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Internal Market

PR(01)23: Reasoned opinion sent to Norway concerning restrictions on the allocation of aquaculture licences


On 15 November 2001 the EFTA Surveillance Authority sent a reasoned opinion to Norway.

According to the Norwegian Act No. 68 of 14 June 1985, the establishment, purchase, running and owning of fish farms is subject to a licence system. When allocating licences among equally qualified applicants for the breeding of salmon and trout, importance should be given to the fact that the ownership interest of the fish farm has a local connection to the extent possible. Pursuant to the Norwegian Regulation No. 633 of 11 June 1998, importance should be given to local ownership to the extent possible when licences for the breeding of salmon and trout are re-allocated in Finnmark and Troms. According to consistent and general administrative practice, the local ownership criterion is met if, as a minimum requirement, the applicant company is registered in the region of allocation. In addition, it is the degree of local ownership which is decisive for the allocation of licences.

In two letters of formal notice sent to Norway, the Authority concluded that the “local ownership criterion” and its application by administrative practice is in breach of the rules on the freedom of establishment and free movement of capital. The Norwegian Government was invited to submit its observations to the content of these letters.

It is the Authority’s opinion that the “local ownership criterion” by requiring a company to register in the region of allocation restricts the exercise of the right of establishment in the Norwegian aquaculture sector contrary to Article 31 of the EEA Agreement since a foreign company is hindered to use branches or agencies as means of secondary establishment. Moreover, contrary to the provisions on the freedom of establishment, the “local ownership criterion” contains a local residence requirement for persons, companies and the shareholders of companies which is most likely met by Norwegian nationals or companies. Finally, since a company is required to show a certain degree of ownership by local shareholders, foreign companies are forced to seek local partnership in order to qualify. This restricts direct investments of foreign companies in the Norwegian aquaculture sector contrary to the provisions on the free movement of capital (Article 40 of the EEA Agreement).

In the Authority’s opinion, Norway has not justified the required objective reasons for these restrictions.

The Norwegian Government has been requested to take the necessary measures to comply with the reasoned opinion within two months of its receipt.

For further information please contact Mr. Jónas Fr. Jónsson (Director of the Persons, Services and Capital Movement Directorate), telephone (32)-02-286-1860.

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