The Norwegian Transparency Act 2021 – An important step towards human rights responsibilities for corporations - By Nora Kenan

Editor’s note: Nora Kenan has been an intern at the Asser Institute for the past five months and is about to complete her LL.B. in International & European Law at The Hague University of Applied Sciences. Upon graduating, she will proceed with a Master’s in human rights at the University of Utrecht.


The Norwegian Transparency Act [1](‘Åpenhetsloven’), also known as the ‘Act on Business Transparency and Work with Fundamental Human Rights and Decent Work’ was proposed in April 2021. Now, two months later, the Act has officially been adopted by the Norwegian government and represents yet another mandatory due diligence initiative which has been trending across various jurisdiction in the recent years. The Act will require all large and medium-size corporations in Norway to disclose the measures taken to ensure the respect for human rights throughout their entire supply chain.

Various Norwegian organizations have been campaigning for years in favor of such a law. The official preparations began in 2017, when the Parliament (‘Regjeringen’) requested the Government (‘Stortinget’) to explore the possibility of introducing a law that would oblige companies to inform consumers about the steps that they take to follow up on various human rights responsibilities. The Government appointed a law firm as well as a group of experts, the Ethics Information Committee, to conduct thorough research on the matter, and to investigate whether there were any other legal obligations standing in the way of a proposal of this kind, such as for example EEA-obligations or bilateral/multilateral agreements. As a result of this research, it was concluded that there was indeed room for imposing human rights obligations on corporations. Shortly after, the Ethics Information Committee published a report in which they proposed the introduction of a due diligence legislation – more specifically, the Transparency Act. The Act consists of fifteen paragraphs (§)[2], and each paragraph has a commentary which further describes how it should be interpreted and applied.[3]

The objective of the law is essentially to promote corporate respect of human rights and decent working conditions in the production of goods and provision of services, as well as to ensure public access to information on the steps taken by corporations to safeguard these goals (§1). By making this information public, individuals and stakeholders in general are given the chance to directly question the activities of a company.

Key elements

The Act is based on various global standards related to human rights and business, such as the OECD Guidelines for Multinational Enterprises and the United Nations Guiding Principles on Business and Human Rights (UNGPs) – similar to other mandatory due diligence initiatives. However, this Act introduces a rather unique approach to transparency and regulatory oversight, namely the Right to Information and the Duty to Disclose. In its essence, the Act covers all the elements of human rights due diligence (HRDD), such as detecting the negative impacts of corporate activity on human rights, continuously assess and take action to mitigate these negative impacts, as well as to report about their efforts. Even though many human – and workers’ rights conventions are listed throughout the Act, such as the International Covenant on Economic, Social and Cultural Rights (ICCPR) and ILO Declaration on Fundamental Rights and Principles at Work, the commentaries emphasize that these are non-exhaustive examples and accordingly refers to, inter alia, the UN Convention on the Rights of the Child and the ILO Indigenous and Tribal Peoples Convention.[4]  The Act uses these conventions to clarify what is meant by ‘decent working conditions’, adding that ‘decent working conditions’ entails the protection fundamental human rights as according to these conventions, as well as safe and secure working conditions and an income that is sufficient for the workers to support themselves and their families (§3(c)).

Personal scope of application

The Act is applicable to all larger companies domiciled in Norway, regardless of whether they offer their products or services within the Norwegian borders. Further, foreign corporations who sell their products or services in Norway and who have tax obligations to the Norwegian government also fall within the scope of this Act (§2). In order to define a ‘large company’, the Act makes a reference to §1-5 of the Norwegian Accounting Act.[5] Alternatively, a corporation is also considered a ‘large company’ if it meets at least two of the following three requirements:

1. Turnover of at least 70 million NOK (approximately, €6.880.000 (June 2021))

2. Balance-sheet total of at least 30 million NOK (approximately, €2.950.000 (June 2021))

3. Average amount of employees in a financial year: 50 man-years (§3(a)).

The Ministry’s own calculations stipulates that this will entail approximately 8800 companies. To give an insight to the comprehensiveness of this scope, the French duty of vigilance law applies to 200-300 corporations.  

Scope of due diligence obligation

The Act imposes an obligation for companies to carry out due diligence assessments in accordance with the OECD Guidelines for Multinational Enterprises with the aim of documenting what actions they take to prevent and limit human rights risks. Essentially, such a due diligence process entails (i) the embedment of responsible business conduct into the company’s policies and management systems; (ii) mapping the actual and potential negative impacts on human rights and decent working conditions that the company has either caused or contributed to, or which are directly linked to their corporate activities; (iii) implementation appropriate measures to stop, prevent or limit negative impacts; (iv) monitoring of the implementation and results; (v) communication with the affected stakeholders about how negative impacts are dealt with; and (vi) arranging for or cooperate on remedy and compensation where this is required. The due diligence assessments should be proportionate to the size and nature of the company, and to the context in which the company operates (§4).

Right to information

As the wording of the Act reveals, the element of transparency lies at the core of this Act and is embodied in an explicitly recognized Right to Information (§6). This paragraph establishes the right, upon a written request, to receive information from a corporation on how they tackle actual and potential negative consequences of their corporate activities, be it with regards to general or specific information (§6). However, the Act establishes some exceptions in the form of grounds upon which a request for information may be rejected, such as for example if the request seems obviously unreasonable, or if it concerns commercially privileged information. Despite these exceptions, the provision remains strong in nature as it sets clear guidelines on how requests should be dealt with, and that it should, generally speaking, be handled within 3 weeks (§7). Furthermore, rejections can be appealed, and fines may be issued in case of repeated infringements by the company, meaning unreasonable denials of requests.

Duty to disclose

Hand in hand with the right to information is the duty to disclose. The Act creates a duty for corporations to disclose their due diligence processes, which must be made available and accessible on the website of the corporation and include, at the minimum: a general description of due diligence policies and routines for handling risks to human rights and decent work, information on the negative impacts identified by the company, as well as information on measures taken to cease or prevent these negative impacts and the expected results (§5). Besides disclosing information on its website and responding to requests for information, corporations must also disclose all information necessary for the Norwegian Consumer Authority (‘Forbrukertilsynet’) and the Market Council (‘Marketsrådet’) to carry out their duties (§10). The company must respect the set deadlines and provide the information orally or in writing, depending on the request. As for the requests coming from either one of these two parties, matters of corporate confidentiality are, generally speaking, to be disregarded.    

Enforcement and sanctions

The Norwegian Consumer Authority will be responsible for implementing and enforcing the law. They shall, on their own initiative or the upon inquiries from others, seek to influence corporations to comply with the law (§9). Anyone can bring a complaint with the Norwegian Consumer Authority through their website. In case of a complaint, the Norwegian Consumer Authority will forward it to the Market Council who will deal with the claim. If it is found that the corporation has not sufficiently complied with the law, the Norwegian Consumer Authority together with the Market Council may issue injunctions for non-compliance with due diligence obligations or the right to information, fines for non-compliance with the duty to disclose and for repetitive breach of due diligence obligations or the right to information (§11-14). The Act does not give the victims of human rights abuses a right to seek remedy in court. Further, it does not provide for civil liability for harm caused, which fails to live up the recent legislative and judicial developments in other HRDD initiatives.


Inspired by John Ruggie’s Protect, Respect and Remedy Framework and the United Nations Guiding Principles on Business and Human Rights, the Norwegian Transparency Act introduces a duty for corporations to respect human rights, which is a far-reaching step in the right direction. The adoption of a HRDD act is in itself a historical happening.  This Act primarily focuses on the element of transparency and regulatory oversight enshrined in the Right to Information and the Duty to Disclose. Additionally, the Act is not limited to a corporation and its subsidiaries but covers its entire supply chain.

That being said, there is, according to one of the member of the Ethics Information Committee, still room for improvement. First of all, the Act does not cover any environmental impacts. However, the Environment Information Act of 2003 also contains some of the elements that are present in the Transparency Act, such as the Right to Information. Yet, this might emerge as a point for improvement at a later stage. Other points of improvement relate to access to justice for victims of corporate abuses. Since the Act is focused on consumer rights, it could also be appropriate for it to include a right for individuals to bring a case against a corporation in a court. Lastly, the fact that not all corporations fall within the scope of this Act can also be a point of criticism. Arguably, the size of the company is not what determines whether or not they take part in human rights breaches throughout their supply chain. Nevertheless, the Act in its entirety constitutes a remarkable milestone which forms part of the ongoing HRDD legislative wave across various European countries.

[1] Only available in Norwegian.

[2] § means ‘Paragraph’ and is used to indicate articles in Norwegian law. One paragraph consists of multiple sub-paragraphs. 

[3] See pages 105-117 of the report.

[4] Commentary on §3

[5] Only available in Norwegian

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