Rideshare apps, such as Uber and Lyft, may become legal in Iceland if an impending bill on taxicab driving and licensing passes.
The bill was initially proposed in 2019 but did not pass during the last electoral term. It was a response to an investigation of the EFTA Surveillance Authority (ESA) in 2017, which led to the conclusion that due to restriction of access to the taxi driver profession embedded in Icelandic legislation, there was a possibility that Icelandic law did not conform to EEA law.
“Current practice in Iceland limits the number of taxi licenses available in certain districts. Requirements for awarding new licenses in those districts are not objective, effectively favouring existing taxi operators over new entrants. This has the potential to deter and prevent new operators from establishing businesses. The current legislation also requires taxi operators in certain districts to be connected to a dispatch central and to have taxi driving as a principal profession,” ESA states.
Since Iceland did not respond to ESA’s findings by amending the law, the authority announced last January that it had taken action against Iceland for restrictions in the taxi-services market. ESA’s letter of formal notice was the first step in an infringement procedure against Iceland.
The bill, which will be discussed in the Parliament in January, may determine the future of rideshare companies such as Lyft and Uber in Iceland. Currently, Uber operates in over 785 metropolitan areas in 85 countries. Iceland is one of few countries in Europe that hasn’t welcomed the service.