The legality of the arrest is contestable in its legality as there appears to be no documents to prove that the land is not public access. The activists, once detained were not allowed to make phone calls in the manner outlined in Icelandic law, but were allowed food to be brought to their cells (unlike on the main protest site where the police are trying to starve out campaigners).
All of the activists have since been released with no charges as it seems unlikely that they were breaking the law. Clearly the police and landsvirkjun are uncomfortable with campaigners close proximity to the dam.