The Norwegian Consumer Protection Authority (NCPA), the regulator for the Norwegian Transparency Act, announced that it will start actively monitoring companies’ compliance with the law. We expect aggressive monitoring of company compliance by the NCPA.
About the Act
- The Norwegian Transparency Act requires companies to carry out due diligence on human rights and decent work in line with the OECD Guidelines for Multinational Enterprises and the OECD’s six-step due diligence process. It also includes a right to information, which allows stakeholders to request information from companies on how they address actual or potential negative impacts and information on their products or services.
- The Act entered into force in 2022 and in-scope companies had until 30 June 2023 to publish an annual report on their due diligence.
- The Norwegian Consumer Protection Authority (NCPA), the regulator for the Act, announced that it will start actively monitoring company compliance with the law from this autumn (i.e. September onwards). No set date was given.
- The NCPA has powers to investigate breaches and can issue penalties for extensive and obvious breaches of the law. They can also issue orders and prohibition decisions and impose enforcement penalties for non-compliance and infringement fees for breaches.
- We expect the NCPA to actively monitor company compliance. The NCPA is the regulator responsible for monitoring greenwashing in Norway and has held companies accountable for making misleading claims under the country’s Marketing Control Act.
Implementation to date
- Since the Transparency Act entered into force, the NCPA has received 17 complaints. Two were investigated (see below) and one is still in process. The remaining cases were dismissed. The reasons for the dismissals have not been made public.
- In July 2023, the NCPA announced that it had carried out investigations into complaints against IKEA and transport company Posten for not providing stakeholders with sufficient information about the companies’ human and labour rights under the right to information provision.
- In the case against IKEA, the NGO Future in our Hands requested information from IKEA on labour conditions at four IKEA suppliers in Bangladesh and Pakistan based on a report by the Workers Right Consortium. IKEA provided general information about its audit process and code of conduct, but did not provide information on the specific sites or the status of the specific risks. IKEA noted that they could not share additional information due to contract confidentiality. The NCPA ruled that IKEA had not breached the law because the complaint was submitted on the same day that the law came into effect. The NCPA ruled that IKEA could not be expected to already have robust due diligence processes in place. However, the NCPA warned that they will expect a higher level of due diligence and disclosure from companies now that the law is fully in effect. Companies will not be able to claim contractual confidentiality in most cases.
- In the case against Posten, plaintiffs in a class-action lawsuit sought information on the names and organisation numbers of Posten’s suppliers. The NCPA ruled that the request was out of scope because the Act does not require companies to disclose their supplier lists.