Norway - Country Commercial Guide
Norway Digital Economy
Last published date:

Overview

Norway is not a member of the European Union (EU) but participates in the EU single market through the European Economic Area (EEA) Agreement.  As an EEA Agreement signatory, Norway assumes most of the rights and obligations of EU Member States, except in the agricultural and fishery sectors.  Norway has implemented or is in the process of implementing most EU trade policies and regulations, including those on digital economy.  

During the 2019-2024 European Commission (EC) mandate, the EU took an assertive stance toward regulating the digital economy.  Based on two strategic communications, Shaping Europe’s Digital Future and Europe’s Digital Decade, the EC set out its vision for a “human-centric, sustainable digital society to empower citizens and businesses” through establishing: a digitally skilled population and highly skilled digital professionals; secure and sustainable digital infrastructure; digital transformation of businesses; and digitalization of public services.  Norway is among the most digital countries in Europe.

Details on the EU’s progress toward achieving its digital economy objectives can be found in the EC’s report on the State of the Digital Decade 2024.  

In July 2023 the United States and the EU enacted the EU-U.S. Data Privacy Framework as a replacement for the Privacy Shield, reestablishing a legal mechanism for transfers of personal data from the EU to the United States.  Transatlantic data flows are critical for all companies large and small across all sectors of the economy. 

 

Challenges

The EU/EEA digital economy is highly regulated.  A host of newly enacted regulations still in the early stages of implementation make the regulatory environment complex, opaque, and potentially fragmented.  Startups and small and medium-sized enterprises (SMEs) with limited financial resources face a disproportionate burden and often exist in a gray zone when facing regulatory compliance compared to larger companies.

During the 2019-2024 Commission mandate, the EU enacted numerous pieces of legislation governing the digital economy that Norway also follows, including:

Digital Markets Act (DMA): Enacted in 2022, this ex-ante regulation aims to harmonize rules on competition in digital markets and make digital markets fairer and more contestable by preventing large companies from abusing market power.

Digital Services Act (DSA): Enacted in 2022, the DSA includes measures for companies in scope to counter illegal content; combat the online sale of illegal products and services; reduce disinformation, and better protect minors online.

Data Governance Act: Enacted in 2022, the Act regulates the reuse of certain categories of data held by public sector bodies and is a key pillar of the European strategy for data. Similarly, Norway released a Fifth Norwegian Action Plan Open Government Partnership.

Data Act: Enacted in 2023, the Data Act covers business-to-business, business-to-government, and business-to-consumer sharing of non-personal data stored within industrial applications (e.g., robots, wind farms) and smart devices (e.g., smart TVs, connected cars).

Network and Information Systems (NIS) Directive and its revision, known as NIS2: Enacted in 2023, the Directive aims to enhance the security of network and information systems within the EU by requiring operators of critical infrastructure and essential services to implement security measures and report incidents to relevant authorities.

Artificial Intelligence (AI) Act: Enacted in 2024, the Act seeks to set a global standard for AI technologies including such services as machine learning programs, translation programs, speech to text conversion, forecasting and optimization programs, and computer vision.

European Digital Identity Framework (eID): Enacted in 2024, the framework is available to EU citizens, residents, and businesses who want to identify themselves or provide confirmation of certain personal information, for both online and offline public and private services across the EU.

Cyber Resilience Act (CRA): Proposed by the EC in 2022, creating approval processes for a wide range of digital products and services.

Cybersecurity Act: Enacted in 2019, with amendments proposed in 2023. 

Still other proposed pieces of legislation remain pending at the conclusion of the mandate, including:

The EC is also working to ensure the security and resilience of the EU’s connectivity sector and telecommunications infrastructure.  

The United States Trade Representative’s 2024 National Trade Estimate Report on Foreign Trade Barriers outlines many of the barriers to U.S. goods and services in the EU, including in areas related to the digital economy. 

 

Opportunities

Norway is a leader in digital government amongst OECD Member countries and an early adaptor of new technology.  The OECDs “The Digital Transformation of Norway’s Public Sector” holds that Norway has strong digital governance driving digitalization, but still needs to be better at attracting talents to this sector and also needs better AI coordination to increase effectiveness. The government is actively working with private sector to make necessary improvements.  Opportunities for doing business with the EU and EEA public institutions are handled through public procurement. Projects above certain financial thresholds (depending on the product or service involved) are posted on the Tenders Electronic Daily (TED) platform.

Norway’s Minister of Digitalization and Public Governance, earlier this year announced that by 2025, 80 percent of the Norwegian public sector will use AI. Today, one of four government agencies use AI, according to the Minister, who has keyed in on the healthcare sector as a good use case, arguing that we must use people where people are needed, and technology where we can use technology.

Private companies meanwhile spearhead many software developments in the offshore energy, renewables, and maritime sectors, where digital applications are needed to bring the change on health security and environment.  Much of this is sourced directly or indirectly from the United States.  Selling to Norwegian companies in these critical sectors require close collaboration with end users but also teaming up with service partners.  

In Norway, AI is high on the agenda. AI can be a tool for companies and the public sector to increase productivity, develop new markets and industries, take global leadership positions, and potentially revolutionize healthcare, education, security, and other sectors domestically.  Given that much of AI innovation originates in the United States, Norway’s focus is to optimize the adoption of productive applications and strategies across both private and public sectors.

Norwegian consumers are advanced when it comes to e-commerce, and foreign players enjoy good prospects.  On e-commerce, the introduction of the VOEC scheme (VAT On E-Commerce) on April 1, 2020, has simplified the reporting of value-added tax (VAT) and fastened the process of online shopping for Norwegian consumers. The scheme enables foreign online shops and online marketplaces to collect up to 25% Norwegian VAT when private persons make purchases from them. The VOEC is administered by the Norwegian Tax Administration and the online shops/marketplaces must register with the tax authorities before they can collect value-added tax. 

 

Resources