Who does not need a residence permit after a certain period of time?

The main rule is that citizens of countries outside the EEA intending to reside in Iceland for more than 3 months must have a residence permit.

Citizens of EEA countries are allowed to stay in Icelandic up to 3 months without a residence permit, but citizens of EEA countries searching for employment are allowed to stay in Icelandic up to 6 months without a residence permit (this does not apply to citizens of the new EU countries until May 1, 2006).  A stay in another Schengen-zone country counts the same as a stay in Iceland.

There are certain exemptions from the main rule that foreigners need a residence permit in Iceland.  Those not needing a residence permit in Iceland are:

• Citizens of the Nordic countries, i.e. citizens of Denmark, Finland, Norway and Sweden.
• A foreigner who was an Icelandic citizen at birth, but has renounce their icelandic citizenchip.  
• A foreign citizen, who has an Icelandic parent, if he has resided and has had residence permit continually in Iceland for two years, provided the parent has been an Icelandic citizen for at least five years.
• A foreigner who is the spouse of an Icelandic citizen and has resided with him in Iceland and has had a residence permit continually for three years after the date of marriage or registration of partnership.
• A registered common-law spouse of an Icelandic citizen who has had his registered domicile in Iceland and has had a redidence permit continually for five years since the date of the registration of the cohabitation, provided that neither party is legally married and that the spouse has been an Icelandic citizen for at least five years.