On February 14th, 2023, the regulation on The Imposition of Compulsory Fines and Violation Fees for Non-Compliance with the Transparency Act came into effect. The amount of the fine is determined by discretion, where the maximum rate can be up to 4% of the company's annual turnover, or 25 million Norwegian kroner, with the highest amount to be applied.
It is not always the case that the maximum rate should be applied, but it is assumed that the fee will be set high enough so that it does not pay to act in violation of the Transparency Act.
According to the regulation, the same principles that are applied for violation of the Marketing Act, the Right of Withdrawal Act, and the Package Travel Act should also be used in determining fines for inadequate compliance with the Transparency Act.
The Norwegian Consumer Authority is responsible for ensuring that businesses directly affected by the Transparency Act comply with their obligations. This includes conducting a due diligence assessment, publishing a Transparency Report, and providing information on how the business complies with fundamental human rights and decent working conditions.
Also read: The Norwegian Transparency Act
In cases where a company has received an order from the Consumer Authority but failed to comply, compulsory fines and violation fees may be imposed. When assessing the size of the fine or fee, factors such as the severity of the violation, whether it was preventable, whether the violation of the Transparency Act was committed to promote one's own interests, and the preventive effect of such a fee should be considered.
If your business meets the requirements to be directly affected by the Transparency Act, we recommend taking action as soon as possible to comply with the law, as the consequences of violating the law can be very extensive.
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