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NORWAY Law and Practice Contributed by: Kristian Lindhartsen, Lilly Kathrin Relling and Tobias Kilde, Kvale Advokatfirma DA

at least 3% in a company or chain of companies owning such a vessel. There is a required ratio of owned vessels to chartered-in vessels, and cer - tain restrictions to the chartering out of vessels on bareboat to external parties. There is also a restric - tion as to what assets the company may own. • The company must comply with flag requirements. 9. Implications of Non-Performance, IMO 2020, Trade Sanctions and International Conflict 9.1 Force Majeure and Frustration The wording of the specific force majeure clause is decisive for whether certain events, such as global illness, epidemics or pandemics, constitute force majeure. Under Norwegian law, the starting point is that profes - sional parties entering into agreements are responsi - ble for their contractual obligations. Therefore, if they have agreed to a contractual obligation, they must fulfil said obligation. If the contract is subject to Nor - wegian law, the Norwegian Sale of Goods Act may be applicable, under which certain force majeure-like events may give grounds to exemption of liability for economic loss caused by a breach of contract. For the exception to become applicable, it must be shown that the breach was caused by a hindrance that was outside the control of the defaulting party, and that the defaulting party could not reasonably have been expected to have foreseen the hindrance at the time of entering into the contract, nor avoided or remedied the consequences of it. The decisive factor is the actual effect the hinderance has, rather than the nature of the hinderance in ques - tion. When considering whether the breach would be considered a force majeure event, the following should be considered: • review of the contract or statute applicable; • consideration of the underlying cause of the hin - derance; • the foreseeability requirement (was the hinderance foreseeable?);

• formalities connected to invoking force majeure; and • mitigation/remedy. The Norwegian Court of Appeal handled a case ( Gulat- ing Lagmannsrett reference LF-2021-146849) during the pandemic regarding this current problem. The case concerned a contract of delivery of salmon, which had to be cancelled due to the COVID-19 pandemic. The issue was whether the cancellation was a breach of contract or whether the pandemic constituted a force majeure event, thereby giving contractual grounds for the cancellation. The court found that this qualified as a breach of contract, as the event was not within the force majeure clause, and the non-performing party was liable for the loss. 9.2 Enforcement of the IMO 2020 Rule Limiting the Sulphur Content of Fuel Oil MARPOL Annex VI and the EU Sulphur Directive (Directive EU 2016/802) have been implemented in Norwegian law. Norwegian waters up to longitude 62 degrees are part of the North Sea emission control area (ECA), des - ignated in MARPOL, with a 0.10% limit to SOx and particulate matter emissions. On 1 March 2019, the 0.10% limit was extended to also cover the Norwe - gian world heritage area, which includes the fjords north of this area, as set out in the Regulations of 30 May 2012 No 488 on environmental safety for ships and mobile offshore units. Outside an established ECA, the applicable limit is 0.5%. Specific requirements have also been introduced on passenger ships sailing en route to or from harbours in the EEA that are located in Norwegian territorial waters or exclusive economic zones, with an appli - cable limit of 1.5%. Multiple sanctions are available if a breach is estab - lished, including orders, fines and withdrawal of per - mits. The vessel also risks detention, and the party inducing the breach may risk prison if there are seri - ous breaches as a result of gross negligence or wilful misconduct.

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