How Do I Get Paid (Methods of Payment)
U.S. exports to Denmark are usually financed by the importer or the importer's bank. Eximbank financing is available but rarely, if ever, used. The most common method of payment for an importer in the early phases of a business relationship is by Irrevocable Letter of Credit opened through a commercial bank. This is a recognized procedure, well-known and acceptable to Danish banks and importers. When a business relationship has reached a stage of mutual trust, payment credits are often extended by the exporter for periods varying from 30-90 days. In some cases, payment by credit card may prove to be the simplest and most effective means of payment. There are no local credit facilities available specifically to finance imports from the United States, or from any other country.
How Does the Banking System Operate
The vast majority of small-to-medium-sized Danish firms are financed by commercial bank lines of credit. The credit line is typically extended on a continuous, revolving basis and is not subject to an annual settlement. Such credit lines are usually established to finance day-to-day operations, including inventory financing. Larger corporations may obtain capital through stock offerings on the Copenhagen Stock Exchange. In some cases, Danish companies also make use of U.S. stock exchanges. Institutional investors, such as pension funds, also play a major role in financing Danish companies, and such investments are usually carried out following individual negotiations. Financing is often a problem for small-to medium-sized companies with high growth, or growth potential. Frequently, such companies choose to or are forced to solve their financing problems by selling out to foreign, including U.S., corporations. During the last decade, the concept of venture capital has also caught on in Denmark and can now be described as an established method of financing. However, venture capital funding applies primarily to IT and biotechnology companies.
Foreign-Exchange Controls
There are no foreign exchange controls in Denmark.
U.S. Banks and Local Correspondent Banks
All major Danish banks have correspondent bank relationships in the United States. Most of them have such relationships with more than one American bank. The two largest Danish banks have branches in New York as listed below:
Danske Bank
299 Park Avenue, 14th floor
New York, NY 10171
Phone (212) 984-8400
Fax (212) 984-9573
www.danskebank.com
Nordea (formerly Unibank)
Merita Bank Plc
New York Branch
437 Madison Avenue
New York, NY 10022
Phone (212) 318-9300
Fax (212) 318-9318
www.nordea.dk
Project Financing
The Danish Government arranges its own financing for infrastructure projects. Private projects are financed through a well-established local capital market. Multilateral institutions which make project finance available include the European Investment Bank and the Nordic Investment Bank.
Web Resources
Export-Import Bank of the United States: http://www.exim.gov
- Country Limitation Schedule: http://www.exim.gov/tools/country/country_limits.html
OPIC: http://www.opic.gov
Trade and Development Agency: http://www.tda.gov/
SBA's Office of International Trade: http://www.sba.gov/oit/
USDA Commodity Credit Corporation: http://www.fsa.usda.gov/ccc/default.htm
U.S. Agency for International Development: http://www.usaid.gov
Danish Commerce and Companies Agency - http://www.eogs.dk/sw285.asp
Danske Bank - www.danskebank.com
Nordea - www.nordea.dk