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PR(07)21: The differentiation in taxation of pension contributions to occupational pension schemes in Norway is contrary to Article 36 of the EEA Agreement


The EFTA Surveillance Authority today delivered a reasoned opinion to Norway regarding the differentiation made in taxation of contributions to occupational pension schemes. A distinction is made depending on whether the pension fund is established on Norwegian territory or not. The Authority concluded that this measure is an unjustified discrimination and in contradiction to Article 36 of the EEA Agreement, providing for the free provision of services within the EEA.

In November 2002, the Authority received a complaint against Norway regarding taxation of contributions to Norwegian occupational pension schemes. The complainant alleged that according to the Norwegian Tax Act, only contributions paid to two particular Norwegian pension schemes are deductible from the tax. The mentioned pension schemes can only be set up by institutions that are established in Norway. Moreover, employees must be covered by the Norwegian social security system to be able to enrol.

In July 2004 the Authority issued a letter of formal notice to the Norwegian Government.  In its reply, the Norwegian Government acknowledged the arguments of the Authority, taking into account the recent development in the case law of the Court of Justice of the European Communities. The necessary amendments to take into account also contributions to foreign occupational pension schemes for tax reductions were adopted by the Norwegian Parliament during 2005. However, they were not brought into force, because, first, the necessary control mechanism had to be established.

The Norwegian Government agreed to adopt the necessary provisions by July 2006. On request by the Norwegian Government, the timelimit was extended until March 2007. However, the control mechanism has still not been established and, consequently, the amendments adopted by the Norwegian Parliament in 2005 have not yet entered into force.

Issuing a reasoned opinion is the second stage in infringement proceedings. The EFTA  Surveillance Authority could bring the matter before the EFTA Court if Norway fails to produce a satisfactory reply within three months of receiving the reasoned opinion.

For further information, please contact:

Ms. Tuula Nieminen
Deputy Director, Internal Market Affairs Directorate
tel. (+32)(0)2 286 18 67; or

Mr. Bernhard Zaglmayer
Officer, Internal Market Affairs Directorate
tel. (+32)(0)2 286 18 85

30 May 2007

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