Expanding Abroad Can Quickly Make You a Criminal

It is easy to be critical when reading about labor market crime—foreign companies in Norway trying to evade taxes and duties or taking health, safety, and environment (HSE) regulations too lightly.

However, I have reason to believe that many of these companies do not have malicious intentions. They simply underestimate the formalities that must be in place when operating in a foreign country.

For example, if a foreign company sends construction workers to Norway, the company must obtain a Norwegian organization number, register in the employer and employee register, and secure a D-number for its employees. Forgetting these requirements can have serious consequences.

As international accountants, we see significant variations in awareness of such requirements. Many businesses could face substantial problems if they did not receive help—either from us or others. The tasks are not necessarily complex, but they are often time-consuming and difficult to understand from the outside.

Norwegian companies entering new markets face the same challenges. Each country has its own rules and accounting standards. Right now, new e-invoicing requirements are being introduced in Germany. In Switzerland, all outgoing invoices must include a QR code. In Denmark, ERP systems must be certified, and if you operate in Panama, you must not forget the impresora fiscal. There are almost as many systems as there are countries.

When a company enters a new market, accounting regulations are rarely at the top of the agenda. Marketing, sales, and distribution often take center stage. However, accounting and compliance can quickly become a headache—and, in the worst case, a trap.

As in many areas of life, there is much to gain by doing things correctly from the start. The last thing you want in an international expansion is time-consuming and costly conflicts with authorities regarding VAT, taxes, labor conditions, or reporting.

Our clear recommendation is to prioritize accounting and compliance from the outset before expanding abroad. Good preparations can prevent you from ending up on the wrong side of the law—without meaning to.