NORWAY Law and Practice Contributed by: Harald Sætermo, LexOslo
duct. A shareholder may be liable where it has acted intentionally or negligently and caused or contributed to loss, for example by participating in unlawful dis - tributions, giving improper instructions, abusing its influence over the company, misleading creditors or otherwise contributing to conduct that gives rise to liability. Mere ownership, ordinary group-level contact or ordinary exercise of shareholder rights will not nor - Norwegian law does not recognise a broad or clearly defined doctrine of “piercing the corporate veil” in the same sense as some common law jurisdictions. The question has been debated, and the courts are gener - ally reluctant to disregard the separate legal person - ality of a limited liability company. Any such liability would be exceptional and would typically require cir - cumstances making it unjustifiable to uphold limited liability, such as abuse of the corporate form, serious misconduct, commingling of interests, or a company structure that does not deserve protection. In practice, similar results are more commonly analysed under statutory liability rules, contribution liability or gen - eral tort law, particularly where a shareholder or other controlling person has acted culpably and caused or contributed to a specific loss. mally be sufficient. “Piercing the Veil” Damages liability under the Norwegian Companies Acts may be reduced in exceptional cases under the general statutory rules on mitigation of damages. For foreign investors, however, the practical point is that passive share ownership in an AS or ASA normally gives strong limited liability protection. Personal liabil - ity risk increases where an owner, director or officer takes an active role in management, gives instruc - tions, extracts value from a distressed company or allows the company to continue trading when it is no longer responsibly capitalised or liquid.
Statutory law is the primary source of regulation, in particular the Working Environment Act, which is the central protective statute in Norwegian employment law. The Act applies broadly to undertakings that employ workers, subject to certain statutory exemp - tions and sector-specific rules. Its provisions are gen - erally mandatory and may not be derogated from to the detriment of the employee. Other statutes regulate specific aspects of employ - ment, including holidays, collective labour law, non- discrimination, pensions and data protection. State employees are also subject to specific rules under the State Employees Act, although large parts of the Working Environment Act also apply to employment in the state sector. Collective labour law plays a central role in the Norwe - gian model. Collective agreements at different levels supplement statutory legislation and may set binding wage and working conditions for employment rela - tionships falling within their scope. Such agreements are concluded between trade unions and employers or employers’ organisations. The Labour Disputes Act governs collective labour disputes and the legal framework for collective agreements. Individual employment contracts constitute a further layer of regulation, operating within the framework established by mandatory legislation and any appli - cable collective agreements. Norwegian employment law is also developed and interpreted through case law. Disputes concerning individual employment relationships are heard by the ordinary courts, while the Labour Court has jurisdic - tion over disputes of a collective nature. International and European legal sources are signifi - cant. Under the EEA Agreement, Norway is required to implement relevant EU legal acts as adapted within the EEA framework. Many provisions of the Working Environment Act implement EU directives incorpo - rated into the EEA Agreement, which may be relevant when interpreting the Act.
4. Employment Law 4.1 Nature of Applicable Regulations
The legal framework governing employment relation - ships in Norway is based on statutory law, case law, collective agreements and individual employment contracts.
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