Norway

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Contents

General Context

The Kingdom of Norway, a Scandinavian country, is located in northern Europe, bordering on the North Sea and the North Atlantic Ocean, to the west of Sweden. Norway shares borderlines with Sweden, Finland and Russia. About two-thirds of Norway is mountainous, and its total land mass includes about 50,000 islands. As of July 2009, the population of Norway was estimated at 4,660,539. Norway’s capital city is Oslo.

Political and Social Landscape

The government of Norway is a constitutional monarchy. Norway’s constitution, the Eidsvoll Convention, was first adopted in 1814 during a brief period of independence after nearly four centuries of Danish rule. Subsequently, Norway became part of a Swedish-headed monarchy. The country gained independence in 1905 when the union with Sweden was dissolved. The head of state, King Harald V, has mostly symbolic powers, and executive powers are exercised by the cabinet, the Council of State, in the King’s name. The head of government is the Prime Minister, currently Jens Stoltenberg. Legislative power is vested in the Storting, the Norwegian unicameral parliament, which sits for four-year terms. Norway’s legal system is based on a mixture of common law, civil law and customary law traditions.

In 2009, the UN Development Programme’s Human Development Report found Norway to have the best quality of life. Norway is one of the least corrupt nations in the world, and was ranked 11 out of 180 countries surveyed in Transparency International’s 2009 Corruption Perceptions Index. Freedoms of the press and of assembly and association are constitutionally guaranteed. Equal rights for men and women are statutorily protected by the Gender Equality Act. Freedom House’s 2010 Freedom in the World report determined Norway’s status to be free, giving it a score of 1, the highest possible, in both political rights and civil liberties.

Norway enjoys one of the highest standards of living in the world, in large part due to the discovery in the late 1960s of offshore oil and gas deposits. Norway's annual oil revenue amounts to around $40bn (£21bn), and more than half of its exports come from this sector. To counter inflation, there is cross-party agreement to restrict spending of oil revenue. The very considerable surplus is invested for future generations. Originally, the coastal waters provided fish for export. Today, Norway is among the world's largest exporters of fuels and fuel products.

International Community Participation

While Norway was a founding member of both NATO in 1949 and the Nordic Council in 1952, the Norwegians rejected membership of the then European Economic Community in 1972, and of the European Union in 1994, despite being urged by their governments to vote "yes". Norway has forged a stronger role for itself in international politics in recent years. It has mediated between Israel and the Palestine Liberation Organisation, and is trying to foster contact between the Sri Lankan government and Tamil separatists.

Whaling remains a point of contention for Norway’s international cooperation. Norway registered objections to the 1986 International Whaling Commission (IWC) ban on whaling and resumed the practice on a commercial basis in 1993. It argues that whaling is no more cruel than fishing and that stocks are sufficient to allow it to continue although conservationists disagree.

International Organisation Participation

According to the CIA World Factbook[1], Norway participates in the following organisations:

Asian Development Bank (ADB) (nonregional member); African Development Bank Group (AfDB) (nonregional member); Arctic Council; Australia Group; Bank for International Settlements (BIS); Council of the Baltic Sea States (CBSS) Council of Europe (CE); European Organization for Nuclear Research (CERN); Euro-Atlantic Partnership Council (EAPC); European Bank for Reconstruction and Development (EBRD); European Free Trade Association (EFTA); European Space Agency (ESA); Food and Agriculture Organization (FAO); Financial Action Task Force (FATF); Inter-American Development Bank (IADB); International Atomic Energy Agency (IAEA); International Bank for Reconstruction and Development (IBRD); International Civil Aviation Organization (ICAO); International Chamber of Commerce (ICC); International Criminal Court (ICCt); International Red Cross and Red Crescent Movement (ICRM); International Development Association (IDA) International Energy Agency (IEA); International Fund for Agricultural Development (IFAD); International Finance Corporation (IFC); International Federation of Red Cross and Red Crescent Societies (IFRCS); International Hydrographic Organization (IHO); International Labor Organization (ILO) International Monetary Fund (IMF); International Maritime Organization (IMO); International Mobile Satellite Organization (IMSO); Interpol; International Olympic Committee (IOC); International Organization for Migration (IOM); Inter-Parliamentary Union (IPU); International Organization for Standardization (ISO); International Telecommunications Satellites Organization (ITSO); International Telecommunication Union (ITU); International Trade Union Confederation (ITUC); Multilateral Investment Guarantee Agency (MIGA); United Nations Mission in the Central African Republic and Chad (MINURCAT); United Nations Organization Mission in the Democratic Republic of the Congo (MONUC); North Atlantic Treaty Organization (NATO); Nordic Council (NC); Nuclear Energy Agency (NEA); Nordic Investment Bank (NIB); Nuclear Suppliers Group (NSG); Organization of American States (OAS) (observer); Organization for Economic Cooperation and Development (OECD); Organization for the Prohibition of Chemical Weapons (OPCW); Organization for Security and Cooperation in Europe (OSCE); Paris Club; Permanent Court of Arbitration (PCA); Schengen Convention; United Nations (UN); United Nations Conference on Trade and Development (UNCTAD); United Nations Educational, Scientific, and Cultural Organization (UNESCO); United Nations High Commissioner for Refugees (UNHCR); United Nations Industrial Development Organization (UNIDO); United Nations Institute for Training and Research (UNITAR); United Nations Mission in the Sudan (UNMIS); United Nations Relief and Works Agency for Palestine Refugees in the Near East (UNRWA); United Nations Truce Supervision Organization (UNTSO); World Tourism Organization (UNWTO); Universal Postal Union (UPU); World Customs Organization (WCO); World Federation of Trade Unions (WFTU); World Health Organization (WHO); World Intellectual Property Organization (WIPO); World Meteorological Organization (WMO); World Trade Organization (WTO); and Zangger Committee (ZC).

Regulation of Alternative Dispute Resolution

In large part due to a strong shipping sector and successful oil and gas industry, the use of alternative dispute resolution methods in Norway is on a strongly upward trend. Large, complex commercial disputes tend to be resolved by arbitration rather than through the courts.

Arbitration

Parties may agree to have disputes settled by arbitration. The enforcement of arbitration agreements is governed by the Arbitration Act of 2004. Norway’s Arbitration Act is based heavily on the UNCITRAL Model Law, with only one significant difference: arbitration agreements in Norway need not be in writing, but may be made orally as well. Matters such as divorce, adoption and criminal law actions cannot be arbitrated.

Norwegian courts are amenable to arbitration and become involved in arbitration proceedings only when requested by the parties or the tribunal. Importantly, the arbitrator or tribunal is permitted to rule on its own jurisdiction. Disclosure or discovery requests are rarely granted; tribunals may be slightly more willing to grant such requests in international arbitration as opposed to domestic proceedings. While punitive damages are not a part of Norwegian law, should it be provided for in an arbitration agreement an award of such damages would not be considered, under Norwegian law, as contrary to public policy.

Norway is a party to the Geneva Protocol on Arbitration Clauses, the United Nations Convention on the Carriage of Goods by Sea, the Convention on the Settlement of Investment Disputes between States and Nationals of Other States and the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards. Foreign arbitration awards are recognised and enforceable in Norwegian courts unless the award can be challenged under the Norwegian Arbitration Act (the ground for which challenge are the same as those under the New York Convention).

Norway is a party to only a few bilateral investment treaties,[2] and does not use a model BIT (although a draft was circulated for consultations in 2007 and 2008).[3]

ADR in the Courts

Conciliation Boards

Most civil cases are handled in the first instance by Conciliation Boards – mediation bodies with a certain power to enter judgment. The Boards consist of lay judges (i.e., non-professional judges) and exist in every municipality. They deal with more than 250,000 cases per year.

Formally, parties to most civil claims must first attempt amicable settlement, very often by introduction to the Conciliation Boards. However, because of restrictions and exceptions, most disputes of substantial value are brought directly to the district courts. The Conciliation Boards cannot hear, for example, the following types of disputes: most family matters; cases not exclusively dealing with private law; cases determining the validity of an arbitration award or in-court settlement; cases decided by a tribunal if the decisions of the tribunal are binding on the parties unless the case is brought to the courts; claims where the amount in dispute is at least NOK 125,000 and both parties have been assisted by a lawyer; cases where out of court mediation has been attempted; and cases where the Conciliation Board considers the matter inappropriate or too complex for conciliation.

Judgments of the Conciliation Boards can be appealed to the district courts.

Court Mediation

In all civil cases brought before a court, the parties will get an offer of mediation before the court. Additionally, the court must also consider the possibility of mediation at each stage of the litigation. In court mediation, professional judges will carry out mediation and may render a verdict if agreement is not reached. In the land consolidation courts, a specialised court in Norway, mediation is conducted by lay mediators, who may also render a verdict in the absence of agreement. Similarly, lay mediators are empowered to mediate in the minor civil courts and may render a verdict if the parties do not agree.

National Mediation Service – Konfliktradet

The nationally run mediation and reconciliation service in Norway, Konfliktradet, is run outside the court system as a party-driven dispute resolution mechanism. There are three major rules for facilitating this type of mediation: (1) the mediators must be lay people, (2) the parties to the conflict must meet face to face, and (3) generally lawyers are not permitted in the mediation. The national mediation service handles both civil cases as well as criminal cases that are referred to it.

Relevant legislation

Dispute Act[4]

Act Relating to the Courts of Justice[5]

The Arbitration Act[6]

National Mediation Service Act[7]

Practice of Alternative Dispute Resolution

Oslo Chamber of Commerce Arbitration and Dispute Resolution Institute

The Arbitration Institute of the Oslo Chamber of Commerce[8] is the most prominent private dispute resolution mechanism in Norway as well as the principle arbitration institution in Norway. The Institute was established by the Oslo Chamber of Commerce 1984, and is administered by a Board appointed by the Executive Committee of the Chamber of Commerce. The Institute offers arbitration, mediation and mini-trial dispute resolution facilities, and can act as the appointing authority and provide administrative assistance under the UNCITRAL rules.

Labour arbitration: National Wages Board

Created by the National Wages Board Act of 1952, the National Wages Board is in principle intended for voluntary arbitration for disputes on wages and labour conditions not covered by collective agreements. The Board’s decision has the same effect as a collective agreement. If the parties to a dispute wish to solve their conflict by voluntary arbitration, they may use the National Wages Board, and the Government will pay the expenses of the arbitration; they are free to use another arbitration body but must bear the expenses themselves. For civil servants without the right to strike the National Wages Board settles the dispute.

The National Wages Board has been used mostly for compulsory arbitration, which is referred by the Storting in each individual case by separate act, or by the Government by Provisional Ordinance if the Storting is not in session. In an act on compulsory arbitration in a labour conflict the dispute is referred for settlement by the National Wages Board.

Labour disputes: Dispute Resolution Board

The Dispute Resolution Board is an independent regulatory body created by the Working Environment Act[9] to adjudicate certain matters pertaining to working conditions. The Board is made up of lawyers from the Confederation of Norwegian Enterprise and the Norwegian Trade Union Confederation, and industry members are appointed individually for each specific case. Decisions of the Board can be appealed to the courts.

The Social and Environmental Regulation of Business

“ Recently, the Norwegian Government adopted a 100-page white paper on Corporate Social Responsibility[10], which frames the responsibilities and dilemmas of companies. ”


Environmental Regulation

The Pollution Control Act[11] regulates pollution and waste in Norway. Each entity situated in Norway, whether domestic or foreign, is responsible for being aware of the environmental impact of its business activities, especially in relation to larger-scope risks. Additionally, the Product Control Act[12] aims to regulate, inter alia, the environmental impact of products, and requires that businesses connected with the production, importation, processing, sale or use of products to make available certain environmental information in relation to that product.

Norway is a member of the EU's carbon offsets quota trading system.

Social and Human Rights

The Anti-Discrimination Act[13] prohibits discrimination on the basis of ethnicity, national origin, descent, skin colour, language, religion or belief. The Act applies as Norwegeian law the International Convention on the Elimination of All Forms of Racial Discrimination. Employees and job applicants in particular are given enhanced protection by the Act.

Norway is at the forefront of gender equality regulation and has a very strong tradition of innovative, ground-breaking legislation. For example, a father's quota of parental leave was introduced in 1993 and steadily expanded; as of 2009, 10 weeks of parental leave (of a total of 56 weeks available, at 80% pay) are reserved for the father's use only and are forfeited if not taken. Additionally, in 2006, Norway enacted legislation introducing gender quotas for board members of companies (except for private limited companies), setting the representation requirement at 40% membership for each gender.

Working Conditions

Norway has enacted strong legislation in relation to working conditions for employees. All workers have the right to a written contract, whether the employment is permanent or temporary. Collective bargaining is a strong tradition in Norway, and while union membership is not mandatory it is quite common. The Working Environment Act, in addition to creating the Dispute Resolution Board described above, also regulates working conditions and workplace health and safety. There is not, however, a mandatory minimum wage level in Norway.

Recent Initiatives

Recently, the Norwegian Government adopted a 100-page white paper on Corporate Social Responsibility[14], which frames the responsibilities and dilemmas of companies. It gives special attention to subjects such as the challenges involved in operating in conflict zones, and issues relating to indigenous peoples. The paper also proposes strengthening the National Contact Point system of the OECD Guidelines for Multinational Enterprises.

Relevant Mechanisms

Relevant Websites

Keywords

Author

Original Author(s) Kim Everitt, White & Case LLP

References

  1. ↑ CIA World Factbook Norway page
  2. ↑ UNCTAD list of Norway BITs
  3. ↑ See http://www.regjeringen.no/upload/NHD/Vedlegg/hoeringer/2008/Modellavtale/South%20Centre.doc; see also http://www.asil.org/ilib080421.cfm#t1
  4. ↑ English translation of the Dispute Act
  5. ↑ Act Relating to the Courts of Justice (Norwegian version, only abridged versions are available in English)
  6. ↑ English translation of the Arbitration Act
  7. ↑ English translation of the National Mediation Service Act
  8. ↑ Oslo Chamber of Commerce Arbitration and Dispute Resolution Institute
  9. ↑ Working Environment Act
  10. ↑ English translation of Report No. 10 to the Storting
  11. ↑ Pollution Control Act
  12. ↑ Product Control Act
  13. ↑ Anti-Discrimination Act
  14. ↑ English translation of Report No. 10 to the Storting


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Contributor(s): This article was modified by Kimeveritt (30), International Bar Association (6), Kyle (2), and Nicolaclayre (1).