Danish foundations face revised related-party disclosures for 2027

Commercial foundations must apply revised disclosures about transactions with connected parties for financial years beginning on or after 1 January 2027Retsinformation. Law 729 of 1 September 2026 replaces section 70 of årsregnskabslovenRetsinformationRetsinformation and defines the parties covered by reference to the new section 59 a of erhvervsfondslovenRetsinformation.

Where transactions have taken place, the financial statements must explain the relationship between the foundation and the connected parties and provide the information needed to understand its possible effect on the accountsRetsinformation. The minimum information covers the nature and amounts of transactions, the amounts and terms of outstanding balances, and both the year’s impairment of receivables from connected parties and accumulated impairment of existing receivables.

The definition includes management members, their spouses or permanent cohabitants, specified relatives, and companies connected to those people under the statutory tests. It also includes the foundation’s subsidiaries, associates and participating interests. For companies linked to a management member or that member’s spouse or permanent cohabitant, the tests include participation in management and holding at least 5% of votes or ownership interests. Other tests concern being both an owner and employee, or carrying out work for the foundation on the company’s behalf. The owner-and-employee test has an exception for interests acquired through a general employee schemeRetsinformation.

The law separately sets board procedures for reciprocal agreements with management members, their spouses or permanent cohabitants, and companies they control individually or togetherRetsinformation. These agreements must be considered and decided at board meetingsRetsinformation. The board must ensure ordinary market termsRetsinformation; the agreements must be written and attached to the board minutesRetsinformation.

Auditors must immediately notify the foundation authority of breaches of the foundations legislation, rules made under it or the foundation’s statutes when the breach is not immaterial. The law’s general commencement rule is the day after publication in Lovtidende, subject to specified exceptions. The related-party financial-statement changes have their own application date for financial years beginning from 1 January 2027Retsinformation.

The legal basis is Law 729 of 1 September 2026, section 1 amendments to erhvervsfondsloven sections 52, 59 a and 74Retsinformation, section 2’s replacement of årsregnskabsloven section 70, and section 20.