NORWAY Trends and Developments Contributed by: Nicolai Julsvoll, Øyvind Mork Karlsen and Jørn Hove, Thommessen
come by and valuations remain low. The end of 2024 saw an increase in public takeover offer - ings and this trend is expected to continue, aided by the aforementioned weakening of the Norwegian krone versus other key currencies. Sectors According to the latest activity report by the Norwegian Venture Capital Association, IT, life sciences, chemicals and materials and clean - tech were the dominant industries in terms of amounts invested in the venture and seed phase in 2022 – with IT the clear leader, also driven by the emergence of various forms of AI and relat - ed technologies. According to Sondo Capital’s annual review, the emergence of AI technologies continued to drive venture investments in the technology sector in 2024, along with software as a service (SaaS) and hardware companies. The Norwegian economy remains reliant on the oil and gas industry. Key sectors for corporate venture capitalists are therefore technology related to various forms of renewable energy, such as the nascent supplier industry surround - ing offshore wind or the numerous initiatives within green and blue hydrogen. Stricter regulations and environmental require - ments in the fisheries and aquaculture industry – which holds a key position as the second-largest export industry – have also led major industry players to invest in and support initiatives and ideas that will limit pollution and improve animal welfare. Easy access to renewable electric power may also make Norway a hub for data centres in a rapidly digitalising world. As such, global tech giants have already made early-stage invest - ments in land and electric power.
Exit tax In 2024, the Norwegian government proposed a tightening of the so-called “exit tax” , aimed at closing tax loopholes utilised by individuals and businesses relocating their operations or invest - ments outside the country. The tax was enacted by the Norwegian Parliament along with the fis - cal budget for 2025, with certain regulations in effect from 20 March 2024. The exit tax is designed to capture unrealised capital gains when individuals or companies leave the country. The initiative raised concerns among early-stage companies and their found - ers, who typically have unrealised gains or arti - ficially high tax valuations, as well as among investors, who fear that the tax could deter innovation and entrepreneurship in Norway. The initiative has led a few founders to relocate to more tax-friendly jurisdictions during 2024 and, in general, to founders becoming more tax-con - scious at an earlier stage in their growth jour - ney. As a result, many in the Norwegian venture scene are concerned about an outflow of talent and capital from Norway and – conversely – that businesses and talent will refrain from relocating to or establishing activities in Norway. Although the tightening of the exit tax dominated the news in 2024, it remains to be seen what effect the new rules will have on the total level of investments in Norwegian early-stage com - panies. Governmental support and initiatives Amended share option tax scheme for early- stage companies Share options are a common way of incentivis - ing employees in start-ups and early-stage com - panies. Normally, exercising share options with a strike price below the fair market value of the
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