Exemption from document duty and registration fee mintaszakaszok
Exemption from document duty and registration fee. The Norwegian authorities have argued that the manner of proceeding in the present case (which escapes the obligation to pay document duty or registration fee) constitutes a general practice based on the application of the “continuity principle” which is in line with the treatment accorded to all other State restructurings that have previously taken place. The Norwegian authorities have further argued that should the Authority consider that this way of proceeding constitutes an exemption from the general rules, the exemption — based on the conti- nuity principle — is justified by the nature or general scheme of the tax system.
Exemption from document duty and registration fee. According to Section 3(2) of the Mesta Act, real estate trans- ferred to Mesta AS have been exempted from the payment of document duty and registration fee. In terms of legislation on document duty and registration fee the main rule is that when ownership of real estate is transferred a title document must be issued (“formell overskjøtning” or “hjem- melsoverføring”). The transfer of ownership in a title document may be registered in the real estate registry in Norway (“Eien- domsregisteret”) (2), but there is no obligation to do so. However, registration of ownership to property in the real estate registry ensures that any third party can verify who is the owner of the property and in this manner protects the real owner from allo- wing, third parties to transfer title to his property to others in good faith. The registration of the issuance of a title document in the context of transfer of ownership triggers the payment of
(i) document duty of 2,5 % of the value of the property; and (ii) registration fee of fixed rate of NOK 982 per document (3). The new title holder must pay the duty (4). If the registration does not involve registering the issuance of a title document there is no obligation to pay either document duty or registration fee. For example, if only the name of the owner of the real estate has been changed, the registration does not involve registering a title document and there is therefore no obligation to pay document duty or registration fee. Exemption from document duty and registration fee may be granted by reference to the continuity principle which is a term that covers situations where the acquiring company takes over the legal rights and obligations of the transferring company. Two circulars lay down principles on the application of the so-called continuity principle: One circular (“First Circular”) issued by the Ministry of Justice on 25 May 1990 (G-37/90) was replaced by another circular (“Second Circular”) issued by the Ministry of Justice on 21 June 2005 (G 06/2005). Under the First Circular it was only where ownership would be transferred in the context of mergers between limited liability companies that an exemption from document duty and registra- tion fee would be granted by reference to the continuity prin- ciple. However, the Second Circular broadened the scope to cover both mergers, de-mergers and conversions undertaken on the basis of corporate legislation which is based on the conti- nuity principle. According to the Nor...