NORWAY Trends and Developments Contributed by: Daniel Nygaard Nyberg, Ole Andenæs, Karoline Ulleland Hoel and Jens Fredrik Bøen, Wikborg Rein Advokatfirma AS
nomenon arises when a fund’s predetermined allo - cation between unlisted and listed shares needs adjustment due to a depreciation in the value of one of the asset classes. The ongoing geopolitical ten - sions, such as the war between Russia and Ukraine and high inflation, have induced economic instability, rendering listed shares, for example, more volatile. Due to this volatility, combined with periods where unlisted shares outperform other asset classes, cer - tain institutional investors will be forced to rebalance their portfolio (eg, by divesting private equity assets). Regulatory influence The regulatory framework in Norway, highly influenced by the EEA agreement and specific national regula - tions, plays a crucial role in shaping the AIF industry and ensuring alignment with international standards while addressing local market needs. This balance fosters a conducive environment for both domestic and international investors and fund managers, con - tributing to the industry’s resilience and adaptability. Diversification of investment strategies One notable trend shaping the Norwegian alterna - tive funds market is the diversification of investment strategies. Historically, Norway has been recognised for its robust private equity, venture capital and real estate sectors. However, the investment landscape is evolving, with alternative fund managers increasingly exploring a broader range of asset classes. This diversification reflects the growing appetite among Norwegian investors for alternative invest - ments that offer both portfolio diversification and the potential for enhanced returns. Fund managers are seizing opportunities in private credit, infrastructure, shipping and hedge funds, both domestically and internationally. Lending Opportunities Under ELTIF 2.0 Overview One of the most notable developments ahead for the Norwegian alternative fund landscape will be the extended lending possibilities that will follow from the implementation of the revised European Long-Term Investment Funds Regulation (ELTIF 2.0) and, in the longer term, the amended Alternative Investment Fund Managers Directive (AIFMD II). The ELTIF Regulation
became applicable in Norway from 1 January 2023. The revised ELTIF Regulation, or ELTIF 2.0, became effective in the EU on 10 January 2024. It brings several crucial changes to the regulatory framework to make ELTIFs more appealing by relaxing several restrictions, potentially opening up new opportunities for investors and managers alike. ELTIFs offer an alter - native avenue for capital deployment. Lending outside of traditional financial institutions has historically been restricted in Norway, limiting the lending market significantly. The ELTIF 2.0 Regu - lation has not yet been implemented in Norwegian law. However, in June 2025, the Ministry of Finance presented a long-awaited legislative proposal imple - menting the ELTIF 2.0 Regulation through the AIF Act, with the earliest likely effective date being during the first half of 2026. Moreover, despite ELTIF 2.0 not yet being in effect in Norway, the FSAN has indicated that it may receive notifications on the marketing of ELTIFs approved under the ELTIF 2.0 regime by the relevant authority in the ELTIF’s EU home state, permitting their marketing in Norway. However, regarding the ability of ELTIFs to provide loans in Norway, this will continue to be governed by the framework established under ELTIF 1.0, until ELTIF 2.0 is implemented in the course of 2026. ELTIF fundamentals In brief, the ELTIFs are voluntary investment vehi - cles, meaning asset managers can choose to seek ELTIF approval. These funds can only be managed by entities licensed under the AIFM Directive and must adhere to specific investment mandates as outlined in the regulation. ELTIFs can also be marketed to non- professional investors under certain conditions. ELTIFs must invest at least 70% of their capital in long- term investments, as specified by ELTIF regulation, and up to 30% in certain liquid investments. Long- term investments include listed and unlisted compa - nies with a market capitalisation of up to EUR500 mil - lion, and real assets valued at EUR10 million or more, such as wind farms and hospitals. Key changes in ELTIF 2.0 In response to the slow growth of ELTIFs in the EU, ELTIF 2.0 introduces significant amendments to the
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