The strong competitiveness of the Norwegian economy is built on openness and transparency, with policies that support dynamic trade and investment, and the legal framework is among the world’s strongest, providing effective protection of property rights. The tax rebate of 78% of exploration investment makes Norway an attractive destination for O&G investment. However, this is offset to some extent by the creeping regulation, driving the country away from oil & gas, hence a Outlook Neutral.
August 10, 2022
Europe - North West
Companies involved in upstream activities within the geographic areas described in Section 1 of the Norwegian Petroleum Tax Act is subject to a marginal tax rate of 78% (23% ordinary corporate income tax and 55% resource rent tax) on the net operating profits derived from its extractive activities. The area covered, generally, is the area within Norwegian territorial borders or on the Norwegian continental shelf (NCS).
In 1949, Norway abandoned neutrality and became a member of NATO. Discovery of oil and gas in adjacent waters in the late 1960s boosted Norway's economic fortunes. Norway is a highly developed country with a small but very strong economy. Success in the O&G sector and other world-class industries like shipping, shipbuilding and aquaculture. Strong collaboration between industry and research institutions attracts international R&D activity and funding. Norwegian lawmakers and businesses welcome foreign investment as a matter of policy. Norway is politically stable, with strong property rights protection and an effective legal system. A new National Security Act that entered into force January 1, 2019, provides the legal foundations for enhanced government screening of foreign investments.
Source: ESRI, Heritage Index, HMG Foreign & Commonwealth Office, US Department of State, International Trade Administration, International Law Review, Ernst & Young, Wood Makenzie & OGA data.
© 2021 Oil & Gas Advisors Limited
Website by Rugby Web Design