WT/TPR/S/15
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III. TRADE POLICIES AND PRACTICES BYMEASURE
(1) Overview
1. Theconclusion oftheUruguay Round hadimportant implications forseveral trade policy
instruments inNorway, particularly inagriculture where former quantitative restrictions havebeen
converted intotariffs. However, therateschosen forthenewagricultural tariffs, although reduced
tothe"2000-level" on1July1995, suggest thatfurther liberalization willberequired before themain
segments ofNorwegian agriculture mayfacegenuine import competition. Therespective WTO
agreements haveinvolved some revision inrelated Norwegian legislation, forinstance inrelation to
anti-dumpingandcountervailingmeasures,safeguards,governmentprocurementandintellectualproperty,
while theauthorities consider thatexisting legislation regarding preshipment inspection, rulesoforigin
andcustoms valuation isinconformity withNorway 'sobligations under theWTO.
2. Another important development inNorway 'strade policies during 1991-1995 hasbeenthe
entry intoforce oftheEEA Agreement. Theaccession offormer EFTA members Austria, Finland
andSweden totheEUhas,however, highlighted some ofthesectoral limitations oftheEEA. Since
1991, Norway hasalso,bilaterally orthrough EFTA, concluded free-trade agreements anddeclarations
ofco-operation withcountries incentral andeastern Europe andtheMediterranean region.
3. Norway continues tograntsubstantial industry support fortheaccomplishment ofvarious policy
objectives, including regional development, promotion ofresearch anddevelopment andcontainment
ofadverse social consequences ofeconomic restructuring. Future industry support policies may,
however, entail ashiftfrom physical investment support towards emphasis oninvestment inhuman
capital andnewtechnologies.
(2) Measures Directly Affecting Imports
(i) Registration andnotification requirements
4. Allimport declarations have been handled byacomputerized clearance system since
1November 1994. About 90percentofthedeclarations aresubmitted electronically tocustoms by
importers ortheirforwarding agents, theremainder iskeyed intothesystem bycustoms officials.
Thepractice ofpaperless declarations gradually became thenorm aftercomputerized clearance was
introduced asapilotproject bytheDirectorate ofCustoms andExcise in1988.
5. Importers ofcosmetics mustnotify theDirectorate ofHealth, andtheNorwegian Food Control
Authority istheappropriate supervising authority forimports ofpharmaceuticals.
(ii) Tariffs
6. TheNorwegian Customs Tariff, based ontheHarmonized Commodity Description andCoding
System, contains 6,454 tariff linesatpresent. Changes inthecustoms classification wereintroduced
on1January 1996 inaccordance witha1993 recommendation oftheWorld Customs Organization
(WCO).
7. TheCustoms Tariff isadopted annually byParliament. Thecurrent two-column tariffspecifies
thegeneral (m.f.n.) tariff rates andthefrequently lower rates accorded tooriginating products in
accordance withtheEFTA Convention, Norway 'sFreeTrade Agreement withtheEECortheEEA
Agreement. Preferential tariff treatment fornon-EU/EFTA trading partners applies whenever a"P"Norway WT/TPR/S/15
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appears inaseparate column, referring toanappendix containing details ontariffs agreed bilaterally
orunder EFTA FreeTrade Agreements. Administratively reduced tariffratesforagricultural products
arepublished inanannex. Trade preferences accorded todeveloping countries under Norway 'sGSP
scheme arerecorded inaseparate handbook ofthecustoms administration.
(a) Form oftariffs
8. Norway generally followed theapproach oftheEUintheestablishment ofnewtariff rates
under theWTO Agreement onAgriculture; rateswerederived line-by-line asthedifference between
average import prices (1986-88) andactual orestimated domestic prices.1Thebound rates, asthese
appear inNorway 'sSchedule XIV, haveinmostcases beenexpressed inbothspecific andadvalorem
terms withNorway reserving theright toapply whichever would behigher. However, tariffs on
agricultural products applicable from1July1995havewithrelatively fewexceptions (certain vegetable
oils,roots, plants andplant products) beensetonlyasspecific amounts.2
9. M.f.n. tariffs onmanufactured products arebycontrast predominantly advalorem. Specific
ratesareapplied oncement andcement products, peat, essential oils,casein, albumins, films, tyres,
leather goods, wood-board, cork, paper, synthetic fibres, certain footwear, umbrellas, glassandglass
products, some metal products, locks, telecommunication equipment, turntables andaudio tapes.
(b) Average tariff levels
10. Present m.f.n. tariffs areveryhighinagriculture, reflecting therestrictiveness ofprevious
non-tariff barriers. Theestimated average tariffforHSChapters 1-24(and35)of98.4percent,with
Uruguay Round tariffreductions fullyimplemented, ismarkedly different fromtheaverage 5.6percent
tariff forindustrial products. Norway 'scommitment tocuttariffs onindustrial products amount to
a44percentreduction (weighted average) inm.f.n. tariffs onmanufactures effected overafive-year
period, while theUruguay Round tariffcutsalready implemented inagriculture represent a36percent
reduction (simple average) compared tobase-period levels inNorway 'stariff schedule.
11. Tariffs applied in1995 aresignificantly below bound levels forsome agricultural products,
forexample, onyoghurts, certain cheeses, unshelled eggs, various freshandpreserved vegetables and
fruit(seasonal reductions), cereals, chocolate andpreparations ofcereals. Thetariff reductions are
inlinewithgovernment policies tointroduce gradually morecompetition inselected agricultural sectors,
and,thus, overtime, reach price levels fordomestic agricultural products more inlinewithprices
inneighbouring markets. Theintroductory provisions tothecustoms tariff authorize theNorwegian
Grain Corporation (Statens Kornforretning )toadjust tariffs onagricultural products, including general
1Domestic wholesale prices formeat, eggsandvegetables were adjusted toarrive atthe"upper price limits",
i.e.price levels thatwould trigger imports under existing market regulation procedures. Thesame methodology
wasapplied tomilk although thisproduct issubject toadifferent regulatory régime.
2Specific rates have, according tothe1995-96 Agricultural Agreement, been chosen forreasons ofprice
stability andpredictability. However, effective protection maydiffer considerably foritems within atariff line
since therelatively lownumber oflines inagriculture (about 1,200) increases thevariety ofproducts covered
byasingle line. Advalorem tariffs would have ensured uniform protection andencouraged aprice structure,
butalsoprice fluctuations, inlinewithdifferentials observed inworld markets. TheNorwegian authorities may
revert toadvalorem tariffs atafuture date.WT/TPR/S/15
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adjustments applicable toallimporters andreductions forindividual applicants.3Suchadministrative
adjustments mayberequired to"prevent disturbances inthedomestic market andsecure adequate and
required supplies toconsumers andthefoodprocessing industry".
12. Although bound at5.3percentinNorway 'sschedule, theGovernment removed them.f.n.
tariffonpassenger motor vehicles andcarpartson15November 1995. Themove, expected toreduce
tariff revenue byNKr155million in1996, willprincipally affect imports fromJapan andtheUnited
States since carsproduced within theEEA already enter dutyfreeunder preferential arrangements.4
13. TheMinistry ofFinance hasforsome timebeenconcerned about theadministrative costs of
collecting duties onlow-tariff manufactured products. Areview ofthetariffstructure tobeconducted
during 1996mayresult intheremoval ofanumber ofso-called "nuisance tariffs" onindustrial products.
(c) Tariff dispersion andescalation
14. Newtariffs inagriculture varyconsiderably between product groups. Average tariffs arezero
orclose tozeroinareas withhighincidence oftropical products suchascoffee, tea,matéandspices;
vegetable extracts andplaiting materials; cocoa andcocoa preparations; andtobacco (Chart III.1).
However, themainsectors inNorwegian agriculture areprotected byveryhighm.f.n. rates; theaverage
tariffisabove 200percentforliveanimals, meatandmeatproducts, dairyproducts, cereals andmilled
products.
15. Norwegian m.f.n. tariffs onmanufactured products aregenerally low. Average ratesexceed
10percentonlyforcertain detergents, plastic products, leather goods andintextiles andclothing and
tariffs aresettodecline further (Chart III.2). More than45percentofthetariff linesforindustrial
products willbefullyzero-rated onceNorway hascompleted theimplementation ofitsUruguay Round
tariff reduction commitments.
16. Anexamination ofNorway 'sm.f.n. rateswould indicate some tariff escalation intextiles and
clothing, footwear andplastic products. However, anyprotection ofdomestic industries islargely
eroded because oftheextensive free-trade arrangements governing tradewiththemostfrequent sources
ofcompetition (theEU,EFTA, central andeastern Europe orcertain GSPimports). Products with
relatively highm.f.n. tariffs andduty-free preferential imports maynevertheless besubject tosome
trade diversion, notably textiles andclothing andcertain electronic items.
17. Tariffescalationisdifficulttodetectinagricultureduetothehighprotectionaccordedtoprimary
production. Preferential trading arrangements haveemployed a"price compensation" (RÅK) scheme
toensure freetradeinprocessed foodproducts byneutralizing differences inprices paidforagricultural
rawmaterials. Moreover, cases ofnegative tariffescalation forNorwegian producers mayberemedied
through dutyexemption ordrawback facilities.
3More permanent adjustments areincorporated inthecustoms tariff.
4Elimination ofthetariff implies significant reductions (NKr 10,000 to20,000) inNorwegian retail prices
forsome Japanese andU.S. carmakes since value-added taxandhighexcise duties have been levied onthe
tariff-inclusive price.Norway WT/TPR/S/15
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Norway WT/TPR/S/15
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(d) Seasonal tariffs
18. Most fresh fruitandvegetables aresubject toseasonal tariffs inNorway. Theincorporation
ofpastimport licensing andother non-tariff measures haswidened thedispersion between in-season
andoff-season rates. Thetariff onfresh orchilled tomatoes, forexample, nowvaries between free
andNKr12.21 perkg;onapples thetariff ranges from NKr4.83toNKr0.03andonstrawberries
from NKr7.21toNKr0.18perkg.Theduration ofthelow-tariff period differs from product to
product, andmayinsome cases havebeennegotiated withtrading partners.
(e) Tariff bindings
19. Norway hasbound itsentire tariff schedule asaresult oftheUruguay Round. Previously,
about 97percentoftariff linesinmanufacturing sectors werebound, while theincidence ofbindings
waslower inagriculture (around 64percent).
(f) Tariff preferences
20. Arelatively minor share ofmerchandise imports actually receive m.f.n. treatment since the
bulkofNorway 'simports enterdutyfreeoratreduced ratesunder preferential trading arrangements.
Tariffs onintra-EFTA trade inmanufactured products were removed by1966 andextended tofish
andfishproducts in1990. While theagricultural sector hasgenerally beenexcluded from EFTA
free-trade provisions, arrangements havesought toeliminate protective duties ontheindustrial element
ofprocessed agricultural products, andtrade inspecific products hasbeenencouraged under bilateral
agreements.
21. TheEEA Agreement hasnarrowed thelistofindustrial products (HSChapters 25-97) excluded
fromfree-trade arrangements tocasein, certain albumins anddextrin (which arecounted asagricultural
goods intheUruguay Round definitions). Agriculture isnotcovered directly bytheEEAAgreement,
butNorway accords preferential tariff treatment toanumber ofproducts andanevolutionary clause
commitsthepartiestoseekprogressiveliberalizationofagriculturaltrade.NegotiationsbetweenNorway
andtheEUonarrangements relating totrade incertain processed agricultural products, covered in
Protocol 3oftheAgreement, haveproceeded slowly andwereyettobefinalized inDecember 1995.5
22. Since 1991, Norway hasbeenparty toabilateral free-trade agreement withtheFaroe Islands,
according tariffreductions (including zerorates) toselected agricultural products andduty-free treatment
tovirtually allmanufactured products originating intheislands. Imports fromGreenland enter free
ofdutyinaccordance withanagreement between Denmark andNorway of21December 1984.
23. Norway grants tariff reductions onimports from countries incentral andeastern Europe
(Bulgaria, theCzech Republic, Hungary, Poland, Romania, theSlovak Republic, Slovenia, Estonia,
Latvia andLithuania), Israel andTurkey inaccordance withEFTA FreeTrade Agreements. Conditions,
including product listsandtherespective tariffs, arepublished inanannex totheannual Customs Tariff.
Manufactured products typically enter atzerotariffs withsome country-specific exceptions related to
imports oftextiles andclothing, forwhich atimetable forthedismantling oftariffs hasbeenagreed
between theparties involved.
5TheEEA Agreement supersedes the1973 FreeTrade Agreement between Norway andtheEECintheareas
covered byit,however, theFree Trade Agreement remains valid.WT/TPR/S/15
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24. DevelopingcountriesmakinguseofNorway'sGeneralizedSystemofPreferences(GSP)scheme
generally enjoy duty-free andunlimited access forexports ofmanufactures, except forsome products
enumerated inanegative list(textiles, clothing andfootwear) andsome specific exceptions relating
toHong Kong, Macau andtheRepublic ofKorea. TheGSPrégime foragricultural products was
recently revised totakeaccount oftariffication ofprevious quantitative restrictions. Duty-free treatment
isaccorded tospecifically enumerated products andontheindustrial element ofvarious processed
foodstuffs, tariffreductions of10to50percentapply onimportant items suchasmeat, grains, feeding
stuffs, flowers andcertain oilsandfats(seeChapter IIforfurther details).6
25. Agricultural imports from developing countries havethusfarconsisted mainly oftraditional
tropical products -coffee, tea,cocoa, spices, fruitandvegetables. Recognizing apotential forsignificant
tradealsoinnon-tropical commodities, theauthorities would encourage developing countries tocapture
larger shares ofagradually opened agricultural market inNorway suchas,forexample, intheallocation
ofWTO minimum access quotas. TheNorwegian Import Promotion Office forProducts from
Developing Countries (NORIMPOD) organized inspections ofproduction facilities insome African
countries inAutumn 1995 toavoid preferential access being nullified byNorwegian sanitary and
phytosanitary regulations.7
(g) Concessional rates
26. Anewsystem fortheinward processing ofagricultural products intended forexport came into
effect on1July1995, replacing asystem ofexport refunds under the"price compensation" (RÅK)
scheme. Under thenewsystem customs duties areeither reduced orsuspended oncondition thatthe
processed goods areexported within afixedtimelimit, specific conditions maybesetforeachapplicant.
Authorization tousethesystem must beobtained from theNorwegian Grain Corporation before
importation oftherawmaterials orother inputs takeplace. Thedrawback system fornon-agricultural
products continues tooperate asdescribed intheSecretariat 'sfirstTrade Policy Review ofNorway.
27. Thedutyexemption scheme isdecided byParliament onanannual basis. Machinery and
toolsfalling under certain headings within HSChapters 84and85aresubject toconcessions untilfurther
notice. General orindividual tariffsuspensions, normally granted foronecalendar yearonrawmaterials
andinputs inthemanufacture ofindustrial products, maybewithdrawn onshort notice.
28. Dutyreliefisgenerallynotgrantedwhensufficientquantitiesofinputmaterialsmaybedelivered
byadomesticmanufacturer,importeddutyfreeunderaFreeTradeAgreement,orconcernfinalproducts
fordirect saleorusewithout anyfurther working orprocessing. Moreover, thedutywhich would
havebeencollected should constitute atleast3percentoftheex-works price ofthefinalproduct.
Thislatter "essential criterion" may, however, bewaived iftheimporter/consumer candemonstrate
an"aggravation ofhis/her ability tocompete", forexample because thefinalproduct canbeimported
dutyfreeoratatariff lower thantheratecharged oninput materials.
6Preferences aremore extensive forleast-developed countries; duty-free andunrestricted access forall
manufactured andagricultural products except flour, grains andfeeding stuffs onwhich tariffs arereduced by
30percentwithin certain indicative ceilings.
7Asastarting point NORIMPOD identified high-tariff products inwhich duty-free access forleast-developed
countries would beparticularly important duetothelimited preferences accorded toother developing countries.
Potentially interesting products include meat, canned meat andvegetables, honey andcutflowers.Norway WT/TPR/S/15
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29. Anannual circular from theDirectorate ofCustoms andExcise specifies dutyexemptions
applying toimports ofaircraft components falling under theGATT Code onTrade inCivil Aircraft.
EnterprisesorsubcontractorsparticipatingintheconstructionprogrammeforF-16fighterjetsareexempt
from paying dutyonproduction equipment andcomponents orparts included intheaircraft upon
presentation ofaninvoice andadeclaration from theChief ofDefence thatthespecified goods are
onlytobeusedinconnection withtheF-16programme.
(h) Tariff quotas
30. Norwayhasopenedanumberoftariffquotasunderglobalorpreferentialarrangements.8Details
regarding thequotas applicable in1995arepresented inTable III.1. TheWTO minimum access quotas
areallocated tothehighest bidders atquota auctions according tonewarrangements established by
aRoyal Decree of30June1995. From 1996 thetariff quotas within theGeneralized System of
Preferences forimports ofgoods fromdeveloping countries (GSP) arealsoallocated according tothe
same principle. Theauctions takeplace atthebeginning ofthecalendar year. Quantities allocated
tosuccessful bidders maynot,however, bemore than50percentofthetotalquota; exceptions may
beallowed ifthewhole quota isnotfilled bystrict application ofthisrule. Quota entitlements are
valid untiltheendofthecalendar year.
31. Some quotas -those forturkey rollandmeatofdeer, elkandother game -aretobeshared
outonthebasis ofpastimport performance. Newimporters maybereserved upto20percentof
thequota formeat ofgame (inthesecond halfoftheyear), while forturkey rollnewentrants may
beadmitted ifapplications ofestablished importers amount tolessthanthefullquota. Thetariffquotas
forapples andpears areseasonal.9Entitlements arebased onimport performance during thepastthree
years, but"commencement" quotas maybegranted tonewimporters. Quotas formeatforpromotional
fairsandproduct testing areallocated toapplicants tocover theirspecial needs.
32. In1995, theGSPquotas wereallocated toimporters according topastperformance. Quota
auctions asdescribed above tookplace inFebruary 1996.
(iii) Rules oforigin
33. Norway 'snon-preferential rules oforigin havenotbeenrevised since thefirstTrade Policy
Review in1991, butwork oninternational harmonization willproceed under theWTO Agreement
onRules ofOrigin. Inrelation topreferential trade, newruleshavebeenapplied intrade withother
participants intheEEAsince 1January 1994. Therulesoforigin laiddown inProtocol 4totheEEA
Agreementfollowamoresystematicandlogicalstructurewithimportantsimplifiedconditionscompared
toearlier provisions (Protocol 3ofthebilateral agreements between theEEC andindividual EFTA
countries, andAnnex B,PartItotheStockholm Convention).
34. Among themostimportant newelements intheEEA rules oforigin isfullcumulation, i.e.
forproduction processes carried outinvarious EEA countries, originating status isobtained simply
byadding theprocesses together evenwhen eachsingle process isinsufficient toconfer origin status
ontheintermediate product.
8Theadministration ofthetariff quotas wasnotified byNorway inWTO document G/AG/N/NOR/1,
24August 1995.
9Applications forashare ofthequota must besubmitted before 20October forthefollowing year.WT/TPR/S/15
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Table III.1
Tariff quotas applied byNorway in1995
Heading
No.Description ofgoods Quantity/Value Reference:
Preferential quotas
0406.00 Cheese 2,494 tonnes Agreements withEUand
Switzerland
1214.90 Hay 25,500 tonnes National regulation
0602.10 Unrooted cuttings andslips NKr2million Norway-EC Agreement (1993)
0602.30 Azalea indica NKr10million Norway-EC Agreement (1993)
0602.99 Flowering potted plantsaNKr8million Norway-EC Agreement (1993)
0811.10 Strawberries, added sugar 220tonnes EFTA-Poland Agreement
0811.10 Strawberries, nosugar added 1,400 tonnes EFTA-Poland Agreement
0811.20 Raspberries, blackberries, mulberries
andloganberries, nosugar added750tonnes EFTA Agreements withPoland
andHungary
2009.70 Apple juice 500tonnes EFTA Agreements with
Estonia, Lithuania, Hungary
andPoland
0204.00 Meat ofsheep 600tonnes Norway-Iceland Agreement
GSP-quotas
0409.00 Natural honey 192tonnes National GSPregulation
1602.50 Corned beef 200tonnes National GSPregulation
1602.50 Canned tongue 50tonnes National GSPregulation
1602.41 Canned ham 100tonnes National GSPregulation
2005.40 Canned peas 200tonnes National GSPregulation
2005.51 Canned string beans 100tonnes National GSPregulation
2002.51 Canned green beans 50tonnes National GSPregulation
2005.90 Canned mixtures ofvegetables 150tonnes National GSPregulation
Minimum access quotas
0202.1000/
2000/3001/
3009Meat ofbovine animals (ex02.02) 181tonnes WTO Agreement
0203.2100 Meat ofswine 230tonnes WTO Agreement
0204.10/
21/23/30/41
/42/43/
50Meat ofsheep (ex02.04) 34tonnes WTO Agreement
0207.12/
25/33Meat ofpoultry (ex02.07 347tonnes WTO Agreement
0405 Butter 366tonnes WTO Agreement
0407.0019 Eggs 692tonnes WTO Agreement
0704.9013/
9020/9040Cabbage (ex07.04) 45tonnes WTO Agreement
Preferential quotas made global quotas
0208.90 Meat ofdeer 25tonnes National regulations
0208.90 Meat ofelk 100tonnes National regulations
0208.90 Meat ofother animals andmeat ofgrouse andwoodbirds 250tonnes National regulations
1602.31 Turkey roll 20tonnes EFTA-Israel Agreement
Ch.2&16 Various meat forindustrial fairs, etc. 35tonnes National regulations
0602.99 Potted plants, flowering anddecoration plants NKr10million National regulations
0603.10 Cutflowers NKr1million National regulations
0603.10 Flower ofbulbs NKr0.5million National regulations
0808.10 Apples 8,000 tonnes GATT Agreement
0808.20 Pears 250tonnes GATT Agreement
a Excluding Begonia elatior, Campanula, Chrysanthemum, Euphorbia pulch, Hibiscus, Kalanchoe, Pelargonium, Primula and
Saint-Paulia.
Source: Government ofNorway.Norway WT/TPR/S/15
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35. With theimportant exception oftextiles andclothing, co-operation withenterprises inthird
countries isfacilitated byallowing some incorporation ofnon-originating inputs (a"general tolerance"
rule)andvalue added inanon-EEA country (relaxation ofthe"principle ofterritoriality").10These
rules permit inclusion ofthird-country materials andaproduct tobeworked onoutside theEEA as
longasthevalue ofthecomponents andprocessing operations doesnotexceed 10percentofthe
ex-works price ofthefinaloriginating product. Alternative percentage rulesapply tochemicals and
plastics, allowing upto40percentnon-originating components intheex-works priceofbasicchemicals
(HSChapters 28and29)andchemicals (HS31to38), and25percent inplastic products
(HSChapter 39).
36. Evidence oforigin requirements havealsobeenstreamlined under theEEA; EUR.1 certificates
forapproved exporters havebeeneliminated, theinvoice declaration hasbeensimplified, andthegeneral
value limitforuseoftheinvoice declaration raised toECU 6,000.
37. Therules oforigin inNorway 'sbilateral andEFTA free-trade agreements (Chapter II)are
based ontheprinciples laiddown inEC/EFTA rulespriortotheestablishment oftheEEA. Originating
products must accordingly havebeeneither wholly obtained, generally applied tobasic materials,
minerals, waste andwaste products; orsufficiently worked orprocessed, based onachange oftariff
heading orspecific requirements intheso-called "processing lists".
38. Changes intheGSPrules oforigin areunder consideration.
(iv) Customs valuation andclearance
39. Customs warehousing procedures havebeenrevised since 1991. Themaximum storage time
foruncleared goods, previously three months, hasbeenabolished. National legislation oncustoms
valuation procedures wasamended in1995 toadapt totheWTO Customs Valuation Agreement.
40. Importers ortheir forwarding agents arelinked on-line toCustoms anddeclare goods
electronically using theSingle Administrative Document (SAD). Customs isaccordingly unable to
undertake prior checking ofdeclared values; however, postaudit controls maybeperformed bythe
localcustoms authorities.11Importers maychallenge customs valuation decisions andlodge complaints
(appeals)totheDirectorateofCustomsandExcisethroughthelocalcustomsauthorities.TheDirectorate
handles approximately 75cases regarding customs valuation decisions eachyear.
(v) Minimum import prices
41. AnActof11June1993provides theauthority toestablish minimum import prices oncertain
fishproducts incaseofmarket disturbance resulting from imports oflarge quantities ofanyfishat
abnormally lowprices. Thislegislation has,however, notsofarbeenused.
10Under thebilateral EEC/EFTA free-trade agreements aproduct lostitspreferential status when leaving
thefree-trade area, andtheuseofnon-originating inputs wasprohibited.
11Importers arerequired tocomplete avaluation declaration form whenever atransaction value needs tobe
confirmed.WT/TPR/S/15
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(vi) Indirect taxes
(a) Value added tax
42. Taxes ongoods andservices represent morethan70percentofgovernment revenue inNorway
(Table III.2). Thesingle-rated VAT, at23percent, isamong thehighest inEurope.12However,
thetaxbasefortheVATasregards services issomewhat narrower thaninotherindustrialized countries.
Projected income from theVAT amounts tonearly NKr85billion in1995.
Table III.2
Government revenue from duties andexcise taxes inNorway, 1991-95
Share ingovernment revenuea
(percent)Value
(million NKr)
1991 1992 1993 1994 1995a1991 1992 1993 1994 1995b
Customs duties onimports 1.01 1.03 1.08 1.02 1.38 1,439 1,533 1,680 1,812 2,553
Product-specific excise
taxes:20.9 22.4 21.1 21.4 21.9 29,791 33,457 33,038 37,905 40,385
Liquor/wine 2.40 2.24 2.05 1.83 1.80 3,419 3,339 3,192 3,235 3,315
Taxonbottles/cans 0.03 0.03 0.03 0.02 0.03 41 44 48 43 56
Beer 1.59 1.67 1.54 1.49 1.40 2,262 2,483 2,398 2,641 2,615
Taxonbottles/cans 0.01 0.01 0.01 0.05 0.01 13 19 10 91 16
Basic taxonnon-refillable
beverages packaging... ... ... 0.03 0.05 ... ... ... 56 100
Tobacco 2.90 3.04 2.98 2.85 2.96 4,134 4,526 4,649 5,041 5,475
Motor vehicles, total: 5.70 6.54 6.48 6.82 6.72 8,117 9,734 10,099 12,058 12,410
Taxonacquisition 2.28 2.78 2.68 3.97 4.03 3,245 4,143 4,174 7,022 7,670
Annual tax 1.57 1.84 1.91 1.77 1.01 2,240 2,731 2,978 3,134 3,335
Annual tax,trucks ... ... ... 0.17 0.17 ... ... ... 293 320
Kilometre tax,trucks 1.23 1.32 1.26 0.32 ... 1,745 1,968 1,966 560 ...
Taxontransfers 0.62 0.60 0.63 0.59 0.59 887 892 981 1,049 1,085
Petrol 5.60 6.28 5.99 5.26 5.53 7,978 9,351 9,338 9,298 10,206
Auto diesel ... ... 0.07 0.94 1.24 ... ... 107 1,659 2,290
Boatengines 0.02 0.02 0.02 0.02 0.02 22 28 30 36 37
Mineral oil 1.43 1.32 1.04 1.09 1.12 2,030 1,969 1,626 1,925 2,060
Lubricating oil 0.02 0.02 0.02 0.03 0.03 28 30 28 56 58
Coalandcoke ... 0 0 0 0 ... 1 4 7 5
Chocolate 0.39 0.43 0.41 0.38 0.38 561 646 636 667 695
Carbonated beverages 0.23 0.27 0.28 0.31 0.27 330 405 439 553 500
Taxonbottles/cans 0.04 0.02 0.02 0.02 0.01 60 35 24 30 21
Sugar 0.13 0.13 0.13 0.12 0.11 192 197 202 204 195
Non-carbonated beverages 0.02 0.03 0.02 0.02 0.02 28 42 28 40 40
Taxonbottles/cans 0.04 0.03 0.04 0.04 0.02 59 50 65 70 35
Cosmetics 0.28 0.29 0.02 ... ... 399 428 24 ... ...
Table III.2 (cont'd)
12Aspartoffiscal tightening measures thebasic rateofVAT wasraised from 20to22percent on
1January 1993 andfurther to23percenton1January 1995.Norway WT/TPR/S/15
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Share ingovernment revenuea
(percent)Value
(million NKr)
1991 1992 1993 1994 1995a1991 1992 1993 1994 1995b
Audio/video cassettes 0.05 0.06 0.03 0.03 0.04 70 85 45 46 67
Other audio/video cassettes 0.03 0.03 0.03 0.02 0.01 36 44 46 39 26
Radio/television sets,etc. ... ... ... 0.08 0.09 ... ... ... 110 163
Batteries 0.01 0 ... ... ... 12 1 ... ... ...
Other indirect taxes: 46.3 47.5 49.3 47.8 49.1 65,919 70,812 76,918 84,626 90,756
VAT/Investment taxc43.1 43.9 46.1 44.8 46.0 61,383 65,403 71,931 79,324 84,960
Electricity, consumption 2.37 2.32 1.68 1.50 1.48 3,380 3,456 2,615 2,651 2,730
Electricity, production ... ... 0.73 0.73 0.83 ... ... 1,132 1,286 1,535
Taxonperformance fee 0.01 0.01 0.01 0.01 0.01 18 19 20 21 26
Conveyances/documents 0.72 1.21 0.70 0.68 0.56 1,025 1,799 1,095 1,200 1,025
Charter (aircrafts) 0.08 0.09 0.08 0.01 ... 113 135 125 21 ...
Passenger airtransportation ... ... ... 0.07 0.26 ... ... ... 123 480
Total indirect taxes 68.2 71.1 71.5 70.3 72.4 97,149 105,802 116,636 124,343 133,694
... Notavailable.
a Central government revenue except direct andindirect taxes onextraction ofpetroleum andsocial security contributions.
b Figures for1995 areestimates.
c Figures include revenue from theinvestment tax. Therevenue from theinvestment taxwasNKr4,040 million in1991,
NKr4,140 million in1992, NKr4,154 million in1993 andNKr4,563 million in1994. Separate estimates fortherevenue
from theinvestment taxfor1995 arenotavailable.
Source: Ministry ofFinance, Norway.
43. Servicesrelatedtohealth,culture,education,passengertransport,hotelaccommodation,lawyers,
banks andinsurance areexempted fromVAT. Books, newspapers andperiodicals arezero-rated for
cultural reasons, andregional policy considerations underlie azero-rating ofelectricity forhousehold
consumption innorthern Norway. Foodstuffs aresubject tothefullbasic rateofVAT. However,
arefund scheme outside theVAT system affects milk, cheeses andvarious meats. Theproduct groups
covered bythescheme receive asubsidy perunitsold, reducing theaverage effective taxrateto
15percentforthese products.
44. VAT paidoninputs inbusiness transactions is,asageneral rule, deductible provided the
purchases arerelated toataxpayer 'sliable activity (production ordistribution process). However,
aninvestment taxhasbeenlevied oncertain capital goods since VAT wasintroduced in1970.13At
thecurrent rateof7percenttheinvestment taxyields annual revenue ofaround NKr4to4.5billion.
(b) Excise duties
45. Excise duties arearelatively important source ofgovernment revenue inNorway, mainly as
aresult ofhighduties onalcoholic beverages, tobacco, motor vehicles, petrol andother sources of
energy.Progressivetaxationofautomobilesappearstobemotivatedbyincomeredistributionobjectives.
13Theprior retail salestaxhadbeenapplied tovarious investment goods andtheinvestment taxcompensated
forsome ofthelossofrevenue intheconversion tovalue-added taxation.WT/TPR/S/15
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Taxes onalcohol andtobacco areconsidered health policy instruments andproduce revenue ofmore
thanNKr11billion annually. Between 1992and1995thetaxsystem onalcohol wasgradually reformed
tolinkthetaxdirectly tothealcoholic strength ofthevarious beverages, andthead-valorem taxelement
wasabolished.14Ataxoncosmetics (including soap) waseliminated from 1January 1993.
46. Aworking group intheMinistry ofFinance hassince 1990 examined revision ofthetaxon
performance fees. Thetaxwasintroduced in1963, principally toestablish acorresponding taxburden
between Norwegian musicians levied ordinary income taxandforeign musicians who,because oftheir
temporary stay,areexempted fromincome taxinNorway. Thetaxalsofulfils Norwegian obligations
according totaxtreaties, which establish thatincome should betaxed intheStatewhere theperformance
takes place. Thetaxaddsabout 43percenttotheconcert costs offoreign performers inNorway.
However, numerous concert hallsandinstitutions haveovertheyears beendeclared exempt fromthe
tax.15
47. Newtaxes havebeenintroduced inrecent years tofurther environmental protection. Petrol,
fueloilandnatural gasflared offshore became subject toaspecial carbon dioxide taxin1991; fuel
oilisalsotaxed forsulphur content andemissions ofsulphur dioxide. Expectations thattheinternational
communitywouldfollowsuitandintroduceequallytoughfiscalmeasureshaveonlybeenpartlyfulfilled;
exemptionshavethereforebeenmadesoasnottoputNorwegianindustriesatacompetitivedisadvantage.
Atpresent taxescover only40percentofsulphur dioxide emissions andabout 60percentofemissions
ofcarbon dioxide.16Therelationship between taxation ofnatural resources, environmental taxes and
taxation ofother factors ofproduction (such aslabour) iscurrently subject toreview; a"Green Tax
Commission" istopresent itsreport inJune1996.
48. Excise duties arealsousedtofacilitate collection ofwaste ortheoperation ofrecycling systems.
Adeposit ofNKr900islevied oneachnewmotor vehicle, while owners receive NKr6,000 forvehicles
delivered toauthorized scrapping plants.17Similarly, lubricating oilissubject toataxwhich isrefunded
onwaste oilhandled byauthorized collectors anddelivered forproper treatment.
49. Theenvironmental taxonbeverage containers isalsolinked torecycling, undertaken byprivate
operators. Thefulltaxrateisapplied onbeverage packaging withlessthan25percentreturn rate
while notaxischarged onpackaging withreturn ratesabove 95percent; aproportional taxreduction
applies when return ratesfallintheintermediate range. Non-refillable beverage containers aresubject
toanadditional "basic" taxofNKr0.70perunit.
14Norwegian excise taxes onalcohol, tobacco andpetrol arestillhighbyinternational standards.
15The1963 lawspecifically excluded alltheatres, theNorwegian Opera andtheNorwegian Broadcasting
Corporation from thetax.Current taxexemptions extend tosome 97ofapproximately 500relevant arenas and
organizations (Aftenposten ,6December 1995).
16Moreover,thecarbontaxisnotdifferentiatedaccordingtocarboncontent.However,areviewofthepresent
taxmayresult inanewtaxstructure.
17Parliament increased theordinary refund ofNKr1,000 toNKr6,000 for1996. Thetemporary increase
provides anincentive toreduce theaverage ageofregistered vehicles.Norway WT/TPR/S/15
Page 35
50. Thetaxes arelevied onbothimported anddomestically produced beverage packaging made
ofallkinds ofmaterial (glass, cardboard, plastics ormetal).18Thebasictaxonnon-refillable beverage
packaging wasintroduced on1January 1994. Theintention ofthetaxistoestablish anincentive to
userefillablebeveragepackaging.TheNorwegianGovernmentoriginallywantedtoexemptnon-refillable
glasspackaging fromthebasic taxdueto"unforeseen andundesirable effects" ofthetaxforthemain
receiverofglassformaterial-recycling(PLMMossGlassverkAS).Aspartofthenotificationprocedure,
theEFTA Surveillance Authority concluded thattheexemption forglassbottles didnotconform with
EEA rules onState aid.TheGovernment hasaccepted theconclusion. Byaformal letter ofnotice
of25August 1995 theEFTA Surveillance Authority alsoconcluded thatthebasic taxassuchis
incompatible withtheEEA Agreement, Article 14.Initsobservations totheformal letter ofnotice
theNorwegian Government hasquestioned theconclusion.
51. TheGovernment isconsidering extending adirect subsidy, compatible withEEAprovisions,
toMoss Glassverk topreserve employment atthefactory.
(vii) Import prohibitions
52. GoodsoriginatinginIraqmaynotbeimportedintoNorway.Thelegalbasisforsuchrestrictions
isanActof7June1968concerning theimplementation ofmandatory decisions bytheUnited Nations '
Security Council.19Thetradeembargo against Serbia andMontenegro wasliftedon20December 1995.
53. Product-specific bans concern some items under HSChapter 36; arms andammunition
(HSChapter 93); asbestos andproducts containing asbestos, aerosol containers withCFC gases as
thepropelling agent; andaerosols, foamed plastics, cooling systems, airconditioning systems, heat
pumps andfire-extinguishers containing CFCs orhalons. Imports ofsome ozone depleting substances
(CFCs,halons,carbontetrachlorideandmethylchloroform)are,accordingtoregulationsbytheMinistry
ofEnvironment, prohibited without priorpermission fromtheNorwegian environmental authorities.20
54. Norway 'sGene Technology Actof2April 1993contains provisions regulating marketing and
imports ofgenetically modified organisms. TheGene Technology Actincludes national regulations,
butnowalsoimplements EUdirectives 90/219 (onthecontained useofgenetically modified
micro-organisms) and90/220 (onthedeliberate release ofgenetically modified organisms) asaresult
oftheEEA Agreement.21Marketing, including imports, inNorway requires approval ofbothEU
andEFTA bodies andissubject toassessment ofrisktohuman health ortheenvironment, primarily
18Theabsence ofcommon recycling systems foraluminium orsteelcansinNorway disadvantage thistype
ofpackaging relative tobottles made ofglass orPET(polyethylene terephthalate).
19Trade with Iraqwasprohibited asfrom 6August 1991, regulations banning imports from Serbia and
Montenegro were introduced on5June 1992.
20Regulations forCFCs andhalons were introduced on21January 1991 andforcarbon tetrachloride and
methyl chloroform on28March 1995.
21TheEUdirectives became partoftheEEAAgreement on1January 1995. Marketing andimport provisions
pursuant totheGene Technology Actentered intoforce on1September 1993. TheActincludes provisions,
notyetinforce, concerning imports ofproducts consisting ofgenetically modified organisms forcontained use.WT/TPR/S/15
Page 36Trade Policy Review
carried outinthefirstcountry within theEEAinwhich approval issought. Import applications are
evaluated casebycase. Marketing could beprohibited ifproducts areconsidered unethical, inother
ways notbeneficial tosociety, orinconflict withsustainable development.
55. Nochanges haveoccurred since theprevious Trade Policy Review inthecoverage ofgoods
subject toimport prohibitions inapplication oftheWashington Convention (Convention onInternational
Trade inEndangered Species ofWild Fauna andFlora; CITES). Imports ofbirds onCITES listII
require anexport permit from theexporting country andanimport permit from theMinistry of
Agriculture. Direktoratet fornaturforvaltning must issue anadditional licence forimports ofbirds
onCITES listI.
56. Norway implemented aregulation regarding imports (andexports) ofhazardous waste, based
ontheBasel Convention, on23May1990. Rules werereplaced byanewregulation, incorporating
Council Regulation 259/93 onthesupervision andcontrol ofwaste within, intoandoutofthe
European Community, on30December 1994. Controls inNorway arebased onthegreen, amber
andredlistsintheECregulation. Norway hasatotalprohibition onexport ofredlistwastes to
non-OECD countries.
(viii) Import quotas
57. Previous quantitative restrictions onagricultural products havebeenreplaced bytariffs. In
some cases global tariff quotas havebeenopened toensure market access previously attained through
preferential arrangements (Table III.1). Remaining quotas inNorway thusconcern imports oftextiles
andclothing.Since1991NorwayhasremovedMFAquotasonshirtsandunderwear(fromHongKong),
while introducing quotas onimports offishing netsfrom ninesupplying countries.22Under the
Agreement onTextiles andClothing (ATC), Norway removed further restrictions on1January 1996
(Chapter IV).
(ix) Import licensing
58. Import licences areissued fortextile andclothing products under quantitative restraint,
i.e.jackets, trousers, bedlinen andfishing nets,etc.inaccordance withNorway 'sobligations under
theATC orduetobilateral restraint agreements withnon-members oftheWTO. Imports ofwhale
meatandrelated products alsoremain under licence. Licensing requirements inprinciple cover imports
fromallsources except withrespect tofootwear where onlyimports originating inChinese Taipei are
affected (Table III.3).23
22Only fishing netsoriginating inChinese Taipei were subject totrade control measures (licensing) in1991.
23BicyclesmadeinChineseTaipeibecame subjecttolicensingon13April1992butthemeasurewasabolished
on1January 1994.Norway WT/TPR/S/15
Page 37
Table III.3
Products subject toimport licences issued byNorway 'sMinistry ofForeign Affairs asof1May 1993
Country HSNumber Production description
R 02.08.9093 Meat ofwhale
R 15.04.3020-3090 Sperm oil,other oilofmarine mammals
R 16.03.0010 Whalemeat extracts
R 56.08 Knotted netting oftwine, cordage orrope
R 61.12.1100-2000 Tracksuits andskisuits, knitted orcrocheted
R 62.01 Men'sandboys'overcoats, car-coats, capes, cloaks, anoraks,
(including skijackets) windcheaters, wind jackets andsimilar
articles ofwoven material
R 62.02 Women 'sorgirls'overcoats, car-coats, capes, cloaks, anoraks
(including skijackets), windcheaters, wind jackets andsimilar
articles ofwoven material
R 62.03.1100-3900
62.03.4109
62.03.4209
62.03.4309
62.03.4909Men'sandboys'suits, ensembles, jackets, blazers, trousers, bib
andbrace overalls ofwoven material
R 62.04.1100-3900
62.04.61.09
62.04.6209
62.04.6309
62.04.6909Women 'sorgirls'suits, ensembles, jackets, dresses, trousers,
bibandbrace overalls ofwoven material
R 62.10.2000-5000 Garments made upoffabrics impregnated orcoated withrubber,
plastics orthelike(other thanunderwear)
R 62.11.2000-4900 Tracksuits, skisuits, other garments ofwoven material
R 63.02.1000-3900 Bedlinen
T 64.01-64.05 Footwear
Note: R=Allcountries. However, goods falling under HSChapters 61-63 originating intheEUorEFTA countries donotrequire
alicence ifavalid EU/EFTA certificate oforigin ispresented toCustoms.
T=Chinese Taipei.
Source: Ministry ofForeign Affairs.
59. Thelegalbasisforthelicences, issued bytheMinistry ofForeign Affairs, isatemporary law
of13December 1946 which allows abanonimports. Amore general temporary import lawof
22June1934 alsoallowing imports tobebanned -inthepastinvoked intheimposition ofimport
restrictions onagricultural products -isnolonger applied. According totheNorwegian authorities
the1934 and1946 import lawsaretoberemoved inthenearfuture; newlegislation istobelinked
toimplementing regulations fortheWTO Agreement onSafeguards.WT/TPR/S/15
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(x) Import surveillance
60. TheNorwegian authorities statethatlicensing, affecting theproducts mentioned above, is
primarily effected forsurveillance purposes. Afurther surveillance measure, anend-use declaration
isapplied toimports ofproducts which may also beused asfeeding stuffs. Automatic
licensing/surveillance hasbeenintroduced forimports ofcertain agricultural products inconnection
withtherecent revision ofNorway 'sGSPscheme. Current surveillance measures affect imports of
flour, grains, feeding stuffs andmeat from least-developed countries andmeat, meat products and
"sensitive" flower, fruitandvegetable products from other developing countries.
61. Newarrangements intheagricultural sector include theestablishment ofanimport council
tomonitor developments inagricultural markets andadvise theGovernment ontariffreductions which
mayprovide a"reasonable" levelofimport competition.24Members ofthecouncil, representing the
interests ofMinistries, farmers, thefoodprocessing industry, traders, labour andconsumers, have
yettobeappointed bytheMinistry ofAgriculture; butappointments areexpected inthenearfuture.
(xi) State trading
(a) Cereals andmilled products
62. TheNorwegian Grain Corporation, originally established toensure stable andadequate supply
ofgrain, flourandgrain seed, hastraditionally heldexclusive rights toimport grain andfeeding stuffs
andbeen obliged topurchase alldomestically produced grain atprices fixed intheAgricultural
Agreement. Asimplementation ofNorway 'sUruguay Round commitments haschanged theframework
within which theoldmonopoly wasworking, anewmarket system hasbeenworked outforthegrain
sector.
63. TheNorwegian Grain Corporation wasreorganized in1990, partly toprepare forchanges in
theexternal environment. InDecember 1994, Parliament decided tosplittheGrain Corporation into
twoseparate legalentities, Statens Kornforretning andStatkorn Holding AS.25Themonopoly rights
onforeign trade andfirsthandbargaining andsalesofmeal, grain andfeeding stuffs wereabolished,
effective 1January 1995. Inpractice, however, thenewsystem implies relatively small changes in
purchasing arrangements withfarmers, while subsequent trade, distribution, processing orimports
isopentocompetition.
64. StatensKornforretning,reportingtotheMinistryofAgriculture,willcarryonthenon-commercial
activities oftheformer Grain Corporation. Itstasks include administration ofthenewtariff-based
import régime fornon-grain agricultural products andsupport schemes fordomestic grain production,
including pricesupports andassistance toconstruction ofgrain-drying plants, andmanagement ofexport
subsidy schemes forthefoodprocessing industry. Theentity alsomanages thebargaining ofdomestic
grain arising fromtheGovernment 'spurchase obligations vis-à-vis farmers. Statens Kornforretning
isonlyresponsible forthefirst-hand bargaining from producers, whoarepaidtheinstitutional farm
gateprice. Thisgrain isresold immediately. Theentity maintains emergency stocks ofgrain and
wheat flour forreasons ofnational security.
24Stprpnr61(1994-95), Jordbruksoppgj øret1995 -Endringer iStatsbudsjettet for1995 m.m.
25Thesegregation wasagradual process which wascompleted on1July1995. Norway hasnotified the
changes inGATT document G/STR/N/1/NOR, 22August 1995.Norway WT/TPR/S/15
Page 39
65. Statkorn Holding AShasbeenestablished asaholding share company, fullyowned bythe
Government through theMinistry ofAgriculture. Itssubsidiary Statkorn AScontinues thecommercial
operations ofthetrading unitoftheformer Grain Corporation, including importation andtradeingrain
andother rawmaterials fortheproduction offeeding stuffs, transportation andstorage. Thecompany
alsoeffects export ofgrain from Norway, although suchoccasions arelikely toberare. Another
subsidiary, Storm øllenAS,isinvolved inproduction, refining, andtradeinfeeding stuffs foragriculture
andfishfarming, andrelated industrial andtrading activities.26Theliable firmNorgesm ølleneDA
isinvolved inproduction, refining andtradeinmilled products. Statkorn Holding ASalsohasmajority
andminority interests insome smaller companies mainly managing grain silos, anda51.1percent
stake intheseedresearch firmNorsk Kornforedling AS.
(b) Alcoholic beverages
66. Considered animportant instrument ofhealth andsocial policy, thealcohol monopoly
(A/SVinmonopolet ),established in1922, hasheldlong-standing exclusive rights withregard to
production andwholesale, retail andforeign trade inwineandspirits inNorway.27Thecompatibility
ofthesearrangements withtheEEAAgreement has,however, beencalled intoquestion, andtheEFTA
Surveillance Authority requested information from theNorwegian Government onexisting trade
monopolies inJanuary 1994.
67. TheWine Monopoly 'sexclusive righttoimport beerwasremoved withtheentry intoforce
oftheEEAAgreement andallsalestoconsumers ofbeers containing more than2.5percentalcohol
byvolume wereregulated through asystem ofsaleslicences. However, seeking tomaintain aWine
Monopoly withitsother exclusive rights intact, thecompany changed itsstructure andintroduced new
regulationsregardingpurchasingandproductselection.28Nevertheless,theEFTASurveillanceAuthority
indicated thatthechanges were inadequate, andon30December 1994 notified theNorwegian
Government thatNorway hadfailed tofulfil itsobligations under theEEAAgreement regarding the
Wine Monopoly, andrequested necessary measures tobetaken within sixweeks.29
68. TheGovernment accordingly decided toreplace themonopoly rights witharestrictive licensing
procedure forimports, exports andwholesale trade. Theproduction monopoly forspirits andtheretail
monopoly regarding alcoholic beverages arecontinued, buteffected byindependent units withno
institutional linksbetween them. There-organization oftheWine Monopoly andthenewcontrol system
26Thecompany heldapproximately onethird oftheNorwegian market forflour (human consumption) in
1994.
27In1995, itsmonopoly rights covered production, export, import, wholesale andretail trade inspirits and
liqueurs containing more than2.5percentalcohol byvolume; import, wholesale andretail sales ofwine and
fruitwine withalcoholic strength exceeding 2.5percent; import andwholesale trade inethyl alcohol and
iso-propanol; andretail sales ofstrong beers. Theexclusive right regarding retail trade ofbeers containing
more than4.75 percentalcohol byvolume wasintroduced on1March 1993.
28Private agents could forexample actasintermediaries between exporters andpotential customers suchas
restaurants, butpurchasing orders would need tobeeffected bytheWine Monopoly. Asfrom 1May 1994,
inaddition totheregular product range, eachWine Monopoly store carried asupplementary selection, andnew
products could beadded totheregular range through atestsales scheme. Retail sales arecurrently effected
from 112outlets.
29A/SVinmonopolet (1995), Årsberetning ogRegnskap 1994, Oslo.WT/TPR/S/15
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forproduction andwholesale trade inalcoholic beverages wascompleted bytheendof1995. While
theWine andSpirits Monopoly reported totheMinistry ofHealth andSocial Affairs, thenewcompany
forwholesale trade anddistribution reports totheMinistry ofIndustry andEnergy andistooperate
incompetition withprivate firms. However, theopportunities forprivate wholesalers tocompete on
equal terms withtheState-owned commercial company Arcus A/Shavebeenquestioned.30
(c) Pharmaceuticals
69. TheState-owned Norwegian Medicinal Depot (NMD), inoperation since 1957, hadhelda
monopoly onimports, exports andwholesale distribution ofpharmaceutical products. However, its
position aswholesale monopolist became unlawful withtheentry intoforce oftheEEA Agreement
andregulations have been changed toallow other wholesalers tosupply thedomestic market in
competition withNMD. Further amendments toNorwegian legislation willgrant wholesalers theright
tosellpharmaceuticals toeachother. Such provisions arenecessary tofacilitate parallel exports of
pharmaceuticals from Norway.
(xii) Standards andother technical requirements
(a) Technical regulations andstandards
70. TheGovernment hastraditionally encouraged institutions issuing regulations totakeaccount
ofwork carried outinorganizations suchastheWHO, Codex Alimentarius, ISOandtheIEC. Two
privateinstitutions,theNorwegianStandardsAssociationandtheNorwegianElectrotechnicalCommittee,
prepareandadoptNorwegianstandards.Norwegianproducersmayalsosetstandardsamongthemselves.
Norwegian standards arefrequently based oninternational standards orEuropean Standards (EN)
developed bytheEuropean Committee forStandardization (CEN) andtheEuropean Committee for
Electro-technical Standardization (CENELEC). While theEEA Agreement wasunder negotiation
requirements pertinent tospecific products groups wereharmonized toECdirectives through EC/EFTA
expert discussions.
71. Norway isnowforallpractical purposes integrated intotheEUinternal market intheareas
covered bytheEEA Agreement, including technical regulations andprocedures governing thefree
movement ofgoods. However, certain exemptions aremaintained duetodiffering opinions concerning
assessments ofrisks, special climate andsoilcharacteristics andvariations inconsumption patterns.
RegulationsarestricterinNorwayregardingbatteries(mercuryandcadmiumcontent),theuseofasbestos
andclassification andlabelling ofdangerous substances, inparticular withrespect tocarcinogenicity.31
30Aftenposten,30November1995.AccordingtotheNorwegianauthorities,theEFTASurveillanceAuthority
received information confirming thereorganization ofthealcohol monopoly andthenewalcohol legislation,
aswellasinformation about theprevailing market conditions.
31Manufacturersorimportersmustensurethatthepackagingofsubstancesandpreparationswhichmayinvolve
ahazard tohealth islabelled inNorwegian andincludes thename andaddress oftheNorwegian manufacturer
orimporter, thetrade name ofthesubstance orpreparation, theunambiguous chemical name ofthesubstance
andhealth hazard symbols (asshown intheregulations).Norway WT/TPR/S/15
Page 41
Health andenvironmental reasons havebeeninvoked tomaintain stricter Norwegian regulations on
pesticides andphosphorous fertilizer (cadmium content).32
72. Product safety regulations setoutintheEEA Agreement affect toys, human andveterinary
pharmaceuticals andfoodstuffs. Integration intotheEEA Agreement ofEUdirectives onmarket
authorization ofpharmaceuticals andfoodadditives iscurrently under consideration.
(b) Sanitary andphytosanitary regulations
73. Norway hastraditionally applied verystrict border controls tomaintain highanimal andplant
health standards. Many diseases common inother countries havenotbeenobserved inNorway. The
WTO Agreement ontheApplication ofSanitary andPhytosanitary Measures establishes ageneral
framework within which Norway maycontinue toimpose tough requirements forimported goods.
Requirementsmaybestricterthanthoseestablishedthroughinternationalsanitaryandveterinarystandards
aslongasNorway canprovide scientific evidence thatcertain imports would endanger theexisting
levelofanimal andplanthealth andspecific Norwegian regulations donotdistort trade. TheAgreement
alsocovers transparency withregard topublication ofchanges indomestic regulations.
74. Sanitary andphytosanitary regulations havelargely beenharmonized between theEUandEFTA
countries through theEEA Agreement. TheAgreement allows Norway tomaintain sanitary and
phytosanitary measures alsoagainst EEA members, however, provisions intheEEA Agreement are
morespecific thanintheWTO Agreement withregard totheapplication ofborder instruments. Norway
hasmade useoftheopportunity afforded under theEEAAgreement, forexample, inrestricting poultry
imports fromSweden inNovember 1995following anoutbreak ofNewcastle disease atfarms inSkåne
(southern Sweden).
75. Norway enforces national requirements, applicable toimports from allcountries, regarding
antibiotics, cocsidiostatica andgrowth promoting substances infeeding stuffs. Specific Norwegian
regulations concerning salmonella infeeding stuffs ofplantorigin aretobemaintained untilcommon
rulesapply within theEEA. Imported feeding stuffs fromEEAcountries arethussubject tosalmonella
control, imports from other countries undergo additional checks regarding remainders ofpesticides,
hygienic quality, mycotoxines andbotanical purity.
76. Quarantine measures areimplemented bytheVeterinary Field Services onthebasisofdetailed
provisions issued bytheMinistry ofAgriculture. Allimported liveanimals aresubject toquarantine
except cats,dogsandhorses fromEEAcountries.33Serological andbacteriological testsareundertaken
before animals canbereleased fromquarantine. Allliveaquatic organisms aresubject toquarantine;
detailed provisions suchasduration, disinfection, testing, etc.varydepending onthespecie. Regulations
32Norwegian regulations regarding fertilizers havebeenadjusted toEUrulesexcept withrespect tothecontent
ofcadmium, which inNorway maynotexceed 100milligrams perkg.ofphosphorus innon-organic fertilizers.
Norway alsoapplies specific criteria forproducts made oforganic waste asfrom May 1995.
33Quarantine requirements maybelifted forimported horses depending onthezoo-sanitary situation incertain
third countries. Veterinary border controls mayalsobeeased forcompetition horses.WT/TPR/S/15
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relatingtotradeinaquacultureproductshavebeenharmonizedthroughtheEEAAgreementwithNorway
adopting theEUacquis communautaire.34
77. Norway continues toimpose verystrictphytosanitary standards. Imports ofcertain plants and
plant products arebanned. Allconsignments ofplants, including fruitandvegetables, must be
accompanied byaphytosanitary certificate issued bytheplant inspection authorities oftheexporting
country inaccordance withFAO standards. However, certificates arenotrequired forcertain fruit
andvegetables from 1October to15April.
78. Food standards andfoodcontrol procedures areprepared andadministered bytheNorwegian
Foods Control Authority (SNT) andtheMinistry ofHealth andSocial Affairs withSNTacting asthe
centralco-ordinatingbodyforthedevelopmentandimplementationofrelevantlegislation.Foodcontrols,
including onimports andexport items, arecarried outlocally bythemunicipal Food Control
Authorities.35
(c) Eco-labelling
79. TheNordic Environmental label, avoluntary scheme approved bytheNordic Council of
Ministers inNovember 1989, istheworld 'soldest multinational environmental labelling system. Based
ontheemblem oftheNordic Council, the"White Swan" is-according totheauthorities -aneutral,
independent, multinational label guaranteeing thatproducts meet strict environmental requirements
onthebasis ofobjective assessments, thereby assisting consumers inidentifying products thatcause
theleastdamage totheenvironment. Thescheme isopentoproducts from anycountry.
80. ThejointprogrammeisadministeredbynationalboardsinNorway,Sweden,IcelandandFinland
which meetintheNordic Coordinating Group forEnvironmental Labelling, asubsidiary body ofthe
Nordic Council ofMinisters.36Draft criteria aresubject topublic review intheNordic countries and
subsequently approved bythenational boards before finaldiscussion andadoption (byunanimity) in
theCoordinating Group. Product conformity withsetcriteria isdetermined byanindependent testing
organization attheapplicant 'scost. Alicence awarded byonenational board isautomatically valid
intheother Nordic countries.
81. Thescheme ispartly self-financed.37Anapplication foralicence issubject toafeeequal to
DKK 11,000 (around US$2,000). Inaddition, labelusers arecharged anannual feeof0.4percent
oftheturnover ofthelabelled product initsrespective participating country. Themaximum annual
feeinNorway isNKr250,000 (about US$40,000).
34TheEUtreats Norway asa"third country" asfarastrade inliveaquatic organisms,semen andovais
concerned.
35EUacts, transposed intonational legislation, regulate trade inproducts ofanimal origin within theEEA.
Imports intoNorway from third countries aresubject tofood safety requirements laiddown intheFood Act
andtheMeat Inspection Act.
36Denmark participates inthework asobserver.
37TheNorwegian Foundation forEnvironmental Product Labelling, thenational agency inNorway, was
established byParliamentary decision inJune 1989 andinitially subsidized bytheGovernment. Theagencies
inSweden andFinland areintegrated inthenational standardization bodies.Norway WT/TPR/S/15
Page 43
82. The"WhiteSwan"labelhasseenafastexpansionandhasbecomewell-knownamongNorwegian
consumers. TheNordic experience suggests thatcompetitors arequick tofollow suitonce the
environmental labelhasbeenawarded tooneproducer. Since thefirstlicence wasawarded tocopy
paperinNorwayin1992,newproductstocarrythelabelincludewashingpowder,dishwashers,washing
machines, writing paper, envelopes, newsprint, laserrefills, rechargeable batteries, lawnmowers and
marine engines. ByJanuary 1996, criteria documents hadbeenadopted for37product groups and
267licences awarded toproducers (corresponding toapproximately 800products).
83. Norway alsoparticipates intheeco-labelling system oftheEUthrough theinclusion ofthe
EUregulation oneco-labelling intheEEAAgreement. TheNorwegian Foundation forEnvironment
Product Labelling hasthefunction ofnational competent body andassuchtakes anactive partinthe
elaboration ofnewcriteria. Norway adheres tothelong-term aimofonecommon European system
foreco-labelling, butrecognizing thelongwaystilltogo,aimsatasmooth co-existence withthe
EUsystem.
(xiii) Intellectual property rights
84. Norway attaches considerable importance tointernational harmonization oftheprotection of
industrialpropertyrights,includingcompliancewithobligationssuchastheAgreementonTrade-Related
Aspects ofIntellectual Property Rights (TRIPS). Norway hasalsoemphasized thatTRIPS should be
implemented inawaythatisconsistent withobligations laiddown intheirrelevant legalinstruments,
including theConvention onBiological Diversity. Norway 'slegislation islargely similar tothatof
otherNordic countries andNorway hasaparticular interest inthedevelopment ofrulesontheprotection
ofindustrial property rights intheEuropean Union through co-operation arrangements within the
framework oftheEEA Agreement.
85. TheWTOTRIPSAgreementhas,accordingtotheauthorities,notnecessitatedanymajorrevision
ofNorway 'sprotection ofindustrial property rights. Pertinent legislation intheareaincludes the
TrademarksActof3March1961No.4;thePatentsActof15December1967No.9;theDesignsAct
of29May1970No.33;theActof15June1990No.27Relating totheProtection ofLayout-designs
forIntegrated Circuits; theActof12March 1993No.32Relating tothePlant Breeder 'sRight; and
Chapter IoftheMarketing Control Actof16June1972 No.47.Inaddition tothelegalprotection
ofintellectual property rights setoutineachAct,domestic courts mayalsoberequested toorder
temporary measures bywayofinterlocutory orders.38TheGovernment iscurrently considering the
introduction oflegalprovisions authorizing customs officials tointervene andseizeinfringing imports
orexports without acourt order tothateffect.
86. Ontheconditions andwiththelimitations setoutinthePatent Act,aperson having made an
invention which canbeexploited industrially mayuponapplication begranted apatent fortheinvention
andthereby obtain theexclusive righttoexploit theinvention commercially. Theextent ofthepatent
protection isdetermined bythepatent claims section (section 39)oftheAct. Agranted patent may
bemaintained forupto20years fromthedateoffiling ofthepatent application, anadditional five-year
period mayincertain cases begranted formedical products (section 62a).TheNorwegian Patent
Office received 5,103 applications forpatents during 1994 andhad15,959 patents initsregistry at
yearend.
38Such orders areissued inaccordance withtheprovisions ofChapter 15oftheEnforcement ofClaims Act
of26June 1992 No.86.WT/TPR/S/15
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87. Anexclusive right toexploit adesign commercially isobtained byregistration withthe
Norwegian Patent Office inaccordance withtheDesigns Act.Theregistration isinforceformaximum
fiveyears fromthedatetheapplication wasfiled, andmayuponrequest beextended fortwoadditional
five-year periods. Intotal5,533 industrial designs were registered inNorway attheendof1994;
some 805applications were submitted during theyear.
88. Theconditions andlimitations governing theexclusive righttoexploit alayout-design areset
outintheActRelating totheProtection ofLayout-designs forIntegrated Circuits. Theexclusive right
comes intoexistence when thelayout-design iscreated andexpires tenyears aftertheendofthecalendar
yearinwhich thelayout-design wascommercially exploited forthefirsttime.39
89. Plantbreeders 'rights aresetoutintheActRelating tothePlantBreeder 'sRight. Theexclusive
righttoexploit aplantvariety commercially canbemaintained untiltheendofthetwentieth calendar
yearaftertheyearinwhich itwasgranted. Noexclusive rights wereregistered attheendof1994,
but58applications hadbeenreceived.
90. Anexclusive righttouseatrademark, valid foruptotenyears fromthedateofregistration,
maybeobtained inaccordance withtheTrademarks Act.Theregistration mayberenewed anunlimited
number oftimes. Aproprietor mayalsohaveexclusive rights toanunregistered trademark provided
thetrademark iswellestablished. TheNorwegian Patent Office received 7,455 applications for
trademarks during 1994; atyearend83,437 trademarks were registered inNorway.
91. Norway hasnolegislation dealing specifically withtheprotection ofgeographical indications.
However, theuseoffalseorotherwise misleading geographical indications isprohibited under the
Marketing Control Act.TheMarketing Control Actalsocontains provisions prohibiting unlawful use
ofbusiness secrets andother types ofundisclosed information.
92. TheNorwegianCompetitionAuthorityispreparingtworeportsonparallelimports;onefocusing
onjudicial aspects (theuseofintellectual property rights toprotect against parallel imports), theother
report examines theimpact ofparallel imports oncompetition, andnational andglobal welfare. The
preliminary conclusions ofthese studies suggest thatintervention against attempts bysoleimporters
tomaintain theirexclusive rights should bebased onacareful analysis ofeachcasewithproof that
inter-brand competition intherelevant market isrestricted, thatparallel importation canbeexpected
toalleviate thesituation, andthatthecauses oftheweak inter-brand competition maynotbeaddressed
inamore direct manner. However, these tentative conclusions mayberevised inthelightoffurther
experience.
(xiv) Government procurement
93. AnewActonPublic Procurement wasadopted byParliament on27November 1992.40On
thebasis ofthisAct,government regulations transforming EUdirectives onpublic procurement into
39However, foralayout-design which isnotcommercially exploited theexclusive rightexpires 15years from
theendofthecalendar yearofitscreation.
40Inthepast, central government procurement wascovered bya1978 Ordinance forCentral Government
Procurement andtheTokyo Round Agreement which covered purchases ofgoods by19State entities. The
Ordinance didnotextend tolocal andregional authorities. However, theNorwegian Association ofLocal
Authorities (KS)haddeveloped procurement guidelines modelled after theOrdinance. These guidelines were
followed bymost municipalities andabout halftheregional authorities (counties).Norway WT/TPR/S/15
Page 45
Norwegian legislation became effective astheEEAAgreement entered intoforceon1January 1994.41
Thenewregulations cover allcentral, regional andlocal authorities aswellasentities operating in
energy andwater supply, transport andtelecommunications.42
94. Procurement -inprinciple allsupplies, services andworks contracts above certain threshold
values -iseffected under open, restricted ornegotiated tendering procedures. Negotiated tenders
areonlytoapply inexceptional circumstances intheso-called classical sector, whereas intheutilities
sector negotiations canbeusedfreely afteracallforcompetition hasbeenpublished. Tenders are
widely advertised. Disciplines apply, forexample ontheelaboration oftechnical specifications, to
ensure openandnon-discriminatory procurement.
95. According totheNorwegian authorities, theexperience withpublic procurement under EEA
rulesthusfarsuggests anincrease indomestic competition, while thegrowth ofthevalue ofcontracts
awarded toforeign suppliers hasbeenmoderate andnosubstantial increase hasoccurred incross-border
bidding. TheEFTA Surveillance Authority hasintervened regarding theprocurement practices of
some Norwegian municipalities andoneprocurement caseconducted byNorway Post, butadherence
toEEA rules doesnotappear tobemore problematic inNorway thaninEUcountries.
96. Norway signed theWTO Government Procurement Agreement (GPA) inMarrakesh on
15April 1994. TheActonPublic Procurement hasbeenslightly amended duetotheGPA, which
became applicable inNorway on1January 1996. Thepending regulation totheProcurement Act
willberevised duetotheGPA andisexpected toenter intoforce inMay1996.
97. Initsreport forthe1991 Trade Policy Review, theSecretariat noted particular arrangements
intheprocurementofrailwaygoodsfromStrømmenVerkstedandtextilespurchasedbyNorway'sdefence
forces. According totheNorwegian authorities, theagreement between theNorwegian StateRailways
(NSB) andStrømmen Verksted nolonger exists. TheEEA Agreement entails some liberalization of
defenceprocurementinNorwayalthoughmeasuresmaybeappliedtoproducts"indispensablefordefence
purposes" (Article 123). TheWTO Agreement onGovernment Procurement includes aprovision
(Article XXIII) allowing somewhat wider exceptions thanArticle 123oftheEEA Agreement; only
defence products listed inNorway 'sannexes willbeprocured according toGPA rules.
(xv) Anti-dumping andcountervailing dutyactions
98. Norway 'sobligations under theAgreement onImplementation ofArticle VIoftheGeneral
Agreement onTariffs andTrade 1994 andtheAgreement onSubsidies andCountervailing Measures
wereimplemented inNorwegian legislation in1994, withsomeminor adjustments in1995. Definitions,
conditions andprocedures areestablished intheintroductory provisions oftheNorwegian Customs
Tariff (paragraph 3).Norway usesthistypeoflegislation sparingly. Thelastmeasure inforce, an
anti-dumping dutyoncement imported fromthethenGerman Democratic Republic, waslifted in1985.
Noanti-dumping orcountervailing investigations havebeencarried outthusfarinthe1990s.
99. Requests foranti-dumping orcountervailing measures, submitted byoronbehalf oftheaffected
industry, areforwarded totheMinistry ofFinance andCustoms. TheMinistry actsassecretariat for
theinvestigating authority, anAnti-dumping Committee, comprising representatives oftheMinistries
41TheActimplements theEUremedies directives directly.
42Public utilities intheelectricity supplying sector maythusnolonger apply a10percentpreferential margin
onbidsfrom domestic suppliers.WT/TPR/S/15
Page 46Trade Policy Review
ofFinance andCustoms, Industry andEnergy, andForeign Affairs, theNorwegian Competition
Authority, thePublic Consumer 'sCouncil, theConfederation ofNorwegian Business andIndustry
(NHO), theFederation ofNorwegian Commercial andService Enterprises (HSH) andtheFederation
ofNorwegian Trade Unions (LO).
100. TheCommittee submits itsrecommendation totheMinistry ofFinance andCustoms which
preparestheofficialproposaltoimposeanti-dumpingorcountervailingdutiesifsuchactionisconsidered
justified.43Theformal decision tointroduce measures istaken bytheKing inCouncil ofState and
reported toParliament without delay. Theprocess from theopening ofaninvestigation tothefinal
decision should nottakemore thanoneyear, inexceptional circumstances maximum 18months.
101. Decisions toimpose antidumping/countervailing (orsafeguard) measures maybechallenged
inordinary courts oflaw. Courts caninvalidate decisions taken bypublic administration andorder
repayment oferroneously collected customs duties andcompensation tobepaidtoinjured parties.
(xvi) Safeguard measures
102. Thegeneral rules fortheimposition ofsafeguard measures arecontained inparagraph 4of
theintroductory provisions oftheNorwegian Customs Tariff, andconstitute thelegal basis for
implementation ofNorway 'sobligations under theAgreement onSafeguards. Requests forsafeguard
measures areexamined bytheMinistry ofFinance andCustoms andtheMinistry ofForeign Affairs.
Decisions toimpose measures aretaken bytheGovernment (theKing inCouncil ofState), having
consulted withParliament.
103. Norway 'sonlysafeguard action under GATT Article XIXtodateaffected certain textiles and
clothing imports between 1978 and1984.
(xvii) Other matters
104. AllEFTA FreeTrade Agreements haveprovisions onmutual administrative assistance between
customs authorities andclauses forthefurther development ofsuchco-operation. Norway hasalso
signed several bilateral agreements onmutual assistance; currently, agreements existwithGermany,
Poland, theNetherlands, theUnited Kingdom, Spain, theUnited States, Russia, Estonia, Lithuania
andtheNordic countries. Inthelatter case, agreements withSweden andFinland ensure, interalia,
theoperation ofcustoms offices working forbothcountries. Thecontent ofother bilateral agreements
issimilar totheprovisions ofProtocol 11totheEEA Agreement.
(3) Measures Directly Affecting Exports
(i) Registration requirements
105. TheNorwegian Seafood Export Council (NSEC), charged withthegeneric marketing offish
andfishery products abroad andathome, wasestablished inJuly1991. ThetasksoftheCouncil include
registration andapproval ofexporters.44TheCouncil 'smain source offinance isanannual feeand
43TheMinistry isnotbound bytheconclusions oftheAnti-dumping Committee.
44TheCouncil wasestablished pursuant toActNo.9of27April 1990 relating totheRegulation ofexports
offishandfishery products, registration andapproval procedures areeffected inaccordance withRegulation
No.157of22March 1991.Norway WT/TPR/S/15
Page 47
alevyonevery exported consignment offishandfishery products, differentiated according tofish
specie andthedegree ofprocessing.
(ii) Export controls
106. Exports tocertain destinations arebanned inaccordance withanActof7June1968concerning
theimplementationofmandatorydecisionsbytheUnitedNations'SecurityCouncil.Presentprohibitions
affect anyexport toIraq, Somalia, Liberia andRwanda. Theembargo onarms andother military
equipment isextended toaircraft, aircraft components andsupplies toairports inthecaseofLibya;
andpetroleum andpetroleum products delivered tocertain parts ofAngola.
107. Exports ofstrategic goods arecontrolled bytheMinistry ofForeign Affairs. Licences are
required forproducts classified asweapons, ammunition andothermilitary equipment (ListI)andother
strategic goods (ListII)before exportation maytakeplace. Thescope ofthecontrols results from
work carried outininternational fora-theformer COCOM, theNuclear Suppliers Group, theAustralia
Group andtheMissile Technology Régime. Thecurrent ListIIisaNorwegian translation oftheEU
listingof"dualuse"goods,i.e.,productsandtechnologywhichmayhavemilitaryaswellasnon-military
applications. According totheNorwegian authorities, thelistrepresents asignificant reduction inthe
product coverage oflicensing procedures.45
108. Products notspecifically mentioned inListsIandIImayalsorequire export licences ifincluded
inthedevelopment, handling oruse,maintenance, storage, detection, identification ordestruction of
nuclear, chemical orbiological weapons, orthedevelopment, production, maintenance orstorage of
missiles thatmaycarry suchweapons. Trade inheavy water issubject tospecial regulations.46
109. Licensing requirements forexports ofstrategic goods apply toallcountries, including theEU,
inlinewithtemporary arrangements currently inforce among EUcountries. ListIIislikely tobe
amended upon completion ofongoing negotiations toestablish acommon export control forum (and
theassociated product list)within theEU.
110. Exports ofnon-strategic goods areregulated onthebasis ofProvisional ActNo.30of
13December 1946. Restrictions apply toobjects ofcultural heritage; hazardous waste; endangered
species ofanimals andplants; animals andplants subject todisease controls; fishandfishproducts;
beerandspirits; andgrains, milled products andconcentrated animal feed.
111. TheMinistry ofEnvironment introduced regulations controlling use,manufacture, import and
export ofCFCs andhalons, respecting theMontreal Protocol, inJanuary 1991 andforcarbon
tetrachloride andmethyl chloroform inMarch 1995. Exports canonlytakeplace ifpermitted bythe
Norwegianenvironmentalauthoritiesandacceptedbytheenvironmentalauthorityintheimportedcountry
upon receipt ofaNotification formsubmitted bytheexporter. Each consignment ofusedcontrolled
substancesmustbeaccompaniedbyatransportdocumentandtheNorwegianauthoritiescarryoutrandom
checks toensure compliance withrules ondocumentation andlabelling.
45Separate Norwegian lists(III-V) ofexport restrictions onchemicals usedinthemanufacture ofchemical
weapons,certainnuclearinstallationsandnuclearequipment,andmissilesandappurtenantproductsandtechnology
have been abolished withanyremaining restrictions merged intothenewListII.
46Regulation of10March 1989 withamendment of28February 1992, based ontheActrelating toControl
oftheExport ofStrategic Goods, Services andTechnology, etc.of18December 1987.WT/TPR/S/15
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112. Norwegian environmental controls onexports ofwaste currently follow ECCouncil Regulation
No.259/93, butarestricter inthesense thatNorway prohibits allexports ofhazardous waste (EU
redandamber lists)tonon-OECD countries. Norway generally supports IATA (International Aviation
Transport Association) guidelines onthetransport ofliveanimals.
(iii) Export promotion
113. TheNorwegian Trade Council istheprincipal executing agency forpublicly financed export
promotion andmarketing assistance. Theinstitution wastransformed intoanindependent foundation
witheffect from 1January 1996. Thefounding capital isNKr30million withtheGovernment and
theConfederation ofNorwegian Business andIndustry asequal contributors. For1996 theCouncil
hasbeengiven agrant ofNKr120million tocover running costs. Government contributions totwo
specificprogrammestoassistsmallandmedium-sizedcompaniesandthedevelopmentofexportstrategies
cover specific projects andconsultancy feesfrom Norwegian companies. Thegoalisthatfunding
shallderive equally from private sector andpublic contributions.
114. Thenewfoundation willtoalarge extent continue theTrade Council 'smain tasks, activities
andresponsibilities. TheTrade Council willnotgiveanymonetary support tocompanies orinstitutions;
itwillonlyoffer assistance intheform ofservices. Alower financial basewillreduce thevolume
ofactivities andpromotional programmes compared toprevious years. Themaincurrent programmes
concern development ofexport capabilities forsmall andmedium-sized industries; development of
export strategies forindividual markets andproducts; andgeneral individual assistance toenterprises
onanadhocbasis (Table III.4).
Table III.4
Export promotion programmes inNorway
Initiation year Name ofprogramme Payment orestimated subsidy
in1994
1969 TheExport Campaign 36.3
1986 Export Development inSMEs 14.0
1989 TheStrategy Programme 26.4
1978 TheExport Credit Financing Scheme 119.0
1960 Export Credit Guarantees -186.2
Source: WTO document G/SCM/N/3/NOR, 3August 1995.
115. Thefoundation NORTRA (theNorwegian Tourist Board) isthecentral agency forinternational
marketing oftourism toNorway. Itsactivities, established inco-operation withindustry enterprises
andregional andlocal organizations inacommon market plan, aretwo-fold, i.e.,general profiling
campaigns andspecific marketing projects. NORTRA alsocomplies anddistributes market information
totheindustry. Projects aremainly implemented abroad; NORTRA hasrepresentatives inNewYork,
Tokyo andninemajor cities inEurope.
116. ThetotalbudgetofNORTRAamountedtoNKr163.5millionin1995ofwhichtheGovernment
contributedaround60percent.NORTRA'sbudgethasincreasedby50percentsince1991.Marketing
oftourism inruralareas ispartly supported under theAgricultural Agreement, providing 3.6percent
ofNORTRA 'sincome in1994.Norway WT/TPR/S/15
Page 49
117. TheGovernment decided inSpring 1995toestablish aco-ordinating council forpublicly funded
promotional activities abroad. Thecouncil, chaired bytheMinistry ofForeign Affairs, includes
representatives oftheMinistry ofIndustry andEnergy, theNorwegian Trade Council, NORTRA and
theNational Institute ofTechnology. Within theirareas ofresponsibility eachinstitution mayforward
instructionsdirectlytoNorwegianembassies;thelocalAmbassadoroverseestheoperationsofmarketing
Norway inhis/her country.
(iv) Export finance
118. A/SEksportfinans,aprivatecompanyownedbyNorwegianbanks,essentiallyprovidesrequired
financing ofexports ofNorwegian capital goods. Thecompany hasnoaccess togovernment funds
andraises capital through issuance ofmedium- andlong-term bonds indomestic andinternational
financial markets. TheGovernment doesnotguarantee itsborrowing. Eksportfinans arranges medium-
andlong-term postshipment credits oncommercial terms, determined bythecostoffunding plusa
margin. Loans maybeextended upto100percentofthetransaction value.
119. Lending terms forgovernment-supported credits aredetermined bytheOECD Arrangement
onGuidelines forofficially supported export credit andtheUnderstanding onExport Credits forShips.
TheMinistry ofFinance administers ascheme covering interest raterisksandcurrency fluctuations
asregards credits fortheexport ofcapital goods. There ispresently nooperative system forinterest
rateorcurrency support forexport credits forships. Thefinancing offoreign components islimited
to30percentofthecontract. Loans under theOECD scheme maybeextended upto85percent
ofthecontract value. Thenetaccumulated subsidy in1994 hasbeenestimated atNKr119million
bytheNorwegian authorities (Table III.4).
120. Mixed credits areavailable forprojects having high priority indeveloping countries.
Eksportfinansnormallyactsaslenderunderthescheme,administeredbytheMinistryofForeignAffairs.
Thegrant element maybegiven either asaninterest subsidy orasacashgrant. Eligible recipients
arelowincome andlower middle-income developing countries. Funds arenormally tiedtopurchases
from Norway, butforeign content upto30percentisaccepted. International competitive bidding
isusedasfaraspossible. Theadministration ofthescheme isconsidered tosatisfy OECD guidelines.
121. Government support other thanexport credit insurance isnotavailable forshort-term export
credits. Such loans must beprovided bytheexporters orrefinanced withcommercial banks.
(v) Export insurance andguarantees
122. Governmental guarantee schemes covering commercial andpolitical risksrelated toNorwegian
exports ofgoods andservices areoperated bytheGuarantee Institute forExport Credits (GIEK), a
government agency reporting totheMinistry ofForeign Affairs. Newframework conditions allowing
theagency more independence andincreased responsibility came intoeffect on1January 1994. With
anewseven-member board appointed inOctober 1993, GIEK hasbeen re-organized intofour
departments.47
47TheGuaranteeDepartmenthandlesallapplicationsandissuespoliciesforcreditriskcover.Workconcerning
indemnifications andrecoveries isunder-taken bytheLegal Claims Department, which alsoassists theGuarantee
Department inlegal matters. ThePolicy andPlanning Department develops theagency 'sstrategy andproducts,
andcarries outcountry riskassessments andallinternationally related work. TheAdministration andFinance
Department provides in-house services such asaccounting, dataprocessing andpersonnel administration.WT/TPR/S/15
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123. Short-termguaranteesadministeredbytheCommercialSection,andlong-termguaranteeshandled
bythePublic Section, areorganized asseparate profit centres. Thenewconditions offerGIEK more
flexible percentage coverage ofrisksandautonomy inthefixing ofpremiums, previously decided by
Royal Decree. GIEK maynowcover upto90percentofcommercial riskunder thewhole turnover
guarantee and95percentcoverage forpolitical risk,coverage levels inlinewiththose offered by
guarantee institutions inother countries. Norwegian exporters havealsobenefited from premium
reductions forseveral markets. Theunderwriting ceiling (guarantee limit) forthegeneral scheme has
beenraised from NKr12.5billion toNKr30billion.
124. Thefinancial objective istooperate theguarantee schemes onano-gain no-loss basis, for
long-termguaranteesbalanceissoughtinalong-termperspective.Theportfolioofguaranteesconcluded
before end-1993 andsome special (country) schemes administered bythePublic Section arekeptin
separate accounts andhaveseparate balancing requirements. GIEK doesnothavea"national interests"
programme, butrather itassists theNorwegian Agency forDevelopment Cooperation inoperating
aspecial scheme forexports toandinvestment indeveloping countries.
125. GIEK targets small andmedium-sized firms notoffered credit insurance intheprivate market
andhasappointed aspecial commission tostrengthen thispriority. GIEK 'sportfolio thustends to
reflect acustomer baseofexporters notconsidered sufficiently remunerative byprivate insurers. In
1994, recoveries andfeesreceived byGIEK exceeded costsofguarantees metbyNKr186.2 million
(Table III.4).
(4) Measures Affecting Production andTrade
126. TheEEAAgreement includes rulesonStateaidsimilar tothose oftheEU.Norwegian State
aidtoindustries andservices isthussubject tomonitoring bytheEFTA Surveillance Authority which
hasthesame powers asthose oftheEuropean Commission fortheapplication ofaidrules.
127. TheGovernment hasappointed acommission toexamine current sectoral support measures,
including Stateaids,andthelinktoefficient resource allocation. Thecommission isexpected topresent
itsfindingsinSummer1996,subsequentlytheGovernmentintendstoundertakeafullreviewofindustrial
andsectoral policies initsLong-Term Programme 1998-2001. Industrial policies mayasaresult be
linked more closely withgeneral employment policies.
128. Thefollowingsectionconcentratesonbudgetarymeasures,principallyaffectingindustry.Support
toprimary industries andmore broad-based indicators ofgovernment assistance arepresented in
Chapter IV.
(i) Provision ofcapital
129. Statebanks wereestablished aftertheSecond World Wartoprovide credit tospecific sectors
forreasons ofsocial, industrial orregional policy. Four ofthese banks -theNorwegian Bank for
Industry, theIndustrial Fund, theSmall Business Fund andtheRegional Development Fund -were
merged on1January 1993 withtheestablishment oftheNorwegian Industrial Fund (SND).48The
main taskoftheSND istopromote profitable commercial andsocio-economic development across
Norway through grants, loans, guarantees andequity capital. Oneloanscheme andtheequity capital
scheme isextended oncommercial terms. TheFund targets small andmedium-size enterprises, in
48Plans tomerge theBank forFisheries andtheState Newspaper Loan Fund withSND areunder discussion.Norway WT/TPR/S/15
Page 51
principle, inallsectors except primary industries (agriculture, forestry andfisheries), oilandgas,
shipping andfinancial services. Theceiling ontotalfunds allocated bytheSND under itsvarious
measures amounts toNKr3.5billion in1996.
130. TheState Bank forAgriculture andtheAgricultural Development Fund provide investment
support andother economic support topromote diversified employment inruralareas. Thelending
quotaoftheBankforAgricultureamountstoNKr350millionin1996.ApproximatelyNKr190million
willbeprovided asloans forhousing purposes. TheAgricultural Development Fund amounts to
NKr510million in1996. About NKr120million istobeprovided totraditional agricultural activities,
theremainder being usedtosupport diversified employment.
131. TheGovernment took theinitiative toestablish aclosed venture capital company,
Norsk Vekst A/S, in1990. Thecompany hasbeenlisted ontheOsloStock Exchange since 1994.
Norsk Vekst A/Shasashare capital ofNKr600million ofwhich 66.4percentisowned byprivate
investors.49
132. TheStateisdirectly involved incommercial activities invarious sectors through wholly owned
companies orcontrolling interests incertain enterprises. Major investments supervised bytheMinistry
ofIndustry andEnergy include theState-owned Statoil anda51percentstake inNorsk Hydro A.S.50
StatoilhasparticipatedinalllicencesawardedontheNorwegiancontinentalshelfsincethethirdlicensing
round, butthispractice wasdiscontinued asofthe15thlicensing round in1996. Atpresent, theState
alsoowns somewhat more than50percentofRaufoss A/SandNorsk Forsvarsteknologi A/Sdueto
pastState control oftheNorwegian arms industry.
133. TheState alsohasclose to100percentownership inthree mining companies; A/SOlivin ,
A/SSydvarangerandStoreNorskeSpitsbergenKulkompaniA/S.ProfitabilityhasbeenlowinNorwegian
mining inrecent years andenterprise restructuring hasbeengiven highpriority. Stateenterprises are
tobemanaged asefficiently aspossible, measured bycommercial criteria.
134. Theformer StatePower Board hasasanatural consequence ofthenewEnergy Actbeensplit
intotwoseparate judicial entities; Statkraft SF,apureproduction andtrading company, andStatnett SF
owning 85percentofNorway 'scentral power gridsystem.
135. TheMinistry ofTransport andCommunication oversees anumber ofenterprises inkeyservices
sectors suchastelecommunications, postal services, railways andcivilaviation. TheNorwegian State
Railways (NSB) isalsoengaged inroadtransport while theCivil Aviation Administration owns a
consultancy company andasubsidiary operating carparks atcertain airports. Most oftheenterprises
operate asnatural monopolies, legal monopoly rights arelimited tocarriage anddelivery ofclosed
letters andpostcards (Norway Post)andvoice telephone services, telegraph services, analogue cellular
telephony andinfrastructure fortelecommunication services (Telenor AS).
49TheState'sequity participation wasreduced from 49to44percentinafloatation inconnection withthe
stock exchange listing, andsubsequently to33.6 percent.
50TheState alsohasdirect financial interests, managed byStatoil, inseveral petroleum fields. Independent
consultants have onbehalf oftheMinistry ofIndustry andEnergy valued Statoil atapproximately NKr80to
100billion. Norsk Hydro A.S. hadamarket capitalization ofaround NKr60billion attheendof1995.WT/TPR/S/15
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(ii) Research anddevelopment
136. Norway gives high priority tointernational research co-operation, participating inthe
EUFrameworkProgrammesthroughtheEEAAgreementandinco-operationprojectssuchasEUREKA,
IEAandCOST. Government support toindustrial research anddevelopment, concentrated onafew
large user-directed programmes, totalled NKr1.3billion in1994. TheResearch Council ofNorway
(NFR), which administers theindustrial R&D programmes, encourages higher spending byindustries
themselves toraisethetotalvolume ofindustrial research anddevelopment.51
137. TheNorwegian authorities consider research anddevelopment contracts between public entities
andNorwegian enterprises animportant policy measure. Public R&D contracts areconcluded onthe
condition thatthespecial needs ofapublic entity maynotbefilled adequately byexisting products.
Theprincipal objectives ofthese contracts aretoimprove thequality andeffectiveness ofservices
supplied bypublic entities through technological advances while strengthening thecompetitiveness of
Norwegian enterprises byreinforcing theircapacity tosupply public entities.
138. Thebudget forpublic R&D contracts amounted toNKr124.5 million in1994, withanaverage
subsidy perproject ofabout NKr2million. Industrial R&D contracts, limited tobusiness relations
inprocurement andsubstantially newproducts, wereintroduced inJanuary 1994, withatotalbudget
fortheyearofNKr28million. Thepublic andindustrial R&D contracts areadministered bythe
Norwegian Industrial andRegional Development Fund (SND).
139. Aidceilings forindustrial research anddevelopment programmes andpublic R&D contracts
amount to50percentofproject costsforbasicindustrial research and25percentforapplied research
anddevelopment; themaximum aidintensity canbe10percentage points higher forsmall and
medium-sized enterprises.52Grants forindustrial R&D contracts arerestricted toapplied research
anddevelopment insmall andmedium-sized enterprises; themaximum aidintensity is35percent.
140. TheSwedish-Norwegian Industrial Fund, established in1982, isafoundation regulated by
Swedish law.TheFundoffers grants andloans toprojects inwhich Norwegian andSwedish enterprises
co-operate inthedevelopment andlaunch ofproducts. Allindustries except oilandgasareeligible.
Interest ratesonloans arecomparable tothose offered byprivate institutions andadjusted upwards
forsuccessful products alsoinvolving grants. Thecredit ceiling fortheFundamounts toSEK75million
in1996.
(iii) Regional support
141. Theprimary objective ofNorway 'sregional policy istomaintain theoverall population pattern.
WiththeentryintoforceoftheEEAAgreement, aidschemes arenownotified toandsubject toapproval
bytheEFTA Surveillance Authority, which on16November 1994 accepted Norway 'sproposal to
leave unchanged thegeographic areaeligible forregional aid.Some adjustments have, however, been
51TheNorwegian Research Council wasestablished on1January 1993, replacing fiveresearch institutes.
Theauthorities sought efficiency gains through amore appropriate organizational structure andadditional effects
such astoavoid duplication ofresearch efforts, tobeabletocreate sufficiently large research groups andto
facilitatetheestablishmentofinterdisciplinaryprojects.TheCouncilalsoworkstopromoteclosercontactsbetween
theresearch environment, public administration andthebusiness community.
52Small andmedium-sized enterprises aredefined according tothree criteria related towork force (maximum
250employees), annual turnover ortotalbalance sheet, andcompany ownership.Norway WT/TPR/S/15
Page 53
maderegardingmaximumaidintensityanddefinitionsaidobjectives.Themodifiedregionalaidschemes
entered intoforce on1April 1995.
142. Regional grants areadministered bytheMinistry ofLocal Government andLabour through
theNorwegian Industrial andRegional Development Fund (SND) and15county municipalities. All
enterprises inassisted areas except those engaged inprimary production (agriculture, forestry and
fisheries), oilextraction orrefining areeligible forsupport. Aidceilings forinvestment grants are
differentiated according tothree zones, higher support maybeaccorded tosmall andmedium-sized
enterprises.53Business development grants arelimited to50percentofcosts eligible forso-called
"soft aid", forexample, one-off requirements forup-to-date knowledge invarious areas orthe
establishment ofnetwork co-operation.54Inprinciple, business development grants arelimited tosmall
andmedium-sized enterprises.
143. Grants andloans toenterprises indisadvantaged regions amounted tonearly NKr5billion
in1994 (Table III.5), ofwhich some NKr900million were grants forinvestment andbusiness
development. TheNorwegian Industrial andRegional Development Fund (SND) provided
NKr500million in1993andNKr426million in1994ininvestment loans tosupport business projects
inassisted areas. Guarantees forregional development projects amounted toNKr82million and
NKr88million in1993 and1994, respectively.
144. TheNorwegian Corporation forIndustrial Estates andDevelopment (SIVA) primarily assists
small andmedium-sized manufacturing enterprises. Themaximum subsidy issetat50percentof
eligible costsunder thenotion of"softaid",29enterprises received suchsupport in1994. Inthesame
year,thenationalprogrammesforregionaldevelopmentprimarilyallocatedfundstoR&Dinfrastructure,
suchasresearch institutes andcentres, inassisted areas.
53Thegeneralceilingsrefertototalaid,i.e.grantsincombinationwithothersupport.Themaximuminvestment
grant inZone Aamounts to35percent(50percentforsmall andmedium-sized enterprises). Therespective
ceilings inZones BandCaresetat25percent(30percent) and15percent(25percent).
54Physical investment ornormal operation expenditures would notqualify for"soft aid". Research and
development activities may, however, besupported byupto25percentofeligible costs forlarge companies
and40percentforsmall andmedium- sized enterprises.WT/TPR/S/15
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Table III.5
Industry-wide support programmes inNorway
(NKr million)
Initiation
yearExpiry Type ofprogramme/project: Measure Payment or
estimated
subsidy
in1994
Research anddevelopment
1991 ... Industrial research anddevelopment grants 425.0
1968 ... Public research anddevelopment contracts grants 121.3
1994 ... Industrial research anddevelopment contracts grants 28.0
1982 2001 Swedish-Norwegian Industrial Fund grants/loans 7.4
Regional development
1966 ... Regional investment grants grants orloans 477.0
1983 ... Development ofbusiness andindustry grants orloans 331.0
1987 ... Restructuring insingle industry regions grants 65.2
... ... Industrial Estates andDevelopment (SIVA) grants 16.0
1986 ... National programmes forregional developmentagrants 119.0
1988 1995 Restructuring inthecommunity ofRana grants 6.1
1991 1996 Restructuring inthecommunity ofSør-Varanger grants 40.0
1993 ... Restructuring inGrenland grants 3.8
1991 1996 Viking Business Development A/S(Askim) grants 40.0
Small andmedium-sized enterprises
1993 ... Enterprise development grants 807.0
1988 ... Public Advisory Systemb(free) services 158.85
Environmental improvement
1990 ... Development anddiffusion ofcleaner technologies investment grant 46.9
1990 ... Waste reduction andrecycling investment grant 71.3
1992 ... Loan guarantees forinvestment one-off guarantee 8.6
1991 2011 Treatment ofhazardous waste loan/loan guarantee n.a.
1979 ... Introduction ofnewenergy technology grants 20.0
Taxconcessions
1992 ... Carbon dioxide tax;pulpandpaper industry taxrebate 30.0
Carbon dioxide tax;fishflour industry taxrebate 10.0
Carbon dioxide tax;cement andleca taxrebate 90.0
Sector specific support measures
1969 ... Newspapers grants 269.0
Shipbuilding
1982 1989 Support toship-owners subsidized interest 643.2
1982 1989 Subsidies toyards construction loans 17.6
1990 1995 Contract andconstruction loans grants 478.9
... Notavailable.
a Thefigure includes support allocated toresearch institutes andcentres located intheassisted areas. Thisaccounts foramajor
share ofthesupport.
b Atotalgrant ofNKr158.85 million isgiven toinstitutions inorder toprovide advisory services (VINN, TI,BRT).
Source: WTO document G/SCM/N/3/NOR, 3August 1995.Norway WT/TPR/S/15
Page 55
(iv) Adjustment assistance
145. Norway 'sregional development programmes include ascheme forrestructuring inregions
dependant onasingle industry. Payments under thisscheme amounted toNKr65.2million in1994
(Table III.5). Inaddition, some major cases ofcompany restructuring inrecent years havebeencarried
outascommunity-specific projects, reflecting thedifficult taskofproviding alternative employment
opportunities inNorway 'smore thinly populated areas. Themostsignificant project hasbeencarried
outinRana municipality (Nordland county), deeply affected byadecision byParliament in1988 to
restructurethestate-ownedironandsteelproducerNorskJernverkAS.Atthetime,Parliamentapproved
atemporary grant ofNKr500million toattempt toavoid anyunacceptable social consequences of
theironandsteelretrenchment, aiming attheestablishment ofamore diversified androbust economic
structure intheRana community. About 40percentofthegrant hasbeenallocated toinfrastructure
projects andnewjobsinpublic bodies, theremainder hasbeenchannelled toprivate sector jobcreation.
Support totheprivate sector has,according totheauthorities, beengranted inconformity withEFTA
rulesconcerningStateaidandtheframeworkandguidelinesoftheNorwegianindustrialanddevelopment
fund. Theprogramme issettoexpire attheendof1995.
146. Theauthorities established aneconomic restructuring programme forthecommunity ofAskim
(Østfold county) in1991, following adecision byforeign private owners toclose Norway 'sonlytyre
producer, Viking-Askim. Theclosure involved thelossof400-500 jobs. Theprogramme consisted
ofworkforce retraining, provision ofbuildings fornewenterprises andaNKr40million grant to
establish VBU Bedriftsutvikling .Theventure company would subsequently invest innewbusiness
opportunities developed bytheprivate sector. Support, granted under EFTA rules onState aid,has
beenallocated toavariety ofprojects andsectors. Theprogramme expires on1December 1996.
147. Extraction andprocessing ofironorebyA/SSydvaranger ,thebackbone ofthelocaleconomy
inKirkenes (Finnmark county) closetotheborder withRussia, hasnotbeenprofitable fortwodecades.
Ithasbeenevident forsome timethatproduction would cease completely withthedepletion ofiron
oreinexisting surface mines. A/SSydvaranger ,which hadnearly 600employees inearly 1994, will
layoffmost oftheremaining workforce when theproduction ofpellets ishalted during 1996.
148. Aprogramme tofacilitate localrestructuring came intoeffect inJanuary 1991andisscheduled
toexpire attheendof1996. Ofatotalbudget ofNKr400million about onethirdhasbeenearmarked
forinfrastructure projects andjobcreation inpublic bodies while theremainder isavailable tosupport
private sector investment andnewindustrial activities inenterprises located intheCommunity of
Sør-Varanger. Subsidies totheprivate sector areadministered bytheNorwegian Industrial andRegional
Fund onthesame conditions applicable totheRegional Investment Grants andRegional Grants for
theDevelopment ofBusiness andIndustry.
149. Starting in1993, subsidies havealsobeenprovided foreconomic restructuring andjobcreation
intheGrenland area(Telemark county) inresponse toindustrial decline andhighunemployment in
theregion. Funds aremanaged byalocalindustrial development organization andprimarily granted
tosmall andmedium-sized enterprises fordevelopment projects, preliminary studies andone-off update
ofknowledge. Atthebeginning of1996some NKr27million hadbeenreleased intheformofgrants.
For1996 some NKr18million isavailable under thisscheme. Thescheme expires in1998.
150. InAutumn 1994, Parliament granted NKr875million tothefood-processing industry to
strengthen itsposition inamore internationally competitive environment resulting from theWTO
Agreement onAgriculture andtheEEA Agreement. Thescheme, administered bytheNorwegianWT/TPR/S/15
Page 56Trade Policy Review
Industrial andDevelopment Fund, accords priority tocost-reduction programmes, improved marketing
anddevelopment ofhuman resources.
(v) Environmental improvement
151. Norway hasnotified fivesubsidy schemes forenvironmental improvement totheWTO.55The
Ministry ofEnvironment isthesupervisory authority forsubsidies accorded toinvestment in"cleaner
technologies" andwaste reduction andrecycling. One-off investment grants fordevelopment and
diffusion ofcleaner technologies maycover upto50percentofexpenditure insmall andmedium-sized
enterprises ontechnical environmental studies and25percentofcostsrelated tospecialized investment
andresearch anddevelopment. Themaximum grant forwaste reduction andrecycling projects is
30percentofeligible costs.56Loan guarantees forinvestments areadministered bytheNorwegian
IndustrialandRegionalDevelopmentFund.Guaranteesforloansandgrantsshallnotexceed75percent
ofthetotalfinancial requirements. Allsupport isconfined toprojects exceeding requirements imposed
bylaworregulation.
152. Theloanandguarantee facility fortreatment ofhazardous waste isacompany-specific measure
(NorskAvfallshåndteringA/S)introducedin1991foraperiodof20years.TheloanofNKr100million
isgranted oncommercial terms, while theguarantee, covering 55percentofuptoNKr250million
ofthecompany 'sdebts withother institutions, isprovided freeofcharge.
153. Newenergy saving technologies aresupported bytheMinistry ofIndustry andEnergy through
theNorwegian Water Resources andEnergy Administration. Grants maycover upto50percent
ofeligible expenditure forequipment, training, consultants 'feesandother costs inconnection with
thedemonstration andintroduction ofnewtechnology. Thebudget ofthescheme amounted to
NKr20million in1994, and1995, respectively. In1996, thebudget forintroduction activities is
NKr36million, withNKr6million specifically allocated forgastechnology.
(vi) Production subsidies, taxconcessions andother budgetary measures
154. Production subsidies generally conflict withEEA rules onState aid.Grants are,however,
available toNorwegian newspapers through theNorwegian Mass Media Authority asthesubsidy is
assumed tohavenoeffect ontrade. Aimed atpromoting andmaintaining adiversified press, grants
arecalculatedonthebasisofcirculationstatistics.57NewspapergrantstotalledNKr269millionin1994.
155. TheEU'sseventh shipbuilding directive formally became partoftheEEA Agreement on
1May1995. Reductions inthegrants under theNorwegian scheme, ensuring conformity withthe
EUdirective, were approved byParliament inlate1994 andtookeffect from 1January 1995. The
current construction grant scheme covers construction ofnewvessels of100gross tonnes andship
conversions of1,000 gross tonnes ormore. Thesubsidy -9percentofthecontract priceofnewships
worth more thanECU 10million and4.5percentofcontracts forsmaller ships andconversions -
55WTO document G/SCM/N/3/NOR, 3August 1995.
56Both schemes allow aidceilings tobeincreased by10percentage points forsmall andmedium-sized
enterprises andafurther 5to10percentage points forfirms located inregionally disadvantaged regions.
57Eligible forgrants areweekly local papers withacirculation ofminimum 1,000 copies, newspapers with
twoormore editions perweek andanaverage circulation of2,000 to6,000 copies, anddaily papers "inan
unfavourable market position" withanaverage circulation ofupto80,000 copies.Norway WT/TPR/S/15
Page 57
ispaidtotheshipyard inoneinstalment seven to13months afteraship'sdelivery. Disbursements
under thescheme totalled NKr802million in1995.58
156. TheNorwegian grant scheme wasscheduled forabolition on1January 1996 withtheentry
intoforce ofthenewOECD Agreement respecting normal competitive conditions inthecommercial
shipbuilding andrepair industry. AsJapan andtheUnited States havenotratified theAgreement,
theAgreement hasnotyetentered intoforce. Following announcements bytheUnited States andthe
European Union thatthesecountries would continue theirsupport schemes fortheshipbuilding industry
in1996, Norway hasdecided toextend theduration ofitssupport scheme into1996 until the
OECD Agreement enters intoforce.
157. Norwayintroducedcarbon-andsulphur-dioxidetaxesonsomeenergyproducts,includingmineral
oil,inJanuary 1991andoncoalandcokeinmid-1992. These taxesarehighbyinternational comparison
andsome sector-specific taxconcessions havebeenintroduced inorder nottoweaken theinternational
competitiveness ofcertain industries. Airlines, shipping companies andfisheries areexempt fromthe
taxonmineral oil(thetaxonsulphur dioxide content islevied oncoastal fishing andcoastal goods
transport), while theherring flour andpaper andpulpindustries payhalftherateofcarbon dioxide
tax.Coalandcokeusedasreducing agents orrawmaterials inindustrial processes, andenergy input
intheproduction ofcement andleca,arenotliable tocarbon dioxide tax.
158. Allmanufacturing andmining enterprises areexempted fromtheconsumption taxonelectricity.
According totheMinistry ofFinance, thevalue oftaxconcessions onelectricity andmineral oilreached
almost NKr3.3billion in1994.
159. TheNorwegian Industrial andRegional Development Fundadministers acountry-wide scheme
toimprove theefficiency ofindustry. Thescheme isavailable tonon-public-sector commercial
enterprises inallsectors except banking, insurance andotherfinancial services, oilandgasexploration,
andpublic administration, butisprimarily targeted atsmall andmedium-sized enterprises. General
aidceilings amount to50percentof"softaid"costs, 35percentofeligible expenditures onresearch
anddevelopment and7.5percentofphysical investment costs (15percentforsmall enterprises).
Payments under thescheme exceeded NKr800million in1994, onaverage about NKr270,000
perproject.
160. TheMinistry ofIndustry andEnergy alsosubsidizes advisory services provided freeofcharge
oratlowcostbytheNational Institute ofTechnology (NKr 77.5million in1994), theNorth Norwegian
Institute ofTechnology andInnovation (NKr 26million), andanation-wide network ofregional
consulting services (NKr 55.35 million). Thelatter institution provides general consultancy services
while thetwootheragencies focus ontechnical know-how. Subsidized services, ofavalue notexceeding
ECU 50,000 overathree-year period, canonlybedirected atcompanies withlessthan100employees.59
58Thepredecessor tothepresent contract andconstruction loansubsidy, theInterest RateSubsidies forthe
Shipbuilding Industry -Long Term Financing andConstruction loans scheme, operated between 1982 and1989.
However, payments under theoldscheme areeffected fiveto12years after thedelivery ofships.
59Clients aretypically firms withlessthan20employees andtheaverage value ofservices provided amounts
toNKr10,000 (around ECU 1,200).WT/TPR/S/15
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(vii) Price controls
161. TheNorwegian Competition Authority isauthorized tofixmaximum prices, currently affecting
taxifares, milk(retail prices), meat(wholesale level), cement andcertain rents.60Other authorities
regulate prices ofspecific goods andservices -intermediary andretail prices ofprescription drugs
(Ministry ofHealth andSocial Affairs); passenger airtransport between Norway andcountries outside
theEEA(theNorwegian Civil Aviation Authority); transmission ofelectricity (theNorwegian Water
Resources andPower Board); domestic regional airtransport, certain domestic passenger transport
bysea,domestic railtransport, "A-mail" postal charges; andmetering units(Ministry ofTransport
andCommunications); andlocalscheduled passenger transport byroadandsea(municipalities and
county administrations).
162. Inaddition, market dominating firms mayberequired tonotify prices totheCompetition
Authority.Presentprice-surveillancearrangementsaffecttobacco,margarine,rawfatsfortheproduction
ofmargarine, roofing materials, explosives, carwindows, fertilizers, air-freight transport andpassenger
airfares forflights within Norway andbetween Norway andother EEA countries. Theextent of
Norwegianpriceregulationshasdecreasedsince1986duetoenhancedinternationalcompetition,notably
inairtransport andartificial fertilizers.
60Rent controls areimplemented inaccordance withActNo.13,7July1967 while other maximum prices
aresetpursuant toSection 3-10 oftheCompetition Act.