Is Iceland a good place to host a website?

What does Icelandic data protection law say?

Iceland applies the GDPR. EFTA states that the regulation entered into force in Iceland, Liechtenstein and Norway on 20 July 2018. Iceland’s own Act No. 90/2018 on Data Protection and the Processing of Personal Data came into force on 15 July 2018, according to the law firm Linklaters. The Icelandic Data Protection Authority supervises it.

For a site owner this means one thing. In Iceland, as in EU countries, the GDPR governs how personal data is processed, for example visitors’ IP addresses and contact-form entries.

The law protects people’s data. It does not protect a site’s content from a court.

Is Iceland in the EU?

No. The EEA is made up of the EU member states and three EEA EFTA States: Iceland, Liechtenstein and Norway. The EEA Agreement entered into force on 1 January 1994.

That is why Velumhold labels Reykjavik “EEA, outside the European Union” and labels Amsterdam and Bucharest “European Union”.

What is the IMMI resolution of 2010, and what is it not?

IMMI is the Icelandic Modern Media Initiative. On 16 June 2010 the Althingi, Iceland’s parliament, passed it as a parliamentary resolution. It tasked the government with finding ways to strengthen freedom of expression and information in Iceland, with strong protection for sources and whistleblowers.

What it is: a mandate to prepare laws. The IMMI site said at least 10 laws in 4 ministries had to change, and that this would take a few years.

What it is not: a law that protects hosted websites, or a promise that requests are ignored. The surveyed Icelandic hosts say they follow Icelandic courts. OrangeWebsite says it complies fully with takedown requests granted by Icelandic courts. 1984 Hosting says it hands over customer data only on a valid court order.

Velumhold makes no legal promise about what Icelandic law does for your site.

Does Iceland run on renewable energy?

On the national grid, yes. S&P Global Ratings said in September 2025 that Iceland makes most of its electricity from renewable sources, about 70% from hydropower and 30% from geothermal plants. The Government of Iceland’s 2023 financing framework puts renewable electricity at 99.98%, citing production data for 2020.

Two cautions. First, that is the national grid. It says nothing about the power mix of the datacenter that holds your server, and Velumhold does not publish that. Second, power is not unlimited. S&P notes that low water levels in the reservoirs that feed hydro plants caused shortages in 2024 and forced aluminum smelters to cut output for a few months.

S&P also says relatively cheap energy and a cool climate are driving a sharp rise in data center investment in Iceland.

What are the limits of hosting in Iceland?

• Not a legal shield. Icelandic hosts follow Icelandic court orders, as shown above.
• Price. At FlokiNET, the Iceland location costs more than Romania or the Netherlands. At Velumhold the price is the same in every location.
• Local rules. FlokiNET’s acceptable use policy bars adult content at its Iceland location. 1984 Hosting does not offer its crypto option to users who appear to be in Iceland, because of tax rules.
• Distance. Pick the location nearest to most of your visitors.

Read the acceptable use policy before you build.

Which Velumhold location should I choose?

Reykjavik (Iceland), Amsterdam (Netherlands) and Bucharest (Romania): every plan in every location, at the same price.

Reykjavik sits in an EEA country outside the EU. Amsterdam and Bucharest sit in EU countries. Choose by where most of your visitors are, and by which country’s law you prefer for the datacenter. How the company handles requests is in how we work; what “private” covers is in what is private web hosting.