NORWAY: An introduction to Dispute Resolution

Trends in Dispute Resolution in Norway: A Focus on Recent Economic and Legal Developments

In recent years, Norway has witnessed economic, legal, and political trends that are reshaping the landscape of dispute resolution.

Norway‘s economy has faced turbulent years characterised by a pandemic, war in Europe, rising interest rates, and reduced purchasing power. Despite a projected increase in mainland Norway’s GDP from 0.7% in 2024 to 2.3% in 2025, driven by expectations of real wage growth and lower interest rates, challenges remain. The OECD estimates that the Norwegian economy will grow by only 1.7%, with an expected core inflation rate of 2.6% (OECD Economic Outlook, Volume 2024 Issue 2).

With a tense global landscape and economic uncertainty, there is no indication that the demand for dispute resolution will stagnate in Norway. Parties tend to be more inclined to enforce rights and engage in commercial disputes when the political and economic environment is challenging. Furthermore, the number of cases involving foreign jurisdictions is increasing, requiring lawyers and Norwegian courts to increasingly consider the internal laws of other countries. This is particularly relevant in disputes concerning intellectual property rights that span over multiple jurisdictions.

The trend observed in recent years, where an increasing number of commercial disputes are resolved through arbitration rather than litigation in ordinary courts, continues to grow. While ad hoc arbitration remains the most commonly utilised form of arbitration in Norway, there is a notable shift among parties in commercial contracts towards opting for institutional or semi-institutional arbitration.

The increasing complexity of civil litigation, coupled with rising costs, has prompted legislators and the judiciary to implement reforms aimed at enhancing efficiency and reducing expenses. While most of these reforms took effect in 2023, their impact is now starting to become evident. Below, we highlight several key developments in the legal framework governing dispute resolution, particularly focusing on trends in appeal denials, cost assessments, mediation, new legislation for attorneys and constitutional amendments that bolster judicial independence.

Rising trend of appeal denials

A notable trend in the Norwegian legal system is the increase in the denial of appeals. Following a legal amendment that took effect on 1 July 2023, the provision allowing the Court of Appeal to deny cases was rephrased to lower the threshold for appeal denials. Previously, around 10% of the appeals were denied; however, in 2024, this figure has surged to 17.6% according to the Annual Report of the Borgarting Court of Appeal for 2024. The denial rate of the Borgarting Court of Appeal was, for comparison, 15.9% in 2023 and 12.0% in 2022. This increase can be attributed to both the amendment to the law and heightened scrutiny from the Court of Appeal.

As a result of the threshold amendment, courts are considering appeal denials in more cases and are increasingly notifying the appealing party about the possibility of their appeal being denied. This implies that the appealing party must allocate additional resources to strengthen their grounds for appeal at an early stage. For both the courts and the respondent, a greater frequency of appeal denials is a positive development, provided that the case can be resolved at this stage. However, if the appeal is ultimately not denied despite the initial notification of a potential denial, this may result in increased legal costs.

Focus on legal costs and new rules in the Disputes Act

In an effort to mitigate rising costs in civil proceedings and concerns of access to courts, the Norwegian Parliament enacted a law change, which took effect on 1 July 2023, regarding the assessment of legal costs. Historically, judges had the discretion to inform parties of their right to request a determination of their attorney’s fees. The recent amendment transformed this discretion into an obligation, aiming to make the process of cost assessments more visible and frequently utilised. The criterion is that the submitted fee request “clearly exceeds what appears to be necessary”. Early indications suggest that this provision is being employed more often than before.

However, clients who seek a court determination of their attorney’s fees may face the risk of incurring additional legal costs associated with the cost assessment process. While this is a potential concern, there have been no reported cases of such outcomes to date.

Changes in court-ordered mediation

Another significant development in dispute resolution is the change in the approach to court-ordered mediation. Previously, mediation against the will of the parties could only occur if “special reasons” were present, a requirement that was interpreted strictly and applied infrequently. However, a legal amendment effective 1 July 2023 has changed this standard from a discretionary assessment to a mandatory evaluation of a case’s suitability for mediation, even when one or both parties are opposed. The court is now required to not only acknowledge the parties’ objections but also to thoroughly examine and consider their justifications for resisting mediation. This change is likely to lead to more frequent court-ordered mediation, reflecting a growing recognition of the advantages of mediation in resolving disputes efficiently, even when parties initially resist the process.

New Attorney Act

The new Attorney Act took effect on 1 January 2025, establishing a dedicated legal framework for legal practice in Norway, 15 years after the Norwegian Bar Association first sought such legislation.

Key changes include the ability to direct oversight and disciplinary complaints at law firms, not just individual attorneys. This marks a significant shift in responsibility and oversight within the legal profession. Both law firms and organisations employing in-house counsel can now face fines for regulatory violations, ensuring compliance at the organisational level.

The new law also introduces changes to the oversight and disciplinary system, reducing the number of governing bodies from three to two. The Legal Supervisory Authority is tasked with overseeing attorneys to ensure compliance with legal standards and the fulfilment of their obligations to clients. The Attorney Board operates as an independent entity for handling complaints related to disciplinary issues, addressing concerns regarding attorneys’ conduct and services. This regulatory change aims to improve the transparency and efficiency of oversight and disciplinary processes, thereby fostering greater trust in the legal profession.

Another noteworthy change is that the Attorney Act enshrines the fundamental principle of attorney-client confidentiality. This provides a clear legal basis for confidentiality in the attorney-client relationship.

Strengthening judicial independence

In light of recent developments in various legal systems worldwide, it is important to note that on 21 May 2024, the Norwegian Parliament approved several constitutional amendments to strengthen judicial independence. 

One significant change is the formal recognition of district courts and courts of appeal alongside the Supreme Court in the Constitution. Additionally, to prevent political influence through “court packing”, the number of Supreme Court justices will be capped at 22, including the Chief Justice.

To further reduce political interference, an independent council will oversee the appointment of judges. The amendments also provide judges with explicit protections against dismissal and relocation, ensuring their job security regardless of future civil service changes. A constitutional age limit of 70 years will be established for judges to prevent legislative alterations. Finally, the amendments require state authorities to ensure the independent administration of the courts, reinforcing the integrity of the judicial system.