GAPP Principle 1
The legal framework for the SWF should be sound and support its effective operation and the achievement of its stated objective(s).
- GAPP 1.1 Subprinciple The legal framework for the SWF should ensure the legal soundness of the SWF and its transactions.
- GAPP 1.2 Subprinciple The key features of the SWF’s legal basis and structure, as well as the legal relationship between the SWF and the other state bodies, should be publicly disclosed.
Status: Implemented
The Norwegian Parliament has established the legal framework for the GPFN in the Government Pension Fund Act. The Act frames the legal basis and governance structure of the Fund. The overall responsibility for managing the Fund is placed with the Ministry of Finance. The operational management of the GPFN is carried out by Folketrygdfondet. Folketrygdfondet is according to the Act on Folketrygdfondet organised as a company of special statute and is wholly owned by the Ministry of Finance. The GPFN does not constitute a separate legal entity and does not have its own executive board or administrative staff but refers to a specific capital deposit placed by the Ministry of Finance with Folketrygdfondet.
The Government Pension Fund Act states that the investment objective shall be the highest possible return at an acceptable level of risk and that within the scope of this objective, the Funds shall be managed responsibly. The Ministry of Finance has pursuant to this Act laid down the mentioned objective and premise, and further regulations on the management of the Fund in a separate management mandate to Folketrygdfondet. In the mandate the Ministry instructs the general investment framework for the Fund and stipulates requirements regarding risk management, reporting and responsible management. Within the limits set by the Ministry, Folketrygdfondet shall seek to generate the highest possible return, net of costs, measured in Norwegian kroner.
Sources: Government Pension Fund Act, Folketrygdfondet Act, GPFN mandate, Ministry of Finance’s website.