Photo credit: Pexels

After many years of being employed, I took the leap and started my own business. Like in many countries, being a business owner in Norway has its perks and downsides. But as a foreigner, the challenges can be even greater. The system here dances to rules that are sometimes invisible to us, until we trip over them. So, if you’re considering creating a business in Norway, here are some hard-earned insights and lessons that might save you time, money, and stress.

Creating a sole proprietarship is easy, but has high risks

Let’s start with the basics: to have a business in Norway you need an organisation number. Creating an enkeltpersonsforetak (sole proprietorship) is incredibly easy. All you need is a personal number and an address. Bam! You’re registered in the Brønnøysund corporate registry with your own organizational number. However, this ease comes at a price. First, the tax level is quite high and applies annually, regardless of what you plan to do with the money (for example save it or invest it). Second, any loan you take or contract you sign is legally tied to you as an individual, meaning you are personally responsible for any losses the business may incur.

There’s more: the taxes you pay through a sole proprietorship don’t count toward Norway’s social security system (NAV). So if you become unemployed or go on sick leave, the money you made won’t factor into your benefits.

I wouldn’t recommend this type of company for the long term unless you have a very stable income and only use the company as a side-gig. An AS is more suited, but then stricter accounting rules apply. Check here for all the company forms.

The Norwegian tax authorities have no mercy

Now, let’s talk about the Norwegian tax authorities. I say this with full respect for the system: they are professional, knowledgeable, and even offer free courses in English. I’ve received incredibly useful advice when I’ve called them. That said, they have no mercy. If you’re late submitting your VAT report, or make mistakes in your accounting, you will be fined, no exceptions. A friend of mine had a side business as an event organizer that was on pause, with no sales for six months. She forgot to submit a VAT report (which would have been zero kroner), and was fined 12,000 NOK. She appealed. She lost.

When you start a company in Norway, you are expected to know the rules: the deadlines, the obligations, the toll, the fees, and the risks. Is your type of activity subject to VAT? Are you legally required to have an accounting system? Are you sending in the A-melding for any staff? Are you checking Altinn regularly for communication from the tax authorities? The responsibility is on you from day one.

Janteloven in action in the business world

Another uniquely Norwegian challenge when starting a business is the invisible force called Janteloven, the social norm that says you shouldn’t think you’re better than anyone else. Now imagine trying to promote your own products or services in a culture where self-promotion is practically a sin. How do you succeed in business if you’re never supposed to speak highly of what you do?

Let me reassure you: Janteloven doesn’t apply equally in all circles. If you’ve ever met a 25-year-old young Norwegian man fresh out of BI (the Oslo business school), you’ll know what I mean. Some of them brag like they invented hot water, and they’ve done nothing but graduate from an expensive school. So don’t hold back.

Also, Janteloven takes a backseat in start-up environments, business pitches, and investment meetings. These are not the moments to downplay your work. You can promote your project with pride without demeaning others. Be confident, be clear, and explain the value of what you’re offering. But if you do get funding or investment, include everyone in your thank you note and don’t boast of the success all on your own.

Accounting without speaking Norwegian is almost impossible

One very practical challenge: accounting without speaking Norwegian is nearly impossible. While several accounting programs exist to make things easier, like Fiken, Visma eAccounting, and Tripletex, most are only available in Norwegian. Tripletex has an English interface, but only for employee users, not the main admin.

You do have options: hire a Norwegian accountant (expect to pay up to 60,000 NOK per year for a basic business), or work with a Norwegian business partner who handles that side. Personally, I speak fluent Norwegian and still had no idea how to do business accounting or taxes when I started. So I ended up taking accounting classes and now consult with an accountant by the hour when I have questions.

Specificities of the Norwegian market

It’s also important to understand that the Norwegian market is different. There are two main differences: the monopolies and the specific rules to each sector.

I often see posts in French expat groups from people dreaming of moving to Norway to open a bakery or cheese shop. And yes, those are great ideas that can work, but only if you’ve done your homework. Norway isn’t in the EU, which means tolls and import restrictions are stricter. Imported cheese, for instance, comes with sky-high taxes to protect local products (because heaven forbid we replace Norvegia with a smelly camembert!).

For example if your business is related to food, whether it’s baking, cooking, or running a restaurant, get ready for very strict regulations from Mattilsynet (the Food Compliance Authority). It is the same if you intend on selling alcohol (in a bar for example), many rules apply. Or just driving tourists to see the Northern lights (you need a special permit to drive other people for work). There are also consumer laws that apply in Norway as well as labour law, which you are expected to know when starting a business. Without mentioning contract law.

There is also a concentration of power in industries like books, food retail, which often dominated by a few powerful players. I made the mistake of thinking the Norwegian book industry was open, it’s not. Two companies own nearly everything. It can be difficult to break in. However other fields are much more open, such as software, IT, and innovative solutions to reach out to consumers (like Oda for example).

You can do it!

But despite all this, I want to end on a high note: you can do it.

This article isn’t meant to discourage you from starting your own company, it’s meant to give you a map of potential pitfalls. You’ll make mistakes (we all do), but with the right preparation, some of them are avoidable. If I can save you time and effort by sharing mine, then I’ve done my job.

I truly believe there are thousands of business opportunities in Norway. Many Norwegians hesitate to take risks for cultural or systemic reasons, which means there is space for innovation in this country, there is no doubt about that. In the U.S., many company founders are children of immigrants. I believe the same will become true in Norway.

Opportunity is here. You just have to be ready for the ride.