General information on commercial aviation

Individuals, institutions or companies intending to operate aircraft commercially must hold an air operator certificate issued by the aviation authorities or have submitted a declaration for specialized operations to the aviation authorities.

Such parties may carry passengers and/or cargo, whether operating passenger jets on international flights, conducting sightseeing flights in smaller aircraft, or performing specialized operations involving various tasks such as research missions.

Before applying for an air operator certificate or submitting a declaration for specialized operations, it is essential to understand the type of operation intended and consider the following points:

• Types of aircraft to be operated

• Location of intended operations

• Scope of the operation

• Whether the operation will involve visual flight (e.g. sightseeing), instrument flight, or require specific approvals

Applicants submit applications on designated forms and are invited for an interview where the handling of the application is reviewed.

It is not possible to state exactly how long it will take to review an application for an air operator certificate, as it depends, for example, on the quality of the submitted documentation.

When a company is granted an air operator certificate, the Icelandic Transport Authority performs a comprehensive audit of the company's headquarters and also conducts a route check. The same applies to parties intending to conduct specialized operations.

Fees are according to the Icelandic Transport Authority’s tariff and are charged by the hour.

Laws and regulations:

• Act on Aviation No. 80/2022 and EU Regulations No. 965/2012 and 1008/2008.

To obtain an Air Operator Certificate and an operating license for commercial air transport in Iceland, it is necessary to demonstrate compliance with the European Union Aviation Safety Agency (EASA) requirements regarding the management of air operations and airworthiness.

Various parties facilitate the transport of people and goods between Iceland and Europe, but they must engage an air operator with the appropriate licenses to carry out the flights on their behalf. The air operator is always responsible for the flight.

It is important that service purchasers verify that contractors hold an operating license issued by the Icelandic Transport Authority. However, it is ultimately the responsibility of the aircraft operator to ensure that the operation complies with laws and regulations.

Air operators that are authorized to conduct commercial air transport in countries within the European Economic Area (EEA) are permitted to operate flights between Iceland and Europe (the EEA). They meet EU/EASA requirements and do not require authorization from the Icelandic aviation authorities.

Icelandic aviation authorities may authorize air operators from other ICAO (International Civil Aviation Organization) member states to conduct air transport between these countries, provided it involves non-scheduled operations such as charter flights, and potentially scheduled flights, if air services agreements are in place that allow such operations.
Regulations governing such flights stipulate, among other things, that safety standards equivalent to those required by the Icelandic authorities must be adhered to, as assessed by the Icelandic Transport Authority. As a result, operators or states listed on the European Commission's air safety list are not eligible for such flights. Additionally, the country in Europe to which the flight is operated must also approve the flight. Operators from outside the EEA must hold a TCO (Third Country Operator) authorization issued by EASA.

In assessing the risk of such operations, consideration shall be given to whether the operator clearly meets ICAO requirements for air transport, as well as to the number of flights and the likelihood of incidents occurring during operations.

In some cases, permission has been granted to transport goods from Iceland with an airline that is not certified by EASA. This has generally been limited to individual flights and due to special circumstances, e.g. if Icelandic interests were high or there were no airlines in the region with aircraft capable of carrying out the project.

It is not permitted to operate flights carrying passengers, cargo, or to conduct specialized operations for remuneration or for profit within Iceland without a valid air operator certificate for commercial air transport or a declaration of specialized operations submitted to the Icelandic Transport Authority.

There are three exceptions to this rule:

Flight Training

• Flight schools and flight instructors are permitted to charge for flight instruction for the issuance or renewal of flight privileges within their scope of authorization.

Introductory Flights
Flight schools and associations established with the purpose of promoting sport or recreational aviation are permitted to charge for introductory flights under the following conditions:

• The company must operate the aircraft on the basis of ownership or dry lease.

• The flight must not generate profit.

• Flights with persons who are not members of the organization must constitute only a small part of the company’s operations.

Cost Sharing in Private Flights

Cost sharing in private flights is permitted under the following conditions, in accordance with European Union regulations:

• The flight must be a private flight with cost sharing between individuals (i.e. cost-shared flight by private individuals).

• The direct costs of the flight may only be shared among all occupants on board, including the pilot. The maximum number of persons on board, including the pilot, is six (6).

• Direct costs are those incurred directly in relation to the specific flight, such as fuel, airfield charges, and aircraft rental. In the case of jointly owned aircraft, the hourly rate typically paid by an owner for usage may also be considered a direct cost.

• It is not permitted to share annual or recurring costs associated with owning and operating the aircraft, such as maintenance, insurance, or other fixed operational costs. Such costs are not considered direct and must not be included in cost sharing.

• The pilot must contribute to the cost sharing and may not make any profit from the flight. No element of the cost sharing may involve profit.

• These rules apply to non-complex motor-powered aircraft as defined by EASA, and also to aircraft registered outside the EEA if operated by individuals or entities established or residing within the EEA.

Additional Guidance

• Any advertising or promotion of cost-shared flights must clearly state that these are private flights, not conducted in accordance with commercial air transport regulations.

• The term “individual” in this context refers to a person acting as a pilot (and potentially also as the operator) – not a company or organization.