A Democratic State
Iceland is a democratic state based on a representative government and the three traditional branches of power.
The legislative power is in the hands of the Alþingi or Parliament, called the legislative assembly. Sixty-three representatives are elected to sit in it by general elections every four years.
The executive power resides jointly with the President and the national government.
The judicial power is comprised of two judicial levels, the District Court and the Supreme Court. All cases go before a judge of the District Court, but a party who is not satisfied with the outcome may appeal to the Supreme Court. Judges in Iceland do adjudicate in all matters, one judge in the District Court (three if the matter is felt to be of special importance) and three in the Supreme Court (five if the matter is felt to be of special significance). In addition to these judicial levels, hearings are held in the Labour Court, to which one may bring a case that arises from a dispute between a trade union and an employer. Its decisions may be referred to the Supreme Court.
The President holds restricted formal authority. He gives his assent to all laws and regulations and has the power to refuse to do so and then the matter is put to a referendum. This has happened three times. First in June 2004, when Ólafur Ragnar Grímsson (president 1996-2016) refused to give his assent to a law regarding the media. The government withdraw the law instead of putting the matter to a referendum. The second and third time was in January 2010 and February 2011 when the president refused to give his assent to a law regarding the Icesave accord. In both times the matter was put to a referendum where it was rejected by the nation.
To form a new government. The one who has the authority from President to form a government (most often the exiting Prime Minister or the leader of the largest party), must obtain the support of the majority of the parliamentarians. As no party has, at a any time, obtained a majority of the Parliament, most governments are formed by coalitions of two or more parties.