Government measures in key jurisdictions 3rd edition final - Flipbook - Page 93
Norway
Under the State Compensation Scheme companies experiencing a minimum of 30% reduction in
revenues, can apply to the state for the state to cover a portion of the company's overhead expenses.
Businesses required to shut down by the government are eligible to get up to 90% of their overhead
expenses covered. Other businesses experiencing a minimum of 30% revenue reduction are eligible for
state compensation for up to 80% of their overhead expense. For businesses not required to shut
down by the government, a NOK 5 000 deductible is applicable.
In the extended period of the State Compensation Scheme the coverage-percentage will be reduced to
70% for June and July and 50% for August.
On the 27 March 2020, the government proposed a NOK 2.5 billion financial aid package to
entrepreneurs and start-ups, pursuant to which entrepreneurs and start-ups are eligible for various
loans, financial subsidies and investment capital.
Employment
What financial support
is the government
providing to businesses
and to individuals on
employment issues?
The employer's obligation to pay salaries after temporary layoffs was as a temporary measure
reduced from 15 days (three weeks) to two working days under the Lay-off Salary Payment Act.
Moreover, the Government paid salaries for an additional 18 days (capped at 6G, approximately
NOK 600,000) to employees laid-off. The changes were effective as of 20 March 2020.
Employers who paid their employees' salaries for more than the 2 working days required, or prepaid salaries, may apply for a refund, capped at 6G for each employee.
Refund applications must be submitted to the National Labour and Welfare Administration (Nw.
NAV) by 31 October 2020. The possibility to apply for a refund is not applicable for lay-off periods
commencing subsequent to 20 April 2020.
On 28 May 2020, the government proposed a temporary salary payment-solution for companies
who bring back their own laid-off employees in July and August. The proposal implies that the
relevant company will receive a monetary compensation for each employee it brings back to
work. A refund application portal is scheduled to be opened in September 2020.
On 29 May 2020, the Government proposed to extend the period for which the employer is
responsible to pay salary during temporary lay-offs from two to ten working days and to end the
arrangement where the Government must pay salaries for 18 days, for new lay-offs subsequent
to 1 September 2020.
Insolvency
Has the
government made
any changes
to insolvency
legislation?
The Norwegian Parliament passed the Temporary Restructuring Act (nw: rekonstruksjonsloven), which
came into force 11 May 2020. The law will remain in effect until January 2022 and replaces the
restructuring chapters of the Bankruptcy Act (nw: konkursloven). The new rules will reduce the risk of
unnecessary bankruptcies in viable businesses that are now hit by acute revenue failure.
The most important changes in the new law are:
• No requirement for the debtor to be illiquid to open reconstruction negotiations.
• Creditors may, under certain conditions, request the opening of reconstruction.
• New rules to secure financing of the debtor's operations during the reconstruction period.
• Better opportunities for conversion of debt to equity in connection with restructuring.
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