To understand the history of Brennivin, you have to understand the history of Iceland.
Iceland was settled in the late ninth century by the Norse. In 1262, Icelanders became subjects of the king of Norway. In 1397 the Kalmar Union between the Nordic countries put Iceland (along with Norway, Greenland, and the Faroe Islands) under the Danish crown.
Although beer could not easily survive the ocean journey, malt and honey were freely traded between Scandinavia and Iceland. Icelanders could make their own mead, and, occasionally, beer.
But in 1602 the Danish King instituted a trade monopoly, the "Einokunarverslun," in Iceland. Only certain Danish merchants could trade with Iceland, and Icelanders could not trade with anyone else.
Mead, beer, honey and malt took up valuable space on the ships. Spirits, however, took up less space, didn't spoil, and could be sold for a much higher price.
The distillation techniques of the day (known as "burning") meant that the resulting spirits (known as "burnt wine" or "brann-vin") were often less than appealing. One way to improve the taste was to infuse the spirits with herbs.
Even in the harsh climate of Iceland, caraway was available, and used to flavor the shipments of spirits from Denmark.
And so, aquavit was born.
The trade monopoly ended in 1786, and thirty years later modern distillation techniques made their way to Scandinavia. Of course, by then the taste for various aquavits had already been well established in all the Nordic countries. Cleaner spirits were available, but people still preferred them flavored with herbs.
Although the trade monopoly was no more, the Danish Distilling Company had a monopoly on distillation in Denmark and the territories it controlled, including Iceland. Icelanders were forbidden to distill their own spirits.
In 1908, a prohibition referendum was passed in Iceland. Starting in 1912 all imports of alcohol would cease. There would be no more beer, no more wine, and no more distilled spirits. Any remaining stocks of alcoholic beverages had to be consumed or destroyed by 1915.
In 1918 Iceland regained its independence from Denmark. Absent prohibition, the Danish monopoly on distillation would no longer apply.
In 1935, prohibition was partially repealed. Once again spirits would be allowed, but the production, distribution, and sale would be controlled by the now independent government. Beer would remain illegal until March 1, 1989.
No longer captive to the Danish Distilling Company, the Icelandic government set up the State Alcohol Company of Iceland, known as the "AVR", which still exists today as the "ATVR". One of the few spirits the AVR decided to produce was caraway-flavored Brennivin.
In contrast to the colorful French and Italian spirits labels at the time, the government of Iceland demanded a stark black and white label for the newly legal spirit. The intention was to be visually unappealing, and limit demand.
It didn't work.
For decades, Brennivin was the drink of choice for Icelanders and became a pop-culture treasure brought home by travelers. Privatized in 1989, and produced by Ölgerðin Egill Skallagrímsson, it was only exported to America starting in 2014.
And by then, Brennivin had practically become a symbol of Iceland itself.