NORWAY Law and Practice Contributed by: Ida Marie Windrup, Kristine Hjertenæs, Markus Nilssen and Daniel Jovanovic, BAHR
• the acquiring company is incorporated in an EEA jurisdiction; • the acquiring company will form part of the same group of companies as the target fol- lowing the acquisition; and • a detailed procedure is complied with (often called “whitewash procedure” in international financing transactions). The procedure involves, among other things, (i) an evaluation by the target’s board of directors of the creditworthiness of the recipient of the Financial Assistance, (ii) approval by the board, and (iii) a declaration by the board that it will be in the interest of the company to grant the Financial Assistance, and the background and terms of such Financial Assistance. The Finan- cial Assistance must then be approved by the target’s shareholders’ meeting and information regarding the Financial Assistance must be reg- istered with the Norwegian Business Registry before the Financial Assistance can be granted. 5.6 Other Restrictions Notwithstanding the exceptions available as described in 5.4 Restrictions on Upstream Security and 5.5 Financial Assistance and across its business, a Norwegian entity (and its board of directors) must always act in the best interest of the relevant company and ensure that there is sufficient corporate benefit. Legal advice should be sought in each case involving Financial Assistance. 5.7 General Principles of Enforcement Generally, a distinction must be made between enforcement through the procedure set out in the Norwegian Enforcement Act of 1992 (the “Enforcement Act” ) and enforcement in accord- ance with the Norwegian Financial Collateral Act of 2004 (the “Financial Collateral Act” ), imple-
menting the Financial Collateral Arrangements Directive. At the outset, individual enforcement of security interest granted over an asset located in Norway shall take place within the framework of the Enforcement Act, stipulating enforce- ment procedures for different asset classes. The central authority responsible for this process is the enforcement officer ( Namsmannen ), or in the case of a vessel it will be the District Court (jointly, the “Enforcement Authority” ). However, certain security interests (as set out below) may be enforced in accordance with the more flexible and quick procedures provided for by the Financial Collateral Act. Pursuant to the Financial Collateral Act, assets which are not subject to enforcement through the Enforcement Authority – eg, financial collateral and monetary claims, may be enforced by self- appropriation through the security agent subject to the enforcement procedures and conditions agreed between the parties in the security agree- ment, without involvement of the Enforcement Officer. Such financial collateral includes, but is not limited to, bank deposits and financial instru- ments such as transferable securities (including shares and bonds). Enforcement will typically be exercised by way of the security agent notifying the security provider of its intention to enforce, followed by which the security agent will be able to, inter alia, take pos- session of and exercise any and all ownership and creditor rights in connection with the assets as if it was the creditor thereof, or immediately sell or assign the claim or the assets (by public or private sale for consideration as is then agreed), or require a sale by the Enforcement Authority. To the extent self-appropriation is not explicitly agreed between the parties, the provisions of the Enforcement Act will apply.
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