Establishing and Operating a Company in Norway

Establishing and Operating a Company in Norway: What Foreign Owners Often Underestimate

Norway is widely regarded as a stable, transparent and business-friendly country. Strong institutions, high trust in society and a predictable legal system make it an attractive destination for foreign investors and international companies.

Yet, in our experience at Ecovis, many foreign owners underestimate what it actually takes to establish and operate a company in Norway — not because the rules are unreasonable, but because they are detailed, interconnected and strictly enforced.

This article highlights the most common pitfalls foreign owners encounter, and howto avoid them.

1. Setting up a company is easy – compliance is not

Formally, incorporating a Norwegian private limited company (AS) is relatively straightforward. The minimum share capital is low, the process is digital, and registration with the authorities can often be completed within days.

However, in order to register an AS, a Norwegian bank account must be opened at the same time to deposit the share capital. It is this banking process that often becomes the main bottleneck for foreign founders.

For companies with foreign shareholders, directors or management, opening a Norwegian bank account can be a time-consuming and unpredictable process due to strict KYC and AML requirements. In some cases, the account opening process may take several weeks or even fail altogether, effectively putting the entire company registration on hold.

In addition to the banking challenge, compliance requirements in Norway are strict and non-negotiable. Companies are subject to ongoing reporting to multiple authorities, detailed bookkeeping and documentation requirements, and potential personal liability for board members and managing directors in the event of non-compliance. Errors that may be tolerated in other jurisdictions can quickly result in penalties, forced corrections or, in severe cases, personal liability.

As a result, many foreign founders find that purchasing a pre-registered “shelf company” can be a more practical and efficient solution. This can significantly reduce delays related to bank account opening and operational start-up, allowing the business to become operational faster. ECOVIS can assist with both incorporation and the acquisition of ready-made companies, depending on what is most appropriate in each case.

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2. Accounting and tax rules are highly formalized

Norwegian accounting rules are principle-based but operationally strict. Every transaction must be documented, traceable and recorded in accordance with Norwegian bookkeeping standards.

Common challenges include:

• Incorrect VAT treatment
• Misclassification of costs
• Missing or insufficient documentation
• Delayed reporting

Tax compliance is closely linked to accounting. Inconsistent bookkeeping often triggers questions from the tax authorities, even when there is no intent to avoid tax.

For foreign owners, this can be surprising. In Norway, how something is documented is often just as important as what it represents economically.
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3. Employment rules are more rigid than expected

Hiring employees in Norway carries significant responsibilities. Employment protection is strong, and mistakes made at the start of an employment relationship can be difficult and costly to correct later.

Key areas often underestimated include:

• Mandatory employment contracts with specific content requirements
• Working time and overtime regulations
• Sick leave and employer obligations
• Termination procedures and notice periods

Foreigncompanies often assume that Norwegian employment law resembles other Europeansystems. In reality, it is more formal and less forgiving when procedures arenot followed precisely.

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4. Substance matters – especially for foreign-owned companies

Norwegian authorities place increasing emphasis on substance: real activity, real management and real decision-making in Norway.

This isparticularly relevant for:

• Foreign parent companies with Norwegian subsidiaries
• Cross-border management structures
• Transfer pricing and intercompany agreements

A Norwegian company must be able to demonstrate that it is not merely a formal shell. Board meetings, management decisions and operational control must be documented and defensible.

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5. Fragmented advice creates risk

A common mistake is to use different advisors for legal, tax, accounting, payroll and immigration matters without coordination between them.

In Norway, these areas are tightly connected. A decision taken from a purely legal perspective can have unintended tax or accounting consequences — and vice versa.

Lack ofcoordination often leads to:

• Inconsistent reporting
• Delays and corrections
• Increased exposure during audit

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How Ecovis supports foreign owners in Norway

At Ecovis,we work with international companies at all stages — from establishment to daily operations and long-term growth.

Our approach is integrated and pragmatic:

• Accounting, tax, legal, payroll and immigration under one roof
• Clear communication in English
• Practical advice grounded in Norwegian regulations and business culture

Our role is not only to ensure compliance, but to help foreign owners understand how Norway works — so they can focus on running and growing their business withconfidence.

Considering establishing or operating a company in Norway?
Early, coordinated advice is often the difference between a smooth setup andcostly corrections later.

Ecovis is here to help.

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