Starting a Business in Iceland
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Why Start a Business in Iceland?
The first time Iceland makes the headlines since Bjork assaulted that journalist, and it's more bad news. Here in the West, we're not used to national inversions so severe they completely change the way we live forever. Yet it's happened. We have finally felt the unforgiving ripple of the chaos theory of finance.
Iceland is still a pretty place. If you like countries without an army, then this is your pacifistic paradise. It's topographically stunning too, and not often does a country have streets so criminally crimeless that its jails are less busy than Christmas in Israel.
On the less attractive hand, however, tax has always been high but the question is, what the hell do they spend it on? No crime, no military. 24-hours of daylight during the summer, so no street lights. Salting the roads certainly doesn't cost that much, and they evidently weren't saving for a rainy day. Just another fiscal anomaly to add to the list.
It's not all doom and gloom like the newspapers have been propagating, though. After listening to the media's fatalism every day, you'd be forgiven for thinking that Armageddon was drafted in for next week. It is shear, teeth-clenching misguidance because, quite contrarily, business has been picking itself up and brushing off the frost. After all, the human race is resourceful, and anyone with the capacity to endure such hoary weather and doesn't mind sleeping while it's still bright outside is the personification of adaptability.
Business in Iceland has simply acclimatised. Therefore, if you are ardent in intent, insistent that a business can still thrive, and have contextualised your expectations, requirements and company socioeconomically, then there is no discernable reason not to go to Iceland.
There are many options that are sustainable, even immune to the situation. If your company provides an indispensable service, then capitalise on the credit chaos. Debt collection, healthcare, plumbing, roofing, funeral directors, basic foods, and maintenance and repairs are all industries that appear to transcend circumstance and resist recession.
Exoduses are invariably made to evade endangerment, not enter into it. However, if you've been contemplating in the melting pot of corporate ingenuity, then Iceland may just be the country to cool off.
Just two final words, though. Research. Meticulously.
Iceland's economy depends heavily on fishing, as it has done for years. Fishing provides 40% of the country's export earning and employs 8% of the work force. However, due to declining fish stocks, Iceland has been diversifying its economy into manufacturing and service industries including software production, biotechnology and financial services. The economy does still rely heavily on fishing although its importance is diminishing and other industries are growing. One such growing industry is travel as the tourism sector is expanding due to recent trends in whale-watching and ecotourism.
Iceland's main exports are fish, fish products, metals, sheepskin products and wool; the main export partners being Netherlands, UK, Germany, US and Spain. The main imports are machinery, equipment, petroleum products, foodstuffs and textiles; the main import partners are US, Germany, Norway, Sweden and Denmark.
Iceland is a member of the UN, NATO, EFTA, EEA, OECD, but not a member of the EU.
What are the essentials to know?
Labour in Iceland
Holidays: an individual who has worked a full vacation year, from May 1 to April 30, is entitled to 24 days holiday. It does not make any difference whether the individual has changed companies during the period. Those who have worked a shorter period of time are entitled to 2 vacation days for every month that is worked.
Minimum Wage: minimum wage in Iceland is determined on grounds of the nature of work, seniority and education. All employers should abide by the provisions of the collective agreements on minimum wage.
Working Hours: usual working hours are no more than 8 hours per day and a total of 40 hours per week. The normal working day starts at 0700 and the end of the day varies depending on collective agreements.
- The handshake is the traditional form of greeting. You should shake everyone's hand at the start and at the end of a business meeting
- It is common practice to exchange business cards at meetings
- English is widely spoken as the business language
- Very few Icelanders have original surnames and for this reason telephone directories list individuals by their first names. Surnames are based on the father's Christian name plus 'son' (son) or 'daughter' (d?ttir) prefixed at the end of the surname
The following contacts will provide you with helpful information on setting up a business in Iceland:
UK Trade & Investment
66-74 Victoria Street
Tel: +44 (0)20 7215 8510
Fax: +44 (0)20 7215 8313
PO Box 460
Tel: +354 550 5100
Fax: +354 550 5105
Organisations that can assist with Starting a Business
Simplified Global Payroll Companies with global employees often find that managing payroll in multiple countries is complicated - different systems, laws, and languages in each country, lack of reporting, and constantly changing laws and regulations each year. Trying to manage global payroll via fax and email with excel spreadsheets leads to data security issues, fines, and penalties for non-compliance. Blue Marble has solved global payroll challenges with cloud-based technology, aggregated reporting, and a hybrid service model in 135+ countries around the world.
Finding office space abroad poses one of the most difficult changes that many start-ups face. Location, costs, and transport all need to be considered. And, more crucially of all, what office will allow a new business to attract and retain the best staff?
PEO Worldwide is an international PEO offering employer of record, payroll, employee benefits management, HR and compliance services throughout the world.