What do you need to know when setting up a business in the Nordic region? Our business primer helps you succeed in this northern innovation powerhouse.
The countries on the northern edge of Europe – Denmark, Finland, Norway, and Sweden– form a geographical and cultural region that stands out as the continent’s innovation powerhouse.
They share a common culture, similar flag design, an egalitarian approach to society, and prosperous economies. Each country scores near the top of global lists for gender equality, environmental protection, quality of education, standard of living, transparency, and ease of doing business.
But while the Nordic countries may appear similar, foreign investors should be aware of significant differences at national and regional levels. Here’s what you need to know to set up a business in the Nordic region.
Doing business in Denmark
Business entity options: The most common types of business entities available to foreign investors in Denmark are:
- Private limited company (Anpartsselskab, ApS)
- Public limited company (Aktieselskab, A/S)
- Branch office
- Limited partnership (Kommanditselskab, K/S)
- General partnership (Interessentskab, I/S)
Public and private limited companies are the most popular. They can be used to conduct all types of activity in the country. Some enterprises such as financial services are restricted to public limited companies.
Residency rules: There are no residency or nationality restrictions for directors or shareholders, except in certain regulated industries.
Tax treaties: Denmark has concluded more than 70 tax treaties based on the Organisation for Economic Co-operation and Development (OECD) Model Tax Convention on Income and on Capital.
Doing business in Finland
Finland has topped the Fragile States Index as the world’s most stable country. It’s also a leader in the number of foreign direct investment (FDI) projects in Nordic countries and, for the fourth year running, has been named the world’s happiest country.
It has a strong technology-based economy and is undergoing further transition to encompass next-generation technology such as cleantech, fintech and the Internet of Things.
Business entity options: Foreign investors can access the same benefits as Finnish companies. Opening a legal entity takes only a few weeks. The most common business vehicles in Finland are:
- General partnerships (avoin yhtiö)
- Limited partnerships (kommandiittiyhtiö)
- Private limited liability companies (yksityinen osakeyhtiö)
- Public limited liability companies (julkinen osakeyhtiö)
Residency rules: Citizens of Denmark, Iceland, Norway, and Sweden, as well as those from the EU, Switzerland, and Liechtenstein, can work in Finland without residence permits. Employees of other nationalities need a residence permit.
Tax treaties: Finland has signed about 90 double tax treaties, which follow the OECD Model Tax Convention on Income and on Capital.
Doing business in Norway
As a leader in oil and gas, energy, and the maritime and seafood industries, Norway has one of the world’s strongest economies. Medtech, fintech, and other technology clusters are growing.
Business entity options: Foreign investors in Norway can either open a Norwegian branch of a company registered in another country or set up a Norwegian business entity. The most common types of business entity are:
- Private limited liability company (Aksjeselskap – AS)
- Public limited liability company (Allmennaksjeselskap – ASA)
- Norwegian branch of a foreign company (Norskregistrert utenlandsk foretak – NUF)
In certain sectors of national interest, such as the power and energy sector (including oil, gas, and hydropower) and the finance sector (including financial, credit, and insurance institutions), some limitations are imposed on ownership and business operations.
Residency rules: Individuals from countries in the EU or European Economic Area (EEA) must register within three months of arrival in Norway. All others must apply for a residence permit to work.
Tax treaties: Norway has several double taxation treaties in place that allow Norwegian tax residents to claim tax credits or tax exemptions on income from foreign sources.
Doing business in Sweden
Sweden’s location at the center of the Nordic region and its outstanding transportation links make it an ideal hub for doing business with neighboring countries and the rest of Europe.
The country enjoys abundant natural resources, and key contributors to the economy include engineering, telecoms, manufacturing, and pharmaceuticals.
The government has supported investment in growth sectors, notably biotechnologies and food processing, through measures that include favorable taxation and financial incentives.
Business entity options: In general, there are no restrictions on foreign investments or foreign shareholders. The most common business entities are:
- Limited liability company (aktiebolag)
- General partnership (handelsbolag)
- Limited partnership (kommanditbolag)
A limited liability company can be either private or public, and private is the most common. They are easy to establish and widely recognized.
Residency rules: Non-EU citizens must obtain a work permit and residence permit to work in Sweden.
Tax treaties: Sweden has tax treaties with more than 80 jurisdictions for the avoidance of double taxation.
How CSC can help you invest in the Nordic region
Before entering the Nordic market, foreign investors should consider professional advice to navigate these complex matters. Working with a trusted partner is essential.
In the Nordics, we are a one-stop shop for legal or financial administrative needs, providing high-quality support at all levels.
Our team in the Nordics includes professionals specializing in administration services dedicated to servicing multinational, private equity, and fund clients.
We help corporate clients expanding into this exciting economy with a full suite of services from our offices in Copenhagen, Helsinki, Oslo, Stockholm, and Malmö.
Why CSC
CSC provides tailored administration and strategic outsourcing solutions to support the complex operations of alternative asset managers across jurisdictions and asset types while adhering to global regulations and compliance. A market leader, we work with funds of all sizes, from start-ups to the largest and most experienced fund managers in the world. Founded in 1899, CSC prides itself on being privately held and professionally managed for more than 120 years. We are the trusted partner of choice for more than 90% of the Fortune 500® and more than 70% of the PEI 300. CSC has office locations and capabilities in more than 140 jurisdictions across Europe, the Americas, Asia Pacific, and the Middle East. We are a global company capable of doing business wherever our clients are—and we accomplish that by employing experts in every business we serve. We are the business behind business®. Learn more at cscgfm.com.