Establish a Subsidiary in Norway

Expand a business in Norway

Foreign companies willing to extend their portfolio may choose to open a company in Norway. The two most common business forms that a foreign company may open here are the branch offices and subsidiaries. While the branches have no legal personality and must operate under the direct supervision of the parent company, the subsidiary may take its own management decisions and even though a large part of the capital is owned by the foreign company, the liability of the shareholders is limited to their contribution to the capital.

Quick Facts
Independence from the parent company	Independent.
Share capital	Minimum NOK 30,000 for private limited liability company.
Company law	The main company laws in Norway are governed by the Companies Act of 1997, which outlines the legal framework for establishing, operating, and winding up companies in Norway.
Board of directors	At least one director can be a foreign national for your subsidiary in Norway.
Company name	Must be unique and approved by the Brønnøysund Register Centre.
Registration process	Register with the Brønnøysund Register Centre.
Taxation	The corporate tax rate is 22%.
VAT rate	25% is the usual rate. Whereas reduced rates of 15% are eligible for food and beverages (except for alcohol, and tobacco). Furthermore, a 12% rate is in effect for domestic passenger transport services and access to these services.
Stamp tax	It is 2.5% of the market value.
Annual reporting	Submit annual financial statements to the Register of Business Enterprises.
Registered address	Must have a registered physical address for your subsidiary in Norway.
Liability of the parent company	The parent company is not liable for the subsidiary’s debts and obligations.
Filing tax return	Foreign firms must file a corporation tax return, regardless of potential tax exemptions under international agreements, and failure to do so may lead to penalties and additional taxes.
Compliance	Comply with Norwegian regulations and reporting requirements. Our company incorporation consultants can guide you in this regard.
Business permits	Check if your business activities require specific permits for opening a Norwegian subsidiary. Our company formation agents in Norway can assist you in this regard.

Tax incentives for Norwegian subsidiaries 

There are many tax incentives offered to the Norway subsidiaries. For example, if a foreign company holds at least 10% of the subsidiary’s capital for at least two years, it may claim a tax credit in the country of residence and these regulations are available under the provisions of the numerous double tax treaties signed by Norway with a wide range of partner countries. Our team of specialists in company registration in Norway can provide full assistance on the tax system applicable to a Norwegian subsidiary. 

Incorporating a subsidiary in Norway in 2024

Prior to the registration with the Central Coordinating Register for Legal Entities some steps must be taken, such as opening a bank account or checking the company’s name at the Registrar. It’s important to know that the operation is canceled if the memorandum of association was signed with three months prior to this procedure and our team of specialists in company registration in Norway can provide further information regarding this matter. 

One of the phases of the company registration procedure in Norway consists in opening a bank account and depositing the required minimum share capital. After depositing it, the account must receive the approval of an auditor. The name of the subsidiary must be unique so it must be checked first at the Register of Business Enterprises in Brønnøysund.

Registration with the Central Coordinating Register for Legal Entities is then required. The subsidiary must submit the foundation deeds and the articles of association. As a result, the company will receive an organization number and may apply for registration with the Register of Business Enterprises and for the VAT number.  The prerequisites for VAT registration in Norway are prescribed under the VAT Act. The law provides for the conditions applicable to both local and foreign companies, as well as to individuals who operate as sole traders and who can voluntarily register for this tax. In addition, they can obtain various benefits, such as VAT refunds.

The last step of forming a subsidiary in 2024 is enrolling for the pension fund and injury insurance, necessary procedures when hiring employees in this country. The whole registration process takes approximately nine working days if all the steps are respected and the documentation is properly submitted.

Value added tax (VAT) registration for subsidiaries

If your subsidiary is involved in taxable operations, it is obligatory to register for value added tax (VAT) with the Norwegian Tax Administration. VAT registration becomes mandatory for companies whose annual turnover surpasses NOK 50,000. Registration can be completed either online or by submitting the necessary documentation to the tax office. By registering for VAT, you gain the ability to levy and recover VAT on both goods and services. This process is essential for ensuring compliance with Norwegian tax regulations and facilitating the appropriate handling of VAT-related transactions within your subsidiary. Our company formation agents can help you register for VAT in Norway.

Opening a subsidiary as a limited liability company in Norway

Usually, a subsidiary is formed as a limited liability company which can be either private or public. Aksjeselskap, the Norwegian private limited liability company, is formed by at least one founder with a minimum share capital of NOK 30,000. It’s generally preferred by small and medium size companies. The liability of its members is limited and the shares are not for public transfer. This type of company may not issue certificates for its shares.

Those setting up subsidiaries in Norway in 2024 must also be aware of the tax implications of this legal form, as well as the accounting requirements that must be fulfilled during a financial year.

Allmennaksjeselskap, the public limited liability company in Norway, is formed especially by large corporations mostly because the minimum share capital required is NOK 1 million. Unlike the capital of a private limited liability company, the capital is divided into shares that can be transferred and that can be registered with the Stock Market.

For any questions on how to set up a subsidiary in Norway in 2024, do not hesitate to send them to our specialists.

Why register a Norwegian subsidiary as a limited liability company in 2024? 

One of the main reasons for opening a company in Norway as a limited liability company is given by the popularity of this business form. Although it is generally preferred by investors setting up small and medium sized companies in this country, this legal entity is also the first option of large multinational corporations expanding on this market due to the following: 

• it may be registered by both natural persons and legal entities and, starting with 2013, the share capital was lowered to NOK 30,000 (the previously required capital was NOK 100,000);
• it requires at least two directors, one of whom must be a Norwegian citizen or a citizen of a country located in the European Economic Area (EEA);
• in a situation in which the company employs more than 30 persons, it is necessary that one of the directors to be appointed by the employees;
• if the company hires more than 50 employees, the board of directors has to be comprised by both men and women;
• the company must have a registered office in a Norwegian region;
• in specific conditions, the company may opt not to have its accounts audited; 
• this legal entity can also be employed for starting a holding company in Norway; 
• the company’s board can be formed only by one person. 

The Norwegian subsidiary is a great oppoprtunity for those interested in exploring new markets in 2024.

In case you would like to establish a subsidiary, a branch office or any other business form in Norway, feel free to contact our Norwegian company formation agents, who can advise on the main advantages of this business form and who can provide full consultancy services regarding any matter related to the incorporation of a business here. 

For company formation services in Asia, feel free to contact our partners located in Japan, Hong-Kong or Singapore. Moreover, request from Russian investors can be handled by our experienced Russian partners –  Регистрация компаний Норвегия.