10 Common Mistakes Lithuanian Companies Make When Entering Norway
Norway offers attractive opportunities for Lithuanian companies, but entering the Norwegian market requires careful preparation. Norway is part of the European Economic Area (EEA), but it is not an EU Member State, and some rules and procedures are different.
1. Assuming EU rules apply exactly the same way in Norway
Norway is part of the EEA, but it is not an EU Member State. While many rules are aligned with the EU, important differences remain. Always check the Norwegian requirements that apply to your specific business activity.
2. Missing Norwegian VAT obligations
Foreign companies carrying out VAT-liable activities in Norway may need to register for Norwegian VAT (MVA). The general registration threshold is NOK 50,000 in turnover over a 12-month period.
3. Treating a work assignment as merely a business trip
A short visit for meetings is different from actually performing work in Norway. Companies sending employees to Norway should assess the applicable tax, employment, reporting and social-security requirements before the work begins.
4. Not arranging A1 documentation
For employees temporarily posted from Lithuania to Norway, companies should assess their social-security position and obtain the appropriate A1 documentation where applicable. The A1 certificate can confirm which country’s social-security legislation applies to the employee.
5. Missing employee and assignment reporting
Foreign companies carrying out relevant assignments in Norway may have reporting obligations concerning both the assignment and the employees working on it. Make sure the required information is submitted to the Norwegian authorities on time.
6. Using incorrect customs documentation
When importing goods into Norway, companies must ensure that customs declarations, invoices, values, quantities and commodity codes are correct. Incorrect documentation can cause delays and may result in incorrect customs or VAT treatment.
7. Underestimating labour costs
Norwegian labour costs can be significantly higher than in Lithuania. When calculating the cost of an employee, consider not only salary but also employer contributions, holiday pay, pension and other applicable employment costs.
8. Not checking sector-specific licences and requirements
Certain industries and professional activities require specific licences, registrations, permits or qualifications in Norway. Check the applicable requirements before signing contracts or starting work.
9. Not understanding Norwegian procurement practices
Norwegian private and public-sector customers may have specific requirements concerning procurement, documentation, quality, sustainability, compliance and previous experience. Understanding how your target customers purchase goods and services can significantly improve your chances of success.
10. Choosing an unsuitable Norwegian partner or distributor
A good local partner can make market entry easier, while the wrong partner can create significant costs and risks. Before signing an agreement, assess the partner’s market coverage, customer network, financial position, sector experience and ability to represent your company.
Before Entering the Norwegian Market
Before starting business activities in Norway, Lithuanian companies should consider five basic questions:
What am I selling?
Who is my customer?
Where will the work take place?
Will employees work in Norway?
What registrations, tax and reporting obligations apply?
When in doubt, contact the relevant Norwegian authority or seek advice from a qualified Norwegian tax, legal or accounting professional before starting your activities.
NLCC can help Lithuanian companies identify relevant contacts and resources when entering the Norwegian market.