Students from outside the EEA to pay full tuition fees

Students from outside the European Economic Area (EEA) will be required to pay full tuition fees at Iceland’s public universities for the 2027 to 2028 academic year under legislation approved by parliament last month before the end of the parliamentary session, as reported by Iceland Review.

The ‘443 Government Bill’ – ‘Bill for an Act on an amendment to the Act on Public Universities, No. 85/2008 (fees authorization)’ – was presented by the Minister of Culture, Innovation and Higher Education, Logi Einarsson.

The new bill ends state funding for most non-EEA students and brings Iceland into line with all other Nordic countries, becoming the last to switch to charging tuition fees for international students from outside the EEA. Students from the Faroe Islands, Greenland and Switzerland are exempt from the new rules.

Although the law was not passed in time for the fees to take effect in the 2026 to 2027 academic year, the changes were widely expected during the admissions period. The fees will instead be introduced for the 2027 and 2028 academic year.

The amount students will be required to pay has not yet been determined. Universities must calculate the cost of providing full-time education before fees can be set ahead of enrolment opening in December 2026 for the 2027 to 2028 academic year.

Rector of the University of Iceland, Silja Bára Ómarsdóttir, said a significant drop in applications from outside the EEA is likely.

Similar measures introduced elsewhere in the Nordic region have led to substantial declines in international applications. Denmark introduced tuition fees for non-EEA students in 2006, followed by Sweden in 2011, Finland in 2017 and Norway in 2023.

The implementation of tuition fees had been planned for a couple of years. In August 2024, the Daily Northern reported that public universities in Iceland would soon be allowed to charge tuition fees for students from countries outside the European Economic Area (EEA), as proposed in a bill discussed in government.

In 2024 Minister of Higher Education, Industry, and Innovation, Áslaug Arna Sigurbjörnsdóttir, stated that there had been a significant increase in the number of students from non-EEA countries in recent years and that other Nordic countries had already implemented tuition fees for this group of students.

“I do not find it justifiable to use shared funds to subsidise higher education for this group,” Áslaug Arna is reported as saying after the 2024 cabinet meeting. She noted that it would be at the discretion of public universities to set their own tuition rates for students.

Wider international student changes

Notably, the new legislation does not apply to non-EEA residents who already hold permanent residence permits in Iceland. Additionally, there will be the introduction of a merit-based scholarship programme for exceptional students from outside the EEA. According to the EEA agreement, discrimination between Icelandic students and those from EEA countries is not permitted.

However, the tuition fee legislation was accompanied by broader changes affecting international students and migrants. Parliament also approved amendments to residence permit rules, limiting family reunification rights to spouses and children and removing eligibility for parents over the age of 67.

In addition, the period graduates can remain in Iceland to seek employment after completing their studies has been reduced from three years to 18 months, while stricter academic performance requirements will apply when renewing student residence permits.

Growth in foreign student numbers

The bill notes that the number of foreign students at Icelandic universities has grown steadily in recent years, especially for students from outside the EEA.

At the beginning of the 2025 to 2026 academic year, 23,361 students were enrolled in Icelandic universities. Of these, 3,044 had foreign citizenship, and of that group, 1,737 had citizenship from a country outside the EEA.

Among undergraduate applicants, the School of Humanities attracted the largest number of applications, with ‘Icelandic as a Second Language’ and ‘Icelandic Studies’ proving especially popular.

“The increase in the number of foreign students at Icelandic universities has followed the general increase in the number of students at the university level and even more so.

“Over the past seven years, the proportion of students with citizenship outside the EEA of the total number of registered students has increased from 3.89% to 7.44%. There has also been a comparable increase in the number of students studying in the ‘Icelandic as a Second Language’ programme,” the bill states.

“In comparison, the proportion of foreign university students with non-EEA citizenship was 2.3% in Denmark, 3% in Norway, 4.2% in Sweden and 6.3% in Finland in the academic year 2022 to 2023,” the bill notes.

According to the bill’s explanatory memorandum, applications from outside the EEA to the University of Iceland rose from just under 1,200 in 2021 to nearly 2,600 in 2025. Part of that increase has been attributed to Norway’s decision to begin charging tuition fees.

Of the 639 students who were registered in the ‘Icelandic as a Second Language’ programme at the University of Iceland in the fall semester of 2025, 405 had citizenship from countries outside the EEA.

Why legislation is necessary

In accordance with the rising influx of international students in Icelandic universities and the broadened regulations regarding residence permits for non-EEA nationals, a continued increase in the number of non-EEA students is anticipated, resulting in heightened expenses for educational and student services at these institutions.

The bill notes that while international cooperation between Icelandic universities and universities in other countries is important for the quality and competitiveness of universities, it is clear that as the number of students with citizenship outside the EEA increases, public funding to universities must cover the costs of these students.

Private universities can meet these costs by charging tuition fees, while public universities have lacked the legal authority to charge tuition fees.

“This difference in conditions distorts the competitive position of public universities vis-à-vis private universities and foreign universities. Elsewhere in the Nordic countries, students with non-EEA citizenship pay tuition fees at universities, and the same applies to most other countries in Europe,” the bill notes.

“The 2023 Organisation for Economic Co-operation and Development (OECD) report on the Icelandic economy discusses the increased opportunities for foreign students to stay in Iceland for longer after completing their studies.

“In connection with this discussion, the Icelandic authorities are encouraged to introduce tuition fees for students from outside the EEA in line with what is done elsewhere in the Nordic countries,” the bill states.

Globally, Iceland distinguished itself as the sole Nordic nation that, to date, had not imposed tuition fees on students from outside the EEA. “It is important that public universities in Iceland keep pace with the other Nordic countries and international developments in the field of higher education,” the bill emphasises.

The bill also follows OECD recommendations on how Iceland can contribute to increased economic and social benefits from the growing group of immigrants.

“The OECD report on the Icelandic economy from 2023, for example, encourages the Icelandic government to introduce tuition fees for students from outside the EEA in line with what is being done elsewhere in the Nordic countries as a way of attracting more highly educated individuals who are willing to pay tuition fees to universities rather than less or low-educated individuals,” it notes.