The term ‘Icelandic sweater’, actually íslensk lopapeysa if you speak Icelandic, is now a legally protected product name. It received Iceland's Designation of Origin status. Because hand-knitting these beautiful wool sweaters are in fact an historic tradition in Iceland.
The Handknitting Association acquired the designation of origin for the original designs, which are unique to Iceland. I discovered there are seven conditions that must be met for a sweater to be designated an 'Icelandic sweater.' These include that virgin wool be used, that it come from Icelandic sheep and be handspun.
I find it comforting to know that knitters are taking steps to protect the traditions that have been entrusted to them. To read the entire article by Jóhann Páll Ástvaldsson in the Icelandic Review click here.