Denmark: Investing

FDI in Figures

The level of FDI in Denmark is far below the country's potential and tends to stagnate. After having registered a slight increase in 2010, FDI flows have recovered in 2011 but are expected to remain modest in 2012 because of the crisis in the eurozone. The country's strengths include: a highly skilled and multilingual workforce, flexible labor market, ultramodern infrastructure (telecommunications, transport, etc..), tax incentives for businesses.

Foreign Direct Investment	2008	2009	2010
FDI Inward Flow (million USD)	2,717	2,966	-1,814
FDI Stock (million USD)	150,938	152,521	139,205
Performance Index*, Ranking on 141 Economies	125	66	-
Potential Index**, Ranking on 141 Economies	24	-	-
Number of Greenfield Investments***	65	36	-
FDI Inwards (in % of GFCF****)	3.8	8.0	-
FDI Stock (in % of GDP)	44.3	50.9	-

Source: UNCTAD - Last Available Data.

Note: * The UNCTAD Inward FDI Performance Index is Based on a Ratio of the Country's Share in Global FDI Inflows and its Share in Global GDP. ** The UNCTAD Inward FDI Potential Index is Based on 12 Economic and Structural Variables Such as GDP, Foreign Trade, FDI, Infrastructures, Energy Use, R&D, Education, Country Risk. *** Green Field Investments Are a Form of Foreign Direct Investment Where a Parent Company Starts a New Venture in a Foreign Country By Constructing New Operational Facilities From the Ground Up. **** Gross Fixed Capital Formation (GFCF) Measures the Value of Additions to Fixed Assets Purchased By Business, Government and Households Less Disposals of Fixed Assets Sold Off or Scrapped.

FDI Inflows By Countries and Industry

Main Investing Countries	2010, in %
Sweden	26.8
The Netherlands	12.1
UK	8.1
USA	8.0
Luxembourg	7.6
Germany	7.5
Norway	6.8

Main Invested Sectors	2010, in %
Financial services	37.9
Manufacturing	20.6
Trade and transport	16.0
Information and telecommunications	9.2
Business services	4.8
Agricultural, fishing, mining	2.3

Source: National Bank of Denmark - Last Available Data.

Main Foreign Companies: Microsoft IT, IBM IT, Motorola Telecom, Texaco Energy, Merck, Sharp & Dohme Pharmaceuticals, Statoil (Norway); L.M. Ericsson (Sweden); Nordea (Sweden); APV (United Kingdom); Bayer (Germany), and Q8 Oil (Kuwait).
Sources of Statistics: Danish Statistics

Why You Should Choose to Invest in Denmark

Strong Points: This Scandinavian state's main advantages are:
- A skilled and multilingual workforce;
- Political stability;
- A high purchasing power;
- Well developed infrastructures;
- Great flexibility;
- One of the most advanced telecommunication infrastructures in Europe. The country is a world leader in the use of PCs, Internet and Broadband; and
- A relatively low company taxation rate (25%). Aditionally, expatriates can benefit from a special tax regime.
Weak Points: The country's main weak points are:
- A relatively high income tax rate;
- A limited domestic market;
- An economic system that is too dependent on the international situation; and
- A currently damages economy.
Government Measures to Motivate or Restrict FDI: The laws and regulations implemented by the government in recent years are orientated towards more openness and are non-discriminatory. The Danish government has concentrated its efforts on the improvement of general investment conditions and on reducing structural obstacles to market access. Significant progress has been made in privatization, de-monopolization and competitiveness.
In the eyes of the investors, Denmark has the advantage of being strategically geographically situated. It is a natural doorway to Scandinavian countries and the Baltic region.

Protection of Foreign Investment

Bilateral Investment Conventions Signed By Denmark: As of December 2004, Denmark has concluded investment protection agreements with the following 41 countries: Albania, Argentina, Bolivia, Bulgaria, Czech Republic, Chile, China, Croatia, Egypt, Estonia, Ghana, Hong Kong, Hungary, India, Indonesia, Latvia, Lithuania, Malaysia, Mexico, Mongolia, Mozambique, Nicaragua, North Korea, Pakistan, Peru, the Philippines, Poland, Romania, Russia, Slovakia, Slovenia, South Korea, Sri Lanka, South Africa, Tanzania, Tunisia, Turkey, Ukraine, Venezuela, Vietnam, and Zimbabwe.
International Controversies Registered By UNCTAD: There have been no major disputes over investment in Denmark in recent years.
Organizations Offering Their Assistance in Case of Disagreement: ICCWBO , International court of arbitration, International chamber of commerce
ICSID , International Center for settlement of Investment Disputes
Member of the Multilateral Investment Guarantee Agency: Yes

Country Comparison For the Protection of Investors

	Denmark	OECD	United States	Germany
Index of Transaction Transparency*	7.0	6.0	7.0	5.0
Index of Manager’s Responsibility**	5.0	5.2	9.0	5.0
Index of Shareholders’ Power***	7.0	6.8	9.0	5.0
Index of Investor Protection****	6.3	6.0	8.3	5.0

Source: Doing Business - Last Available Data.

Note: *The Greater the Index, the More Transparent the Conditions of Transactions. **The Greater the Index, the More the Manager is Personally Responsible. *** The Greater the Index, the Easier it Will Be For Shareholders to Take Legal Action. **** The Greater the Index, the Higher the Level of Investor Protection.

Procedures Relative to Foreign Investment

Freedom of Establishment: High.
Acquisition of Holdings: A majority holding interest in the capital of a local company is authorized.

Office Real Estate and Land Ownership

The Possibility of Buying Land and Industrial and Commercial Buildings: A foreign or domestic private entity may freely establish, own, and dispose of a business enterprise in Denmark.
Risk of Expropriation: Private property is only expropriated for public purposes, in a non-discriminatory matter, with reasonable compensation, and in accordance with established principles of international law.

Investment Aid

Forms of Aid: Both the Danish Government and the EU provide a number of industrial incentives. The Royal Danish Ministry of Foreign Affairs, through its investment promotion agency Invest in Denmark, provides a comprehensive overview of these investment incentives. It should also be contacted in order to get a complete investor guide.
Free Zones: The only free port in Denmark is the Copenhagen Free Port, which is operated by the Port of Copenhagen. The Port of Copenhagen and the Port of Malmo (Sweden) in 2001 merged their commercial operations, including the free port activities, in a joint company named CMP.

Investment Opportunities

Tenders, Projects and Public Procurement: Licitationen, Tenders & Projects from Denmark
Globaltenders, Tenders & Projects from Denmark
Tenders Info, Tenders in Denmark
DgMarket, Tenders Worldwide

Finding Assistance For Further Information

Investment Aid Agency: Invest in Denmark
Federation of Danish Investment Associations
Other Useful Resources: Danish statistics
Ministry of economic and business affairs
Doing Business Guides: Denmark Commercial Guide 2010 - Buy USA
Country guide only in Spanish (ICEX)

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