Company Registration in Norway- An Overview
Doing business in Norway attracts lot of benefits for an investor. Norway is a developed country and the government offers different incentives for entrepreneurs to operate. Though Norway is in Europe, still it does not form a part of the European Union. It forms a part of the European Free Trade Area (EFTA). Therefore an investor would consider all the above benefits and go for the process of company registration in Norway.
The government of Norway provides different forms of incentives to entrepreneurs to carry out business. Doing business in Norway is quite straightforward as a company can be incorporated within a span of one month with less formalities.
Resident shareholders and directors do not need to be appointed to run a company in Norway. An entity which is formed in Norway can be controlled by foreign shareholders and directors. Norway is ranked 25th in the world for ease of doing business. Hence investors and entrepreneurs would prefer company registration in Norway.
Benefits of Company Registration in Norway
The following are the benefits of company registration in Norway:
- Fast Registration Procedure
The incorporation process of a company in Norway is quick and straightforward. Companies can easily be established in Norway with less documentation and administrative work.
- Ownership Structure
There is no requirement for resident directors to be appointed in Norway. Hence non-residents can qualify to be appointed as directors for a company. The company can be owned by foreign shareholders. Due to the ownership structure, it is a preferred destination for company incorporation.
- Ease of Doing Business
Norway is ranked 25th place in the world for ease of doing business. There are lot of incentives provided for doing business in Norway. These incentives would include various forms of tax deductions and subsidies for companies engaged in R & D activities in energy and petroleum sectors.
- Free Trade Zone
There are several free trade zones for carrying out business in Norway. Svalbard is a particular free trade zone in Norway that offers certain forms of benefits such as 100% duty and VAT exemption. Due to this, lot of investors prefer going for company registration in Norway.
- Less Corruption
As per the Transparency International Index, Norway is considered as one of the least corrupted countries in the world. It is ranked 5th for tackling corruption and money laundering activities.
- Transportation Hub
Norway is surrounded by seas; hence there is cheap transport available in the form of commercial vessels. Due to this, there are thriving trading opportunities in Norway.
All the above benefits make it attractive for an investor to go for the process of company registration in Norway.
Eligible Business Structures for Company Registration in Norway
The following are the eligible business structures for company registration in Norway:
- Private LLCs
Private LLCs are known as private limited liability companies. It is also known by another name ‘Aksjeselskap’ which comes from Nordic descents. The principle of limited liability and separate legal entity would be applicable to private LLC. Usually, the board of directors would consider taking all the majority business decisions of this form of entity. A general manager would be appointed to manage the affairs of a private LLC.
- Public Limited Liability Companies
Public Limited Liability companies are entities which have their securities listed in a public stock exchange. The principle of limited liability and separate legal entity would be applicable to public limited liability company. Majority of the decisions for a public limited liability company would be taken by the general manager, board of directors and the shareholders. Foreign companies can list their shares in regulated public exchanges.
- Partnerships with Unlimited Liability
Usually, partnerships would appoint a general manager to manage the affairs of the business. The liability of the partners can either be limited or unlimited.
- Branch Office
A branch office is an entity formed by a non-resident Norwegian Company. A company which is formed outside Norway can set up its branch office in Norway. Branch office which is formed in Norway goes by another name ‘Utenlandsk Foretak’. These offices are formed to carry out specific form of expansion projects.
- Free Zone LLC
These companies are usually incorporated in Free Zones of Norway. An individual going for the process of company registration in Norway, would utilize this form of entity as there is limited amount of VAT and duty free subsidies provided by the government. Usually these forms of companies would require to pay limited corporate tax at 16%.
Eligibility Criteria for Company Registration in Norway
The following eligibility criterion has to be sufficed for company registration in Norway:
- Minimum Capital Requirements
The following minimum capital is required for company registration in Norway:
• For Private Limited Liability Companies the minimum capital required is NOK 30,000.
• For Public LLCs, the minimum capital required is NOK 1 Million.
• For Partnerships with Unlimited Liability, there is no requirement for any minimum capital.
- Minimum Number of Shareholders
An applicant going for company registration in Norway should have minimum number of shareholders. The following requirements have to be sufficed in terms of minimum number of shareholders:
• Private Limited Liability Company must have minimum of one shareholder.
• There is no limit on the number of shareholders for a public limited liability company, if it is not mentioned in the articles of association of the company.
• For a partnership there are no requirements for appointing a shareholder, but at least two partners have to be present to manage the business of the partnership.
- Minimum Number of Directors
Minimum number of directors must be appointed for running a company in Norway. The following requirements have to be sufficed in terms of minimum number of directors:
• For a private limited company there has to be an individual appointed who runs the board of directors. The number of directors for this form of company is not limited, unless it is explicitly stated in the articles of association.
• For a partnership company there has to be minimum one director.
• Public Limited Liability Companies require to have minimum of three directors. Any company that has a corporate assembly must have 5 directors.
There is no requirement for companies to have resident directors and shareholders. Hence an applicant going for the process of company registration in Norway can appoint foreign shareholders and directors. The following has to be sufficed related to nationality:
• However a private company must have a general manager. The general manager must be a resident of Norway. The general manager can also be a resident of the European Economic Committee (EEC).
• Half of the directors must be either Norwegian nationals or nationals of the EEC.
• For partnerships, there is no form of residence requirements related to directors.
Procedure for Company Registration in Norway
An applicant doing business in Norway would have to suffice the below requirements:
Private Limited Company
- The applicant going for company registration in Norway first has to execute the memorandum related to incorporation.
- In the next step, the applicant would have to provide information related to the subscribers of the company, purpose of forming the company and the minimum share contribution.
- If the applicant pays contribution in the form of cash, then a bank account has to be opened in Norway.
- After this process is carried out, the incorporation procedure must be filed with the coordinated register notification. This must be filed to the Norwegian Register of Business Enterprises (NRBE). Along with this, a declaration must be filed with all the required documentation.
Public Limited Company
- The procedure for forming a public limited company is the same as forming a private limited LLC.
- However, only when the directors are appointed for the company, then minimum of three directors must be appointed for this type of entity.
Partnerships with Unlimited Liability
- First and foremost, the applicant going for company registration in Norway should sign the partnership agreement.
- The names of the partners, the purpose of the partnership and all other requirements related to the partnership must be mentioned in the partnership agreement.
- The liability of the partners must be explicitly stated in the partnership agreement. Such liability of the partners can either be limited, unlimited or on a pro-rata basis.
- All the information requires to be submitted to the NRBE along with the coordinated register requirements.
Compliances for Company Registration in Norway
All entities that are registered in Norway would have to comply with the requirements of respective law. The following compliances must be adhered:
- For a partnership all the partners have to execute the partnership deed.
- Annual Meetings must be held at least once a year to approve the annual accounts of the partnership and resolutions made in the articles of association. Similarly for meetings must be held in partnerships.
- Private Limited Companies require to have board meetings at least once a year. All board meetings would be held in order to approve any unusual matters. If the partnership has a board, then at least one meeting is required every year to approve annual accounts.
- Annual Corporate tax has to be paid by private and public LLC. Partnerships also have to pay respective tax. Apart from this, partners also have to pay individual taxes. Currently the corporate tax which companies have to pay is 22%. The highest income tax rate present in Norway is 38.1 %. However, there are specific companies in the finance sector which pay 25% corporate tax rate.
- Annual Filings have to be carried out as per the requirement of Companies Registry of Norway.
Documents Required for Company Registration in Norway
Private and Public Limited Liability Companies
- Articles of Association
- Memorandum of Incorporation
- Shareholders Register
- Information on Appointment of Shareholders, Directors and General Manager
- Shareholders Registry for Public Limited Liability Company
- Declaration from Auditor related to paid up share capital
- Statement from the applicants related to the contribution verified by an auditor.
Partnership with Unlimited Liability
- Partnership Agreement
- Signature of Partners filed with the NRBE
- Information on Partners
- Appointment of Directors (If the partnership has directors)
- Declaration from Auditors.