A holding company is a company whose primary purpose is to own shares in other companies — rather than to sell goods or services itself. Holding structures are very common in Norwegian business, from sole traders who have scaled up to large listed groups.
What does a holding company do?
A pure holding company has no operating activity of its own. It owns shares in one or more subsidiaries and receives dividends from them. It may also hold loans and make group contributions to its subsidiaries.
In practice the structure looks like this: a person owns 100% of a holding company (say "Hansen Holding AS"), which in turn owns 100% of the operating company ("Hansen Regnskap AS", which actually runs the accounting firm). The person therefore owns the operating company indirectly — through the holding company.
Why are holding companies used?
There are two main reasons Norwegian business owners choose holding structures:
- Tax deferral through the participation exemption: Dividends and gains on shares between Norwegian limited companies are as a general rule exempt from tax — this is known as the participation exemption (fritaksmetoden). It means the proceeds from selling a subsidiary can accumulate in the holding company without the owner paying tax immediately. Tax falls due only when the money is paid out as a dividend to the owner personally.
- Risk separation: By separating the operating business from the owning company, funds accumulated in the holding company are protected if the operating company goes bankrupt.
Groups and ownership structures
Large companies often have complex ownership structures with several layers: a parent company at the top, then one or more intermediate holding companies, and finally the operating subsidiaries. This is done to separate business areas or geographic markets, or to make it easier to sell off part of the business.
The Brønnøysund Register Centre records who owns the shares in each individual company. To find the ultimate owner — the person or company that controls a business in the final instance — you have to follow the ownership structure through every layer.
How to identify a holding company
Some characteristics that often mark out a holding company:
- The name contains words such as "Holding", "Invest", "Group" or "Capital"
- The NACE code is 64.200 ("Activities of holding companies") or 64.300 ("Trusts, funds and similar financial entities")
- Operating revenue is low or zero — income arrives instead as financial income (dividends and interest from subsidiaries)
- The balance sheet is dominated by "shares in subsidiaries" under fixed assets
On Biztrac you can trace ownership structures through multiple layers in the ownership graph, so you can quickly find who ultimately controls a company.