qualified Electronic Signature (QES)
Icelandic law explicitly mandates the use of a Qualified Electronic Signature (QES) or a traditional wet-ink signature for several key areas where legal certainty or high public interest is paramount.
Documents where QES is typically mandatory if signed electronically:
i. Real Estate: Contracts to purchase or transfer real estate, as well as documents relating to the registration of deeds (Act No. 40/2002 on Real Estates).
ii. Employment: Employment agreements and, critically, termination of employment agreements (often stipulated by collective bargaining agreements or specific acts).
iii. Family Law: Marriage settlements or contracts (Act No. 31/1993 on Marriage) and Wills (Act No. 8/1962 on Inheritance).
iv. Corporate Formalities: Memorandum of association for certain companies, such as public limited companies (Act No. 2/1995).
v. Finance & Insurance: Declarations of debt for certain financial support, some consumer loan agreements, and insurance contracts or notices of termination.
vi. Judicial/Public Filings: Subpoenas, defense statements in civil and criminal cases, and requests for financial reorganization or bankruptcy proceedings.
Documents that Cannot Be Signed Electronically (Wet-Ink Only)
While the QES provides the highest legal equivalence, a few specific acts or processes traditionally require a public deed, notarization, or an in-person witness/attestation that an electronic signature cannot typically substitute:
1. Notarized Deeds: Any document where the law explicitly requires a Notary Public to certify the signature or act, which often necessitates a physical presence and wet-ink signature (though the scope for QES is continually expanding).
2. Declarations of Debt for Direct Enforcement: Certain enforceable declarations of debt must be signed by the debtor with certification by a notary, attorney, certified real estate agent, or two witnesses. The specific certification requirement is often challenging to fulfil with an electronic process alone.
3. Mandates/Powers of Attorney with Attesting Witnesses: Some types of mandates still require the signature of the person giving the mandate and two attesting witnesses for identification and authentication, a process not always compatible with standard e-signing protocols.
Notable Changes in Icelandic Law
The Icelandic legal landscape for e-signatures is marked by a transition from national legislation to full integration with the European framework, and a continued push toward digital governance.
1. Full eIDAS Adoption (Act No. 55/2019): This Act was crucial for formally incorporating the eIDAS Regulation into Icelandic law, ensuring that QES issued by an Icelandic QTSP is mutually recognized throughout the entire EEA and vice versa.
2. Focus on QES for High-Value Transactions: Unlike some jurisdictions where AES is considered the default for commercial contracts, Iceland’s statutes have been particularly specific in mandating QES for major life and business events (real estate, wills, marriage, and employment termination). This emphasizes security and non-repudiation in sensitive areas.
3. Digital E-Invoicing Mandate: The Icelandic government has mandated the use of electronic invoicing for all Business-to-Government (B2G) transactions, utilizing the Peppol eDelivery Network. These e-invoices must use advanced electronic signatures and be compliant with the European standard (EN 16931), further normalizing the use of secure digital documentation across the public sector.
Disclaimer
The information on this site is for general information purposes only and is not intended to serve as legal advice. Laws governing the subject matter may change quickly, so Flowmono cannot guarantee that all the information on this site is current or correct. Should you have specific legal questions about any of the information on this site, you should consult with a legal practitioner in your area.
References
1. Act No. 8/1962 on Inheritance (Article 40 regarding wills).
2. Act No. 55/2019 on Electronic Identification and Trust Services for Electronic Transactions (Transposing the eIDAS Regulation into Icelandic law).
3. Icelandic Act No. 28/2001 on Electronic Signatures (The original foundational law).
4. Regulation (EU) No 910/2014 of the European Parliament and of the Council (the eIDAS Regulation).
5. Icelandic Act No. 91/1991 on Civil Procedure (Article 44 regarding admissibility of evidence).
6. Act No. 40/2002 on Real Estates (Article 7 regarding the required signature for transfer).
