Investor Guide to Europe 2014
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TYPES of oWnERSHIP
Î
freehold
ownership
•
Norwegian law traditionally defines ownership as the all-inclu-
ding factual and legal right to dispose over an asset, e.g. a real
property.
•
Any title, transfer or charge of a right to a real property must
be registered in the Norwegian Land Register (
grunnboken
) in
order to obtain legal protection against
bona fide
third party
interests. The Land Register is a nationwide register administe-
red by the Norwegian Mapping Authority.
Co-ownership
•
Defined by law.
•
Ownership where two or more persons jointly own something
together, e.g. a real property, in such a way that their rights are
divided proportionally or by fractions.
Commonhold units
•
Defined by law.
•
Ownership by one or more persons to a co-ownership share in
a in developed property with an associated sole right to the use
of one of several dwellings or commercial units in the property
(
eierseksjonssameie
).
•
Consists of:
- privately owned areas (
eierseksjoner
);
- common area (
fellesareal
).
•
Established through a municipal sectioning decision after a
prior application, which shall include a definition of the pro-
perty units, the purpose of each property unit (i.e. residential or
commercial), the section number and ownership proportion of
each property unit.
•
All co-ownerships must have bylaws.
•
Each co-owner has a right to use the common areas and
shares the related service charges in accordance with the
ownership proportion of each property unit.
Î
Leasehold
Lease of real property
(tomteleie)
•
Lease of land without an intention to build anything on the
leased land is not statutory regulated in Norway.
Long-term ground lease
(feste)
•
Governed by the Norwegian Land Lease Act of 1996, which
sets out background law that will complement any matters not
regulated by a leasehold agreement.
•
It regards lease of land to a lessee that already has or will
construct buildings on the leased land. As a main rule, the
lessee has the same right as the lessor to dispose over the
leased land, unless otherwise agreed in the leasehold agree-
ment.
•
The leasehold agreement must be in writing. A leasehold
agreement regarding real property which is for commercial
purposes will last for 80 years, unless otherwise stated in the
leasehold agreement.
•
Each party may, every 10 years, require the leasehold consi-
deration to be adjusted in accordance with the Norwegian
Consumer Price Index, unless otherwise agreed in the lease-
hold agreement. There is a general ban on unreasonably high
leasehold rent, although in commercial leases the level of what
would be considered unreasonably is high.
•
The right to lease may be mortgaged and transferred unless
otherwise agreed in the leasehold agreement.
•
To ensure that it is enforceable against third parties, the lease
must obtain legal protection by registration in the Norwegian
Land Registry.
RIGHTS affECTInG oWnERSHIP
Î
Public approval
(konsesjon)
•
According to the Norwegian Concession Act of 2003, any pur-
chase of real estate in Norway is subject to public approval.
•
An important exception, however, is that developed proper-
ties under 100,000 sq.m. of which any agricultural land area
does not exceed 20,000 sq.m., are not subject to concession,
provided that the transaction does not require an alteration of
the area’s zoning status. For undeveloped properties there is
no such threshold.
•
The Concession Act of 2003 is drawn up, construed and
applied in accordance with the EEA-agreement article 40. Thus,
the authorities are not entitled to treat companies resident
in other EU Member States less favourably than Norwegian
entities.
•
The main objective of the Act is to protect agricultural areas
and interests, and normally approval is granted to a purchaser
of commercial real estate.
•
Concession also applies to lease agreements and leaseholds of
more than 10 years. The size exemptions outlined above also
applies to lease agreements.
Î
Easement
(servitutt)
•
Is a burden imposed upon a real property, for the use and
utility of another real property belonging to another owner,
without the beneficiary holder of the easement having the
possession of the encumbered real property.
•
Are divided into the right to use or otherwise dispose over (po-
sitive easements) and the obligation to refrain from use of or
otherwise dispose over (negative easements) a real property.
•
An easement may be due to the holder at any time (real ease-
ments) and thus may only be transferred together with the
encumbered real property. Other easements (personal ease-
ments) may, as a main rule, be freely transferred, however the
property owner has a pre-emptive right unless the easement is
transferred to an individual closely related to the holder.
•
The owner and holder may not exercise their respective rights
in a manner that is to the unreasonable or unnecessary disad-
vantage to the other.
Î
Mortgage
(pant)
•
Is a security encumbering the asset, which entitles the benefi-
ciary to a preferential right over other creditors in the event of
a forced sale of the relevant asset.
PRoPERTY LaW
