Going north Nordic States Almanac - Rödl & Partner
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Going north
DENMARK FINLAND NORWAY SWEDEN Nordic States Almanac
2018
Heading up north
„If investment is the driving force behind all economic
development and going cross-border is now the norm
on the European continent, good advisors provide
both map and sounding-line for the investor.”
Rödl & Partner
„We also invest in the future! To ensure that our
tradition is preserved, we encourage young talents
and involve them directly into our repertoire.
At first, they make up the top of our human towers
and, with more experience, they take responsibility
for the stability of our ambitious endeavours.”
Castellers de Barcelona
3
Table
Table of
of contents
contents
A. Introduction 6
B. Map 8
C. Countries, figures, people 9
I. Demographics 9
II. Largest cities 11
III. Country ratings 12
IV. Currencies 16
IV. Norway and the EU 16
VI. Inflation rates 17
VII. Growth 18
VIII. Major trading partners 19
IX. Transactions with Germany 22
X. Overview of public holidays in 2018 23
D. Law 27
I. Establishing a company 27
II. Working 35
III. Insolvency – obligations and risks 47
IV. Signing of contracts 50
V. Securing of receivables 54
VI. Legal disputes 57
E. Taxes 65
I. Tax rates 65
II. VAT – obligation to register for VAT 68
4
III. Personal income tax – tax liability for foreign employees 72
IV. Corporate income tax – criteria for permanent establishment (national) 74
V. Tax deadlines 75
VI. Transfer pricing 78
F. Accounting 84
I. Submission dates for annual financial statements 84
II. Contents / Structure of annual financial statements 85
III. Acceptable accounting standards 86
G. Audit 87
I. Statutory audit requirement – criteria 87
H. Key contacts 89
I. Chambers of Commerce 89
II. Rödl & Partner 90
I. Own contacts and notes 91
5
A. Introduction
Dear readers,
In a time when Europe is facing political challenge and economic recovery, one region never fails to tender
stability, wealth and confidence: the Far North. Having formed one economic neighborhood long before the
European Union found its integrative force, Norway, Sweden, Finland and Denmark are certainly the most
affluent and inviting business environments the Old Continent has on offer, all under the hugely successful
brand of “the Nordics”.
Remarkable political and social permanence and a most welcoming, liberal culture have produced political
currency that the Nordic countries know how to invest wisely, quietly leading the region with soft power and
hard money. The Stockholm School of Economics remains a world-class teacher of free enterprise, shining
well beyond Europe, the Scandinavian finance sector rules the lands with little competition, and the appeal of
the Scandinavian way of life unobtrusively informs the development, especially in the Baltic States.
And yet the Nordic countries are far from being self-reliant. Export-driven like few others, they connect
well to both Germany and the Anglo-American world in trade and direct investment, and need the influx
of know-how and capital on many levels. In recent years, old ties across the Baltic Sea have been patiently
rebuilt, Finland has turned itself into a gateway to Russia, Swedish banks cover the Baltics for Europe, and the
impressive Oresund Bridge that links Malmö and Copenhagen has given new meaning to the European adage
of “regional integration”.
6
The Far North is an innovative region that remains impervious to the current political antics. The constantly
growing needs in construction and infrastructure, the exquisite conditions for research and development, the
everexpanding IT sector or the rapidly changing energy markets are just a few reasons to take a closer look
at the Nordic States.
We assist you with your investment plans, from opportunity and risk analysis to the implementation of your
project.
This guide is here to help you on the first miles along the way – more advice is readily available, as we are at
your service at any time.
With best regards,
Jens Pastille
Managing Partner for the Nordic and Baltic States
A 7
B. Map
Finland
Sweden
Norway Russia
HELSINKI
OSLO
STOCKHOLM
Estonia
Latvia
Denmark
United Lithuania
COPENHAGEN
Kingdom Belarus
Russia
Germany Poland
8C. Countries, figures, people
I. Demographics
Sweden Finland Denmark Norway
Population approx. 10 million approx. 5.50 million approx. 5.76 million approx. 5.26 million
Area 449,964 km� 390,908 km� 42,921 km� 385,186 km�
Population 24.5 inhabitants per km� 18 inhabitants per km� 133.4 inhabitants per km� 13.67 inhabitants per km�
density
Gender Women: 49.8 % Women: 50.9 % Women: 50.2 % Women: 49.6 %
distribution Men: 50.2 % Men: 49.1% Men: 49.8 % Men: 50.4 %
Age structure Ages 0 to 19: Ages 0 to 14: Ages 0 to 19: Ages 0 to 15:
2,290,606 (22.9 %) 890,103 (16 %) 1,306,388 (22.7 %) 1,000,025 (19.02 %)
Ages 20 to 49: Ages 15 to 64: Ages 20 to 49: Ages 16 to 44:
3,917,166 (39.2 %) 3668 235 (66.1 %) 2,219,397 (38.5 %) 2,036,980 (38.7 %)
Ages 50 to 69: Ages 65 and over: Ages 50 to 69: Ages 45 to 66:
2,383,790 (23.8 %) 988,165 (17.8 %) 1,455,365 (25.3 %) 1,455,310 (27.7 %)
Ages 70 and over: Ages 70 and over: Ages 66 and over:
1,403,591 (14.1 %) 779,544 (13.5 %) 766,002 (14.6 %)
Living area Urban: 85 % Urban: 78 % Urban: 85 % Urban: 81 %
Rural: 15 % Rural: 22 % Rural: 15 % Rural: 19 %
C 9Sweden Finland Denmark Norway
Nationalities Swedes: Finns: 5,259,658 (95.2 %) Danes: Norwegians:
8,210,656 (82.15 %) 5,008,076 (86.9 %) 4,374,566 (83.2 %)
Estonians: 44,774 (0.82 %)
Finns: 153,620 (1.54 %) Russians: 30,757 (0.56 %) Turks: 63,040 (1.09 %) Poles: 108,255 (2.06 %)
Syrians: 149,418 (1.49 %) Swedes: 8,382 (0.15 %) Poles: 45,822 (0.79 %) Swedes: 39,266 (0.75 %)
Iraqis: 135,129 (1.35 %) Somalis: 7,465 (0.14 %)
Syrians: 39,744 (0.69 %) Somalis: 41,463 (0.79 %)
Poles: 88,704 (0.89 %) Chinese: 7,121 (0.13 %)
Germans: 32,651 (0.57 %) Lithuanians:
42,491 (0.81 %)
Iranians: 70,637 (0.71 %) Iraqis: 32,225 (0.56 %)
Thai: 6,484 (0.12 %)
Pakistanis: 36,700 (0.70 %)
Former Yugoslavs: Romanians:
Iraqis: 6,353 (0.12 %)
66,539 (0.67 %) 28,227 (0.49 %) Iraqis: 32,304 (0.61 %)
Turks: 4,398 (0.08 %)
Somalis: 63,853 (0.64 %) Lebanese: Germans: 27,593 (0.52 %)
Indians: 4,372 (0.08 %) 26,550 (0.46 %) Vietnamese:
British: 4,048 (0.07 %) Pakistanis: 22,658 (0.43 %)
Others: 83,357 (1.53 %) 24,936 (0.43 %) Danes: 21,447 (0.41 %)
Bosnians and Herzegovini- Filipinos: 22,892 (0.44 %)
ans: 23,029 (0.40 %)
Somalis: 21,175 (0.37 %)
Others: 415,219 (7.25 %)
Unemployment 2014: 7.9 % 2012: 7.7 % 2014: 6.7 % 2014: 3.5 %
rate 2015: 7.4 % 2013: 8.2 % 2015: 4.6 % 2015: 4.4 %
2016: 6.9 % 2014: 8.5 % 2016: 4.2 % 2016: 4.7 %
2017: 8.8%
Sources Statistics Sweden Eurostat, worldometers, Statistics Denmark Statistics Norway
countrymeters
10II. Largest cities
Sweden Finland Denmark Norway
City Inhabitants City Inhabitants City Inhabitants City Inhabitants
Stockholm 935,619 Helsinki 635,181 Copenhagen 1,295,686 Oslo 975,744
Gothenburg 556,640 Espoo 274,583 Aarhus 335,684 Bergen 252,772
Malmö 328,494 Tampere 228,274 Aalborg 211,937 Stavanger/ 213,313
Sandnes
Uppsala 214,559 Vantaa 219,341 Odense 200,563 Trondheim 177,617
Linköping 155,817 Oulu 200,526 Esbjerg 115,905 Fredrikstad/ 109,907
Sarpsborg
Väster�s 147,420 Turku 182,604 Vejle 113,243 Drammen 115,137
Örebro 146,631 Jyväskylä 138,850 Frederiksberg 105,037 Porsgrunn/ 92,001
Skien
Helsingborg 140,547 Lahti 119,452 Randers 98,118 Kristiansand 61,037
Jönköping 135,297 Kuopio 117,740 Viborg 96,477 T�nsberg 51,061
Norrköping 139,363 Kouvola 85,059 Kolding 92,282 �lesund 51,474
Source: Statistics Sweden Source: Statistics Finland Source: Statistics Denmark Source: Statistics Norway
C 11III. Country ratings
Sweden Finland Denmark Norway
Country rating Aaa, Outlook: stable Aa1, Outlook: stable Aaa, Outlook: stable Aaa, Outlook: stable
Moody’s
Country rating A1 A2 A2 A1
Coface In 2017, activity is expected In 2018, activity will slow down The slow rate of growth of Low oil prices led to a
to slightly slow due to less slightly, although growth will exports and consumption in slowdown in activity in 2016
dynamic demand than in remain above potential. Private 2016 thwarted the expected because of reduction in oil
2016. Private consumption investment, although more acceleration in growth. In investments and weaker
will be affected by slower moderate in 2018, will remain 2017, there is likely to be a private consumption. Growth
wage growth and the one of the main contributors to moderate upturn in activity, is expected to be a little
decline in unemployment growth, due to low interest driven by domestic factors. firmer in 2017, driven by
(6.4 % in November 2016). rates, coupled with dynamic Household consumption will private consumption and
However, this will remain domestic and external underpin growth thanks to investment in non-oil sectors.
high due to the continuation demand. Higher capacity improvements in the labour Household consumption is
of the Riskbank’s (Central utilization rate in the forestry market. In addition, expected to support
Bank) accommodative and metallurgical industry investment will make a Norwegian growth because
monetary policy as well as a would foster investment in positive contribution to of historically low interest
significant immigration. these sectors. Investment in growth, sustained by rates (0,5 %) set by the
The current account surplus research and development will increased consumption and a central bank and rising
is set to remain stable in also be more dynamic relaxed monetary policy on property prices boosted by
2017, at a very comfortable following several years of the part of the Central Bank. easy access to credit.
level. Imports will still be decline due to the deterioration Inflation is expected to Despite high household debt
firm, buoyed by growing of mobile telephone services. increase in 2017 as a result of (220 % of disposable
domestic demand, but will, Residential construction will the slow rise in oil prices income), the government’s
nonetheless, be offset by support activity, due to strong alongside higher wages. The expansionary fiscal policy
stronger exports due to the housing demand, particularly in Danish Central Bank’s relaxed can help to encourage
moderate growth in demand the Helsinki area. In addition, monetary policy (policy public investment and
from the country’s main the expansion of tourism will interest rates: 0 %; deposit household consumption.
trading partners. However, a continue, driven by a growing rates: -0.65 % since
slowdown in demand from influx from Russia and Asia, February 2015) is likely to
12the United Kingdom (3rd attracted by preserved natural continue in the short term, Unemployment will stabilise
largest trading partner) after sites and the northern lights. bearing in mind the low level (4.5 %), with a halt to oil
Brexit could affect the trade Exports will continue to benefit of inflation and the pegging sector companies’ plans to
balance through a decline in from the Competitiveness Pact, of the Danish krone to the lay off workers. The recovery
exports. which reduced unit labour euro. The 2017 budget of investment in other
The banking system will costs by 3.7% in 2017, includes measures aimed at sectors will also support the
present a high risk as although wages are expected improving the healthcare economy, especially in
household debt is high and to rise again in 2018. In system and the collection of shipbuilding and
property prices are still rising addition, strong demand in the taxes as well as boosting aid construction.
(danger of the bubble main partner countries for refugees and displaced
bursting). (Sweden, the United States and persons from conflict zones
Germany), as well as the (particularly the Middle East).
economic recovery in Russia, The deficit as well as the
would favour Finnish exports. public debt will therefore
The dynamism of orders in the remain well below the
shipbuilding industry and the threshold defined by the
completion in 2017 of the European Stability and
country’s largest wood process- Growth Pact (3 % and 60 %
ing plant (paper, resin, of GDP, respectively). The
bioenergy, etc.), will also business climate in the
support exports. Thus, the country will be very positive
contribution of trade to growth and ranks third in the Doing
will be positive in 2018. Business 2017 survey behind
Household consumption will be New Zealand and Singapore.
more dynamic, driven by a
slight rise in wages, in a context
of moderate inflation, and by
decreased unemployment
(7.3% in October 2017). Low
interest rates will also favor
consumption, even if the
weight of the debt (129% of
disposable income) will still
weigh on the financial situation
of households.
C 13Sweden Finland Denmark Norway
Corruption 88/100 89/100 90/100 85/100
perception
th
index (CPI), (shared 4 place out of 176 (3rd
place out of 176 (1st
place out of 176 (6 th place out of 176
where 0 countries) countries) countries) countries)
means that a
country is
percieved as
higly corrupt
and 100
means it is
perceived as
very clean
Source: Transparency International, Report 2016
14Sweden Finland Denmark Norway
Ranking of 138 countries
Competitiveness 19 10 12 11
Higher education and 12 2 6 7
training
Technological 4 16 11 7
readiness
Macroeconomic 17 46 18 1
environment
Institutions 11 1 15 5
Innovation 7 3 10 12
Business sophistication 7 11 9 10
Health & primary 20 1 21 11
education
Goods market 17 19 18 21
efficiency
Financial market 14 5 24 9
development
Labour market 20 23 13 9
efficiency
Market size 41 5 58 49
Source: The Global Competitiveness Report 2015-2016
C 15IV. Currencies
Sweden Finland Denmark Norway
Currency SEK (Swedish Krona) EUR (Euro) DKK (Danish Krone) NOK (Norwegian Krone)
IV. Norway and the EU
General Norway is not a Member State of the European Union; however, Norway‘s economic and trade
relations with the EU are mainly governed by the agreement on the European Economic Area (EEA).
Importing into the EU from Norway The EU uses trade defense instruments to re-establish a competitive environment for the EU
industry when harmed by dumped or subsidized imports.
Exporting from the EU to Norway The European Commission monitors and assists affected EU industries when non-EU countries
take trade defense measures against EU exporters.
Customs duties (Norwegian: toll) shall be paid upon importation of goods. The “ordinary” rate of
the customs tariffs applies for goods imported from countries with whom Norway has not
entered into a free trade agreement (FTA) and for goods imported from a FTA-party, but not
satisfying by the conditions for preferential tariff treatment as set out in these agreements.
Source: toll.no
16VI. Inflation rates
4
3,5
3
2,5
Sweden
2
Norway
Finland
1,5
Denmark
1
0,5
0
2010 2011 2012 2013 2014 2015 2016 2017 2018
-0,5
Source: http://www.inflation.eu/inflation-rates/cpi-inflation.aspx
C 17VII. Growth
GDP Growth
(in millions of US$)
700
600
500
Sweden
400
Norway
300 Finland
Denmark
200
100
0
2010 2011 2012 2013 2014 2015 2016 2017
18VIII. Major trading partners
Sweden
Import Export
Germany
10%
Norway
19%
Denmark
10%
30%
Finland
39%
UK
8%
7%
The Netherlands
Belgium
7% 7%
4% France
5% 6% China
6%
4% 5% 3% 5%
Poland
4% 5%
5% 8% 4%
Other countries
C 19Finland
Import Export
Germany
15% 13% Sweden
Russia
32% China
11%
11% 37%
The Netherlands
France
6%
US
11%
5% Estonia
3%
3% UK
3% 7%
3% 8%
4% 5% 3% Poland
4% 6% 3% 7%
Other countries
20Denmark
Import Export
Germany
15% Sweden
21%
29% Norway
UK
39% 11%
US
The Netherlands
12%
6% China
3%
Poland
4% 4% 6%
Italy
4% 4% 5%
3% 3% France
8% 3% 5% 5%
8%
2% Other countries
C 21Norway
Import Export
Germany
11% 14%
Sweden
11% 31% 6% Denmark
41%
4%
UK
5%
The Netherlands
5% France
4% 20%
4%
China
3%
2%
2% 7% Poland
6% 11% 10%
3%
US
Other countries
IX. Transactions with Germany
Sweden Finland Denmark Norway
Foreign trade (million euro in 2017, January - June)
Imports from Germany 12,836 6,992 16,453 8,381
Exports to Germany 7,421 6,249 13,339 14,861
Balance -5,415 -743 -3,114 6,480
22X. Overview of public holidays in 2018
Sweden
01 January New Year’s Day
06 January Epiphany
30 March (varies from year to year) Good Friday
01 April (varies from year to year) Easter Day
02 April (varies from year to year) Easter Monday
01 May Labor Day
10 May (varies from year to year) Ascension Day
06 June National Day
22 June (varies from year to year) Midsummer Eve
23 June (varies from year to year) Midsummer Day
03 November All Saints Day
24 December Christmas Eve
25 December Christmas Day
26 December Boxing Day
31 December New Year’s Eve
C 23Finland
01 January New Year’s Day
06 January Epiphany
30 March (varies from year to year) Good Friday
01 April (varies from year to year) Easter Day
02 April (varies from year to year) Easter Monday
01 May Labor Day
10 May (varies from year to year) Ascension Day
22 June (varies from year to year) Midsummer Eve
23 June (varies from year to year) Midsummer Day
06 December Independence Day
24 December Christmas Eve
25 December Christmas Day
26 December St. Stephen’s Day
31 December New Year’s Eve
24Denmark
01 January New Year’s Day
29 March (varies from year to year) Maundy Thursday
30 March (varies from year to year) Good Friday
01 April (varies from year to year) Easter Day
02 April (varies from year to year) Easter Monday
27 April General Prayer Day
10 May (varies from year to year) Ascension Day
20 May Bank Holiday
21 May Whit Monday
05 June Constitution Day
24 December Christmas Eve
25 December Christmas Day
26 December St. Stephen’s Day
31 December New Year’s Eve
C 25Norway
01 January New Year’s Day
25 March (varies from year to year) Palm Sunday
29 March (varies from year to year) Maundy Thursday
30 March (varies from year to year) Good Friday
01 April (varies from year to year) Easter Day
02 April (varies from year to year) Easter Monday
01 May Labor Day
10 May (varies from year to year) Ascension Day
17 May National Day
20 May (varies from year to year) Pentecost
21 May (varies from year to year) Pentecost Monday
24 December Christmas Eve
25 December Christmas Day
26 December Boxing Day
31 December New Year’s Eve
26D. Law
I. Establishing a company
Sweden Finland Denmark Norway
Incorporated companies
Limited liability Private Ltd, Private Ltd, Private Ltd, Private Ltd,
company AB (privat aktiebolag) Oy (Osakeyhtiö)/ ApS (Anpartselskab) AS (Aksjeselskap)
Ab (Aktiebolag)
»» Share capital at least »» Share capital at least »» Share capital at least
SEK 50,000 »» Share capital at least DKK 50,000 NOK 30,000
(approx. EUR 5,300) EUR 2,500 (approx. EUR 6,600) (approx. EUR 3,300)
»» Legal person and holder »» Legal person and holder »» Legal person and holder »» Legal person and holder
of rights and obligations of rights and obligations of rights and obligations of rights and obligations
»» Taxable entity »» Taxable entity »» Taxable entity »» Taxable entity
Entrepreneur company,
IVS (Iv�rks�tterselskab)
»» Share capital at least
DKK 1
»» The company is obligated
to retain at least 25 % of
the profit until the capital
reaches DKK 50,000
(approx. EUR 6,600)
»» Legal person and holder
of rights and obligations
»» Taxable entity
D 27Sweden Finland Denmark Norway
Joint stock Public Ltd, Oyj (Julkinen osakeyhtiö)/ Public Ltd, ASA
company AB (publikt aktiebolag) Abp (publikt aktiebolag) A/S (aktieselskab) (Allmenn Aksjeselskap)
»» Share capital at least »» Share capital at least »» Share capital at least »» Share capital at least
SEK 500,000 EUR 80,000 DKK 500,000 NOK 1,000,000
(approx. EUR 53,000) (approx. EUR 66,000) (approx. EUR 110,000)
»» Legal person and holder
»» Legal person and holder of rights and obligations »» Legal person and holder »» Legal person and holder
of rights and obligations of rights and obligations of rights and obligations
»» Taxable entity
»» Taxable entity »» Taxable entity »» Taxable entity
European »» An incorporated »» An incorporated »» An incorporated »» An incorporated
companies (SE) company with a company with a company with a company with a
minimum capital of minimum capital of minimum capital of minimum capital of
EUR 120,000. Its EUR 120,000. Its EUR 120,000. Its EUR 120,000. Its
registered office must registered office must be registered office must be registered office must
be located in an EU or located in an EU or EEA located in an EU or EEA be located in an EU or
EEA country country country EEA country
»» However, it can be »» However, it can be »» However, it can be oved »» However, it can be
moved to another moved to another to another location at moved to another
location at any time location at any time any time location at any time
»» An SE is treated in each »» An SE is treated in each »» An SE is treated in each »» An SE is treated in each
Member State as a joint Member State as a joint Member State as a joint Member State as a joint
stock company formed stock company formed in stock company formed in stock company formed
in accordance with the accordance with the law accordance with the law in accordance with the
law of the country in of the country in which of the country in which law of the country in
which the SE‘s the SE‘s registered office the SE’s registered office which the SE‘s
registered office is is situated is situated registered office is
situated situated
28Partnerships
General HB (handelsbolag) AY (avoin yhtiö)/ I / S (interessentskab) ANS/DA (ansvarlig selskap)
partnership ÖB (öppet bolag)
»» Established through a »» Established through a »» Established through a
partnership agreement »» Established through a partnership agreement partnership agreement
by at least two company partnership agreement by at least two company by at least two company
founders by at least two company founders founders
founders
»» The partners have equal »» The partners have equal »» The partners have equal
status in all the »» The partners have equal status in all the status in all the company’s
company’s operations status in all the company’s operations operations (if not otherwise
and are personally company’s operations and are personally agreed in partnership
responsible for company (if not otherwise agreed responsible for company agreement) and are
decisions, liabilities, and in partnership decisions, liabilities, and personally responsible for
debts agreement) and are debts company decisions,
personally responsible liabilities, and debts
»» Legal person and holder »» Legal person and holder
for company decisions, »» Legal person and holder
of rights and obligations of rights and obligations
liabilities, and debts of rights and obligations
»» Taxed by dividing the »» Taxed by dividing the
»» Legal person and holder »» Taxed by dividing the
profit and net assets profit and net assets
of rights and obligations
between the partners between the partners profit and net assets
»» Taxed by dividing the (transparent) between the partners
profit and net assets according to the terms of
between the partners partnership agreement
according to the terms »» DA (ANS med Delt
of partnership Ansvar). In this form,
agreement each of the participants
can only be held liable
for as high a percentage
of debts as outlined in a
predetermined founding
contract
D 29Sweden Finland Denmark Norway
Limited KB (kommanditbolag) KY (kommandiittiyhtiö)/ K/S (kommanditseskab) KS (kommandittselskap)
partnership KB (kommanditbolag)
»» Established through a »» Established through a »» The company is owned
partnership agreement »» Established through a partnership agreement by two types of entities:
by at least two company partnership agreement by at least two company the general partner,
founders by at least two company founders who holds unlimited
founders liability, and one or
»» There is at least one »» The general partner,
more limited partners
limited partner, i.e. a »» There is at least one who has management
with limited liability
participant in the limited partner, i.e. a control, shares the
company who generally participant in the profits of the firm in »» Each limited partner
acts as an investor company who generally predefined proportions must pay equity of
acts as an investor. and carries liability for NOK 20,000, of which
»» A limited partners’
Limited partners’ the debts of the 20 % must be paid
personal responsibility
personal responsibility partnership. The limited before the registration
for company’s liabilities
for the company’s partners are only liable at Br�nn�ysund Register
and debts is limited to
liabilities and debts is for debts incurred by Centre
the capital invested
limited to the capital the firm to the extent of »» The general partner
»» Legal person and holder invested. General their Investment must supply at least
of rights and obligations partners’ personal
»» Legal person and holder 10 % of the total equity
»» Taxed by dividing the responsibility as in of rights and obligations »» Legal person and holder
profit and net assets general partnership
»» Danish corporate tax is of rights and obligations
between the partners »» Legal person and holder
avoided completely if »» Taxed by dividing the
of rights and obligations
there are nonresident profit and net assets
»» Taxed by dividing the partners and if the between the partners
profit and net assets trading company works
between the partners solely outside Denmark
according to the terms
of partnership
agreement
30Other
Branch of a Filial Sivuliike /Filial Filial NUF
foreign trader (Norskregistrertuten-
»» Part of a foreign »» Part of a foreign »» Part of a foreign landsk foretak)
organization that runs a organization that runs a organization that runs a
continuous business in continuous business in continuous business in »» Part of a foreign
Sweden in the name and Finland in the name and Denmark in the name organization that runs a
for the benefit of the for the benefit of the and for the benefit of continuous business in
foreign organisation foreign organisation the foreign organisation Norway in the name and
for the benefit of the
»» No legal personality »» Must operate in the »» No legal personality
foreign organisation
same line of business as
»» Taxable entity, as it is »» Taxable entity as it is
the foreign trader »» Must operate in the
usually a permanent usually a permanent
same line of business as
establishment of the »» No legal personality establishment of the
the foreign trader
foreign company foreign company
»» Taxable entity
»» No legal personality
»» Taxable entity
Foundation Foundation (Stiftelse) Säätiö / Stiftelse Foundation (Fond) Stiftelse
»» Set up to manage »» Set up to manage »» Set up to manage »» Set up to manage
property donated for a property donated for a property donated for a property donated for a
particular purpose. No particular purpose. No particular purpose. No particular purpose. No
owners, shareholders, or owners, shareholders, or owners, shareholders, or owners, shareholders, or
members members members members
»» Legal person and holder »» Legal person »» Legal person and holder »» Legal person
of rights and obligations of rights and obligations
»» Taxable entity for »» Taxable entity for
business operations business operations
D 31Sweden Finland Denmark Norway
Economical Economic association Cooperative association Economic association, SA (Samvirkeforetak)
associations (Ekonomisk förening) (Osuuskunta /Andelslag) (Erhvervsdrivende
Forening) »» Established by at least
»» Established by at least »» Established by at least two persons. Owned by
three persons. Owned by three persons. Owned »» Established by at least its members
its members by its members two persons. Owned by »» Legal person and holder
its members
»» Legal person and holder »» Legal person and holder of rights and obligations
of rights and obligations of rights and obligations »» Legal person and holder »» Taxable entity
of rights and obligations
»» Taxable entity »» Taxable entity
»» Taxable entity
Non-
R.y. (Rekisteröity governmental
yhdistys) / organisations
r.f. (Registrerad förening) (NGO-associations)
(almennyttig forening)
»» A non-profit association
is an organisation that is »» A non-profit association
meant to be permanent, is an organisation that is
founded by several meant to be permanent,
persons or several founded by several
organisations having persons or several
legal capacity, for the organisations having
realization of a common legal capacity, for the
non-profit purpose realisation realization of
a common non-profit
»» Legal person and holder purpose
of rights and obligations
»» Legal person and holder
»» Taxable entity for of rights and obligations
business operations
»» Taxable entity for
business operations
32Proprietorship Proprietorship Tmi (Toiminimi)/ Proprietorship ENK
(Enskild firma) Fma (Enskild (Enkeltmandsvirksomhed) (Enkeltpersonforetak)
näringsidkare) »» Not a separate legal
»» Not a separate legal »» Not a holder of rights
entity, a holder of rights
entity, a holder of rights »» Not a holder of rights and obligations, and not
and obligations, and not
and obligations, and not and obligations, and not a taxable entity
a taxable entity
a taxable entity a taxable entity »» The entrepreneur bears
»» The natural person is
»» The natural person is »» The entrepreneur bears the liability and is also
taxed for income from
taxed for income from the liability and is also taxed for the profit
business activities
business activities taxed for the profit
D 33Copenhagen
34II. Working
Sweden Finland Denmark Norway
Employment and labor law
General Formal requirements Formal requirements Formal requirements Formal requirements
for employment for employment for employment for employment
relationship relationship relationship relationship
»» Written contract is not »» Written contract not »» Written employment »» Written employment
required to enter into required by law agreement. The Danish contract and Norwegian
agreement Notice period
Act of Statements of tax card (skattekort) are
Employment (based on mandatory
Notice period
»» Depends on the duration EU regulations) contains Notice period
»» Depends on the duration of employment, 1-6 minimum requirements
of employment, months as to the contracts of the »» Depends on the
1 – 6 months employment agreement employment time and
Probationary period
Notice period age of employee, 1-6
»» Depends on the age of
»» 6 months allowed by law months
the employee for
(additionally limiting to »» Depends on the duration
employment commenced Probationary period
half of the fixed-term of of employment,
before January 1, 1997
employment). Can be 1 – 6 months »» 6 months allowed by law
»» Variations occur in extended by 1 month for »» Variations occur in
collective agreements each 30 days’ absence collective agreements
Probationary period due to sickness or
Probationary period
parental leave
»» 6 months allowed by law
»» During the probationary »» 3 months allowed by law
»» Variations occur in period, the employment
collective agreements may be terminated
without a notice period
D 35Sweden Finland Denmark Norway
Managing »» An employee who is »» Is a part of the company »» Normally exempted from »» The managing director
director normally exempted from and hence not employed the application of The and at least half of the
the application of the by the company. Salary Employment Act, members of the board
Employment Protection Therefore, the provisions The Holiday Act etc., must reside in Norway or
Act, which means that of the Employment which means that the another EEA country
the contract may Contracts Act, Working contract may stipulate
stipulate other Hours Act, and Annual other conditions as to
conditions for Holidays Act are not termination, notice
termination, notice applicable to an MD periods, etc.
periods, etc. »» Terms regarding working »» The parties are free to
»» As the Act is not hours, holidays, etc. agree on the terms and
applicable, the contract stipulated in a contract conditions of the
should be much more »» Should hence be much
employment, which
comprehensive than is more comprehensive
should hence be much
otherwise required more comprehensive
»» Collective agreements
do not apply to MD
36Employment »» Permanent employment »» Permanent employment »» Permanent employment »» Permanent employment
forms as a general rule as a general rule as a general rule as a general rule
»» Temporary employment »» Termporary employment »» Temporary employment »» Temporary employment
is allowed, but may be allowed 1) on is allowed, but may be is allowed, but may be
converted to permanent employee’s initiative, or converted to permanent converted to permanent
employment if the 2) on employer’s employment if employment if the
employee has sufficient initiatative, provided that prolonged consecutively employee has sufficient
employment time with a there are justified without valid reason(s) employment time with a
certain employer reasons for fixed-term certain employer
employment
»» Contracts made for a
fixed term on the
employer‘s initiative
without a justified
reason and consecutive
fixed-term contracts
concluded without a
justified reason are
considered valid
indefinitely
D 37Sweden Finland Denmark Norway
Termination By the employee By the employee By the employee By the employee
»» Reason does not have to »» Reason does not have to »» Reason does not have to »» Reason does not have to
be provided be provided be provided be provided
»» Notice period applies if the »» Notice period applies if the »» Notice period applies if the »» Notice period applies if the
termination does not result termination does not result termination does not result termination does not
from gross breach of from gross breach of from gross breach of result from gross breach of
contract by the employer contract by the employer contract by the employer contract by the employer
By the employer By the employer »» One month’s notice for By the employer
»» Dismissal requires a good »» Dismissal requires a good expiry at the end of the »» Dismissal requires a
cause, which may be cause, which may result month good cause, which may
either due to redundancy from personal or financial By the employer result from personal or
or personal causes reasons and production »» Dismissal requires a financial reasons and
»» The good cause related grounds good cause, which may production related
requirement is not met if »» The good cause result from the grounds
the employer can offer requirement is not met if employee’s personal or »» The good cause
another position to the the employer can offer the employer’s financial requirement is not met if
employee another position to the and business related the employer can offer
»» Notice period applies employee grounds another position to the
»» Notice period applies »» The notice period employee
Summary dismissal
Summary dismissal depends on the duration »» Notice period applies
»» Requires gross breach of of the employment at
the employment contract »» Termination without the time of giving the
by the employee notice possible only for notice of termination
»» Not subject to a notice particularly weighty
reasons »» 0 < 5 months: 1 month
period
»» Termination without »» 5 months < 2 years and
notice is not possible on 9 months: 3 months
financial and »» 2 years and 9 months <
production-related 5 years and 8 months:
grounds 4 months
38»» 5 years and 8 months <
8 years and 7 months:
5 months
»» 8 years and 7 months or
more: 6 months (Above
is applicable for white
collar employees only)
Unions and Right to employee Right to employee Right to employee Right to employee
collective participation participation participation participation
agreements »» The employer is required »» Employee participation is »» Outside of collective »» The Norwegian labor
to inform unions with protected by law. bargaining agreements, market is regulated by
which there are Substantial worker there is mandatory both legislation and
collective agreements as participation rate, more employee participation through collective
well as other unions than 70 % by 1/3 (in the top-tier bargaining agreements
which have members in »» The employer must corporate governing (tariffavtale)
the workforce about observe at least the body) if there are more »» Trade unions traditionally
plans and events that provisions of the than 35 full-time hold a powerful position
have an effect on national collective employees on average in Norway
employees agreement declared as »» In collective bargaining Duty to negotiate
»» Failure to comply with generally binding within agreements, a joint
this requirement is the sector in question cooperation committee »» Prior to any action to
sanctioned by damages must be established with dismiss an employee, the
»» Any provision of an employer must discuss the
Duty to negotiate employment contract employees/union
representative if there matter with the employee
»» The employer is required that is in conflict with an and the employees’ elected
equivalent term in the are more than 35
to negotiate with unions full-time employees on representatives
with which there are applicable generally
binding collective average »» The statutory period of
collective agreements as notice of termination varies
well as other unions agreement is void, and
the equivalent provision between one and six
which have members in months
the workforce before in the generally
D 39Sweden Finland Denmark Norway
taking decision that have applicable collective
an effect on one or more agreement is applied
employees instead
»» Failure to comply with Duty to negotiate
the requirement is »» The duty to negotiate
sanctioned by damages with employees or their
elected representatives
concerns employers
regularly employing
20 employees or more
»» Failure to comply with
the duty may result in
the employee’s right to
compensation
(max. EUR 30,000)
Minimum Wage Wage Wage Wage
requirements »» No statutory minimum »» No statutory minimum »» No statutory minimum »» No statutory minimum
and conditions wage rate wage rate wage rate wage rate
»» The minimum wages »» Collective agreements »» Collective agreements »» Wages fall within a
stipulated by collective include minimum wage often include minimum national scale negotiated
agreements within rates wage rates by labor, employers, and
different industries are »» If a collective agreement Working time local governments
generally respected, is not applicable to an Working time
even by employers not »» Normal office working
employment relationship time in Denmark is 37 »» Ordinary working hours
bound by the and the employer and
agreements hour per week: 7.5 hours for full time employees
the employee have not Monday to Thursday and are usually limited to 40
agreed on the 7 hours Friday. hours per week,
remuneration to be paid Lunchtime is not paid. excluding lunchtime.
for the work, the This means that work There are, however,
40Working time employee shall be paid is usually done from a number of collective
»» The law stipulates that reasonable “normal” 8.30 to 16.30, including agreements that specify
an ordinary working day remuneration for the 30 minutes unpaid a shorter normal
is 8 hours and an work performed lunchtime working week for
ordinary working week is particular types of work
Working time »» However, the employer
40 hours. Overtime may and employee agree on »» Normal working hours
»» The time spent on work
be required by the and the time an precise working time may, under special
employer within limits employee is required to arrangements as part of circumstances, exceed
stipulated by law be present at a place of the hiring process 40 hours a week, as long
»» Many collective work at the employer’s as the average does not
»» Overtime is not
agreements have rules disposal are considered exceed 13 hours a day or
regulated by law and
for working time working hours 48 hours per any 7 days
shall thus also be
»» Regular working hours addressed in the
shall not exceed eight contract
hours a day or 40 hours »» The average working
a week. The regular hours may not exceed
weekly working hours 48 hours in a 4 months
can also be arranged in period
such a way that the
average is 40 hours over
a period of no more than
52 weeks
»» Overtime refers to work
carried out on the
employer‘s initiative in
addition to the regular
working hours
»» Explicit consent of the
employee is required in
each case of overtime
D 41Sweden Finland Denmark Norway
»» Many collective
agreements have specific
provisions for working time
Minimum Annual leave Annual leave Annual leave Annual leave
requirements »» The statutory minimum »» An employee is entitled to »» The statutory minimum »» The statutory minimum
and conditions leave is 25 days per year two and a half weekdays leave is 5 weeks per leave is 25 days per year
Severence pay of leave for each full leave year. Paid leave requires »» Employees above the
credit month. However, the employee to have age of 60 are granted 6
»» There is no obligation to the entitlement is two accrued leave days in the
pay severance pay when additional leave days per
weekdays of leave for past calendar year year
there is good cause for each full leave credit
termination NOTE: A new law Severence pay
month if the duration of regulating leave is enacted
the employment has been and will come into force on »» An employee cannot
less than one year (i.e. September 1, 2020. This claim severance pay
maximum statutory law will change the current under Norwegian law. If
annual leave entitlement leave system in Denmark. dismissal is justified,
is either 24 or 30 days) claims are limited to
Severence pay salary during the notice
»» An employee is granted
annual leave at a time »» 1 month’s salary if the period
determined by the employee has more than »» The employment
employer. A total of 24 12 years of tenure at the contract for a company’s
weekdays of the annual time of expiration of the CEO may state that the
leave must be taken in notice period, and CEO waives his/her
the holiday season »» 3 months‘ salary, if the employment protection
(summer holiday; until employee has more than in exchange for a
30.09.). The rest of the 17 years of tenure at the severance payment.
leave (winter holiday) time of expiration of the Such agreement must be
must be granted by the notice period. (Above is done in advance and in
start of the following applicable to white collar writing
holiday season (until employees only)
01.05.)
42»» Employees have the right
to receive at least their
regular or average pay
for the time of their
annual leave
»» Leave pay calculations
differ based on whether
the employee’s salary is
calculated on a weekly,
monthly, or hourly basis
Severence pay
»» No obligation to pay if the
employee is terminated
for good cause
Minimum Parental leave Parental leave Parental leave Parental leave
requirements »» Maternity leave of 7 »» Maternity leave begins »» Women have the right to »» Parental leave is a
and conditions weeks prior to as well as 50 (maximum) to 30 four weeks of pregnancy statutory right for all
after giving birth. (minimum) days before leave before the parents (regardless of
Parental benefits are the due date. Maternity expected date of birth gender) in Norway
paid in total for 480 days allowance is paid for 105 and 14 weeks of
»» From 1 July 2013,
for each child, to be working days maternity leave after
parental leave may be
divided between the childbirth, of which the
»» Paternity leave lasts up to fully paid by the
parents first two weeks are
54 working days and may Norwegian National
»» Right to parental leave be used after birth mandatory
Insurance for a
during the first 18
»» Childcare leave may be »» Fathers have the right to maximum of 49 weeks
months regardless of take up to two weeks of (or maximum of 59
taken in order to care for
whether parental paternity leave, which weeks at 80 % pay)
a child until the child
benefits are paid must be taken within the
reaches the age of three »» Parental leave may be
»» Right to parental leave first 14 weeks after
freely distributed between
D 43Sweden Finland Denmark Norway
when parental benefits »» The employee must notify the birth or the date on the parents, except that
are paid during the first the employer of maternity, which the child moves 10 weeks are reserved
4 years paternity, parental leave, into the parents‘ home for each parent and that
Sick leave or childcare leave at least »» After the first 14 weeks, the first 6 weeks of the
two months before the both the mother and the leave are reserved for
»» An employee may be intended start of the leave the mother
absent for 7 days father have the right to
without a medical »» The right to parenthood up to a total of 32 weeks
certificate allowances is regulated in of parental leave,
the Health Insurance Act provided that both
»» The first day of absence parents are working in
is without pay Sick leave
Denmark
»» For day 2 – 14, the sick »» According to the
Employment Contracts »» Salaried employees are
pay is 80 % and paid by entitled to half of their
the employer Act, an employee who is
unable to perform work salary during the 4
»» From day 15, the duties due to sickness is weeks of pregnancy
employee instead entitled to his / her salary leave and the 14 weeks
receives sickness benefits for up to nine days from of the maternity leave.
the start of the illness During this period, the
employer will receive a
»» Several collective refund from the
agreements contain government
provisions for a longer
paid sick leave (up to »» However, companies
4 – 6 weeks) often grant their
employees further rights
(14 + 10 weeks of paid
maternity leave and 10
weeks for the father)
»» Collective agreements
also provide for further
rights (14 + 13 weeks of
paid leave)
44Sick leave »» Employees covered by the Salaried Employees Act are entitled to their salary for the duration of the illness. However, after the first 30 days, the municipality will reimburse the employer for part of the salary (sick pay) »» The Employer has to pay for any medical examinations requested from the employee D 45
Helsinki
46III. Insolvency – obligations and risks
Sweden Finland Denmark Norway
Board
Obligations »» The Board of Directors is »» The Board of Directors is »» In addition to »» The Board of Directors
responsible for the responsible for the performing overall and must manage the
appropriate appropriate arrangement strategic management company’s affairs in the
arrangement of control of control over company duties, the Board of best interests of the
over company accounts accounts and finances Directors is responsible company and its
and finances »» Obligation to control the
for the appropriate shareholers
arrangement of control
»» Obligation to establish amount of equity. »» The overall liability
of the company
adequate risk Should the Board of resides with the Board
accounts and finances
management and Directors notice that the
internal controls company has negative »» Obligation to establish
equity, the Board shall at adequate risk
once make a register management and
notification on the loss internal controls
of share capital »» Obligation to ensure
that the board of
managers performs its
duties properly and as
directed by the Board
Risks Inadequate control may result in liability to pay damages
D 47Sweden Finland Denmark Norway
Managing Director
Obligations »» Only public limited »» The Managing Director »» In a public limited »» Only public limited
liability companies are must ensure that the liability company, the liability companies are
required to also have a company’s accounts are day-to-day business is required to have a
Managing Director. The in compliance with the managed by the board Managing Director
Managing Director is law and that its financial of managers (Direktion) (daglig leder)
responsible for affairs have been »» The Managing Director »» The Managing Director is
controlling the finances arranged in a reliable is responsible for responsible for
of the company and manner. The Managing controlling the finances controlling the finances
reporting to the Board Director must act of the company and of the company and
according to instructions
»» The Managing Director reporting to the Board reporting to the Board
and orders given by the
must act according to »» The Managing Director
Board of Directors
instructions and orders shall act according to
given by the Board of instructions and orders
Directors given by the Board of
Directors
Risks Inadequate control may result in liability to pay damages
48General meeting/shareholders
Obligations »» The shareholders’ rights »» The shareholders’ rights »» The shareholders’ rights »» The shareholders’ rights
are exercised at the are exercised at the are exercised at the are exercised at the
Shareholders’ general Shareholders’ general Shareholders’ general Shareholders’ general
meeting meeting meeting meeting
(Generalforsamlinge)
»» Decisions are generally »» Decisions are generally »» Decisions are generally
made by simple majority, made by simple majority, made by simple majority, »» Decisions are generally
although certain although certain although certain made by simple majority,
resolutions require a resolutions require a resolutions require a although certain
qualified majority qualified majority qualified majority resolutions require a
qualified majority
»» If there is reason to »» If there is a reason to »» If there is reason to
believe that the equity believe that the equity believe that the equity
amounts to less than amounts to less than the amounts to less than
half of the share capital, share capital, an official half of the registered
a balance sheet for announcement has to be share capital, action
liquidation purposes registered in the Trade must be taken to
must be established register remedy the capital
deficiency. The
»» If the capital deficiency »» In a public company, a
management must
cannot be remedied, the financial closure has to be
ensure that a general
shareholders must vote prepared if there is reason
meeting is held within
for liquidation to believe that the equity
six months
amounts to less than half
of the share capital. The
shareholders’ meeting has
up to 3 months to decide
on further steps
Risks Failure to comply may lead to personal responsibility for debts of the company
D 49IV. Signing of contracts
Sweden Finland Denmark Norway
General May be entered orally or May be entered orally or by May be entered orally or by May be entered orally or by
guidelines by implicit acquiescence implicit acquiescence implicit acquiescence implicit acquiescence
Written agreement is Written agreement is Written agreement is Written agreement is
required by law in certain required by law in certain required by law in certain required by law in certain
situations, including: situations, including: situations, including: situations, including:
»» Transfer of real property »» Transfer of real property »» Transfer of real property »» Wills
»» Wills »» Wills »» Wills »» Prenuptial agreements
»» Prenuptial agreements »» Prenuptial agreements »» Prenuptial agreements »» Collective agreements
»» Collective agreements »» Collective agreements »» Consumer credits »» Consumer credits
»» Consumer credits »» Consumer credits »» Employment contract »» Labor contracts
»» Ground leases
Representation »» For legal persons, »» For legal persons, »» For legal persons, »» For legal persons,
authorization to authorization to authorization to authorization to
represent the company represent the company represent the company represent the company
may be viewed in the may be viewed in the may be viewed in the may be viewed in the
company register, which company register, which public company register, company register, which
should be done before should be done before which should be done should be done before
contracts are signed contracts are signed before contracts are contracts are signed
signed
50Consumer »» Several laws stipulate »» Several laws stipulate »» Several laws stipulate »» Different laws stipulate
contracts that the contracts that the contracts should that the contracts should that consumer contracts
should be in writing be in writing be in writing should be in writing
»» Contractual terms and »» Contractual terms and »» Standard terms and »» Contractual terms and
conditions that conditions that conditions that conditions that
unreasonably place a unreasonably place a unreasonably place a unreasonably place a
consumer at a consumer at a consumer at a consumer at a
disadvantage compared disadvantage compared disadvantage compared disadvantage compared
to standards set by law to standards set by law to standards set by law to standards set by law
are not binding to the are not binding to the are not binding to the are not binding to the
consumer consumer consumer consumer
Security Typical security Typical security Typical security Typical security
Instruments instruments include: instruments include: instruments include: instruments include:
»» Pledges »» Pledges »» Pledges »» Pledges
»» Guarantees »» Guarantees »» Guarantees »» Guarantees
»» Bank guarantees »» Bank guarantees »» Bank guarantees »» Bank guarantees
»» Chattel mortgages »» Chattel mortgages »» Chattel mortgages »» Chattel mortgages
Material Legal consequences in Legal consequences in case Legal consequences in case Legal consequences in case
defects case of material defects: of material defects: of (material) defects: of material defects:
»» Repair of defects »» Repair of defects »» Repair of defects »» Repair of defects
»» New product »» New product »» New product »» New product
»» Price reduction »» Price reduction »» Price reduction »» Price reduction
»» Cancellation of the »» Cancellation of the »» Cancellation of the »» Cancellation of the
agreement agreement agreement agreement
»» Compensation of »» Compensation of »» Compensation of »» Compensation of
damages damages damages damages
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