NUF or AS: which Norwegian entity a foreign company should register

Foreign companies keep asking whether they should set up an aksjeselskap, the Norwegian private limited company, or a norskregistrert utenlandsk foretak, a Norwegian-registered foreign business. The choice sounds bigger than it is. One of them is a whole new company. The other is a stamp on the company you already run.

Two different things

An AS is a separate legal person. You form it in Norway, it has its own name, its own board, its own balance sheet, and it is owned by shareholders who may or may not be you. When your German GmbH forms a Norwegian AS, there are now two companies.

A NUF is not a company. It is a registration. Your existing company tells the Norwegian authorities that it operates here, and Norway records that and issues an organisasjonsnummer, an organisation number, for the branch. There is still one company. It now has a Norwegian registration and a Norwegian number attached to it.

That distinction drives almost everything below. A new company needs capital, a board and its own filed accounts. A branch registration does not, because the company behind it already has all of those somewhere else.

Share capital and liability

An AS requires share capital of at least NOK 30,000 (about $3,200), paid in before registration. That money is not a fee. It goes into the company and you can use it for ordinary running costs once the company exists, but it has to be there on day one and a Norwegian bank or auditor has to confirm it.

A NUF has no equity requirement at all. Nothing to pay in, nothing to lock up, nothing to confirm.

Liability is the trade the capital buys. An AS limits the owners’ liability to what they put in. A NUF does not create any such limit on its own, because it is not a separate entity. The liability of a NUF is the liability of the foreign company behind it, under that company’s own law. If your parent is a GmbH or a limited company, it already carries limited liability, and the branch sits inside that. If your parent is a sole trader, the branch does not add a shield.

Accounting and audit

This is where people expect the NUF to be a free lunch and find out it is not.

A NUF that carries on commercial activity in Norway and is taxable here has a bookkeeping obligation under the Norwegian Bookkeeping Act, and has to prepare and submit annual accounts, in the same way a small AS does. A dormant NUF, or one used only to hold an asset, is treated more lightly. The moment it is trading, plan for a Norwegian accountant.

Audit is the same threshold for both. You need an auditor once you pass NOK 7 million in operating revenue, or NOK 27 million in total assets, or you average more than ten full-time employees over the year. Below all three, a small AS and a trading NUF can both opt out of audit.

So the ongoing paperwork is closer than the setup difference suggests. The real saving with a NUF is at the start, not every year afterwards.

What each costs

Brønnøysund publishes both fee schedules and they change from time to time, so check the current number rather than trusting this one a year from now. The link is in the sources.

How each is taxed

An AS is a Norwegian tax resident. It pays Norwegian corporate tax on its worldwide profit at the ordinary rate, currently 22 percent, and distributions to foreign owners can carry withholding tax unless a treaty reduces it.

A NUF is taxed in Norway only on the profit attributable to its Norwegian activity, as a permanent establishment of the foreign company. The rate on that Norwegian profit is the same 22 percent. The rest of the company’s profit is taxed where the company sits, and a double tax treaty between Norway and that country decides how the two claims are reconciled.

For a company with a small, clearly bounded Norwegian operation, the NUF is usually the simpler tax story: one profit figure to work out, taxed once, with the treaty doing the rest. For a company that wants Norway to be its own profit centre with its own retained earnings, the AS is cleaner. This is the part worth an hour with a Norwegian tax adviser before you file anything, and Skatteetaten sets out both treatments.

When each is the right answer

If you have read this far and cannot tell which column you are in, you are almost certainly in the NUF one. The AS question answers itself when the time comes.

The case for neither

Here is the part the companies that sell you registrations tend to skip.

If you are a webshop sending parcels to Norwegian consumers and nothing else, you may need no Norwegian entity at all. The VOEC scheme lets a foreign seller register for Norwegian VAT on low-value goods without any local presence, filing four simple returns a year. A trustee can hold your .no domain until you qualify to hold it yourself. Between those two, a lot of foreign shops operate in Norway for years with no branch and no company here.

A NUF or an AS brings a Norwegian accounting obligation, a Norwegian tax return, and a relationship with a Norwegian accountant you now pay every month. That is worth it when you get something back for it, a payment method, a partnership, a scale of sales that makes ordinary MVA cheaper than VOEC. It is dead weight when you do not.

So the order of the questions is: do I need a Norwegian entity at all, then NUF or AS. Most people arrive with the second question and have never been asked the first.

Sources

• Brønnøysund, Norwegian-registered foreign business (NUF) for the branch registration, the bookkeeping obligation and the audit thresholds.
• Brønnøysund, private limited company (AS) for the NOK 30,000 share capital requirement and the incorporation steps.
• Brønnøysund fee schedule for the NOK 3,883 and NOK 2,181 registration fees.
• Skatteetaten, business and organisation for the taxation of a permanent establishment and of a Norwegian company.
• Lovdata, the Limited Liability Companies Act (aksjeloven) for the capital, board and accounts rules an AS runs under.