DENMARK Law and Practice Contributed by: Morten Krogsgaard and Lennart Meyer Østenfjeld, Moalem Weitemeyer
9. Takeover Finance 9.1 Regulated Targets Approval
assets at their tax value. Financing expenses above this level are restricted; • qualifying assets: shares in foreign subsidiar- ies are not qualifying assets (shares in Danish subsidiaries are irrelevant due to consolida- tion); • threshold: lower threshold of DKK21.3 million (just under EUR3 million); • standard interest rate: the standard interest rate applicable to the interest ceiling rule in 2025 is 5.8%; and • permanent loss: save for a limited exception relative to certain capital losses, deductibility of net financing expenses disallowed under the interest ceiling rule is permanently lost. EBITDA Rule The main features of the EBITDA rule are as fol- lows: • implementation: constitutes the Danish imple- mentation of the ATAD EBITDA-based earn- ings stripping rule and is therefore broadly similar to the rules in other EU jurisdictions; • threshold: lower threshold of DKK22.3 million; • deductibility cap: deductibility of net financing expenses capped at 30% of EBITDA; • group ratio: the 30% ratio may be replaced by the actual EBITDA ratio of the consoli- dated worldwide group if the latter is more favourable to the taxpayer; • carry forward: any net financing expenses restricted from deductibility under the EBITDA rule may be carried forward for tax deduction indefinitely; and • unused capacity: unused deductibility capac- ity for net financing expenses may be carried forward for five years.
Acquisitions of qualifying holdings (a direct or indirect holding which represents 10% or more of the capital or voting rights or which makes it possible to exercise a significant influence over the management) operating in the financial services sector must be notified to the Danish Financial Supervisory Authority (the “Danish FSA” ) ( Finanstilsynet ) in advance for approval of the planned acquisition. This requirement also applies to an increase in the qualifying holding which, after the acquisi- tion, results in the interest equalling or exceeding 20%, 33% or 50% of the share capital or voting rights, results in the target company becoming “subsidiary” , or otherwise results in a de facto controlling influence over the company, eg, via a shareholder’s agreement. Assessment The Danish FSA has an assessment period of 60 business days, which may be interrupted if addi- tional information necessary for the assessment is requested. If, during the assessment period, the Danish FSA does not give a written refusal of the application for the intended acquisition, the acquisition will be considered approved. The Danish FSA may stipulate a time limit for the completion of the acquisitions when approving them. The Danish FSA may also extend this time limit. The purpose of the approval is for the Danish FSA to ensure that account is taken of the fol- lowing.
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