In Norway, there are several types of companies that can be formed, each with its own legal structure and requirements. Outlined below is an overview of the main types.

• Private limited liability company (AS): This is comparable to a limited liability company (LLC) in other jurisdictions. The liability of shareholders is limited to their capital contribution.
• Public limited liability company (ASA): This is similar to a private limited liability company but is intended for companies with a larger shareholder base. A public company is further required for a listing on a regulated market in Norway. There are more stringent share capital and reporting requirements compared to a private limited liability company.
• General partnership (ANS) and general partnership with shared liability (DA): These are types of partnerships where the partners have joint and several liability for the company’s obligations. In a general partnership, all the partners have an unlimited, personal liability for the company’s obligations. In a general partnership with shared liability, the partners are liable for a pre-defined part of the company’s obligations.
• Limited partnership (KS): This is a limited partnership where there are general partners (with unlimited liability) and limited partners (with liability limited to their capital contributions).

Unless otherwise stated, any reference to a “company” in this article will be a reference to a private limited liability company (AS) or a public limited liability company (ASA).

Foreign investors usually use a private limited liability company (AS) or public limited liability company (ASA) as it implies issuance of shares and limited liability for the shareholders. Further, it provides a familiar structure with regard to governance, including for example articles of associations, a general meeting for the shareholders, and a board of directors responsible for the company’s operations.

The Companies Act sets out a principle of equal treatment, stating that all shares carry equal rights in the company. Nevertheless, the Companies Act also allows for the articles of association to provide that there shall be different classes of shares. The articles of association shall in such cases specify the distinctions between the share classes.

The most common share class besides ordinary shares is “preference shares” with preferential rights to receive dividends and residual assets. Another example is “non-voting shares”, which do not have voting rights, but otherwise carry equal rights to ordinary shares – eg, to dividends.

The rights attaching to shares are generally set out in the Companies Act, supplemented by the articles of association.

As stated in 1.3 Types or Classes of Shares and General Shareholders’ Rights, the Companies Act set out a principle of equal treatment of all shareholders in accordance with the number of shares owned.

Any deviation from this principle must follow from the company’s articles of association. If the legal relationship between equivalent shares in the company is to be altered (ie, separate shares into a new class of shares) this requires a unanimous resolution by the general meeting.

The minimum capital requirement for a private limited liability company (AS) is NOK30,000, and NOK1 million for a public limited liability company (ASA). The share capital for both types of companies should be divided into one or more shares, with each share having the same nominal value.

There are no capital requirements for a general partnership (ANS) and a general partnership with limited liability (DA).

For a limited partnership, the minimum capital requirement for any the limited partner(s) is NOK20,000.

For a private limited liability company (AS) or a public limited liability company (ASA) there is no minimum requirement for the number of shareholders, and there is also no requirement regarding the residency of the shareholders. However, there is a requirement that the general manager (if applicable – a general manager is not mandatory for a private company) and at least half the members of the board of directors shall reside in an EEA state, the United Kingdom of Great Britain and Northern Ireland or the Swiss Confederation. The ministry can, by individual decision, make exceptions to this requirement.

A partnership (ANS, DA or KS) must have at least two partners. Both natural persons and legal persons can be partners. Foreign natural persons must apply for a D-number in order to be registered as a partner in a partnership.

Both shareholders’ agreements and joint venture agreements are common in Norway. Please see 1.8 Typical Provisions in Shareholders’ Agreements/Joint Venture Agreements for a detailed description of such agreements.

Shareholders’ Agreements

Typical provisions included in shareholders’ agreements are:

• governance matters – business plan/strategy, composition of the board of directors, the procedures of the board of directors, reserved matters, etc;

• capital matters – participation in future capital and equity financing and distributions; and
• transfer of shares/exits – board consent, right of first offer (ROFO), right of first refusal (ROFR), drag-along rights, tag-along rights, exit provisions, etc.

Shareholders’ agreements are binding and enforceable between the parties as a contractual obligation. However, a shareholders agreement is not binding for the company or other shareholders not party to the agreement. Hence, any provision in a shareholders’ agreement that deviates from mandatory provisions in the Companies Act or the articles of associations (eg, that the relevant company shall not hold general meetings or that the composition of the board shall be different than what is stated in the articles of associations), will not be valid and enforceable against the company.

Joint Venture Agreements

Typical provisions included in joint venture agreements are:

• contribution of financial funds, assets, IP, etc, from the parties to the joint venture;
• distribution of profit and loss from the joint venture to the parties; and
• structure for managing – ie, appointment of directors and/or managers.

Similar to a shareholders’ agreement, a joint venture agreement is binding between the parties.

There is no general obligation to make either shareholders’ agreements or joint venture agreements public. These agreements also typically contain confidentiality provisions.

Companies are obliged to hold an annual general meeting within six months after the end of each fiscal year. The general meeting shall be convened by written notice to all shareholders with a known address, and the notice shall specify the time and place of the meeting. The statutory notice period is one week for a private limited liability company (AS), two weeks for a public limited liability company (ASA), and three weeks for an ASA listed on a regulated market. A longer notice period can be stipulated in the articles of association, but it cannot be shortened.

The general meeting must consider and approve the annual accounts and any annual report, including whether dividends should be distributed.

Companies can also hold an extraordinary general meeting (EGM). Normally, such an EGM is called by the board of directors. The board of directors is also under an obligation to convene an extraordinary general meeting when an auditor who audits the company's annual accounts, or shareholders representing at least 10% of the share capital (AS) or 5% of the share capital (ASA) demand, in writing, an EGM in order to have a specific designated matter addressed. The board shall ensure that the extraordinary general meeting is held within one month after the request is made.

The notice period for an EGM is similar to the notice period for the AGM described in 2.1 Types of Meeting, Notice and Calling a Meeting. Similar to the AGM, a longer notice period for an EGM can be stipulated in the articles of associations, but it cannot be shortened.

The annual general meeting shall be convened by the board of directors. If the board of directors fails to convene the annual general meeting required by law, the articles of association, or a previous resolution of the general meeting, the district court shall do so if requested by a board member, the managing director, the auditor responsible for auditing the company’s annual accounts, or a shareholder.

As mentioned in 2.1 Types of Meeting, Notice and Calling a Meeting, the board of directors is obliged to convene an extraordinary general meeting when an auditor who audits the company’s annual accounts, or shareholders representing at least 10% of the share capital (AS) or 5% of the share capital (ASA), demand such a meeting in writing in order to have a specific matter addressed.

Notice of a Meeting

The notice of an AGM or EGM shall be sent to all shareholders with known address. The notice shall provide information about the format of the meeting and, if applicable, the procedure for participating and voting electronically. If the company allows for voting before the general meeting, the notice shall provide information about this procedure. The notice shall also propose an agenda specifying the matters to be addressed. The description of the matters must be sufficiently detailed to enable the shareholders to assess the relevant matters prior to the general meeting.

Information That May Be Required During the Meeting

A shareholder may demand that board members and the CEO provide available information regarding matters that:

• could influence the assessment of the approval of the annual accounts and the annual report;
• are presented to the shareholders for decision; and
• relate to the company’s financial position, including its activities in other companies in which the company participates, and other matters to be addressed by the general meeting, unless the requested information cannot be provided without causing disproportionate harm to the company.

If information needs to be obtained, so that an answer cannot be given at the general meeting, a written response shall be prepared within two weeks after the meeting. Such a written response must be sent to all shareholders with a known address.

A shareholder may further propose an investigation of the company’s establishment, management, or specific aspects of financial management. The proposal can be made at an ordinary general meeting, or at an extraordinary general meeting where the agenda specifies that a matter regarding such an investigation shall be addressed. If the proposal for investigation is supported by shareholders holding at least 10% of the share capital represented at the general meeting, any shareholder may, within one month after the general meeting, demand that the district court decide on the investigation by court order.

Shareholders Registry

Anyone, not only shareholders, can demand access to the shareholder registry at any time, including in connection with a general meeting.

The general meeting shall be conducted in the manner determined by the board of directors, unless otherwise specified in the articles of association. Hence, the general meeting may be held as an electronic meeting. In the case of an electronic general meeting, the board shall ensure that there are systems in place to ensure compliance with the legal requirements for the general meeting. These systems must ensure that participation and voting can be controlled in a reliable manner, and a reliable method must be used to authenticate the sender. Further requirements for electronic general meetings may be stipulated in the articles of association.

There is no minimum requirement for the number of shareholders or the total number of shares present to establish a quorum at a general meeting. Consequently, in situations where the attendance of shareholders at a general meeting is low, the participating shareholders hold a relatively greater influence over the decisions made.

All resolutions by the shareholders must be resolved through an annual or extraordinary general meeting. The Companies Act stipulates different majority thresholds for different types of resolutions by the general meeting.

For ordinary matters, a simple majority (50% of the voting shares + 1 voting share) is required. Certain matters, either specified by law or the articles of association, have a higher threshold. A more detailed overview of the thresholds for different matters is provided in 2.8 Shareholders Approval.

The general requirement for approving matters is a simple majority (50% of the voting shares + 1 voting share).

However, certain matters are subject to a stricter majority requirement. For example, a decision to amend the articles of association requires approval from at least two-thirds of the votes and share capital represented at the general meeting. The following examples represent matters that also require a two-thirds majority for approval at the general meeting:

• an increase of share capital through subscription of new shares;
• a decision on merger and demerger;
• omitting an audit under certain conditions;
• repurchase of own shares; and
• dissolution of the company.

Further, certain matters require approval from shareholders representing shares that constitute more than 90% of the share capital represented at the general meeting, as well as the majority required to amend the articles of association (as outlined above) in order to be approved. These matters are:

• a resolution which in respect of issued shares causes the shareholders’ right to dividends or to the company’s assets to be reduced;
• a resolution which introduces a consent requirement for the transfer of shares; and
• a resolution that introduces a right for all shareholders to be entitled to take over a share that has changed or will change owner (pre-emptive right/ROFO).

It should be noted that only the number of shares present at the general meeting is considered when calculating and determining the majority of votes. If, for example, shareholders representing only 10% of the company’s shares attend the general meeting, half of these, 5.01% of the total share capital, will constitute a simple majority at the meeting.

Finally, certain matters require the unanimous approval from all shareholders (not only shareholders represented at the general meeting)  This is required, for instance, when the decision implies an increase in the shareholders’ obligations to the company. If a decision that requires unanimous approval from all shareholders only affects a portion of the shareholders, the decision requires the unanimous approval of all affected shareholders in addition to the majority required to amend the articles of association (as discussed above).

Each share normally entitles the holder to one vote, unless otherwise provided by the articles of association. The articles of association can include provisions on voting restrictions linked to an individual, and it may be stipulated that shares in a class of shares shall not carry voting rights or have limited weight.

Voting rights cannot be exercised for shares owned by the company itself or a subsidiary, and such shares shall not be counted against any majority requirement.

All shareholders have a statutory right to attend and speak at the general meeting, either personally or through a self-chosen proxy. The company may provide for advanced electronic voting in its articles of association, and this is the case for most companies listed on a stock exchange.

Shareholders also have a right to participate in general meetings electronically, unless the board finds that there are fair reasons to deny this. Where the general meeting is conducted (wholly or partially) electronically, which is often the case for companies listed on a stock exchange due to the number of shareholders, the voting could also be (wholly or partially) electronic in real-time.

A shareholder has the right to have a specific matter addressed at the general meeting. Such matter must be submitted in writing to the board of directors, along with a proposed resolution or a justification for why the matter should be included on the agenda. The deadline for submitting matters for consideration is seven days before the deadline for notice of the general meeting.

During the discussion of matters at the general meeting, all shareholders have the right to submit proposals for resolutions in connection with the matters on the agenda, for instance nominating directors to the board of directors.       

A shareholder may bring a lawsuit claiming that a resolution adopted at the general meeting is invalid, due to having been taken unlawfully or otherwise being in violation of the law or the company’s articles of association.

Such a lawsuit must be initiated within three months after the resolution was adopted, failing which the resolution will be deemed valid. The requirement to bring the lawsuit within three months does not apply if

• the resolution is of a nature that it cannot be adopted even with the consent of all shareholders;
• the law or articles of association require the consent of all or certain shareholders and such consent has not been given;
• the notice of the general meeting has not been given; or
• if the rules on notice have been substantially disregarded.

Alternatively, the lawsuit can be filed within two years after the expiration of the three-month deadline if the court finds that the shareholder had reasonable grounds for the delay, and it would be manifestly unreasonable for the resolution to be deemed valid.

If a judgment is rendered declaring a resolution of the general meeting to be invalid or modifying the resolution, such judgment will have effect on all shareholders.

Institutional investors and shareholder groups do not have specific rights regarding influence over the company or access to monitor corporate activities. However, it is not uncommon for larger shareholders to be represented with board seats or appointed as observers in the board of directors. These positions must, however, be elected; they do not come automatically with a larger ownership stake.

Particularly for publicly listed companies, there are restrictions on the flow of information to from the company to certain shareholders (ie, not all), and the board member of a company who is appointed by a certain shareholder does not have any wider right to disclose information to the shareholder it represents than the company itself. The board of a subsidiary is obliged to provide the board of the parent company with information necessary to evaluate the group’s financial position and the results of the group’s operations.       

As it is the nominee that is registered as the holder of the share in the company’s shareholders’ register, it will be the nominee that receives the notice of general meetings, not the ultimate shareholder. The ultimate shareholders’ right to receive information about the notice of the general meeting will depend on the nominee arrangement in place and is not a matter of Norwegian company law.

Shareholders holding their shares through nominees who intend to participate in the general meeting must notify the company in advance. The notification must be received by the company no later than two business days before the general meeting, but the board can, before the notice of the general meeting has been sent, set a later deadline for the notification. If the notification is given within the deadline, shareholders holding their shares through nominees will have the same rights as other shareholders at the general meeting, both with regard to the voting right as such, but also speaking and information rights.

For a private limited liability company (AS), a simplified general meeting can be conducted without a physical or digital meeting, as long as no shareholder objects.

This is contingent on the fact that all shareholders must be provided with the opportunity to participate in the consideration of the matter in an appropriate manner. The board members and, if applicable, the managing director, should also be given the opportunity to express their views on the matter. The same applies to the auditor if the matter is of such a nature that it is deemed necessary.

Simplified general meetings are not possible for public limited liability companies (ASA) under any circumstances.

In the event of an increase in share capital through an issue of new shares against cash contributions, the main rule is that existing shareholders have a preferential right to subscribe for the new shares in the same proportion as the shares they already own in the company. If the preferential right is not fully used, shareholders who have already exercised their preferential right but wish to subscribe for a larger amount of the new shares, may subscribe to the portion of the capital increase that has not been subscribed. This preferential right cannot generally be deviated from in the company’s articles of association, but the board of directors/general meeting may resolve to deviate from the preferential right on a case-by-case basis.

A share capital increase must normally be resolved by the general meeting, but the general meeting may also authorise the board to increase the share capital up to certain limits. This is fairly common for listed companies, as it allows the board of directors to have a mechanism for quickly conducting a share issue, for instance when the market conditions are favourable. The authorisation from the general meeting to the board will also state whether or not the board can deviate from the preferential right (and that is normally the case).

For a private limited liability company (AS), the starting point under the Companies Act is that any acquisition of shares is subject to consent from the company unless the articles of association specify that consent is not required. Shareholders also have a pre-emptive right to acquire a share that has changed ownership unless otherwise specified in the articles of association.

In cases where the acquisition of shares is subject to consent, the decision should be made as soon as possible after the acquisition has been notified to the company. The decision to grant consent rests with the board of directors unless the articles of association state otherwise. Consent can only be denied if there is a valid reason, and it can never be denied in cases of transfer through inheritance or in close relationships. The acquirer should be promptly notified of the decision, and if consent is denied, the reasoning should be provided. If the acquirer has not been notified of the denial of consent within two months of the acquisition notification to the company, consent is deemed to be granted.

For a public limited liability company (ASA), the starting point is the opposite of an AS; for public companies, the shares are freely transferable pursuant to the Companies Act, unless the articles of association specify that consent is required and/or that the shareholders’ have pre-emptive rights.

Shareholders are entitled to grant a security interest over their shares unless otherwise stipulated in the articles of association.

With regard to the fact that shares in a private limited liability company (AS) are, as a starting point, not freely transferable as described in 3.2 Share Transfers, creditors usually require the articles of association to be amended making the shares freely transferable in order to accept such shares as security.

Both private limited liability companies (AS) and public limited liability companies (ASA) are obligated to establish a shareholder register upon their incorporation and keep such register up to date. The information in the shareholder register is accessible by anyone upon request to the company and the company is under an obligation to share that information.

For an ASA listed on the Oslo Børs (Norway’s stock exchange), a shareholder must notify the market if the shareholder’s proportion of shares with associated voting rights in a company exceeds or falls below 5%, 10%, 15%, 20%, 25%, 33.33%, 50%, 66.66%, and 90%.

For AS and ASA’s listed on the Euronext Growth Oslo, the issuer must notify the market when becoming aware that a shareholder has exceeded or fallen below 50% or 90% of the shares or votes.

Both private limited liability companies (AS) and public limited liability companies (ASA) may cancel their own shares, subject to certain legal requirements and procedures.

For both AS and ASA’s, cancellation of shares through a reduction of the share capital is possible following a buyback of own shares. Please see 4.2 Buybacks for further discussion regarding buybacks.

For private limited liability companies (AS), share cancellation may follow from a claim for share redemption by a shareholder. In cases where such redemption is granted, the shareholder shall receive a redemption amount, and the shares shall be cancelled through a reduction of the share capital. Compelling reasons must exist for a shareholder to be able to demand redemption, and this is not very common.

Both private limited liability companies (AS) and public limited liability companies (ASA) can buy back their own shares. The ability of a company to buy back its own shares is subject to certain restrictions and requirements to ensure transparency and protect the interests of shareholders and creditors, and it cannot be done through subscription of new shares.

A company’s buyback of its own shares is contingent on a two-thirds majority resolution by the general meeting. This resolution must state the maximum number of shares that can be repurchased, the timeframe within which the buyback can occur, and the price range at which shares can be bought back. The general meeting must also specify the methods by which the acquisition and disposal of treasury shares may take place.

The company must use distributable profits or free equity to fund the buyback. It is not allowed to use borrowed funds or capital that is not freely available for distribution. The decision regarding the buyback must also be registered with the company’s registry before the shares can be acquired in accordance with the authorisation.

A public limited liability companies (ASA) may not buy back its shares if the total value of the holding of own shares will exceed 10% of the share capital.

The decision to distribute dividends shall be made by the general meeting based on a proposal by the board of directors. The general meeting cannot decide on any payment of dividends in excess of the proposal from the board of directors. The general meeting can also, following the approval of the annual financial statements, grant the board an authorisation to determine dividend distributions based on the annual financial statements. This authorisation cannot extend beyond the next ordinary general meeting.

Dividends shall be payable to the shareholders who are shareholders at the time the decision is made unless otherwise specified in the decision.

A company may only distribute dividends to the extent that, after distribution, there remain net assets sufficient to cover the company’s share capital and other restricted equity. The calculation shall be based on the balance sheet in the company’s most recently approved financial statements, with the registered share capital at the time of the decision being used as the basis. However, deductions may be made for credits and other dispositions provided for by law. The company may also distribute extraordinary dividends based on an interim balance sheet prepared and audited according to the rules for annual financial statements.

The shareholders elect the members to the board of directors at the general meeting unless otherwise stipulated in the articles of association. When electing members to the board of directors, the candidate who received the most votes will be elected. However, the general meeting can ahead of the vote determine that there shall be a re-election if none of the candidates receive a majority of the votes. Shareholders also have the option to remove directors through a majority resolution at the general meeting.

The employees may also have the right to appoint directors for the board of directors. The number of board members to be appointed by the employees depends on the number of employees in the company.

Shareholders may, by a resolution at the general meeting, give instructions to the board of directors. However, board members are not bound by decisions of the general meeting if such decisions conflict with law or the company’s articles of association. Any directors may also withdraw from the board of directors with immediate effect if it does not wish to follow the instructions from the general meeting.

Shareholders can appoint one or more auditors at the general meeting by a majority vote. One or more alternate auditors can also be elected at the general meeting. The auditor who is elected serves until another auditor is elected.

Shareholders cannot dismiss an auditor before the term of service has expired without reasonable cause. Disagreements concerning accounting treatment, for example, are not considered reasonable cause.

However, for smaller private companies (AS), shareholders can decide at the general meeting that the company’s annual financial statements shall not be audited by an auditor. Such a decision is subject to the condition that the company’s operating revenues, balance sheet total, and number of employees are below certain levels. The same limits apply for mandatory audit for general partnerships (ANS) and general partnerships with shared liability (DA).

Companies defined as “large enterprises” in the Accounting Act (ie, public limited liability companies (ASA) and companies listed on a stock exchange), are obliged to provide an account and overview of principles and practices regarding corporate governance in the annual report.

Further, the Norwegian Code of Practice for Corporate Governance (NUES) includes extensive recommendations regarding the establishment of corporate governance procedures, and related reporting. Listed companies will need to follow the NUES on a comply or explain basis, and cover this in the annual report as mentioned above.

In Norway, a controlling company does not have any specific statutory obligations towards the shareholders of the company it controls as such.

Nevertheless, all shareholders bear a responsibility with regard to abuse of authority against the other shareholders. The general meeting may not adopt any resolution that gives certain shareholders or others an unreasonable benefit at the expense of other shareholders or the company. This responsibility is particularly relevant for controlling companies, as they wield significant influence over the general meetings’ decisions.

Shareholders have limited rights in the event of a company’s insolvency.

The shareholders are entitled to their pro rata share of the remaining assets of the company. However, since shareholders’ rights are subordinate to those of the company’s creditors, there will rarely be any value left for the shareholders.

Under Norwegian corporate law, it is not possible for shareholders to assert indemnity claims directly against the company itself. Such claims can only be directed at the company’s organs, such as board members or managing directors.

However, shareholders do have the right to challenge the validity of resolutions adopted by the general meeting if they were made unlawfully or otherwise in contravention of the law or the company’s articles of association. An example of such resolutions are decisions that give some shareholders an unreasonable benefit at the expense of other shareholders, as further described in 8.1 Duties of a Controlling Company.

A shareholder can do this independently but must as the main rule initiate legal proceedings within three months of the relevant decision being made. If the decision was made outside of a general meeting, this period starts from the day the minutes were sent to the shareholders.

Each of the directors and the general manager can be held personally liable towards the company, shareholders and third parties (including creditors) for any loss or damage which the director has intentionally or negligently caused in the performance of his or her duties. The claimant has the burden of proof. This liability may be modified by virtue of the degree of negligence, the amount of loss, ability to pay and circumstances in general.

Further, whether a director or the general manager has violated any explicit statutes would be an important consideration for the court when determining whether such a director could be held personally liable for damages caused by negligence on his or her part. On the other hand, a director or the general manager may be personally liable for an act or omission causing loss or damage to a third party even though he or she has not violated any such specific rules or regulations.

Below are some examples of situations where liability for a director may arise:

• The board omits to file for bankruptcy in time and conducts the business of the company for the account and loss of the creditors without a realistic possibility of the business recovering.
• The board, on behalf of the company, enters into a contract with a third party at a point when it is likely that the company cannot fulfil its obligations under the contract because of its financial situation.
• A proven performance of poor business judgment, mismanagement or misrepresentation by any of the directors, which has caused damage or loss to the company, its shareholders, its employees or another third party. When determining whether the directors have caused such damage, the court would have to assess the standards that are to be expected by a board of directors in companies of the same size, operating within the same line of business, etc.

The starting point is that it is the general meeting that determines whether the company should pursue compensation claims.

However, shareholders can initiate a derivative action on behalf of the company if the general meeting has adopted a resolution of no liability or it has rejected a proposal to hold liable any applicable person. In such cases, shareholders owning at least 10% of the share capital are eligible to assert claims for compensation on behalf of the company and in its name. If the company has more than 100 shareholders, claims can also be asserted by shareholders constituting at least 10% of the total number of shareholders.

There have been no recent legislative changes encouraging shareholder activism. Nevertheless, there are several tools at the disposal of shareholder activists allowing them to exert influence within corporations. The most important of these are outlined below.

Inspection of the Shareholders’ Register

Activists can identify potential allies and other pertinent information by analysing the shareholders’ register.

Attendance and Speaking Right at General Meetings

All shareholders are entitled to participate and speak at general meetings. By participating in the general meeting, shareholder activists have the opportunity to provide input on matters and thereby influence the direction of the general meeting.

Right to Propose Agenda Items at General Meetings

Every shareholder holds the prerogative to propose matters for inclusion on the general meeting’s agenda, subject to specific deadlines as mentioned in 2.10 Shareholders’ Rights Relating to the Business of a Meeting. All shareholders are further empowered to put forth resolutions concerning agenda items.

Requisition of General Meeting

A general meeting can be demanded by shareholders holding a minimum of 10% of the share capital in a private limited company (AS) or 5% of the share capital in a public limited company ASA).

Investigation

Any shareholder can propose an inquiry into company-related matters. If this proposition garners support from at least 10% of the represented share capital, any shareholder can compel the district court to initiate an investigation.

Blocking Resolutions of General Meeting

Shareholders exerting control over more than a third of the shares represented at the general meeting may obstruct decisions pertaining to, inter alia, changes to the articles of association, and thereby block issuance of shares. In cases of other resolutions, a majority of cast votes is generally requisite for blocking.

The main objectives of activist shareholders in Norway are largely similar to those in other countries. The primary goals of shareholder activists typically include:

• management – change in leadership and the composition of the board of directors;
• strategy and business – disagreement regarding focus and operational challenges, such as the balance between focus on growth and profitability or greater focus on ESG matters;
• maximising values – for example by divesting business operations or sale of assets; and
• equity – declare payment of dividends and/or changes to the debt structure.

Shareholder activists typically acquire shares in the target company in an attempt to exercise influence over the company and its decisions. Following the purchase of shares, shareholder activists can employ various techniques to achieve their goals, ranging from amicable informal dialogue to more formal discussions, including making formal proposals at general meetings and seeking board representation. Furthermore, these techniques can escalate to more confrontational approaches such as using the media, initiating investigations, and in the most extreme scenario, pursuing legal action.

Please refer to the Norway Trends and Developments chapter in this guide.

In Norway, most activist campaigns have been promoted by environmental organisations that have purchased shares in oil exploration and production companies and that have then exercised their right to speak and put forward a resolution proposal at the general meeting. As mentioned in 11.1 Legal and Regulatory Provisions, shareholders only need to buy one single share to acquire such rights.

There are no available statistics on the extent to which public activist demands in the last year were successful. However, it seems clear that shareholder activism is receiving more attention and has become more common. We have for example observed cases in companies listed on the Oslo Stock Exchange where shareholder groups build up through social media, and have achieved sufficient support to be elected as a member of the board of directors.

Establishing an open and constructive dialogue with shareholders is the fundamental proactive strategy with regard to activist shareholders. This dialogue should involve a deep understanding of shareholders’ expectations and their preferred focal points for the corporate activity. Company leadership must show that it is receptive to shareholder concerns and maintain transparency regarding any challenges confronting the organisation.