NORWAY Law and Practice Contributed by: Bernhard Getz-Jeffreys and Johannes Wiegaard, Ro Sommernes Advokatfirma AS
efits if transactions are artificially structured for tax avoidance. These rules apply to both foreign investors seeking tax benefits in Norway and Norwegian inves - tors using tax treaties in other countries. 9.10 Transfer Pricing and IP Taxation BEPS measures have caused big changes to how transfer pricing is done in Norway. More strict rules on documents and reports, especially from BEPS Action 13’s country-by-country reporting, led to Section 8-12 of the Tax Administration Act. These changes enhance the tax authorities’ capacity to verify that transfer pric - es accurately reflect real economic activity. The taxation of profits from intangible assets (IP) has been controversial, and BEPS has introduced meas - ures to ensure that profits from intangible assets are taxed where they are created. Norway has implement - ed BEPS measures that prevent profits from intangi - ble assets from being transferred to low-tax countries through transfer pricing. 9.11 Country-by-Country Reporting and Transparency Provisions Norway supports country-by-country reporting and has implemented the BEPS Action 13 requirements under the Section 8-12 of the Tax Administration Act, imposing on multinational corporations a duty to dis - close their financial earnings, taxes paid and econom - ic activities on a country-by-country basis. 9.12 Digital Economy Businesses It is challenging to adapt the tax system to the global digital economy. Norway is committed to ensuring that digital platforms contribute tax revenues in accord - ance with their economic activities. The nation’s future tax policies are to be aligned with globally recognised tax regulations for the digital economy, which may include digital services tax schemes.
Norway has introduced new reporting obligations for foreign companies, leading to, for instance, the obli - gation for companies (such as AirBnB) to report all transactions in Norway to the tax authorities. Norway has also introduced withholding taxes on royalties paid from Norwegian entities to related non- Norwegian entities resident in low-tax jurisdictions. In addition, the tax authorities are closely monitoring the tax and VAT obligations of foreign entities with sales into Norway. 9.13 Approach to Digital Services Taxation Norway endorses international initiatives on the tax - ation of the digital economy, including the OECD’s BEPS Action 1. It supports a digital services tax to ensure that digital platforms contribute tax in countries where they generate revenue, regardless of a physical presence. Norway has demonstrated its commitment to global solutions by supporting OECD initiatives and aligning with the EU’s digital taxation initiatives. 9.14 Offshore IP Provisions Norway does not have a set of regulations for taxing offshore intangible assets, but the usual tax regula - tions apply to assets used in Norwegian territory. Income derived from business activities in or managed from Norway is taxed in Norway, and withholding tax on royalties, interests and dividends may be imposed. The general anti-avoidance and transfer pricing rules prevent circumvention of the existing rules, and both the general anti-avoidance rule and LOB/PPT rules in the tax treaties prevent the abuse of those treaties, especially by IP owners in tax havens.
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