Operating licences of debt collectors

Collection activities are governed by Act no. 95/2008 . The Act entrusts the Central Bank of Iceland with the task of granting debt collection licences.

In order to be allowed to carry out primary and intermediate collections, the collecting party must have previously been granted a debt collection licence. The same applies to parties who purchase claims for the purpose of collecting them themselves for commercial purposes. Lawyers, public entities, commercial banks, savings banks, other credit institutions and investment firms can, on the other hand, conduct collections without a collection permit. The act does not cover the collection of taxes and levies by public bodies and legal collections.

Debt Collection Act

The Act on Debt Collection contains provisions which stipulate the relationship between debt collectors and debtors, including that collection shall be conducted in accordance with good collection practices and that the collecting entity shall send the debtor a collection warning after the due date of a claim, which must fulfil certain conditions. The Act also covers the relationship between debt collectors and creditors, since it imposes a certain disclosure obligation on the debt collector to provide information to creditors and stipulates in greater detail how the debt collector is to handle the collected funds.

The Central Bank supervision is to ensure the collection activities of licensed entities, public bodies, commercial banks, savings banks, other credit institutions and investment firms are conducted in accordance with the Debt Collection Act and rules and regulations deriving from the Act. On that basis, the Central Bank has set Rules no. 981/2016 on the implementation of the supervision of collection activities in accordance with the Act.

Furthermore, the Minister has set  Regulation no. 37/2009 on maximum collection costs, etc.