Circular 16/25 New Credit Procedures (with clarification added 31 Oct 2025)

The Norwegian Fishermen's Sales Organization for Pelagic Fish's handling of credit risk is an important part of operating the marketplace.

To ensure that credit risk does not influence price formation in the auction, the Norwegian Fishermen's Sales Organization for Pelagic Fish has implemented credit procedures that require security for the buyers outstanding balances. These security requirements and their follow-up are necessary to validate the auction. It is also a key objective that our credit management does not affect market competition.

Changes to the credit procedures are outlined in this circular and are issued pursuant to the organization’s business rules § 17.4 and the Fish Sales Act § 10.

Security

In principle, three types of security are accepted:

1. Credit Insurance
   The Norwegian Fishermen's Sales Organization for Pelagic Fish negotiates an agreement with a credit insurance company, which sets a credit limit per buyer. The buyer is charged a credit insurance premium. There is a deductible that the Norwegian Fishermen's Sales Organization for Pelagic Fish cannot recover in the event of a loss on an insured receivable.

2. Bank Guarantee (Surety guarantee)

3. Cash
   Two variants are accepted:

   • Cash deposit
   • Advance payment
     
     

Under the terms of the credit insurance agreement, there is a provision stating that insurance coverage for new transactions will cease when the oldest outstanding invoice has been overdue for more than a specified number of days (currently 14 days), and debt collection procedures must then be initiated.

This provision will also apply when bank guarantees or cash are used as security.

This will result in a purchase stop.

Credit limit

The credit limit indicates the maximum outstanding amount to the Norwegian Fishermen's Sales Organization for Pelagic Fish. For credit insurance, the credit insurance company sets the credit limit for each buyer. Otherwise, the credit limit consists of the guarantee/cash amount plus any deductible.

Purchasing through Sildelaget

To purchase pelagic fish, the buyer must have a credit limit that covers the purchase. For practical purposes, purchases that exceed the credit limit by up to 2%—with a maximum of NOK 15 million—are accepted. Bids in the auction that exceed this threshold will be rejected with the note “Max credit” in the bid log.

Unposted Payments

This applies to payments made by the buyer that have not yet been verified in the Norwegian Fishermen's Sales Organization for Pelagic Fish’s bank. For such payments to be considered when calculating available credit, the payment must be proven irrevocable or confirmed in writing by the bank in accordance with authorization.

The changes to our credit procedures are being implemented to ensure greater equality and predictability in our transactions.

The new credit procedures will take effect on August 1, 2025.

The changes have been subject to consultation with the relevant parties.

Sincerely,
NORGES SILDESALGSLAG