According to a BBC report, the Icelandic football association turned down EA's offer of $15,000 (around £11,000) because it wasn't enough. It did make a counter offer, however EA didn't find this acceptable.
"They are the ones buying these rights and they almost want it for free," KSI president Geir Thorsteinsson is quoted as saying.
"The performance at the Euros show that we are quite a good team and many would like to play with our team. It's sad for the players - but the criticism should be towards EA Sports."
"I really feel if we are giving away rights, or offering rights, it has to be proper negotiations and fair fees." added Thorsteinsson.
"I didn't feel that this was done in a fair and open manner."
EA is yet to comment.