The Foundations Act is the main law that provides for the creation of foundations in Norway. In this country, such entities can be settled by natural persons and companies alike and are subject to specific registration criteria.
Below, our company formation agents in Norway explain the procedure for opening a foundation. We are also at your service if you want to establish another business form, as well as with VAT registration in Norway.
| Short Facts | |
|---|---|
| Applicable law | The Foundations Act. |
| Types of foundations | Private and public foundations can be created in Norway. |
| Setup requirements for foundations in Norway |
They can be created by one or more persons or companies and must have a board of directors. |
| Mandatory registration (YES/NO) | Yes. |
| Registration authority | The Gambling and Foundations Authority. |
| Creation document | Memorandum and Articles of Association. |
| Local address required (YES/NO) | Yes. |
Share capital requirement (YES/NO) |
– NOK 100,000 for charities, – NOK 200,000 for commercial foundations. |
| Tax benefits for foundations in Norway | Tax exemptions are available for foundations created for charitable purposes. |
| Accounting requirements (if any) | Annual accounts must be submitted yearly. |
| Possibility to conduct economic activities through a Norwegian foundation (YES/NO) | Yes, Norwegian foundations can carry out commercial activities. |
| Special requirements (if any) | The name of the foundation must contain STI or stiftelse. |
| Management requirements | A foundation must have at least one external member in the management. |
| Possibility for a foundation to have foreign founders (YES/NO) | Yes, however, they must have Norwegian residence permits. |
| Support in setting up a foundation in Norway (YES/NO) | Yes, clients can rely on our agents for support in setting up foundations. |
Table of Contents
Registration requirements for Norwegian foundations
One or more individuals can set up foundations in Norway. Private limited companies or other associations can also be considered the founders of such an entity. The main requirement for natural persons is to have turned at least 18 years old to become settlors. Both Norwegian and foreign citizens can set up foundations in this country. However, foreigners must apply for residence permits in order to be founders.
Another aspect to consider is that the name of a commercial foundation must contain the word stiftelse or STI.
Norwegian foundations are divided into two forms:
- regular ones, that do not engage in commercial activities;
- foundations established for commercial purposes.
The main difference between them resides in the capital requirements, as such entities need to have a minimum of capital no matter their purpose.
If you want to create a foundation as an NGO (non-governmental organization) for charitable reasons, our local consultants can advise you.
How to register a foundation in Norway
Foundations must be registered with the Norwegian Gambling and Foundations Authority, the organization that also oversees the activities of such entities. In order to create both types of entities, there are various documents to draft. Also, key members must be appointed to the board.
In Norway, you will find that opening an NGO is similar to the company registration procedure in terms of documents unless a special process is used. For the regular pathway, the following documents must be drafted:
- the Memorandum and Articles of Association;
- a statement from an auditor (in the case of commercial NGOs);
- information about the settlers, the board or trustees, and the beneficiaries.
It is also possible to create a foundation by will, which is often the case for those who want to have their assets protected.
If a foundation is established through a will, the testament serves as the foundation’s memorandum of association, and the entity is deemed to have been created at the time of the decedent’s death.
If you decide to establish a foundation in Norway one way or the other, you can rely on our local professionals for guidance in both procedures.
Capital requirements for foundations in Norway
When creating a Norwegian foundation, the most important aspect is its purpose, as the capital requirements depend on it. Here are the main things to consider:
- for an ordinary foundation, the minimum capital that cannot be altered in any way is NOK 100,000 (approx. EUR 9000);
- for a commercial foundation, the minimum capital is NOK 200,000 (around EUR 18,000);
- also, no matter the type of entity, at least one of the board members must be appointed independently from all other participants.
If you need support in settling a foundation, you can rely on our Norwegian company formation officers.
How to create a commercial foundation in Norway
Commercial foundations must meet similar requirements to the establishment of businesses in Norway. They must have local business addresses, as well as meet other similar conditions in terms of documentation. Also, VAT registration in Norway can be required upon reaching the minimum turnover imposed by law.
Also, as a foreigner, if you want to create a foundation and also want to move here, you will need to consider applying for a Norwegian residence permit.
Management requirements for foundations in Norway
No matter the type of foundation one wants to create in Norway, the following requirements must be met:
- it must have a board of directors;
- the board must comprise at least one external member who cannot be one of the main capital participants in the foundation;
- the board must also appoint a chairman.
Please note that commercial foundations must also ensure a physical local business address, so post boxes are not allowed.
Our company registration consultants in Norway can advise on all the setup requirements that apply to foundations.
Tax and reporting requirements applicable to Norwegian foundations
Provided they meet certain conditions, NGOs can be eligible for tax exemptions and even deductions. They can be accessed if they comply with the accounting requirements applicable to such entities as follows:
- they need to prepare annual account and financial statements on a yearly basis;
- they must submit them with the Registrar.
Apart from benefiting from tax advantages, ensuring tax compliance also allows a foundation to maintain its legal status.
Our accountants in Norway can offer detailed information on the conditions for obtaining the available tax exemptions and the levies to pay in case the foundation does not qualify for them.
How can a foundation gather funds in Norway
There are several ways through which non-commercial foundations can obtain funding. Some of the most common are:
- applying for government grants, as the central authorities sponsor specific actions, especially for foundations involved in humanitarian projects;
- entering partnerships with local companies, many enterprises having corporate social responsibility programs;
- donation is another way for a foundation to obtain funds through campaigns and fundraising;
- accessing international funds through grants and partnerships.
Our company formation agents in Norway can offer more information on these aspects.
How long does it take to register a foundation in Norway?
If you want to open a foundation in Norway, here is a timeline for its registration:
- the notification with the Gambling and Foundations Authority must be filed no later than 3 months from the drafting of the Articles of Association;
- the registration procedure can take up to a few months, depending on the period of the year.
If you need assistance in setting up a foundation in Norway, feel free to get in touch with our specialists.