Establishing a business in the Öreund region

Establishing a Business in the Ă˜resund Region

Establishing a Business in the Ă˜resund Region

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Table of contents Brief facts about the region

3

Development in the Øresund region

5

Establishing Nordic and global head offices in the Øresund region 9 Labour market

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Taxes

18

Starting a company

24

Company culture and industry structure

25

Training

28

Inhabitants with Nordic origins

30

Communication and transport

32

Premises and running costs

34

Logistics costs

36

Electricity costs

38

Quality of life

39

International schools

41

International associations

43

Sources

44

This guide has been developed 2011 by Invest in Skåne and the Malmö Trade and Industry Agency in collaboration with the Öresund Institute.

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The øresund Region – A Quick Guide The labour market and trade & industry – The Øresund region’s integrated labour market offers the opportunity to attract a workforce from both sides of the Øresund strait, which is made easier in a number of ways, including the special SINK income tax.

– Expected population growth by 200,000 up to 2020 and increased workforce range, due to a young population in Malmö.

– The total workforce cost is lower in Sweden than in Denmark.

– Job security and social insurance are combined with flexibility.

– Both Denmark and Sweden in recent years have reduced corporate tax and introduced special regulations for foreign high earners, plus for people who work on the other side of the border.

– In Sweden there are many large companies with over 500 employees; whilst Denmark is dominated by small businesses.

– Growth in productivity since 2000 has been higher in Sweden than Denmark.

– 35.1 per cent of the largest global company’s Nordic headquarters are in the Øresund region.

Training – There are eight universities and three university colleges in the region, with a combined total of over 10,000 researchers and 150,000 students.

– In Malmö, 44 per cent of immigrants have a secondary education, and this number is expected to rise throughout Skåne in the future.

– The ESS research facility is estimated to open in Lund in 2020, which will attract international researchers and contribute to the region’s development.

Population – Over 3.7 million inhabitants live in the Øresund region, which encompasses Själland and the islands of Lolland, Falster, Mön and Bornholm, plus the mainland province of Skåne.

– The Øresund region has many immigrants, which means it is easy for companies to find an international workforce.

– In recent years, a total of 15,143 Danes have moved to Skåne, and currently around 12,000 live in Malmö.

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Communication and transport – The infrastructure in the Øresund region is well-developed, with good flight and train connections.

– Copenhagen Airport can be reached from Copenhagen and Malmö city centres in around 15 minutes.

– In 2010, a total of 21.5 million passengers flew from the airport.

– The number of vehicles crossing the Øresund bridge has increased by around 140 per cent between 2001-2010.

– 42 per cent of personal vehicular traffic and around 60 per cent of train passengers are commuting to their place of work or study on the other side of the strait.

Rental and logistics costs – The rental of premises is cheaper in Malmö than Copenhagen, as well as there being more advantages in rental.

– There are many new modern offices in Malmö including in the new city areas of Western Harbour and Hyllie.

– There are many different operators within IT and telecom. In 2010, a total of 60 per cent of companies with 10 or more employees had a mobile internet connection in Sweden.

– Electricity prices per kWh are half as expensive in Sweden as in Denmark, due to fees and taxes.

Quality of life – Living costs are lower in Sweden than in Denmark, including car prices, the cost of childcare and food.

– There is a wide range of parks, beaches and golf courses, plus other leisure activities and tourist attractions throughout the region.

– There are many international schools and associations in the region.

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Development in the Øresund region Over 3.7 million inhabitants live in the Øresund region, which encompasses Själland and the islands of Lolland, Falster, Mön and Bornholm, plus the mainland province of Skåne. The region accounts for 26 per cent of Denmark’s and Sweden’s combined GNP and is home to 25 per cent of their combined population. The population level in the Øresund region is expected to reach 4.0 million by 2020. This growth is due to greater immigration and that inhabitants are living longer. The proportion of the population of working age will increase, particularly in the Malmö-Lund-Helsingborg area. Weaker growth in the workforce is expected in eastern Denmark.

Since the Øresund bridge opened in July 2000, integration in the region has become even more comprehensive. Malmö has strengthened its role as Skåne and southern Sweden’s centre, and has become a “head office city”. Since 2004, around 30 companies have moved their headquarters to the city, which has generated around 2,300 jobs. Work commuting has increased, primarily with Swedes obtaining jobs in Copenhagen, and Danes moving to Skåne. The net emigration from Denmark to Skåne between 1999-2009 was 15,143 people. The traffic on the Øresund bridge increased by 140 per cent during the period 2001-2010; and the number of train passengers has doubled. In addition, ferry traffic between Helsingör and Helsingborg has been reduced by 23 per cent.

Leisure travel has also increased, as have overnight hotel stays. The currency exchange rate plays a significant role for travel in the region. In 2009, the Danish Krone varied between SEK 135-156 for DKK 100. Danish visitors were primarily concerned with Skåne retail and tourism. According to a survey by the trade organisation, Dansk Erhverv, a total of 17 per cent of Danes and 30 per cent of Själland inhabitants have made purchases in Sweden at least once in the year. The number of Danes staying overnight at Skåne hotels, hostels and holiday villages for the period of 2000-2009 increased from around 57,000 to 176,000. The number of overnight stays decreased slightly in 2010.

With its size, range and metropolitan status, Copenhagen attracts most of the tourists to the region, over half of which are foreign. It is an international city with a strong conference industry and an attractive city break destination. Skåne is the third largest tourist destination in Sweden, measured from the number of overnight stays (excluding camping and summer cottages) and particularly in Malmö, tourism has strengthened, with an increase in tourists of around 70 per cent for 2000-2010. Malmö has also gained many new hotels, a multi-purpose arena and a new stadium. In addition, a new exhibition venue and a conference & concert hall are under construction.

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The Western Harbour is one of Malmö’s development areas that has transformed from an industrial area to a much visited and discussed area of the city. In 2001, the property fair Bo01 was held in the area, close to the sea, and construction subsequently continued. It has been acknowledged for it´s focus on sustainable city development. This city area currently has over 9,000 jobs and over 4,000 inhabitants. According to the municipality forecast, the figures are expected to rise to 7,500 inhabitants by 2016. The area also boasts Malmö University, with 12,000 students. The next city area due for development is Hyllie in southern Malmö, near the Øresund bridge. There are expected to be 8000-9000 properties and just as many jobs. Malmö Arena is already in place, and a new shopping centre of over 90,000 m2 is expected to open its doors in autumn 2012. Hyllie is only 12 minutes by train from Copenhagen airport.

Close to the Øresund bridge on the Danish side is the development area Ørestad. There are currently 11,500 jobs and around 6,000 inhabitants in the area. Once complete, it is expected that Örestad will house 20,000 inhabitants and provide 80,000 jobs. Examples of companies that have placed their businesses in the area include Danmarks Radio, the pharmaceutical company Ferring with 400 employees, plus the consultant company Ramböll with 1,600 employees. The area also has affordable housing such as VM-Bjerget and 8-Tallet, designed by Bjarke Ingels Group.

Nordhavnen [“Northern Harbour”] is Copenhagen’s next city area to be developed, and is to be expanded from its current 200 hectares by 50 per cent, by moving and extending the ferry terminal. The area will be developed for 40-50 years to come, and upon completion is expected to contain 40,000 inhabitants and just as many jobs. Other areas to be developed in Copenhagen include Sydhavnen, Marmormolen/Langeliniespidsen and Valby.

Lund will see the construction of Europe’s new materials research facility for spallation, ESS. Around SEK 15 billion has been invested in the project, and the facility is expected to be ready for operation in 2019-2020.

ESS is expected to be one of the world’s twenty largest research facilities; and between 2,000 and 3,000 guest researchers are expected to visit the facility during an average four to five days per year. Another important research facility in Lund currently underway is MAX IV, to be used for synchrotron radiation research and is estimated to be completed in 2014. The investment is estimated at around SEK 2.6 billion.

A number of infrastructure initiatives are ongoing in the region. The city tunnel through Malmö opened in December 2010, and means more traffic crossing the strait and also shorter journey times from many locations in Skåne to the new Triangeln and Hyllie stations in Malmö’s central parts, as well as throughout Øresund. The tunnel means that the journey time from Malmö city centre at Triangeln to Copenhagen Airport has been shortened to 16 minutes. Copenhagen’s new metro line is estimated to be completed in 2018; an orbital line with 17 stations which will increase accessibility to the city centre. A fixed connection is planned between Denmark and Germany over the Fehmarn Belt, which is expected to be operational in 2020. Hamburg’s 4.3 million inhabitants will be connected with the Øresund region’s 3.7 million inhabitants, together creating an expanded region with an estimated population of around 8.4 million inhabitants in 2020.

Larger Swedish market Sweden’s market size is greater than Denmark’s and, viewed over a longer period, Sweden has grown more rapidly than Denmark. The average growth in GNP for 2000-2010 was 1.0 per cent in Denmark and 2.3 per cent in Sweden, according to the Swedish National Institute of Economic Research. The potential GNP growth for 2016-2025 is estimated by the OECD to be 1.2 per cent in Denmark and 2.0 per cent in Sweden.

According to Eurostat, Sweden is the world’s second most competitive economy in relation to product innovation and patents. A total of 51.3 per cent of Sweden’s innovators introduced new products, which can be compared to the EU-27 average of 32.6 per cent. In Denmark, the proportion was 33.8 per cent. The

Establishing a Business in the Øresund Region

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number of patent applications to the European Patent Office (EPO) and USPTO also show that the Swedish companies are innovative. A total of 243.2 patent applications per million inhabitants can be compared with the average in the EU-27 of 106.7 and Denmark’s 186.3 applications per million inhabitants. The World Economic Forums Global Competitiveness Index 2010-2011 puts Sweden as the world’s second most competitive economy, an improvement of two places from the previous measurement, whilst Denmark went down from fifth to ninth place.

Both Sweden and Denmark have a very low degree of corruption. According to Transparency International, there is a connection between the wide acceptance of high tax burdens in the Nordic countries and the low level of corruption. The inhabitants expect a just and transparent public sector. The Nordic countries top the list of the Corruption Perception Index for the EU.

Largest industries in the Øresund region Region’s employees (2007) Healthcare 315,841 Wholesale and retail

230,858

Other business activities*

170,099

Training and education

151,897

Construction 121,251 Public adm. and defence

101,433

Basic industry

100,863

Finance and insurance

58,020

Hotels and restaurants

56,439

Land transport

47,838

IT** 46,139 Culture, sport and leisure time

43,938

Car sales and mechanics

35,304

Property industry

32,381

Post and TV

30,858

Agriculture, forestry, fisheries

29,671

Member organisation

29,196

Food 28,530 Harbours, logistics, etc.

27,151

High technology industry

24,711

Media 23,074 Source: Job & Magt, October 2010. * Business activities’ is a wide-ranging category, with companies involved in research, auditing, architecture, advertising and marketing, plus environmental technology and life science. ** Including support services.

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Largest companies in the Øresund region Company Industry

No of employees in Øresund region

Posten Norden Logistics

13,881

Danske Bank

13,600

Finance and insurance

Novo Nordisk Life science

13,277

Dansk Supermarked Trade

7,000

Nordea Bank

7,000

Finance and insurance

Coop Sweden and Denmark Trade

6,250

ISS Facility Services Service

6,060

Peab Construction

5,925

DSB Transport

5,670

Falck Service

4,670

TDC Telecoms

3,984

Dong Energy

Energy

3,800

Tryg Forsikring

Finance and insurance

3,600

Tetra Pak Industry

3,600

SAS Transport

3,493

Förenade service Service

3,400

IBM IT

3,300

Ikea Trade

3,167

Sony Ericsson

3,075

Mobile technology

Arriva Transport

3,050

Source: Job & Magt, October 2010.

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Establishing Nordic and global head offices in the Øresund region The Øresund Institute’s study “The Location of Nordic and Global Headquarters 2010” investigates where 603 of the largest companies within eleven industries have chosen to locate their head offices, all on the Forbes 2000 list. The study, as previously conducted in 2000 and 2006, shows a concentration of Nordic head offices in the Øresund and Stockholm region, with a proportion of 83.7 per cent of all Nordic headquarters.

The Stockholm region has the most, with 48.6 per cent, whilst the Øresund region’s share is 35.1 per cent; of which Greater Copenhagen has 26.4 per cent and Skåne 8.7 per cent.

To note is the fact that Skåne with 8.7 per cent of the Nordic headquarters, has more than Oslo (4.1 per cent) and Helsinki (1.5 per cent). Greater Malmö/Skåne’s power is dependent on Skåne being part of the wider Swedish market and proximity to Copenhagen airport. Skåne has declined slightly in the seven industries investigated in the 2006 study, but on the other hand, does have several head offices in the four new industries that have joined the study and therefore has a greater combined proportion than 2006 (7.9 per cent).

Skåne is particularly strong within healthcare and medical technology with 31 per cent of all Nordic headquarters. For capital goods, the share is 18 per cent. For long-lasting consumable goods and food, drinks and technology, the share is above 10 per cent.

Sweden dominates in the Nordic countries with 66.6 per cent of the international large companies’ Nordic headquarters, which is an over representation in relation to the size of the economy at 33.1 percentage points. The over representation is due to the fact that Swedish market is clearly the largest in the Nordic region.

Denmark has 27.9 per cent of the international company’s Nordic headquarters, which is an over representation from the share of the Nordic economy by 4.4 percentage points. The explanation is likely to be the proximity to many of the European headquarters and the significance of Copenhagen’s Kastrup airport as the largest Nordic airport. Investments in wind power and the pharmaceutical industry have been significant export successes, and the cluster within the pharmaceutical industry has grown to be one of Europe’s largest.

Since 2006, Copenhagen has declined in all but two industries – long-term consumables, and pharmaceuticals & biotechnology – which can be explained by the ‘over-heating’ period between 2006-2008, when it was difficult for companies to attract and retain employees.

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Labour market The labour market in the Øresund region has become more integrated since the opening of the Øresund bridge. Particularly during the latest economic boom, many Swedes obtained employment on the Danish side of the Øresund. The record year of 2007 saw over 6,500 Swedes obtain a job in Denmark for the first time. In addition, the number of people in employment will increase in Skåne, whilst the number in eastern Denmark will stagnate. Both countries have a tradition of considerable influence on the labour market parties, and the employees have a high degree of security, either in public policies or collective agreements.

The total workforce cost is lower in Sweden than in Denmark; despite employer’s fees being higher. This is due to wage expenses being higher in Denmark.

Swedes get new jobs in Denmark

2005 2006 2007 2008 2009 2010

Number of people

1,391

3,494 6,667

5,798 2,929 2,231

Source: SkatØresund, after allocation of new tax numbers to Swedes who have not previously worked in Denmark.

Since the Øresund bridge opened, employment has increased by 41,000 in Skåne (daytime population) and by 58,600 if the Øresund commuters are included (night-time population), whilst the number of people employed in eastern Denmark has increased by 47,200 (daytime population). The Malmö-Lund area employment has grown by 1.20 per cent per year on average, which is significantly quicker than other regions.

If the Øresund commuters are included, the growth is three times quicker than in the capital city area with Copenhagen. A lack of workforce in eastern Denmark has contributed to the growth there – both in terms of jobs and the economy – being weaker than in Skåne. The ”Job & competences” project warns of a lack of workforce in Copenhagen and Denmark from 2015.

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Employment (annual growth %) In employment Annual growth Annual growth

2009 1993-2000 2000-2009 Region Skåne, night-time population including commuters to Själland

551,000

1.15

1.32

LLMA Malmö – Lund:

454,311

1.20

1.20

Region Skåne

523,568

1.09

0.94

1,836,006

1.27

0.56

City centre area

975,828

1.60

0.45

Själland region

336,610

0.63

0.32

LLMA Öresund

Source: Statistics Denmark, Statistics Sweden, Örestat The details refer to the daytime population unless otherwise stated.

The night-time population is the number of people employed, who live in the area, but also includes people who work in another municipality/region.

LLMA= Local labour market area.

LLMA Öresund = City centre area, Region Skåne and Själland region.

According to the International Labour Organisation, ILO, the workforce in Denmark and Sweden is reducing less than the EU average. The proportion of the population of working age in 2011 is 58.7 per cent in the EU as a whole, and 64.9 per cent in both Sweden and Denmark, but primarily the proportion of working age will reduce more in Denmark than Sweden. In 2020, a total of 62.9 per cent of the Danish population will be of working age compared to 64.5 per cent in Sweden. In the EU as a whole, the proportion of the population of working age is expected to be 57.3 per cent by 2020.

The population of the Øresund region is expected to increase from 3.7 million to close to 4.0 million up to 2020. In the Copenhagen area, the work force will reduce, whilst it will grow in Skåne.

Population forecast for 25-69 year olds in the Øresund region in 2020 Total 25-29 30-34 35-39 40-44 45-49 50-54 55-59 60-64 65-69 Copenhagen Själland Skåne Øresund region

1,791,215 149,358 127,440 109,126 116,521 121,219 122,217 111,280 93,563 85,140 814,067 36,488 37,877 40,012 50,100 58,556 63,423 59,962 54,927 52,459 1,356,079 89,613 89,550 89,825 89,827 88,635 86,851 80,266 74,284 71,377 3,961,361 275,459 254,867 238,963 256,448 268,410 272,491 251,508 222,774 208,976

Changes 2011-2020 Copenhagen

91,922 29,921 2,607 -21,659 -9,240 -2,279 17,801 15,286 -7,585 4,965

Själland

-5,696 4,679 -3,643 -16,052 -12,284 -4,870 5,960 4,111 -6,440 -2,024

Skåne Øresund region

108,936 7,323 7,235 4,809 4,061 5,366 12,287 6,620 -4,042 520 195,162 41,923 6,199 -32,902 -17,463 -1,783 36,048 26,017 -18,067 -6,469

Source: Statistics Denmark, StatBank Denmark and Region Skåne’s population forecast 2010.

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Types of employment The basic structure of both the Swedish and Danish labour market is primarily based on collective agreements between trade unions and employers. The collective agreement regulates employment conditions such as wages, working hours and holiday allowance. Job hunting in Sweden and Denmark is through Arbetsförmedlingen [the Swedish Public Employment Service], private job portals, newspaper advertising, recruitment companies, company websites and also spontaneous adverts.

There are three different types of employment in Sweden: permanent, fixed term and probationary. The two first types are the most common. A permanent position has no fixed date for when it will cease, and is commonly known as ”fixed” employment. It remains in place until the employer or employee wishes to make a change. A fixed term contract of employment is a limited period, with an end date agreed in advance.

Employees who have worked for the same employer for over two years within a five year period have their contract transferred to permanent employment. A probationary contract is employment which will transfer to permanent employment after a probationary period, and may be of a maximum six months’ duration. A probationary contract can be terminated at any point during the period.

In Sweden, it is primarily the Swedish Employment Protection Act (EPA), the Holiday Act and the collective agreement that form the basis for the employment contract. The notice period depends on the length of employment of the person leaving. If the person has been employed for more than two years, the notice period is two months. In the case of termination due to lack of work, the employer can act in accordance with the ”first in first out” principle, but in certain cases, it is possible to terminate employment due to lack of competence. It is common to use consultants in Sweden, i.e. that a company hires staff in order to have a more flexible workforce.

Unemployment insurance in Sweden is when the employee is insured against unemployment from the Unemployment Insurance Fund ALFA, even if they are not a member of any unemployment benefits scheme. However, around 70 per cent of the work force is a member of an unemployment benefits scheme, with voluntary income-related insurance.

In Sweden, there is a qualifying day in respect of illness, whereby the employee does not receive any salary on the first day of any illness. From the second day, the employer is liable for paying sick pay at 80 per cent of salary, but a maximum of SEK 682 per day (2011), plus any agreed supplements from the employer. For illness lasting longer than 14 days, the Swedish Social Insurance Agency will pay the remuneration.

According to the Holiday Act, all employees have the right to five weeks’ holiday, with four of these able to be taken at once during the period June to August. A holiday year runs from 1 April to 31 March of the following calendar year. If the employee only began their employment after 31 August in the holiday year, they only have the right to five days of annual leave. Some workplaces have local agreements using the calendar year as the holiday year.

Collective agreements in Denmark are not as strictly regulated as in Sweden, but are based more upon the particular industry and employer. Denmark has collective agreements between employer associations and trade unions, but employment agreements can also be made between employers and employees without involvement from trade unions. If the employer is not bound by a collective agreement, there are still some general laws that must be observed, such as the work Environment Act, the Holiday Act, the Equality Act and the sickness benefit act.

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Wages can either be agreed individually, or collectively through agreements between trade unions and employers. Many employers also offer various benefits as a complement to standard wages.

In Denmark, the right to holiday is paid in before it is taken out. The Danish holiday legislation “Holiday allowance” gives all salaried employees the right to five weeks’ holiday. The Danish holiday year runs from 1 May to 30 April, whilst the holiday days are paid in per calendar year.

If an employee is sick, the employer pays sickness remuneration for a maximum of 21 days and a maximum of DKK 3,830 per week. After this, the municipality can then pay “sygedagepenge”, sickness remuneration.

The Danish labour market model of “flexicurity” means a flexible labour market with more liberal regulations compared to many other European countries. Notice periods can be short and at minimal cost to the employer, compared to other countries. In Denmark, a person who is not permanently employed can be made redundant with 14 day’s notice, but for an individual who has been employed for more than six months, the notice period is three months. If it is the employee who terminates the employment, there is usually only one month’s notice period required.

Weekly working hours

hours:

days per week:

Sweden

40 5

Denmark

37 5

Wages Wages are higher in Denmark than in Sweden, in some cases between 30-50 per cent higher. The total workforce cost is lower in Sweden than in Denmark, even if the employer pays more social contributions in Sweden than in Denmark. According to Eurostat, the Danes have the highest average monthly wage. For example, the average annual salary in industry and service differs by EUR 16,294 between Denmark and Sweden.1 The fact that workforce costs are relatively low and there is considerable access to a workforce makes it an attractive prospect to set up a company in Skåne. Many Danish companies have moved their headquarters from Denmark to Malmö, including Panduro Hobby, Vestas Wind Northern Europe, Mercedes-Benz SwedenDenmark, and Kwintet.

1

Unless otherwise stated , DKK 1 = SEK 1.28 and EUR 1 = SEK 9.54, used to refer to funds as annual average for Jan-Dec 2010.

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Gross wages per month (SEK and EUR) Sweden Denmark SEK EUR SEK EUR IT specialists

38,600

4,000

63,149

6,544

MSc engineer

37,900

3,927

74,254

7,695

Financial Business Administrator

39,700

4,114

66,658

6,908

Engineer

32,000 3,316

47,792 4,953

IT technician/operator

30,300

55,764

Salesman

34,300 3,554

54,297 5,627

Accountant

28,400 2,943

48,412 5,017

Office secretary and data entry

24,700

2,560

40,091

4,154

Bookkeeping and accounting assistants

24,700

2,560

43,519

4,510

Customer assistants

21,400

2,218

35,948

3,725

3,140

5,779

Source: Statistics Denmark, StatBank Denmark LON02 and Statistics Sweden 2008.

For Sweden, states the average monthly wage for private sector officials, 2008, and for Denmark, the average monthly wage for private sector permanent employees, excluding young people and students, 2008. The Danish wage is translated to Swedish kronor as per the average exchange rate 2008, SEK 128.84 for DKK 100.

National insurance The employer pays the majority of the national insurance system in Sweden. The employer’s contribution is 31.42 per cent of the employee’s wage and other taxable wage benefits. Most collective agreements contain a contribution of a further 7-8 per cent in pension payments, a so-called service pension.

The Danish employer deductions are small, and do vary. It is not possible to give a standard figure for the deductions. Unlike in Sweden, the employee pays the majority of the social contribution which is deducted from the salary and administered by the employer.

Sweden

% of salary and benefits

Composition of employer’s contributions Pension contribution

10.21

Survivor’s pension contribution

1.17

Sickness insurance contribution

5.02

Parental insurance contribution

2.20

Industrial injuries contribution

0.68

Labour market contribution

2.91

General payroll tax

9.23

Total: 31.42 Source: Swedish Tax Agency

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Denmark Employee’s contribution per person

Labour market contribution

8% of salary

ATP [supplementary pension] (monthly) DKK 90

Employer’s contribution per employee ATP (monthly) DKK 180 FIB & LG (quarterly) DKK 277 AER (quarterly) DKK 532 Industrial Injuries Insurance

individual

AES (annually) DKK 135-690 Parental insurance fund (quarterly) DKK 206 Source: ATP.dk, Nordisketax.net ATP: Supplementary pension, FIB: Financing Contribution, AER: Employers’ Trainee Reimbursement Scheme, AES: The Danish Labour Market Occupational Illness Insurance Scheme

Personnel costs The higher employer contributions in Sweden finance part of the fees that the employees themselves pay in Denmark. The wage for time worked, and wage benefits, is therefore significantly higher in Denmark compared to in Sweden. In addition, the total workforce cost per hour worked is higher in Denmark than in Sweden.

Workforce costs in SEK/hour worked, divided into cost components (2007) COUNTRY Wage for Wage for EMPLOYER Total workforce TIME WORKED time NOT WORKED contributions COSTS Denmark 195.57 47.81 28.25 271.63 Sweden

137.66 25.34 80.65 243.64

Source: Swedish Trade & Industry. Workforce costs are calculated and stated for employers within the manufacturing industry. *Including holiday allowance, one-off bonuses and fringe benefits

The table below shows examples of staff costs per person and month within various profession categories in the Øresund region for 2007.

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Workforce cost2 per person and month in different sectors Sector Currency Skåne Eastern Denmark Finance SEK 47,824

EUR 5,170

Transport SEK 39,330

39,057

5,199 44,006 4,757 35,287

50,504

3,815 49,764

EUR 5,460

Property SEK 48,326

48,093

EUR 4,222

Electricity, VA SEK

4,656

EUR 4,988

Hotel & Restaurant SEK

43,065

EUR 5,320

Trade SEK 46,136

6,524

EUR 4,252

Construction SEK 49,213

60,346

5,380 54,522

EUR 5,224

5,894

Total SEK 47,824

49,44

5,345

EUR 5,170

Source: Örestat. States the workforce costs for 2007 in Skåne and eastern Denmark. No later figures available for Denmark.

Workforce cost components 2007 per person per month Skåne Eastern Denmark Wage expenses

32,798

Retirement pension contribution

48,720

4,883

Survivor’s pension

560

Health insurance contribution

2,401

Parental insurance

1,052

Industrial injuries insurance

324

Labour market contribution

1,392

General payroll tax

4,414

ATP 230 FIB & LG

118

AER 227 AES 59 Parental insurance fund Total, SEK

47,824

88 49,442

Source: Calculated by the Øresund Institute. Information based on Örestat’s workforce cost calculations 2007.

2

Workforce costs are reported in 3 part-components:

– Wage per month which consists of a basic salary/agreed salary plus any additions, benefits and bonus payments. Examples of bonus payments include

commission, bonus and production additions. Bonus payments can be paid regularly in each wage period, or irregularly in individual wage periods.

– Employer contributions per month, consisting of legal and agreed contributions.

– Other costs per month, consisting of other costs than mentioned above, and which do not comprise an income for the loan-taker (e.g. staff training costs).

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Workforce cost components per person per month, 2007 60000 50000 40000

30000

20000

Employer contributions Wage expenses

10000 0

Skåne

Eastern Denmark

Source: Calculated by the Øresund Institute. Information based on Örestat’s workforce cost calculations 2007. Other expenses can arise, including service pension and additional insurance.

It should be noted that benefits, bonuses and extras can vary between industries. In Denmark, the employee also pays a labour market contribution of 8 per cent of their salary.

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Taxes In 2009, Sweden lowered corporate tax from 28 to 26.3 per cent. Denmark lowered its corporation tax from 28 to 25 per cent in 2007. This can be compared to the average corporation tax within the EU which, according to the Confederation of Danish Industry, is 23.1 per cent.

Corporation tax Corporation tax is 26.3 per cent in Sweden and 25 per cent in Denmark.

Sweden Corporation tax constitutes 26.3 per cent of a company’s taxable net gain.

Up to 25 per cent of the annual taxable income can be placed in special tax allocation reserves (periodiseringsfond). Such a placement is tax deductible. The amount must be withdrawn from the reserve, and be taxed, within six years of it’s initial placement.

Fixed assets Inventory and machines which have a life expectancy of 3 years or less can be written off the year they are bought. The same applies to less expensive inventory (i.e. inventory which has a purchase value of 21,400 SEK. Other inventory and machinery can normally be written off according to the National Tax Agency’s regulations for depreciation, i.e. declining balance depreciation of 30 per cent per year of the inventory’s remaining taxable value, or linearly (straight­line depreciation) of 20 per cent per year of the inventory’s original acquisition value.

Depreciation on buildings, which are used for business purposes, is linear during the expected lifetime of the building (2­5 per cent per year).

Intangible assets Intangible assets, e.g. acquired goodwill, can normally be written off according to the regulations for depreciation of machinery and equipment (see above).

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Dividends See return on investment.

Return on investment Dividends on unlisted shares are always taxfree. Dividends on listed shares are exempt from tax if the shares in question represent at least 10 per cent of the votes in the company and the shares are held for at least one year.

In cases other than those mentioned above, dividends and capital gains from corporate owned capital investments are subject to tax. Capital losses are consequently tax­deductible (although only against taxable capital gains from capital investments).

Denmark Corporate income tax rate is 25 per cent.

Fixed assets Fixed assets which are used in the running of the company (inventory and machines) with an acquisition value of up to 12 300 DKK (2009) can normally be written off completely during the year in which they are bought. Depreciation on other capital assets which are in operational use is according to the residual value principle. The maximum amount allowed to be written off per year is 25 per cent. Buildings which are normally used for business purposes can be depreciated with up to 4 per cent linearly (straight­line depreciation) over 20 years.

Goodwill Goodwill can be written off with up to 14.3 per cent per year.

Dividends The selling of shares in foreign subsidiary companies is tax­free if the ownership is of financial character and has lasted for more than 3 years.

Return on investment Tax­free if the stakeholding exceeds 20 per cent and has been continuous for more than one year. For stakeholdings which are less than 20 per cent, the dividend is calculated at 66 per cent of it’s full value.

Tax regulations for sole traders Sweden Tax status for the self-employed: F-tax A self­employed person who is registered for corporation taxation (F­tax) pays income tax as well as social security contributions (31,42 per cent for 2010). Application for an F­tax certificate is made at the Swedish Tax Agency using the form ”Skatte­och avgiftsanmälan”.

Taxation The company’s profit after deductions for social security contributions is taxed as personal income.

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Deduction possibilities Positive interest distribution: If the owner has invested their own capital above a certain level in the company, a part of the profit can be classed as income from capital subject to a tax rate of 30 per cent.

Tax allocation reserve The owner can allocate 30 per cent of the profits to be taxed at a later date (within six years).

Expansion fund Gives the possibility to allocate all or a part of the profit in order to make investments in the company. Profits that are allocated this way are taxed at 26,3 per cent.

Denmark Tax status for the self-employed: B-tax The change from being a registered A­tax income taxpayer to a self­employed B­tax tax­payer is made at the local tax office.

Taxation Personal tax regulations: The company’s profit after deductions for labour market contributions is taxed as personal income. Interest income and expenses are not included in the company’s profits, they are instead taxed as income from capital. Capital income tax is dependent on the amount of the income.

Capital gains ordinance According to these regulations the company’s interest income and expenses are to be taken fully into account when calculating the company’s profits. The part of the profit that equals interest earned on the company’s capital is taxed as capital income. The remainder of the profit is taxed as personal income. The regulations also contain a special business stabilization ordinance which makes it possible to deduct up to 25 per cent of the year’s profit with a corporation taxation of 25 per cent.

Business ordinance The company’s interest income and expenses are also in this case included when calculating the profits of the company. That part of the profit that equals interest earned on the company’s capital is taxed as capital income. The remainder of the profit can be wholly or partly left in the company after payment of a preliminary corporation tax of 25 per cent. That part of the profits which is taken out of the company is taxed as personal income.

Special personal tax regulations Sweden Special income tax (SINK), cross border region tax People who work but are not resident in Sweden pay a special income tax, the so­called SINK tax. This means that people who are to stay in Sweden for no longer than 6 months or those who commute daily to Sweden can apply to be taxed according to the SINK tax. This tax can attract Danish business leaders to work in Swedish companies. The SINK tax is 25 per cent of the gross salary and benefits and does not allow for any deductions. An income tax declaration does not need to be filled in Sweden. In order to be considered for the SINK tax one must apply via the Swedish Tax Agency. Artists and sportsmen who reside outside of Sweden are partially subject to Swedish taxation at a rate of 15 per cent on their taxable income (A­SINK tax.)

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Expatriate taxation Foreign experts, researchers and key personnel may apply for tax relief. This tax relief means that 25 per cent of any Swedish salary is exempt from taxation and social security contributions for 3 years. In order to be eligible for this tax relief one must be resident in Sweden, i.e. subject to unlimited tax liability. One of the conditions for eligibility is that the applicant intends to stay in Sweden for no longer than five years. Additionally the employer must be a company registered in Sweden, or be a foreign company with a permanent establishment in Sweden. The application must be sent to the Research Tax Board (Forskarskattenämnden) within three months of employment in Sweden.

Denmark Taxation of researchers and high-income earners High­income earners (at least approx. 63,800 DKK per month after ATP and labour market contributions) as well as foreign researchers who are associated with a research project approved by a Danish research council, can choose to pay a gross tax of 25 per cent on earned income for a period of maximum three years or 33 per cent on earned income for five years. In return the employee is not allowed to make any deductions. Additionally the employee must be fully liable to pay tax in Denmark, and have a Danish employer. Any benefits paid by the employer, such as living expenses, moving costs, school fees etc. are subject to taxation. If the employee opts to be taxed according to this rule, then all remuneration and benefits are to be taxed according to this rule.

(Source: SKAT)

VAT VAT in Sweden and Denmark is generally at 25 per cent. Some business activities have a reduced level of VAT, or are entirely exempt. In Sweden there are also the VAT categories of 6 and 12 per cent for specific goods and services (see below).

Except Sweden (no VAT) Healthcare, dentistry and social care Education at primary school, secondary school, college and university Bank and financing services Insurance services Artist’s fees Study Association study circles Medication on prescription or sold to hospital Shipments for commercial shipping Production of membership cards, staff journals or similar Lottery, betting and other types of gambling Purchase and rental of property Artwork that the artist or the artist’s estate sells for a maximum of SEK 300,000 in one fiscal year

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12% Sweden Food Hotel rooms Camping Sale of own artwork Importing artwork

6% Sweden Books, newspapers, notes, maps and similar Personal travel within Sweden Transportation in ski lifts Specific entry fees Athletics Museum activities Library activities Sale of specific rights

Except Denmark (no VAT) Hospital treatment Teaching Associations and organisations Sports activities Cultural activities Author and composer activities Insurance activities Specific financial activities Lotteries Post Danmark’s collection and redistribution of post Stamps Passenger transportation Travel agent activities Charity events and second-hand shops Source: Swedish Tax Agency and SKAT

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Danish companies and organisations that are not liable to pay VAT instead pay employer contributions at 3.08 per cent.

Within the financial sector, employer contributions are currently at 9.13 per cent, but from 1 January 2013, the contribution will be raised to 10.5 per cent. Financial activities refer to activities in insurance, loans, credit brokerage, retirement savings, investment management, payment and securities trading and foreign exchange.

Travel agencies and tourist offices have previously been exempt from paying VAT. From 1 January 2011, VAT is removed and the companies are also free from paying employer contributions.

Certain smaller companies do not need to pay employer contributions. This is also applicable to known religious communities and companies which only sell goods for, e.g. assistance or amateur sport.

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Starting a company Both Denmark and Sweden have a good corporate climate. There are several large companies in Sweden.

However in both Sweden and Denmark small and middlezise companies are dominating. Over the last decades, productivity growth has generally been higher in Sweden than Denmark. The corporate cultures are known as flat organisations with relatively few hierarchies where the Danish and Swedish employees are used to participating in the decision process.

Types of company in Sweden

Ltd company Partnership

Limited Sole trader Subsidiary, partnership foreign company

Registration Tax Agency Tax Agency Tax Agency Tax Agency Tax Agency

& Companies & Companies & Companies & Companies & Companies Reg. Office Reg. Office Reg. Office Reg. Office if req. Reg. Office Start-up capital SEK 50,000

-

-

-

-

Registration fee SEK 2,200 SEK 1,200 SEK 1,200 SEK 1,200 SEK 2,000 Purchase of other company* SEK 1,200 SEK 1,200 SEK 1,200 SEK 1,200 SEK 800 Turnaround time

2 weeks

2 weeks

2 weeks

2 weeks

2 weeks

Source: Invest Sweden, Companies Registration Office, Tax Agency *The prices depend on how many changes are made within the company in respect of the purchase.

Types of company in Denmark

Ltd LLC Self-employed Subsidiary, foreign company Registration Danish Commerce Danish Commerce Danish Commerce Danish Commerce

and Companies Agency and Companies Agency and Companies Agency and Companies Agency Start-up capital

Min. DKK 500,000

Min. DKK 80,000

-

-

Registration fee

Free

Free

Free

Free

Purchase of other company

Free

Free

Free

Free

1-4 weeks

1-4 weeks

1-2 weeks

1-2 weeks

Turnaround time

Source: Invest in Denmark, Danish Commerce and Companies Agency

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Company culture and industry structure The public sector employs roughly every third person both in Skåne and in eastern Denmark. Larger companies are common in Skåne, whilst eastern Denmark has a higher proportion of smaller and medium-sized companies. 46 per cent of those employed in Skåne work in a company with more than 500 employees, whilst 51.2 per cent of eastern Danes work in companies with fewer than 50 employees.

Proportion of employees divided according to company size (per cent) Skåne Eastern Denmark >500 employees

45.8

14.1

100-499 employees

13.4

21.6

50-99 employees

6.5

13.1

1-49 employees

34.4

51.2

87,724

118,089

Number of companies

Source: Job & Magt, October 2010. The figures for Skåne are from 2008, for Denmark, from 2007.

Sweden has a great number of large corporations and traditionally, Swedes see employment in these companies as a great start for a future career. There are large­scale international forestry, metal and engineering industries. Denmark has historically more merchants and traders and small and medium sized companies.

Denmark is shaped by long traditions of farming and small enterprises operating in a rich retail culture. Private and family ownership is a prominent part of company culture in Denmark. It is a country for traders and middlemen which requires a high level of flexibility. The Danish State has played a considerably more passive role than the Swedish State in the development of their respective country’s company culture. Skåne’s company culture can be said to be a mixture of Swedish and Danish. There are more small and medium companies than in Sweden as a whole and the economy is more like Denmark’s than Sweden’s. ”Learning by doing” is normal in Danish organizations while Swedish organizations prefer to have as much information as possible before work begins. At meetings and times of decisions, it is normal to agree and

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decide unanimously in Sweden, which leads to greater conformity and swiftness in the realization phase.

Danes generally do not avoid discussions which could lead to conflict in the same way as Swedes do.

Swedish company culture

• A mindset for large­scale corporate thinking dominates the business economy • Shared visions and delegation of responsibility is of importance • Focused on planning and controlling processes • Focused on agreements, honesty, and fulfilling commitments • ”Consensus­orientated” • Emphasis on reducing uncertainty • Strong legal rights for employees • Organization important for identity and sense of belonging • Very low level of hierarchy Danish company culture

• Small scale trading constitutes the basic model • The manager’s role as decision maker is central • More improvisational and short term orientated • Acceptance of differences of opinion and conflict • Relatively high tolerance of uncertainty • Willing to relocate when seeking work • Profession important for identity and sense of belonging • The individual is independent in relation to the employer • Relatively low level of hierarchy Source: Integration and development in the Öresund Region, 1999, Workplace culture in the Öresund region, Ramböll Management, 2005.

Public holidays and other holidays: Denmark and Sweden: New Year’s Day Good Friday Easter day Easter Monday Ascension Day Pentecost Christmas Eve Christmas Day Boxing Day New Year’s Eve

Also in Sweden: Epiphany

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May Day National Day, 6 June Midsummer’s Eve Midsummer’s Day

Also in Denmark: Maundy Thursday Prayer Day 2. Pentecost Constitution Day, 5 June Source: Visit Sweden and Visit Denmark

Productivity The growth in productivity has been higher in Sweden than in other comparable countries between 20002009, whilst it has been lower in Denmark. The low productivity growth is one of the factors concerning Danish economists.

Labour productivity growth, Gross Domestic Product Index 2000=100 2009 Sweden 116.2 Denmark 105.5 USA 115.7 EU 17*

112.5

Source: OECD Explanation EU 17 = Sweden, Denmark, Germany, Belgium, Netherlands, France, Spain, Greece, Italy, Portugal, Finland, Great Britain, Ireland, Czech Republic, Poland, Slovakia, Hungary.

Skåne’s economy is growing, whilst Själland is having difficulties getting going again following the housing and financial crisis. For the Øresund region, the national differences clearly hit home. Thousands of Swedes previously did not consider Øresund for work, but the Danes bought cars and property cheaply in Skåne and continued to work in Copenhagen. These significant streams of people exploded the traffic over the Øresund bridge from 3,000 commuters in 2000 to 19,097 commuters in 2008. The financial crisis that began in 2009 was a turning point. Employment in Själland fell by 38,000, and in Skåne by 8,500 people.

Forecast gross regional product (actual annual growth %) GRP 2009 (mil) 2008 2009 2010 2011 2012 Øresund region DKK 1,081

-0,3

-3,9

+3,1

+2,9

+2,3

Själland DKK 786 -0,2 -3,5 +2,2 +2,7 +2,3 Skåne SEK 355 -0,3 -4,9 +5,4 +3,3 +2,1 Source: Anders Olshov, Øresund Institute, April 2011. DKK/SEK=1.20 has been used in the calculations.

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Training There are eight universities and three high schools in the region, with a combined total of over 10,000 researchers and 150,000 students. One of the strongest research areas is life science. The scientific research is at 17th place in the world, measured from published and quoted articles – six places above the StockholmUppsala region. With the ESS and MAX IV material research facilities built in Lund, the Øresund region research is expected to be further strengthened.

The region has a relatively large proportion of immigrants, as there is significant access to secondary education and a competent workforce. In 2008 there were 153,757 people studying at university and in secondary education throughout the Øresund region. The number of people with a secondary education of three years or more is expected to increase from 22 per cent in 2007 to 31 per cent in 2020 throughout Skåne, according to a report from the Interreg project “Jobs and competences in the Øresund region”. There are already currently a large number of individuals in the Malmö-Lund region with higher education qualifications.

Education levels in Malmö, Lund and Copenhagen (percentage of population) Primary Secondary Higher No

education education education information Malmö Lund

14 37 44 5 7 24 66 3

Copenhagen 23 36 35

6

Frederiksberg 17 34 43

6

Source: Statistics Denmark, StatBank Denmark and Statistics Sweden 2009. For Sweden, the education level is given for people in the age range 25-64 and for Denmark, the education level is given for people in the age range 15-69. It is therefore not possible to make a direct comparison between the two countries.

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Universities in the Øresund region University Location Researchers Students Doctorates

(full time) (full time) University of Copenhagen

Copenhagen

4,012

21,397

440

Lund University Lund, Malmö, Helsingborg

2,216

21,814

378

Technical University of Denmark Lyngby, Copenhagen

2,382

4,564

147

Roskilde University Roskilde

474

4,514

29

of Agricultural Sciences Alnarp

179

664

8

Malmö University

Malmö

648

9,283

11

Kristianstad

285

3,884

Copenhagen

84

523

10

Copenhagen /Aarhus

193

1,213

22

Copenhagen

508

9,468

25

Copenhagen

iu

900

9

Swedish University

Kristianstad University

University of Copenhagen Danish School of Education, Aarhus University Copenhagen Business School The Royal Danish Academy of Fine Arts, Schools of Architecture, Design and Conservation; School of Architecture Source: Job & Magt, December 2010.

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Population of Nordic origin The Øresund region is international, with many people, from different backgrounds and nationalities. Primarily, there are many Danes living in Malmö.

Malmö has developed into a global melting pot, with inhabitants from 174 countries. On 1 January 2010, a total of 87,554 of Malmö’s inhabitants (30 per cent) were born abroad. The majority, 9,465 people, come from Iraq, then comes Denmark with 9,174, Yugoslavia with 8,530 people, Poland with 6,903 people and Bosnia & Herzegovina with 5,920 people. Other sizeable immigrant countries were Lebanon and Iran, but in adjacent areas, also Hungary (1,979 people), Germany (1,790 people) and Finland (1,678 people). The entire Øresund region has over 80,000 inhabitants from other EU countries, approximately 60,000 from Asian countries, 16,000 from the African continent and 13,000 from America. The prospects are good for companies to find an international workforce and cover the entire Nordic market, but also important export markets such as Poland and Germany.

Number of inhabitants in Malmö and Copenhagen with citizenship of another Nordic country Malmö Copenhagen Denmark 12,073 Finland 771 746 Norway 785 3,621 Sweden 3,966 Source: Statistics Denmark, StatBank Denmark LON02 and Statistics Sweden January 2010.

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Movement between Skåne and Denmark

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Total

From Denmark to Skåne

779 1,384 1,849 2,542 3,011 3,227 3,424 4,707 4,866 3,758 3,767 32,535

From Skåne to Denmark

798 800 894 1,001 1,307 1,566 1,724 1,734 2,354 2,620 3,392 17,392

Net to Skåne

-19 584 955 1,541 1,704 1,661 1,700 2,973 2,512 1,138 375 15,143

Source: Örestat.

The wave of movement over Øresund increased the number of Danish inhabitants in Malmö from 2,429 in 1999 to 12,073 in 2009, from 0.9 to 4.1 per cent of the inhabitants. In a similar way, the number of Danes born in Malmö increased from 3,461 in 1999 to 9,174 in 2009, from 1.3 to 3.1 per cent of Malmö’s immigrant total.

There are therefore more Danish inhabitants than are actually born in Denmark in contrast to the situation in 1999. Divided per city area in Malmö, Oxie has the most Danes, with 9.2 per cent Danish inhabitants as at 1 January 2010, followed by Fosie with 6.2 per cent, Limhamn-Bunkeflo with 5.4 per cent and Rosengård with 4.9 per cent. If the figures are broken down further, the Limhamn harbour area has 15 per cent Danish inhabitants, Bunkeflostrand has 11 per cent and Vintrie 10 per cent.

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Communication and transport The Øresund region has good communications. There are direct flight connections to 140 worldwide destinations from Copenhagen’s Kastrup airport. In 2010, around 21.5 million passengers used the airport – an increase of 9.1 per cent compared to the previous year. October 2010 saw the opening of a new low-cost terminal, CPH Go. Kastrup is 8 km south-west from the centre of Copenhagen and can be reached by metro from Kongens Nytorv in 15 minutes, and by train from Malmö Central Station in 20 minutes. Malmö Airport is 30 km outside Malmö, and can be reached by bus, car or taxi. The airport serves 34 destinations and 1.6 million passengers annually.

Copenhagen Malmö Port (CMP) is the joint port company for the two cities. It was founded in 2001 and is one of the largest port companies in northern Europe. A lot has been invested into the ports, including investment in a ”Nordic Hub car terminal” in Malmö in 2003. Over the coming years, both ports will be further expanded.

The development of the public transport network in the region strengthens the communication opportunities. The city tunnel in Malmö which opened in December 2010 shortens the travelling time to Kastrup for many Skåne residents. Copenhagen currently has two metro lines from Vanlöse to the airport or Vestamager.

The next stretch of metro line will open in 2018; an orbital line around the city with 17 new stations in Copenhagen’s central areas.

Price of a commuter travel card per month

• Malmö–Copenhagen H: SEK 1,900/month • Malmö–Lund: SEK 690/month • All of Skåne: SEK 1,060/month • Season ticket Denmark Copenhagen–Roskilde (8 zones): SEK 1,360/month

• Season ticket, all zones, central areas: SEK 1,500/month Source: Skånetrafiken and DSB Illustration: Annual Report: Copenhagen Airport.

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Example of trains, flights and buses from Malmö and Copenhagen From To Transportation Journey time Triangeln, Malmö

Copenhagen H Train, Øresund train

30 min

Copenhagen Airport Train, Øresund train

12 min

Malmö Airport/Sturup Airport bus

40 min

Malmö C Lund Train, Øresund train

10 min

Malmö C Gothenburg Intercity train

2 h 30 min

Malmö C Stockholm

X2000 train

4 h 22 min

Malmö C Oslo Intercity train – NSB

7 h 25 min

Copenhagen H Hamburg Intercity train – Express

4 h 30 min

Hyllie, Malmö Malmö C

Malmö Airport Stockholm/Arlanda

Flight

1 h 5 min

Copenhagen Airport London/Heathrow

Flight

2h

Copenhagen Airport Hamburg Airport

Flight

50 min

Copenhagen Airport Amsterdam/Schiphol

Flight

1 h 30 min

Source: Skånetrafiken, SJ, Airport Coaches, DSB, Copenhagen Airport – Kastrup, Malmö Airport (Swedavia)

Car traffic over Øresund 2001-2010 (millions)

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

HH*

2.4 2.4 2.5 2.6 2,5 2.4 2.5 2.5 2.3 2.2

Øresund bridge

3.0 3.4 3.8 4.3 5.0 5.8 6.7 7.0 7.1 7.1

Source: Helsingborgs Hamn AB and Øresund bridge * HH=Helsingborg–Helsingör

42 per cent of personal car traffic and around 60 per cent of train passengers are commuters to their place of work or study, on the other side of the strait. Work commuting over the Øresund increased during the economic boom, and around 19,000 people commuted daily over the bridge in 2008. A new forecast for traffic trends on the Øresund bridge shows that traffic on the bridge in 2030 will be at 35,000 vehicles and 49,000 train passengers per day. Since the Øresund bridge opened, there has been a new shift in emphasis, with more traffic between Copenhagen and Malmö, and less between Helsingborg and Helsingör.

Freight and passengers Passengers (millions) Freight volume (tonnes of freight) Malmö Sturup Copenhagen Kastrup

1,598,271

24,800*

21,501,750

312,179

Stockholm/Arlanda 16,962,416

131,900**

Oslo 19,091,113 78,000 Source: CPH Airport, Swedavia, Oslo airport.

Passenger numbers 2010, freight 2009. 2009 was a bad year for the aviation industry and is therefore not representative for airborne traffic in Scandinavia, e.g. Arlanda airport lost around 30% of its freight volume in 2009 compared with 2008. * Only air freight. Some air freight arrives and departs in trucks. The volume of freight is estimated at around 50,000 tonnes if the truck transportation is included, according to Swedavia. ** Volyme excluding mail. Mail freight accounted for 20,350 tonnes in 2009.

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Premises and running costs The time period, notice period, extension time, what is included in the rent, plus the rights and obligations of each party for premises rental, are all defined in the rental contract. The tenant usually signs their own electricity agreement and pays for their own usage; whilst heating and water are usually included. In Denmark, the tenant is usually responsible for a number of costs which in Sweden are paid for by the landlord. This includes internal repairs and maintenance, care of communal areas and property insurance.

The definition of office space differs between Sweden and Denmark, whilst only the individual’s internal space is included in Sweden; communal areas such as entrances and stairs are often included in Denmark.

The economic development has affected office rental rates. The downturn in the market in recent years has had more of an effect in Denmark, and rents have been affected more in Copenhagen than in Malmö. The downturn in the labour market has reduced the requirement for premises as well as new office premises being completed, and has increased the places available, which in its turn has driven up the degree of vacancy and strengthened the tenant’s position in the process. Office premises in prime locations have been less affected than those in secondary locations. The downturn has therefore not been as noticeable for Copenhagen’s CBD and port area. New development areas, such as Örestad, with a significant amount of speculation involved, have been more affected. The properties in the area are now filling up and tenants such as Ramböll, Bombardier, Skandia and Dansk Industri have moved to Örestad.

In Malmö, the CBD is the largest market. The fastest growing is the Western Harbour and Universitetsholmen where the majority of the new office projects have been implemented. The next area is Hyllie in southern Malmö, where one of the Citytunnel stations is also located. New office premises have not been built on speculation in Malmö, but the majority have been pre-leased, which has meant that the degree of vacancy and rental levels have not been affected to the same extent.

The total office space in Malmö is around 1.5 million m2, and in Copenhagen is around 11 million m2, of which about 5 million is located in the CBD. The degree of vacancy in Copenhagen’s CBD is around 9 per cent and in Malmö’s CBD around 8 per cent.

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Rental costs for office premises Malmö City centre Western harbour Inner ring road Prime rent level SEK

1,825

1,925

1,075

Prime rent level SEK

190

202

113

Secondary rent level SEK

1,400

1,500

950

Secondary rent level EUR

147

157

100

Copenhagen CBD South Harbour Amager/Örestad Prime rent level SEK

2,010

1,665

1,540

Prime rent level SEK

210

175

160

Secondary rent level SEK

1,590

1,350

1,150

Secondary rent level EUR

165

140

120

Source: Copenhagen and Malmö - Property Market Report 2010 - Sadolin & Albæk

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Logistics costs There are many different operators within IT, telephony and post. A large proportion of the population has access to the Internet and the number of communication methods has exploded.

IT and telephony Today’s market is crammed with a variety of IT & telephony products and solutions. Laptops, e-book readers, smart phones, mobile broadband and IP telephony are just some examples of products that have changed the market in recent years. The wide variety of operators in its turn enables a range of benefits when signing a contract, and can offer package deals at special prices.

The Swedish communications authority, the Post and Telecom Agency (PTS), offers the service ”Teleprice check” which compares prices and contracts between various operators based on the information provided by the user’s telephony and internet habits. In Denmark, the National IT and Telecom Agency functions on the same principle. Telia, which has previously enjoyed a monopoly on fixed telephony in Sweden, still has a large market share of fixed telephony services, but within mobile and data services and broadband subscriptions, a number of other operators have taken significant market shares. Examples of IT and telephony operators in Sweden and Denmark are Telia, Tele 2, Telenor, Hi3G and TDC. Worth knowing is that several operators offer cheaper international call charges for only a small additional fee.

Statistics from SCB show that companies are increasingly choosing to connect to the internet using a mobile connection. In 2010, a total of 60 per cent of companies with 10 or more employees had a mobile internet connection in Sweden. The same figure for the previous year was 46 per cent. 89 per cent of companies have access to fixed high-speed Internet connections.

A study by the Swedish Post and Telecom Agency (PTS) and its equivalent in Denmark, Finland and Norway, shows that Denmark is the country which overall has the most broadband subscriptions per inhabitant, followed by Sweden. For subscriptions at speeds above 10 Mbit/s, the order of the countries changes, with Sweden having more fibre-optic networks than the other Nordic countries.

Skåne is building a broadband via ADSL network with 97 per cent coverage. In Denmark, 99 per cent of all households and companies have access to a broadband connection with coverage of at least 512 kbit/s, and around 25 per cent of these have a connection with an estimated speed of 100 Mbit/s.

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Postage In Sweden, Posten AB dominates the letter and package market. There are also around 30 postal operators, where the majority are local, and primarily newspaper couriers, but Bring Citymail offers delivery of larger items from companies and covers around 54 per cent of delivery areas in Sweden. Bring Citymail is owned

by Posten Norge A/S and specialises in direct mail and advertising. The company has also operated in Denmark, but terminated this branch as from 1 January 2010.

The monopoly for post delivery in Denmark has ceased, but the market is still dominated by Post Danmark.

June 2009 saw the creation of Posten Norden AB following the merger of the Swedish Posten AB and the Danish Post Danmark A/S. The merger has not yet had any effect on prices; and for delivery between Sweden and Denmark, the same rates apply as for the rest of Europe.

Letters within/from Sweden First Class SEK SEK Post (grammes) Second Class Europe 20

6 5.5 12

100

12 11 24

250

24 22 48

500

36 33 80

1000

48 44 150

2000

72 66 225

Citymail* (grammes) 20 3.35 100 4.69 500 11.41 Source: Posten Sverige, Bring Citymail Sweden * Citymail: only deliveries of 500+ items, three day delivery time and primarily large towns/cities (54%). Pricing example refers to deliveries of 1000 items.

Letters within/from Denmark Post (grammes) First Class Second Class Europe First Class Europe Second Class Format 50

5.5

5

8.5

8 Standard letter

100

12.5

12

19

18 Large letter

500

30

29

47

45 Large letter

Source: Post Danmark

Establishing a Business in the Ă˜resund Region

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Electricity costs Electricity prices in both Denmark and Sweden are controlled by the Nord Pool power exchange. Due to taxation, electricity is twice as expensive in Denmark than in Sweden. There are many different electricity contracts, and the price varies considerably, depending on the type of contract and usage; with an example below. The average spot price at Nord Pool in 2010 was 54.48 öre/kWh. Electricity prices, SEK öre/kWh excluding VAT Sweden (SEK) Variable price, average 2010

57.16 Swedish öre/kWh

Surcharge, variable price

2.45 Swedish öre/kWh

Electricity certification fee*, average 2010

4.69 Swedish öre/kWh

Energy tax 2010

28.30 Swedish öre/kWh

VAT 25% Average total price SEK 1.16/kWh Source: E.On and Vattenfall The prices vary according to the type of contract, usage, and the spot price at Nord Pool. * Based on the monthly average market price for electricity certification. Annual fees will also apply.

Denmark (SEK) Basic price, quarterly average

54.21 Swedish öre/kWh

Electricity transportation

36.99 Swedish öre/kWh

Public fees Electricity tax

9.86 Swedish öre/kWh 79.23 Swedish öre/kWh

Electricity distribution contribution 2010

5.12 Swedish öre/kWh

Energy saving tax

7.94 Swedish öre/kWh

VAT 25% Average total price SEK 2.42/kWh Source: Dong Energy The prices vary according to the type of contract, usage, and the spot price at Nord Pool. * Based on the monthly average market price for electricity certification. Annual fees will also apply.

Establishing a Business in the Øresund Region

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Quality of life The Scandinavian labour market is known for enabling employees to combine leisure time and family with work. Living costs are lower in Sweden than in Denmark, including in relation to car prices, the cost of childcare and food. According to Eurostat, Denmark was amongst the countries with the most expensive food & drink prices within the EU in 2009 (index 139 compared with Sweden at 104, EU = 100).

Sweden has a maximum charge for childcare which means that the cost of putting a child in preschool is limited to a maximum of SEK 1,260 for the first child, SEK 840 for the second child, and SEK 420 for the third.

For further children, there is no charge. If the household has a lower income than SEK 42,000/month, the charges are lower. Denmark has no such maximum charge.

The Øresund region offers a wide range of opportunities for active and inspiring leisure time. In addition to the examples below, there are plans for new attractions, including a spectacular new aquarium in Kastrup, an educational theme park in Malmö and a science museum in Lund.

Malmö/Skåne Amusement parks and museums There are a lot of amusement parks in Skåne as Folkets park, Tosselilla, Skånes Djurpark and several museums as Malmö Konstmuseum, Konsthallen in Malmö and Lund and Dunkers Kulturhus in Helsingborg.

Castles There are 78 castles of which 24 are in the south­west of Skåne. Most of them are open to the public or to pre­booked tour groups. Those which are open to the public are, as a rule, open during the summer months of May until August. The castles are often situated in areas of great natural beauty.

Green areas and parks Malmö –”City of Parks”. There are three large parks in Malmö: Kungsparken, Slottsparken and Pildammsparken as well as several smaller parks such as Folkets Park and the Botanical Gardens in Augustenborg.

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Beaches There is 390 km of coast around Skåne with a large variety of excellent public beaches. The sand is white, and the water is clean, clear and shallow which means that even young children can swim safely. The water temperature is usually between 18-­22˚C during the summer.

Golf courses There are over 70 golf courses in Skåne, of which 27 can be found in the southwest of Skåne. Several of these, such as Barsebäck, are of a high international standard.

Other activities There are three national parks in Skåne; Stenshuvud, Söderåsen and Dalby Söderskog as well as several nature reserves. Additionally Malmö and Skåne offer many possibilities for those who are interested in food, hunting, fishing, sailing, culture and history. There are also a great number of events in Skåne such a The Falsterbo Horseshow, Swedish Open and the Malmöfestivalen.

Copenhagen/North SJÄLLAND Amusement parks and museums Copenhagen have the oldest amusement park in the world; Tivoli. Other amusement parks near Copenhagen is Bakken, Zoo and BonBon-land. In Copenhagen there are a lot of different museums such as The National Museum, The National Gallery, Experimentarium, Lousiana, Ordrupgaard and Denmarks Aquarium.

Castles Amalienborg, official residence and home of Queen Margarethe II, lies in the centre of Copenhagen. Other castles in Copenhagen and North Själland: Rosenborg, Frederiksborg and Fredensborg Castle and Kronborg – which is to be found at UNESCO’s World Heritage List.

Green areas and parks Fælledparken, Amager Beach Park, Ørstedsparken, Dyrehaven, Østre Anlæg, Frederiksbergs Have and Amaliehaven, The Garden of the Royal Danish Veterinarian and Agricultural School, Valbyparken, Kongens Have, The Botanical Gardens and The Gardens of the Royal Danish Library.

Beaches There are some excellent public beaches relatively close to the centre of Copenhagen and it is easy to reach them with public transport.

Golf courses There are 35 golf courses in the Copenhagen area.

Other activities Excellent nature reserves such as Vestvolden (Avedøresletten) and Forstbotanisk Have in Gentofte. Good opportunities for coastal fishing and sailing. A good variety of museums, theatres, restaurants, culture and history. Copenhagen is well known for its fine restaurants among which you’ll find the worlds best restaurant 2010 Noma and several restaurants at the Michelin guide. There are also a number of bigger events in Copenhagen such as Copenhagen Jazz Festival, Copenhagen Fashion Festival, Ström Festival and the Roskilde Festival.

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International schools There are several international schools in the Øresund region, and there is a political focus on increasing the number, particularly in Skåne.

Name of School Curriculum Level Grades Location Amount Private/

of Municipal

students school

Skåne: Söderkulla Swedish International School (English Compulsory Language) school 1−9 Malmö 150 Municipal Malmö Borgarskola International Upper secondary Baccalaureate school

10−12 Malmö

240

Municipal

Bladin´s International International School Baccalaureate

0−9

374

Private

Preschool/ Compulsory school

Malmö

Bladin´s International Swedish School (English Upper secondary Language) school

10−12 Malmö

65

Private

The International School of Lund- International Upper secondary Katedralskolan Baccalaureate school

10−12 Lund

175

Municipal

50

Municipial

300

Private

Lingua Montessoriförskola International Preschool Lund

40

Private

Lingua Montessoriförskola International Preschool

40

Private

International Pre- International School of Lund Baccalaureate Preschool Lund

Bilingual Montessori Swedish (French, School of Lund English, Swedish Language)

Preschool/ Compulsory school

0-9 Lund

Ystad

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Filbornaskolan International Upper secondary Baccalaureate school

10−12 Helsingborg 200

Municipal

The International International Compulsory school/ School of Curriculum Upper secondary Helsingborg school 0−12 Helsingborg 250

Municipal

Söderportsgymnasiet International Upper secondary Baccalaureate school

Municipal

10−12 Kristianstad 90

Blekinge: Ehrensvärdska International Upper secondary gymnasiet Baccalaureate school 10−12 Karlskrona

30 (600 in total)

Municipal

570 (The entire school)

Private

Copenhagen: Bernadotteskolen Danish

(English language)

Compulsory school 0-9 Copenhagen

Bjørns International School International

Compulsory school

0-9

Copenhagen 150

Private

CIS – Copenhagen International Preschool/ International School Baccalaureate Compulsory

/Upper secondary

0−12

Copenhagen

600

Private

Hørsholm International Preschool/ International School Baccalaureate Compulsory

/Upper secondary

school

0−10

Copenhagen

230

Private

Nørre Gymnasium International Upper secondary Baccalaureate school 10−12 Copenhagen Prince Henrik’s School French school

Preschool/ Compulsory/Upper secondary school

100 (700 in total) Municipal

0−12

Copenhagen

0-9

Copenhagen 440

Private

Sankt Petri Schule Danish/German Compulsory/ Upper

secondary school

0−12

Copenhagen

Private

Birkerød Gymnasium International Upper secondary Baccalaureate school

10−12

Copenhagen 1000

Rygaards International School

British with an Preschool/ iznternational Compulsory school approach

Amager´s International School International

700

400

Compulsory school 0-9 Copenhagen 195

Østerbro International School

International Compulsory Baccalaureate school

Stepping Stones International Pre-School

International

0-9

Preschool

Private

Municipal

Private (Free school)

Copenhagen 160

Private

Copenhagen 35

Private

Source: Invest in Skåne

Establishing a Business in the Øresund Region

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International associations Skåne

• Interact – international students, Malmö university

• IKF – Organisation for International Women in Malmö

• International club of Skåne (ICS) • American Women’s Club Malmö • Lund University of Foreign Friends (LUFF) • The Swedish-Indonesian Society of Malmö/Lund Copenhagen and Själland

• American Women’s Club • BCCD British Chamber of Commerce • Democrats Abroad • Republicans Abroad • Expat in Denmark • Foreigners in Denmark • ICC ­International Club Copenhagen • IBC ­International Business Club • International Christian Community • International Women’s Club of Copenhagen • JCI – CI – Junior Chamber International – Copenhagen International

• KVINFO’s Mentor Network • LINK (Ladies International Network Copenhagen) • Newcomers Club in Denmark • Polonia.dk • P R O D S (Permanent Residents On Danish Soil) • The Finnish Church in Denmark • The Finland Institute • Den norske Sjömannskirke, Norwegian Church Abroad

• Den svenska kyrkan, the Swedish Church (Source: the associations’ websites)

Establishing a Business in the Øresund Region

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Sources Arbejderbevægelsens Erhvervsråd, the Economic Council of the Labour Movement, www.ae.dk Arbetslöshetskassan Alfa, unemployment insurance fund, www.alfakassan.se ATP, www.atp.dk Bolagsverket, Swedish Companies Registration Office, www.bolagsverket.se Bring Citymail, www.bring.se Copenhagen Airport, www.cph.dk Dong Energy, www.dongenergy.dk DSB, www.dsb.dk Erhvervs- og selskabsstyrelsen, the Danish Commerce and Companies Agency www.eogs.dk E.ON, www.eon.se Eurostat, http://epp.eurostat.ec.europa.eu/portal/page/portal/eurostat/home/ Flygbussarna, airport coaches, www.flygbussarna.se Forskarskattenämnden, Tax relief for foreign key personnel, www.forskarskattenamnden.se Helsingborgs Hamn AB, www.port.helsingborg.se International Labour Organization, www.ilo.org Invest in Denmark, www.investindk.com Invest in Skåne, www.invest.skane.com Invest Sweden, www.investsweden.se IT- og Telestyrelsen, National IT and Telecom Agency, www.itst.dk Job & kompetencer i Øresundsregionen, www.jobkompetence.net Job & Magt, www.jobomagt.org Konjukturinstitutet, www.konjunkturinstitutet.se Malmö Airport, www.swedavia.se/en/Malmo-Airport/ Malmö Turism, www.malmotown.com Newsec, www.newsec.se Nordisketax.net, www.nordisketax.net OECD, StatExtracts, www.stats.oecd.org

Establishing a Business in the Øresund Region

44

Oslo Airport, www.osl.no Posten Sverige, www.posten.se Post Danmark, www.postdanmark.dk Post- och Telestyrelsen, www.pts.se www.telepriskollen.se Rambøll, www.ramboll.dk Region Skåne, www.skane.se Riksbanken, the Swedish National Bank, www.riksbanken.se Sadolin & Albæk, www.sadolin-albaek.dk SJ, www.sj.se SKAT, Danish Tax and Customs Administration, www.skat.dk Skatteverket, Swedish Tax Agency, www.skatteverket.se Skånetrafiken, www.skanetrafiken.se SO, Arbetslöshetskassarnas samorganisation, www.samorg.org Statistics Denmark, www.dst.dk Svenskt Näringsliv, Confederation of Swedish Entreprise, www.svensktnaringsliv.se Statistics Sweden, www.scb.se Swedavia, www.swedavia.se Transparency International, www.transparency-se.org Unionen, www.unionen.se Vattenfall, www.vattenfall.se VisitSweden, www.visitsweden.se VisitDenmark, www.visitdenmark.se World Economic Forum, www.weforum.org WorkinDenmark, www.workindenmark.dk Ørestat statistikbank, www.orestat.scb.se Øresundsbron, www.oresundsbron.com Øresunddirekt, www.oresunddirekt.com Øresundsinstituttet, www.oresundsinstituttet.org

Establishing a Business in the Øresund Region

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Photo: p. 10 Andreas Larsson, p. 43 Anna Kallberg, p. 24, 28, 32 skane.com©Lasse Davidsson, p. 1, 2, 4, 5, 25, 44 ©Leif Johansson Xray, p. 10, 18, 34, 36, 39 ©MagnusPalmér, p. 38 skane.com ©Magnus Palmér, studiojk.se, p. 30 skane.com©Michel Thomas, p. 41 skane.com © Åsa Siller. Production: pendit.se 2012.

Trade and Industry Agency Visiting address: Lugna gatan 84 Postal address: SE-205 80 Malmö, Sweden Phone: +46 40 34 17 00 E-mail: tradeindustry@malmo.se malmobusiness.com/en

Invest in Skåne AB Visiting address: Dockplatsen 26 Postal address: SE-205 25 Malmö, Sweden Phone: +46 40 675 30 01 E-mail: invest@skane.com invest.skane.com