The establishment of companies in Norwegian law follows formalized procedures that vary between company types. For limited liability companies and public limited companies, the procedure is carried out electronically in practice, which simplifies an otherwise formalized process. The practical implementation of company establishment has been significantly modernized, while the legal requirements for the establishment process itself are maintained.
Establishment Procedure for Limited Liability Companies and Public Limited Companies
Limited liability companies and public limited companies are established according to the rules in Chapter 2 of their respective laws. The main purposes of these rules are twofold:
To provide correct information to potential shareholders
To ensure that the share capital is actually paid in and benefits the company
The establishment procedure is formally carried out by creating a foundation document that contains:
The company's articles of association (cf. Limited Liability Companies Act/Public Limited Companies Act § 2-2)
Other provisions as mentioned in the Limited Liability Companies Act/Public Limited Companies Act § 2-3
Electronic Establishment through Altinn
In practice, the establishment and registration of companies occurs electronically through the Altinn platform:
The founder enters information into the electronic system
Altinn automatically generates a foundation document and articles of association
After establishment, the founder receives a message in their Altinn inbox
The founder can use a link in the message to start registering the company
The information from the foundation document is then automatically entered into the "Coordinated Register Form"
Signing of the Foundation Document
The founders shall date and sign the foundation document and any other establishment documentation (cf. Limited Liability Companies Act/Public Limited Companies Act § 2-9, first sentence). When all founders have signed the establishment documentation, the shares are considered subscribed and the company established (cf. Limited Liability Companies Act/Public Limited Companies Act § 2-9, second sentence).
Special Rules for Contributions in Kind
There is no obligation under the Limited Liability Companies Act that the share capital must consist of monetary contributions. The law also allows for contributions of assets and other property values, but the prerequisite is that the assets can be recognized on the balance sheet according to the Accounting Act (cf. Limited Liability Companies Act/Public Limited Companies Act § 2-7).
For contributions in kind, special rules apply:
A statement regarding the contributions must be prepared
The statement must be included in the foundation documentation
This is regulated by the Limited Liability Companies Act/Public Limited Companies Act § 2-6 in conjunction with § 2-4, second paragraph
These special rules are important as contributions in kind can be difficult to value, and it must be ensured that the company is actually provided with the values as share capital.
Post-Establishment for Public Limited Companies
For public limited companies, a special rule applies to so-called post-establishment (cf. Public Limited Companies Act § 2-10 letter a). The rule implies that certain agreements for the company to acquire assets from a shareholder or founder within two years after registration in the Register of Business Enterprises must be approved by the general meeting. The purpose is to prevent circumvention of the strict rules on valuation and control of assets.
Registration in the Register of Business Enterprises
Deadlines and Registration Requirements
The company shall be reported for registration in the Register of Business Enterprises within three months after the foundation documentation has been signed (cf. Limited Liability Companies Act/Public Limited Companies Act § 2-18, first paragraph). Before the company is reported to the Register of Business Enterprises, share contributions must be fully paid (cf. Limited Liability Companies Act/Public Limited Companies Act § 2-18, second paragraph).
Consequences of Failure to Register
If the reporting deadline is exceeded, registration cannot take place (cf. Limited Liability Companies Act/Public Limited Companies Act § 2-18, third paragraph, first sentence). The consequences of this are serious:
Obligations under the foundation document are no longer binding
Share subscriptions are no longer binding
Other obligations under the foundation document cease
For deficient registrations, the error can be "repaired" by correcting it within a deadline set by the Register of Business Enterprises. If the corrected registration is received within the deadline, the registration will be considered timely received.
Legal Effect of Registration
Registration is not a validity requirement for the establishment of the company. However, before the company is registered, it cannot, as a general rule, incur debt or other obligations or be assigned rights (cf. Limited Liability Companies Act/Public Limited Companies Act § 2-20, first paragraph).
From this general rule, certain exceptions apply:
The rule only applies to rights and obligations towards "third parties"
The rule does not include rights and obligations towards shareholders, management, and auditors
The rule also does not include rights and obligations that follow from the foundation document
An unregistered company can go bankrupt, be a separate legal entity in legal proceedings, a separate tax entity, a title holder in the land registry, etc.
Liability for Obligations Before Registration
For obligations incurred by the company in its name before registration, those who have incurred the obligations are personally, unlimitedly, and jointly liable (cf. Limited Liability Companies Act/Public Limited Companies Act § 2-20, second paragraph, first sentence). This liability continues until the company is registered. From the time of registration, the company assumes the obligation (cf. Limited Liability Companies Act/Public Limited Companies Act § 2-20, second paragraph, second sentence).
Establishment of General Partnerships
Differences from Limited Liability Companies
The Partnerships Act contains no rules about foundation documents and registration requirements for general partnerships. The law only provides provisions about the partnership agreement and what it should contain (cf. Partnerships Act § 2-3).
This is primarily because:
There is no obligation to make capital contributions in general partnerships
There are no requirements for restricted company capital
Registration of General Partnerships
The Business Enterprise Registration Act nevertheless contains rules about registration obligations and registration of general partnerships (cf. among others, the Business Enterprise Registration Act §§ 2-1 no. 3, 3-4, and 3-7). The necessary information to register the company is provided in practice by electronically filling out the "Coordinated Register Form" to the Central Coordinating Register for Legal Entities.
Summary
Establishing and registering companies in Norway follows formal procedures that vary by company type. The electronic implementation through Altinn has simplified the process, but the legal requirements for the content itself are maintained. Registration in the Register of Business Enterprises marks an important transition in the company's legal status, particularly with respect to limitation of liability and the ability to undertake obligations.
