February 02, 2025
Registering a business in the Brønnøysund Register is mandatory for all companies operating in Norway. NUF (Norskregistrert Utenlandsk Foretak) refers to a Norwegian branch of a foreign company, which does not have legal personality and is primarily established for reporting and tax purposes. Over the years, NUFs have been a popular solution for foreign enterprises entering the Norwegian market.
Since Poland joined the European Union, many Polish entrepreneurs have chosen to operate abroad. Norway opened the door to foreign companies by allowing branch registration. During my time at Novum, many of our clients have opted to register a branch. Let me provide some examples of situations where an NUF proved to be the most advantageous form of operation in Norway:
This question often arises in discussions with companies planning to operate in Norway. The answer is neither affirmative nor negative. Registering a company branch in Norway is mandatory for all foreign entities operating in the country. Therefore, it is not a question of "profitability" but a necessity.
This registration entails additional obligations, such as employee registration, financial reporting, etc.
In recent years, several changes have been introduced to align the functioning of NUFs with Norwegian limited liability companies (AS). For instance, NUFs are generally required to register in the Foretaksregisteret, which involves submitting financial reports and adhering to Norwegian accounting standards. In practice, this means that NUFs must meet similar requirements as Norwegian AS companies.
Increasing requirements for branches in Norway are effectively aligning them with Norwegian companies. It is essential to stay well-informed about evolving trends to ensure that branch operations meet the expectations of Norwegian contractors and authorities.
There is no straightforward answer to this question. Factors to consider when choosing a business form include:
Sometimes, our clients decide to register a Norwegian AS company instead of a branch. The minimum share capital for AS companies is only 30,000 NOK, making this legal form more accessible to entrepreneurs. This has reduced the appeal of NUFs as an alternative to AS companies. However, there are still situations where registering a branch is more appropriate for a foreign company.
Author: Anna Korpalska
Graphic: Created by AI (OpenAI chatGPT tool) based on the author’s instructions.
What is a NUF?
Registering a business in the Brønnøysund Register is mandatory for all companies operating in Norway. NUF (Norskregistrert Utenlandsk Foretak) refers to a Norwegian branch of a foreign company, which does not have legal personality and is primarily established for reporting and tax purposes. Over the years, NUFs have been a popular solution for foreign enterprises entering the Norwegian market.
When do our clients decide to establish a branch in Norway?
Since Poland joined the European Union, many Polish entrepreneurs have chosen to operate abroad. Norway opened the door to foreign companies by allowing branch registration. During my time at Novum, many of our clients have opted to register a branch. Let me provide some examples of situations where an NUF proved to be the most advantageous form of operation in Norway:
- The company received a contract in Norway: Often, Norwegian clients ordering goods from Poland are interested in their assembly. Assigning workers to Norway necessitates branch registration.
- The company wants to establish a presence in the Norwegian market: Some of our clients register a branch while seeking potential contracts. This allows them to demonstrate to Norwegian clients that they operate in Norway and are ready to collaborate immediately.
- The company received a recommendation from a client: Occasionally, although our clients are not required to register, their contractors demand it, for instance, to issue invoices. This is not a frequent case.
"Is an NUF Worth It?"
This question often arises in discussions with companies planning to operate in Norway. The answer is neither affirmative nor negative. Registering a company branch in Norway is mandatory for all foreign entities operating in the country. Therefore, it is not a question of "profitability" but a necessity.
This registration entails additional obligations, such as employee registration, financial reporting, etc.
Changes in the Approach to Foreign Company Branches in Norway
In recent years, several changes have been introduced to align the functioning of NUFs with Norwegian limited liability companies (AS). For instance, NUFs are generally required to register in the Foretaksregisteret, which involves submitting financial reports and adhering to Norwegian accounting standards. In practice, this means that NUFs must meet similar requirements as Norwegian AS companies.
All foreign company branches are required to calculate and report wages to Norwegian authorities. Many provisions of Norway's Employment Act also apply to seconded employees, even though their employment relationship remains in the country of origin. In recent years, the Norwegian Labor Inspection Authority has made it clear that Norwegian occupational health and safety regulations also apply to the branches of foreign companies.
In Summary:
Increasing requirements for branches in Norway are effectively aligning them with Norwegian companies. It is essential to stay well-informed about evolving trends to ensure that branch operations meet the expectations of Norwegian contractors and authorities.
What to Choose: A Foreign Company Branch in Norway or a Norwegian AS Company?
There is no straightforward answer to this question. Factors to consider when choosing a business form include:
- The type of contract with the Norwegian client
- The nature of the services provided
- The duration of the contract
- The company’s plans for the coming years
Sometimes, our clients decide to register a Norwegian AS company instead of a branch. The minimum share capital for AS companies is only 30,000 NOK, making this legal form more accessible to entrepreneurs. This has reduced the appeal of NUFs as an alternative to AS companies. However, there are still situations where registering a branch is more appropriate for a foreign company.
If you have any doubts about which form of business to choose in Norway, contact us! Our experts will analyze your situation and find the best solution for your company.
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