In a decision of the EFTA Surveillance Authority (ESA) last week, it has decided to refer Norway to the EFTA Court through the infringement procedure for incorrect implementation and application of several aspects of EEA secondary law covering the financial sector.
In the ESA’s view, the fact that Norwegian law requires ‘authorisation’ by national financial authorities for a Norwegian financial sector company to establish a subsidiary (secondary establishment) in an EU Member State or another EFTA state, amongst to a restriction that is prohibited by EEA secondary law.
At present, the national measures in question mean that a Norwegian company must notify the Norwegian Financial Supervisory Authority (Finanstilsynet) when:
- establishing a subsidiary in another EEA state.
- it acquires ownership of 10% or more of the capital or votes in a financial undertaking in another EEA State.
- it increases the qualified shareholding to 20% or more of the capital votes.
The national authority then determines its own criteria for dedicating whether the establishment/acquisition (secondary establishment) should then be pursued or not. According to the ESA, EEA law concerning authorisation for the taking up and pursuit of the business of subsidiaries in the financial sector are fully harmonised, and thus, the national authority’s powers, provided by national law, are incompatible with EEA law.
The ESA opened this infringement procedure against Norway in 2015, and issued a supplementary reasoned opinion in April 2023. In its view, Norway has not acted to resolve the issues raised by the ESA, and thus, the ESA has now referred the matter to the EFTA Court to determine whether the ESA’s pleas are well-founded or not.
The decision of the ESA to refer Norway to the EFTA Court of 27 September 2023 can be found here.