Can Iceland afford to allow its airbridge to the world to grind to a halt?

The indefinite strike by Icelandair’s aircraft mechanics recalls a central lesson from the EFTA Court’s 2014 Wow Air case (E‑18/14): in an island state, airports, slots and reliable air services are not ordinary market parameters. They are part of the country’s lifeline. The Wow Air case was about slots: whether access to Keflavík’s scarce take-off and landing times was organised in a way that preserved effective competition. A slot is not merely a timetable entry: it is the right to use a tightly coordinated chain of runway capacity, terminal facilities, gates, ground-handling services and air-traffic control at a particular time. At a congested hub, commercially viable arrival and departure times are therefore a bottleneck resource; control over them can determine whether a new airline can build a workable network, offer connections and compete with an incumbent. In Icelandair case, this infrastructure has an added systemic dimension because there are few practical substitutes for international air links, so failures in access or operation quickly spill over into tourism, trade, freight, investment and the mobility of residents.

The EFTA Court held in Wow Air that the slot coordinator must be legally and factually independent and clarified that competition authorities may intervene—including by requiring undertakings to transfer slots after allocation—where that is necessary to protect competition. In those proceedings, the EFTA Court provided national authorities and courts with effective avenues for action. Owing to the urgency, the case was dealt with under an expedited procedure by order of its President (yours truly).

Iceland’s geographical position is the same today. A system-wide shutdown not only affects Icelandair and the mechanics. Thousands of travellers, families and businesses are affected, as are tourism, freight and supply routes, and the international accessibility of the country as a whole. These third parties have no seat at the negotiating table. The competent authorities should have prevented this.

The irony is that, in 2014, it was the EFTA Court that showed the way. On 24 September 2026, the EFTA Court’s annual conference will take place in Luxembourg, with prominent Icelandic participants expected to attend. The present strike by Icelandair’s aircraft mechanics is preventing Chief Justice Benedikt Bogason, President of Iceland’s Supreme Court, from attending the EEA’s most important annual gathering.

The EEA is not sustained by treaty text alone. Its coherence, homogeneity and legitimacy depend on direct and continuous judicial dialogue among the EFTA Court, the Court of Justice of the European Union, the European Court of Human Rights and the national supreme courts. Obstructing that exchange weakens the legal order itself. The contrast is striking. After Iceland voted against reopening EU accession negotiations on 29 August 2026, the Prime Minister stressed the importance of the EEA and the government’s intention to strengthen Iceland’s ties through it. Thirty-two years after the Agreement entered into force, Iceland even appears ready to move forward on Protocol 35. This comes despite there being no basis for portraying the Icelandic judiciary as a weak link: in applying EEA law and engaging with the EFTA Court, it has shown no less commitment than other national judiciaries.

My criticism is therefore directed not at Iceland’s courts, but at the passivity of the political authorities. When Iceland’s air connection to Europe is essential to the practical functioning of the EEA, yet the head of its highest court cannot reach the EFTA Court’s central annual event, that passivity becomes impossible to overlook. Commitment to the EEA must be measured not only in declarations and legislation, but also by whether the infrastructure that makes participation in the European legal order possible is kept functioning.

Prof. Dr. iur. Dr. rer. pol. h.c. Carl Baudenbacher

Baudenbacher Law AG, Lawyers & Advisors | Door Tenant Monckton Chambers | Visiting Professor London School of Economics | President of the EFTA Court 2003-2017