In Norway, there are three main types of lease: ground leases governed by the Act Relating to Leasehold Sites (Nw. tomtefesteloven), domestic leases governed by the Tenancy Act (Nw. husleieloven) and business leases which are also governed by the Tenancy Act (‘commercial leases’).
Last modified 7 Oct 2024
This varies greatly, depending on availability, type of premises, type of lease, rent levels and who the contracting parties are etc. Leases are often granted for five years (with a right for the tenant to renew for a further five years) or for ten years. The lease can be for a fixed term or an indefinite period of time. If no expiry date is stipulated, then the lease is valid indefinitely and cancellation must be in accordance with the relevant provisions of the Tenancy Act.
Last modified 7 Oct 2024
Leases of residential property are governed by the Tenancy Act 1999. (Please see the residential leases topic). There is also earlier act of 1939 (now repealed) on tenancies, which still regulates fixed-termed contracts which were entered into before the current Tenancy Act came into force.
In general, the conditions agreed should not be less favourable to the tenant than those provided for under the Tenancy Act.
Leases of commercial property are governed by the Tenancy Act. Agreements may, with certain exceptions, deviate from the provisions of this act, allowing parties to agree on a wide variety of terms for leases.
Last modified 7 Oct 2024
There is no legislation in Norway conferring security of tenure.
Last modified 7 Oct 2024
The tenant has no automatic right to renew where the lease is for a fixed term unless this is stipulated explicitly. However, a landlord cannot ensure that a tenant leaves on the date originally agreed on this basis alone so commercial leases normally include provisions for recovering vacant possession without court proceedings after the term of the lease has expired. The tenant has a right to receive a prior warning and an opportunity to rectify any breaches of the lease before losing possession of the property. Eviction usually takes between six and 16 weeks, but this can vary depending on the workload of the Execution and Enforcement Commissioner.
If the contract does not contain an eviction clause then the landlord must obtain a court order.
Last modified 7 Oct 2024
Commercial lease agreements usually contain provisions for recovering vacant possession without court proceedings in cases of non-payment of rent. The tenant has a right to receive a prior warning and an opportunity to deliver up the property and associated fixtures to the landlord voluntarily before losing possession. Eviction usually takes between six and 16 weeks, but this can vary depending on the workload of the Execution and Enforcement Commissioner.
If the contract does not contain an eviction clause then the landlord must obtain a court order.
If the tenant commits any material breach of the rental agreement then the landlord is normally also entitled to revoke the contract which means the tenant must vacate the property.
Last modified 7 Oct 2024
The government/local authorities or other third parties cannot enforce the termination of a lease. If a leased property is subject to compulsory purchase then the landlord has to negotiate with the tenant for vacant possession.
Last modified 7 Oct 2024
One of the commonest forms of security is for the tenant to provide the landlord with an appropriate form of surety from a parent company, a Norwegian bank or other financial institution. The surety is usually equal to the value of the rent for a maximum of six months and any additional obligations.
Another alternative is for the tenant to pay the landlord a deposit, which is placed in an escrow account with the same bank where the rental payments are deposited. This deposit is normally equal to a maximum of six months' rent.
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Leases normally stipulate the permitted uses of the premises and tenants must also abide by the restrictions imposed by planning regulations.
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Tenants are not usually allowed to alter and/or improve premises without the landlord's written consent, and structural alterations are not normally allowed. The parties must agree on whether or not the premises need to be restored to their original condition at the end of the lease period, and how any costs and benefits related to the alterations and improvements will be allocated.
On termination, the landlord may require the tenant to remove any improvements in order to avoid paying compensation.
Last modified 7 Oct 2024
Under the Tenancy Act, a tenant cannot transfer its rights or obligations under the tenancy agreement to anyone else without the landlord's consent. Depending on the circumstances, the landlord may be free to withhold consent or may be obliged not to withhold it unreasonably. The parties will also often agree further pre-conditions, for example that transferring 50 percent or more of the shares, participation or owner interest is deemed to be a transfer of the lease.
Tenants do not normally have a right to sublet, or transfer the right of use to anyone else without prior written consent from the landlord. However, in this case the landlord is normally obliged to give consent if there are no objective grounds for withholding it.
If the lease is for a fixed term, the tenant can, with the landlord's consent, sublet the property for the remaining period of the lease. If consent is refused, and the landlord cannot demonstrate that there were objective grounds for this refusal, the tenant can terminate the lease by giving three months' notice unless the lease explicitly states otherwise.
Last modified 7 Oct 2024
Rent for commercial leases is often adjusted annually in line with an indexation. Adjustment to market level usually only happens when a lease is renewed. In retail leases the rent may also sometimes be linked to the tenant's turnover.
Last modified 7 Oct 2024
The most commonly used index is the Consumer Price Index from Statistics Norway.
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The landlord can opt to register as a VAT paying company or to register the property for VAT purposes. This allows VAT to be recovered on expenses, but also means the tenant must pay VAT on rent and common expenses. The VAT rate is currently 25%.
Last modified 7 Oct 2024
There are no costs other than the initial rent at the start of a commercial lease, unless otherwise agreed.
Last modified 7 Oct 2024
It is normally the landlord's responsibility to pay the cost of all external building maintenance. The landlord must also pay for the replacement of any technical facilities, such as lifts, ventilation systems, fire safety measures, heating systems etc, when it is no longer economically viable to repair them.
At the start of each calendar year the tenant will normally pay a share of the communal expenses, according to a budget prepared by the landlord, in the form of a sum on account. Communal expenses are usually divided according to a set formula applied to the whole building. Payment of any shares allocated to unoccupied rentable parts of the buildings will normally be made by the landlord. The scope of the expenses that the landlord passes on to tenants as communal expenses, and those that are included in the rent, can vary. Communal expenses may also be capped, particularly if the space being let is not in a new building.
Last modified 7 Oct 2024
A tenant is normally responsible for the cost of maintaining the rented property to an acceptable standard, including both external and internal maintenance of entrance doors, gates and windows with framing. The tenant's duty of maintenance also usually includes renewing wallpaper and floor coverings, and interior decorating and repair, as well as wiring/pipes and other arrangements relating to water, heating, electricity, ventilation and refrigeration systems.
The tenant is also often responsible for any damage following breaking and entering or vandalism to the rental property, including damage to windows, frames, and entry doors and gates.
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Services such as telecommunications, electricity, water, heating, lighting, ventilation, cleaning etc. are usually agreed directly between tenants and suppliers.
Last modified 7 Oct 2024
It is commonly agreed that each of the parties will maintain insurance to cover their own interests. The landlord usually insures the building while the tenant will take out insurance to cover, for example, internal features, furniture and fittings, machinery, data, stock, loss of profit/business interruption and public liability. In addition, the tenant normally takes out insurance for doors and windows in the rental property. In the event of any damage, the tenant’s insurance will be used to its full extent before the landlord’s insurance is called upon. If the tenant’s activities result in any increase in the insurance premium or regular charges for the property, or any stipulation from the landlord’s insurance company involving capital expenditure, it is commonly agreed that the tenant pays the cost.
Last modified 7 Oct 2024
What is the usual length of each type of commercial lease?
This varies greatly, depending on availability, type of premises, type of lease, rent levels and who the contracting parties are etc. Leases are often granted for five years (with a right for the tenant to renew for a further five years) or for ten years. The lease can be for a fixed term or an indefinite period of time. If no expiry date is stipulated, then the lease is valid indefinitely and cancellation must be in accordance with the relevant provisions of the Tenancy Act.
Last modified 7 Oct 2024