OECD Product Market Regulation (PMR) Indicators: How does Norway compare? ___________________________________________________________________________________ Competitive product markets foster economic growth and can improve the living standards of citizens. OECD’s Product Market Regulation Indicators assess the alignment of a country’s regulatory framework with internationally accepted best practices. The Economywide Indicator measures the distortions to competition that can be induced through the involvement of the State in the economy, as well as the barriers to entry and expansion faced by domestic and foreign firms in different sectors of the economy. This indicator is complemented by a set of Sector Indicators that measures regulatory barriers to competition at the level of specific network and service sectors.
Overall PMR Indicator Index scale 0 to 6
Norway
1.15
OECD average
1.38
5 Most competitionfriendly countries 5 Least competitionfriendly countries
1.00 1.82 0.0
2.0
4.0
6.0
Economy-wide PMR Indicators: a breakdown by major components Index scale 0 to 6 from most to least competition-friendly regulation.
6
Norway OECD average 5 Most competition-friendly countries 5 Least competition-friendly countries
5 4 3 2 1 0 Public Ownership
Involvement in Business Operations
Simplification and Evaluation of Regulations
Admin. Burden on Start-ups
Barriers in Service Barriers to Trade & Network sectors and Investment
Note: All the averages include only OECD countries. Information refers to laws and regulation in force on 1 January 2018. Source: OECD 2018 PMR database.
ECONOMY-WIDE HIGHLIGHTS
Overall, regulatory barriers to competition in Norway are among the lowest in the OECD. Regulations in the service sectors are competition-friendly and the administrative burden imposed on new firms is low. Further, regulatory procedures are simple and there are rules in place to ensure transparency in the interaction between interest groups and policymakers; and the barriers to foreign direct investments are limited. However, the government owns firms in many sectors of the economy, more than in most OECD countries. In addition, there is scope to better align regulations in network sectors with international best practice.
Economy-wide PMR indicators: a breakdown by sub-components Index scale 0 to 6 from most to least competition-friendly regulation Distortions Induced by State Involvement Simplification and Evaluation of Regulations
Complexity of Regulatory Procedures
6 5 4 3 2 1 0
Interaction with Interest Groups
Involvement in Business Operations
5 Least competition-friendly countries
Assessment of Impact on Competition
6 5 4 3 2 1 0
Price controls
Governance of SOEs
Direct Control
Scope of SOEs
Gov’t Involv. in Network Sectors
Public Ownership
6 5 4 3 2 1 0
5 Most competition-friendly countries
Public procurement
OECD average
Command & control regulation
Norway
Barriers to Domestic and Foreign Entry
Barriers to Trade Facilitation
Barriers to Trade and Investment
Treatment of Foreign Suppliers
6 5 4 3 2 1 0
Tariff Barriers
Barriers in Service & Network sectors
5 Least competition-friendly countries
Barriers to FDI
6 5 4 3 2 1 0
5 Most competition-friendly countries
Barriers in Network sectors
Licenses and Permits
Admin. Burden on Start-ups
Admin. Requirements for Lim. Liab. Companies and Pers.Owned Enterp.
6 5 4 3 2 1 0
OECD average
Barriers in Services sectors
Norway
Note: All the averages include only OECD countries. Information refers to laws and regulation in force on 1 January 2018. If the blue bar does not appear on the chart for a specific indicator, it means that its value is 0. Source: OECD 2018 PMR database.
SECTOR-SPECIFIC HIGHLIGHTS Regulatory barriers to competition in gas, rail and e-communications are higher than in many other OECD countries. This is due to a combination of regulations that are not always in line with international best practices and public ownership of the largest operators in some of these sectors. In contrast, the regulatory framework in the services sector is more competition-friendly than in many other OECD countries, and in some cases, such as retail distribution and the retail sale of medicines, is among the most competition-friendly in the OECD.
Regulation in network and service sectors PMR Indicators for network sectors Index scale 0 to 6 from most to least competition-friendly regulation Norway 5 Most competition-friendly countries
6
OECD average 5 Least competition-friendly countries
5 4 3 2 1 0 Electricity
Gas
Rail
Air
Energy
Road
Water
Transport
Fixed
Mobile
E-Communications
PMR Indicators for professional services* and retail distribution Index scale 0 to 6 from most to least competition-friendly regulation
6
Norway
OECD average
5 most competition-friendly countries
5 Least competition-friendly countries
5 4 3 2
1 0 Lawyers
Accountants
Architects
Civil engineers
Professional services
Real estate agents
Retail distribution
Retail sale of Medicines
Retail trade
* When comparing the indicators across countries, it should be kept in mind that the activities undertaken by specific professions may vary between countries. Note: All the averages include only OECD countries. Information refers to laws and regulation in force on 1 January 2018. If the blue bar does not appear on the chart for a specific indicator, it means that its value is 0. Source: OECD 2018 PMR database.
OVERALL ASSESSMENT
Regulatory barriers to competition in Norway are among the lowest in the OECD, still there is scope for improving product market regulation in some areas.
Strengths
Challenges
The rules regulating the interaction between interest groups and public officials during the regulatory process are among the most transparent in the OECD. However, there is scope to extend the rules that deal with conflict of interests involving public officials to include members of cabinets and of legislative bodies.
The regulatory framework for retail trade is one of the most competition-friendly in the OECD.
The retail sale of medicines is less regulated than in most OECD countries, in particular, there are no restrictions to the number, location and ownership of pharmacies, and non-prescription medicines can be sold in a variety of retail outlets and online.
The presence of state-owned enterprises is high across the whole economy.
Regulations in the e-communications sector are in line with international best practices, but public ownership is high both in the fixed and in the mobile segments. Similarly, the electricity sector, despite having a relatively competition-friendly set of regulations, is characterised by public ownership of major players in retail supply and generation.
While the regulatory framework of most professions is very competition-friendly, estate agents face more barriers to competition than in many other OECD countries, especially in terms of entry regulation.
Further information
“What are the 2018 OECD PMR indicators?” PowerPoint presentation on OECD PMR website
Vitale, C., et al. (2020), " The 2018 Edition of the OECD PMR Indicators and Database – Methodological Improvements and Policy Insights", OECD Economics Department Working Papers
Please visit our website : http://oe.cd/pmr Contact us at: PMR2018@oecd.org