§ 30. The Financial Supervisory Authority of Norway supervises debt collection businesses
The Financial Supervisory Authority of Norway (Finanstilsynet) supervises debt collection companies that operate under a debt collection licence (inkassobevilling). It can grant and revoke licences, issue orders (pålegg) to change practices and, in serious cases, prohibit the debt collection business (inkassovirksomhet). This is the control system meant to ensure that the debt collection industry follows the law.
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The text of the law (unofficial translation)
Supervision of debt collection businesses conducted under a debt collection licence pursuant to § 5 is carried out by the Financial Supervisory Authority of Norway pursuant to the Financial Supervision Act (finanstilsynsloven).
The Financial Supervisory Authority of Norway grants and revokes debt collection licences, cf. §§ 5 and 31.
The Financial Supervisory Authority of Norway may issue orders to debt collectors (inkassatorer) who conduct debt collection business under a licence pursuant to § 5 to change practices that entail a risk of breaches of this Act or of the Act on the Financial Supervisory Authority of Norway. The Financial Supervisory Authority of Norway may issue an order for rectification to an owner with a significant ownership interest in an undertaking that holds a licence pursuant to § 5 if he is not suitable under § 5.
The Financial Supervisory Authority of Norway may prohibit the debt collection business if one or more of the conditions in § 4 and § 5 first, third and fourth paragraphs are not met for debt collection business conducted under a debt collection licence pursuant to § 5. The Financial Supervisory Authority of Norway may instead give the debt collector a deadline to meet the conditions.
What does this mean?
Section 30 is about who oversees the debt collection industry. The answer is the Financial Supervisory Authority of Norway. It supervises debt collection businesses operating under a debt collection licence pursuant to § 5.
Debt collection (inkasso) is not an ordinary, unregulated business where anyone can start up and send claims to people. Professional debt collection normally requires a licence (bevilling). A licence means official permission. The Financial Supervisory Authority of Norway grants such permissions, monitors the companies and can step in if the rules are not followed.
This matters because debt collection companies have a major impact on people's finances. They send claims, charge fees (gebyrer), handle personal data, receive money and can contribute to collection through the courts (rettslig inndriving). If debt collection companies make mistakes, it can have serious consequences for both debtors (skyldnere) and creditors (fordringshavere).
Section 30 gives the Financial Supervisory Authority of Norway several types of power. First, it carries out supervision (tilsyn). This means it monitors the business. Second, it grants debt collection licences. This means it decides who may operate. Third, it can revoke licences. This means a company can lose the right to carry out debt collection. Fourth, it can issue orders to make changes. This means the company must correct its practices. Fifth, it can prohibit the business if the conditions are not met.
The section is therefore a control rule. It ensures that the Debt Collection Act is not just fine words. There is an authority that can follow up when companies do not operate properly.
What does supervision mean?
Supervision means that the Financial Supervisory Authority of Norway can check whether debt collection companies follow the rules. This can concern the licence, management, owners, provision of security (sikkerhetsstillelse), client funds (klientmidler), routines, notices, costs and good debt collection practice (god inkassoskikk).
Supervision can take place in different ways. The Financial Supervisory Authority of Norway can monitor through reporting, documentation, investigations and cases that come in. It can also receive information from complaints boards (nemnder) under § 24 when the complaints board has stated that the Debt Collection Act has been breached.
For you as a debtor, supervision means that the debt collection company is not answerable only to itself. If a debt collection agency (inkassobyrå) has a bad practice, it can become a supervisory matter. This does not mean that the Financial Supervisory Authority of Norway necessarily resolves your individual case in the same way as a complaints board or a court. But the supervisory authority can follow up on the company's practices.
Supervision is also important for creditors. If you send claims for debt collection, you must be able to trust that the debt collector handles the claims correctly, keeps client funds separate and passes on the money collected.
The Financial Supervisory Authority of Norway grants and revokes licences
The second paragraph says that the Financial Supervisory Authority of Norway grants and revokes debt collection licences. This ties in with § 5 and § 31.
§ 5 sets out the conditions that must be met to obtain a licence. These include suitability, a police certificate (politiattest), an actual manager (faktisk leder), a permanent place of business and security. § 31 says when a licence can be revoked.
This means the Financial Supervisory Authority of Norway controls both the way in and the way out. It decides who may start, and it can take the permission away if the business should no longer be allowed to operate.
This matters because a licence is not just a piece of paper you get once and then keep no matter what. The debt collection company must continue to meet the requirements. If the management changes, the owners change, the security lapses or the business is run irresponsibly, there can be consequences.
Orders to change practices
The third paragraph gives the Financial Supervisory Authority of Norway the right to issue orders to change practices. This is a strong and practical tool.
An order means that the Financial Supervisory Authority of Norway says: “You must change this.” It can apply to practices that entail a risk of breaches of the Debt Collection Act or the Financial Supervision Act. Note the word “risk”. The Financial Supervisory Authority of Norway does not necessarily have to wait until many people have been harmed. If the practice creates a risk of breaking the law, the supervisory authority can step in.
This could, for example, be routines for demands for payment (betalingsoppfordringer), fee calculation, handling of objections (innsigelser), contact with debtors or handling of client funds. If the practice is set up so that mistakes easily happen, the Financial Supervisory Authority of Norway can demand changes.
Orders can also be issued to an owner with a significant ownership interest if the owner is not suitable under § 5. This shows that the law does not view the company merely as a shell. Who owns and controls the debt collection company can matter. If a major owner is not suitable, the Financial Supervisory Authority of Norway can demand rectification.
Prohibition of debt collection business
The fourth paragraph gives the Financial Supervisory Authority of Norway the right to prohibit the debt collection business if the conditions in § 4 and § 5 are not met. This is more serious than an ordinary order.
A prohibition means that the business cannot continue. It may be relevant if the company does not have the necessary licence, does not meet the requirements for management or suitability, lacks security, or otherwise does not meet the conditions of the Act.
The Financial Supervisory Authority of Norway can also give the debt collector a deadline to meet the conditions instead of prohibiting the business straight away. This leaves room for correction. If the fault can be fixed, the company can be given time to sort it out.
But if the fault is serious, or the company does not comply, a prohibition may become necessary. This protects debtors, creditors and trust in the debt collection system.
What happens if the Financial Supervisory Authority of Norway issues an order?
Then the debt collection company must comply with the order. If it does not, the matter may become more serious. Failure to comply can affect the licence and further supervision.
An order can also matter for debtors. Under § 17, the debtor may be exempt from costs if the debt collector has failed to comply with orders concerning its dealings with debtors under section 30, third paragraph.
This means that section 30 is not only about internal control between the Financial Supervisory Authority of Norway and the debt collection industry. It can also affect what you as a debtor have to pay.
Examples
Kari receives a debt collection claim from a company she has never heard of. The letter seems unprofessional, the account number looks private, and it says little about who actually owns the claim. Kari checks the company and finds no clear information about a debt collection licence. She does not pay straight away. Instead, she asks in writing for documentation of the claim, who the creditor is, and what basis the company has for carrying out debt collection. If the company is carrying out debt collection business without meeting the necessary conditions, this may be a matter for the Financial Supervisory Authority of Norway. Under section 30, the Financial Supervisory Authority of Norway can supervise and take action against businesses that do not meet the requirements. The outcome for Kari is that she does the right thing by stopping and asking for documentation. A genuine debt collection claim should be able to withstand scrutiny.
Ola receives a debt collection claim from a large debt collection agency. He paid within the deadline in the debt collection notice (inkassovarsel), but is still charged a debt collection fee (inkassosalær). He sends a receipt. The debt collection agency does not respond properly and keeps demanding the fee. Ola complains to the complaints board. The complaints board finds that the debt collection agency has breached the Debt Collection Act. Under § 24, statements about breaches must be sent to the Financial Supervisory Authority of Norway. If the Financial Supervisory Authority of Norway receives several such cases about the same practice, section 30 may become important. The supervisory authority can order the debt collection agency to change its practice. This helps not only Ola, but can prevent more people from facing the same error.
Common mistakes
- Thinking that everyone who sends debt collection claims is automatically allowed to carry out debt collection
- Thinking that the Financial Supervisory Authority of Norway is the same as an appeals board (klagenemnd)
- Not checking who actually sent the claim
- Forgetting that a debt collection licence can be revoked
- Thinking that supervision only happens after someone has suffered a major loss
What should you do?
If you receive a debt collection claim, check who the sender is. Look for the company's name, organisation number and contact information.
If something seems wrong, ask for documentation. Write briefly and calmly: “I request documentation of the claim and of the basis on which you can collect it.”
If you believe the debt collection agency is breaking the law in your case, first complain in writing to the debt collection agency. If the case concerns a dispute you can bring before a complaints board, use the complaints board scheme.
If the case appears to involve unlawful or systematic debt collection practices, the Financial Supervisory Authority of Norway may be relevant as the supervisory authority. But remember that it does not necessarily handle your private dispute in the same way as a complaints board.