Commercial Arbitration

Last verified on Thursday 2nd April 2020

Commercial Arbitration: Sweden

Fredrik Norburg and Kristina Ljungström

Norburg & Scherp (Stockholm)

Infrastructure

1. Is your state a party to the New York Convention? Are there any noteworthy declarations or reservations?

Sweden

Sweden has signed and ratified the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards without any reservations.

Answer contributed by Fredrik Norburg and Kristina Ljungström

2. Is your state a party to any other bilateral or multilateral treaties regarding the recognition and enforcement of arbitral awards?

Sweden

Sweden is a party to the Energy Charter Treaty (ECT) and the ICSID Convention. There are also bilateral investment treaties in effect between Sweden and about 70 other countries.

Answer contributed by Fredrik Norburg and Kristina Ljungström

3. Is there an arbitration act or equivalent and, if so, is it based on the UNCITRAL Model Law? Does it apply to all arbitral proceedings with their seat in your jurisdiction?

Sweden

Sweden has an Arbitration Act. Several translations, including English, Russian and Chinese, of the Act are available at www.sccinstitute.com.

The Arbitration Act is not based on the UNCITRAL Model Law in form, but have very few material differences from the UNCITRAL Model Law. The Arbitration Act is applicable to both domestic and international arbitrations.

The parties are free to agree on matters that are not governed by mandatory rules in the Arbitration Act, for example, by reference to the rules of an arbitral institution. The institutional rules then modify and supplement the provisions of the Arbitration Act.

Answer contributed by Fredrik Norburg and Kristina Ljungström

4. What arbitration bodies relevant to international arbitration are based within your jurisdiction? Do such bodies also act as appointing authorities?

Sweden

The Arbitration Institute of the Stockholm Chamber of Commerce (SCC) is based in Stockholm, the capital of Sweden. The institute acts as an appointing authority both in relation to arbitrations under its own rules, but also on an ad hoc basis in relation to other arbitral proceedings, for example, arbitrations under the UNCITRAL Rules and the ECT.

Answer contributed by Fredrik Norburg and Kristina Ljungström

5. Can foreign arbitral providers operate in your jurisdiction?

Sweden

Foreign institutions can conduct and manage arbitrations with their seats and/or hearings in Sweden.

Answer contributed by Fredrik Norburg and Kristina Ljungström

6. Is there a specialist arbitration court? Is the judiciary in your jurisdiction generally familiar with, and supportive of, the law and practice of international arbitration?

Sweden

Sweden has no specialised arbitration court, and matters concerning arbitration or arbitration related matters such as challenges can be handled by several different courts. However, the Svea Court of Appeal has a specialised division which handles most of the challenge proceedings concerning international awards made in Sweden. Swedish courts are generally perceived as arbitration-friendly.

Answer contributed by Fredrik Norburg and Kristina Ljungström

Agreement to arbitrate

7. What, if any, requirements must be met if an arbitration agreement is to be valid and enforceable under the law of your jurisdiction? Can an arbitration agreement cover future disputes?

Sweden

An arbitration agreement does not have to be in any specific form. Thus, an oral agreement or implied consent is sufficient for a party to be bound by an arbitration agreement. In practice, most arbitration agreements are in writing.

Unless the parties have agreed otherwise, Swedish substantive law governs the arbitration agreement if the seat is in Sweden. Therefore, the arbitration agreement must generally be valid under Swedish contract law.

Arbitration agreements can cover either an existing dispute or a future dispute that may arise from a specified legal relationship. This requirement for the identification of a legal relationship means that it is not possible to enter into an arbitration agreement that covers all future disputes between two parties. In other words, an arbitration agreement covering disputes relating to unspecified future contracts is not valid.

It should also be noted that section 6 of the Arbitration Act does not allow arbitration agreements concerning future disputes between a business enterprise and a consumer. However, after such a dispute has arisen the parties are free to agree to settle the dispute through arbitration.

Answer contributed by Fredrik Norburg and Kristina Ljungström

8. Are any types of dispute non-arbitrable? If so, which?

Sweden

All matters in respect of which the parties may reach a binding settlement agreement can be referred to arbitration. Non-arbitrable disputes are consequently disputes that concern matters that the parties may not settle through an agreement. For example, criminal charges, taxation disputes and several family law disputes are non-arbitrable. Conversely, almost all commercial disputes are arbitrable.

Answer contributed by Fredrik Norburg and Kristina Ljungström

9. Can a third party be bound by an arbitration clause and, if so, in what circumstances? Can third parties participate in the arbitration process through joinder or a third-party notice?

Sweden

An arbitration agreement is only binding on the parties to the agreement, although a third party may become bound by the arbitration agreement through universal succession or singular succession.

The Arbitration Act has no provisions regarding joinder of third parties, but it is possible for the parties to agree to allow a third party to join the proceedings. A third party cannot be ordered to join the proceedings. It should also be noted that the SCC Rules have provisions regarding joinder of additional parties.

Answer contributed by Fredrik Norburg and Kristina Ljungström

10. Would an arbitral tribunal with its seat in your jurisdiction be able to consolidate separate arbitral proceedings under one or more contracts and, if so, in what circumstances?

Sweden

Consolidation of separate arbitration proceedings is possible. According to section 23 a of the Arbitration Act, consolidation is possible provided that all parties consent, the same arbitrators are appointed in all the proceedings and the arbitrators deem it advantageous for the arbitral proceedings.

According to the SCC Rules, the SCC board may, upon request of a party, consolidate new claims with pending proceedings after consultation with the parties and the tribunal.

Answer contributed by Fredrik Norburg and Kristina Ljungström

11. Is the "group of companies doctrine" recognised in your jurisdiction?

Sweden

The doctrine is not recognised per se, and the possibility to pierce the corporate veil is very limited. If anything, it is more likely that arbitrators and courts would seek to establish that a third party, for example, a parent company, through its conduct has agreed to a new arbitration agreement.

Answer contributed by Fredrik Norburg and Kristina Ljungström

12. Are arbitration clauses considered separable from the main contract?

Sweden

Yes. According to section 3 of the Arbitration Act, the arbitration agreement is deemed to constitute a separate agreement when the validity of the arbitration agreement is determined in conjunction with a determination of the jurisdiction of the tribunal.

Answer contributed by Fredrik Norburg and Kristina Ljungström

13. Is the principle of competence-competence recognised in your jurisdiction? Can a party to an arbitration ask the courts to determine an issue relating to the tribunals jurisdiction and competence?

Sweden

The arbitral tribunal may rule on its own jurisdiction under the principle of competence-competence. However, a competent court has the final say on whether the arbitral tribunal has jurisdiction to decide the dispute. An action in this regard may be brought before a district court before or after the initiation of the arbitral proceedings, irrespective of the tribunal’s decision.

According to the Arbitration Act, a dissatisfied party has 30 days to challenge a positive jurisdictional decision by a tribunal. The challenge is tried by a competent court of appeal. Other than that, it is not possible to bring a separate action before a court regarding the tribunal’s jurisdiction after the initiation of the arbitral proceedings. 

Answer contributed by Fredrik Norburg and Kristina Ljungström

14. Are there particular issues to note when drafting an arbitration clause where your jurisdiction will be the seat of arbitration or the place where enforcement of an award will be sought?

Sweden

Arbitration proceedings in Sweden are private and non-parties are not permitted to attend hearings, unless otherwise agreed. The arbitrators are bound by a duty of confidentiality, but the parties are not, unless this has been agreed.

It can also be noted that in international arbitrations, unless the parties have agreed otherwise, the arbitration agreement is governed by Swedish law if the place of arbitration is Sweden.

Answer contributed by Fredrik Norburg and Kristina Ljungström

15. Is institutional international arbitration more or less common than ad hoc international arbitration? Are the UNCITRAL Rules commonly used in ad hoc international arbitrations in your jurisdiction?

Sweden

There are no records of the number of ad hoc arbitrations conducted in Sweden. However, it is generally assumed that institutional international arbitration is more common than ad hoc international arbitration, and that the ad hoc international arbitrations that do take place are often governed by the UNCITRAL Rules.

Answer contributed by Fredrik Norburg and Kristina Ljungström

16. What, if any, are the particular points to note when drafting a multi-party arbitration agreement with your jurisdiction in mind? In relation to, for example, the appointment of arbitrators.

Sweden

It may be advisable to agree on the appointment of arbitrators, joinder and consolidation. In an arbitration with multiple parties on the respondent side, and where these parties are unable to jointly appoint an arbitrator, the Arbitration Act provides that a district court shall appoint all arbitrators upon request of a party unless the parties have not agreed in the arbitration agreement on how to appoint the arbitrators.

The SCC Rules also have provisions on multi-party arbitrations, including how to appoint arbitrators.

Answer contributed by Fredrik Norburg and Kristina Ljungström

Commencing the arbitration

17. How are arbitral proceedings commenced in your jurisdiction? Are there any key provisions under the arbitration laws of your jurisdiction relating to limitation periods of which the parties should be aware?

Sweden

Unless the parties have agreed otherwise, arbitral proceedings are initiated when a party receives a request for arbitration. A request for arbitration shall be in writing and include an express and unconditional request for arbitration, information about the issue that is covered by the arbitration agreement and that is to be resolved, and the claimant’s choice of arbitrator (if the claimant shall appoint one).

There are no provisions in the Arbitration Act on time limits relating to when arbitral proceedings must be commenced. It is noted in section 45 of the Act that when an action must be brought within a certain time period according to law or agreement, and the action is covered by an arbitration agreement, a request for arbitration must be made within that period. The general limitation period under Swedish substantive law is 10 years, but there are several exceptions to this rule.

Answer contributed by Fredrik Norburg and Kristina Ljungström

Choice of law

18. How is the substantive law of the dispute determined? Where the substantive law is unclear, how will a tribunal determine what it should be?

Sweden

The tribunal is bound by the parties’ choice of law, and in the absence of such agreement the tribunal decides on the applicable substantive law. This has been the established principle in Sweden, and a new provision codifying this principle was added to the Arbitration Act in 2019. The provision leaves a wide discretion to the tribunal on how to decide on applicable law. A similar provision is found in the SCC Rules.

Answer contributed by Fredrik Norburg and Kristina Ljungström

Appointing the tribunal

19. Does the law of your jurisdiction place any limitations in respect of a partys choice of arbitrator?

Sweden

Unless otherwise agreed, a party has 30 days to choose an arbitrator after having been informed of the other party’s choice. If a party fails to appoint an arbitrator in time, the district court can appoint an arbitrator in the party’s stead after an application by its counterparty. All arbitrators must be in their full legal capacity and must be independent and impartial towards the parties and the dispute. 

A party that does not appoint an arbitrator in time also waives its right to invoke the arbitration agreement as a bar towards a litigation initiated by the other party.

Answer contributed by Fredrik Norburg and Kristina Ljungström

20. Can non-nationals act as arbitrators where the seat is in your jurisdiction or hearings are held there? Is this subject to any immigration or other requirements?

Sweden

The Arbitration Act contains no limitations regarding nationality. Except for limitations on entering Sweden, such as a visa in certain situations for non-EU nationals, the Swedish law includes no further requirements.

Answer contributed by Fredrik Norburg and Kristina Ljungström

21. How are arbitrators appointed where no nomination is made by a party or parties or the selection mechanism fails for any reason? Do the courts have any role to play?

Sweden

Unless the parties have otherwise agreed, the local district court can appoint an arbitrator in the party’s or arbitrators’ stead if a party fails to choose an arbitrator, or if the party appointed arbitrators fail to appoint a third arbitrator.

Under the SCC rules the SCC Board will appoint an arbitrator if a party does not. When doing so, the SCC Board shall consider the nature and circumstances of the dispute, the applicable law, the seat and language of the arbitration and the nationality of the parties.

Answer contributed by Fredrik Norburg and Kristina Ljungström

22. Are arbitrators afforded immunity from suit under the law of your jurisdiction and, if so, in what terms?

Sweden

Arbitrators are not immune to suits and can be sued to reimburse their fees, if they have not acted with a reasonable care or skill, or if they have decided on a too high fee. Arbitrators can also, for example, be sued for damage that they have caused through neglect or intent while performing their duties, and may be called to give testimony in challenge proceedings before courts.

Answer contributed by Fredrik Norburg and Kristina Ljungström

23. Can arbitrators secure payment of their fees in your jurisdiction? Are there fundholding services provided by relevant institutions?

Sweden

Under the Arbitration Act, arbitrators are entitled to demand security for their fees and costs. A party that fails to provide such a security waives its right to invoke the arbitration agreement as a bar against litigation proceedings. However, its counterparty may fulfil the party’s duties and proceed with the arbitration. Otherwise, the arbitral tribunal is entitled to close the arbitration proceedings, wholly or partially. However, the arbitral tribunal may not withhold the award pending the payment of fees.

Under the SCC Rules, the SCC Board shall determine an amount to be paid by the parties as an advance on costs. This amount shall correspond to the estimated cost of the arbitration, as calculated according to the SCC Rules. Generally, each party shall pay half of this advance. If one party does not pay its share, the other party is given the opportunity to do so. If the other party makes the payment, the tribunal may render a separate award for reimbursement, at the request of that party. If the payment is not made, the SCC Board can dismiss the case in whole or partially.

Answer contributed by Fredrik Norburg and Kristina Ljungström

Challenges to arbitrators

24. On what grounds may a party challenge an arbitrator? How are challenges dealt with in the courts or (as applicable) the main arbitration institutions in your jurisdiction? Will the IBA Guidelines on Conflicts of Interest in International Arbitration generally be taken into account?

Sweden

A party may challenge an arbitrator if there are any circumstances which may unsettle the parties’ trust in the arbitrator’s impartiality or independence. Such a circumstance is always deemed to exist if: (i) the arbitrator or a person closely associated to him is a party, or otherwise may expect benefit or detriment worth attention, as a result of the outcome of the dispute; (ii) the arbitrator or a person closely associated to him is the director of a company or any other association which is a party, or otherwise represents a party or any other person who may expect benefit or detriment worth attention as a result of the outcome of the dispute; (iii) the arbitrator has taken a position in the dispute, as an expert or otherwise, or has assisted a party in the preparation or conduct of his case in the dispute; (iv) the arbitrator has received or demanded compensation in violation of the regulations in the Arbitration Act.  

Such a challenge is initially adjudicated by the arbitrators, if the parties have not agreed otherwise. 

A decision denying a motion can be retried by the district court after an application by the party. The arbitrators may continue with the arbitral proceedings pending the determination of the district court.

Instead of the above process, the parties may agree that a challenge shall conclusively be determined by an arbitration institution.

A party may also challenge an arbitrator if the arbitrator has delayed the proceedings. As a default rule, such a challenge will be determined by the district court. Where an arbitrator has delayed the proceedings, the district court shall, upon request by a party, remove that arbitrator and appoint a replacement arbitrator. However, the parties may decide that such a challenge shall be conclusively determined by an arbitration institution instead.  

The IBA Guidelines on Conflicts of Interest in International Arbitrations are generally taken into account while examining these issues.

Answer contributed by Fredrik Norburg and Kristina Ljungström

Interim relief

25. What main types of interim relief are available in respect of international arbitration and from whom (the tribunal or the courts)? Are anti-suit injunctions available where proceedings are brought elsewhere in breach of an arbitration agreement?

Sweden

Unless the parties have agreed otherwise, both courts and tribunals may order interim measures. Orders from a court are enforceable in Sweden, but an order from an arbitral tribunal is not. Tribunals have wide discretion to grant such orders, including for example prohibitive measures to restrain a party from carrying out certain action, positive measures that require a party to take certain action and measures aimed at ensuring the future enforcement of the award. Essentially the Arbitration Act allows arbitral tribunals to grant the same kinds of interim measures as the UNCITRAL Model Law.

Both courts and tribunals normally require that the requesting party provides reasonable security for losses that may be suffered by the other party because of the interim measure.

Under the SCC Rules, a request for interim relief may even be granted prior to the constitution of a tribunal, by an emergency arbitrator appointed by the SCC Board.

Anti-suit injunctions do not exist under Swedish law. Thus, Swedish courts will not issue such injunctions.

Answer contributed by Fredrik Norburg and Kristina Ljungström

26. Does the law of your jurisdiction allow a court or tribunal to order a party to provide security for costs?

Sweden

Normally, it is not possible for a tribunal or a court to order a party to provide security for costs in arbitral proceedings, except for fees to the tribunal, see question 23. However, it should be noted that when the claimant is from certain countries outside the European Union, a court may, at the request of the respondent, order such claimant to provide security for litigation costs.

Also, under the SCC Rules, a tribunal may, in exceptional circumstances, order a party to provide security for costs.

Answer contributed by Fredrik Norburg and Kristina Ljungström

Procedure

27. Are there any mandatory rules in your jurisdiction that govern the conduct of the arbitration (eg, general duties of the tribunal and/or the parties)?

Sweden

The general principle of party autonomy is respected under Swedish law, and an arbitration in Sweden can be arranged to fit the parties’ needs and wishes. The Arbitration Act contains only a few mandatory rules concerning the conduct of the arbitration procedure, and those provisions exist to protect the principles of equal treatment and due process. For example, the parties shall be given the opportunity to present their respective cases in writing or orally, and the tribunal may not deny a request for an oral hearing (however the parties may have agreed to exclude this right). The parties shall also be given the opportunity to review all documents and other materials pertaining to the dispute which are supplied to the arbitrators. Also, the parties cannot agree to exclude the provisions on invalidity of an award. Neither can the parties agree to give the arbitrators powers that are exclusively reserved for the courts, for example, examining a witness under oath. 

Answer contributed by Fredrik Norburg and Kristina Ljungström

28. What is the applicable law (and prevailing practice) where a respondent fails to participate in an arbitration?

Sweden

According to section 24 of the Arbitration Act, such failure shall not prevent the continuation of the proceedings, and the dispute shall be resolved based on the existing material. Thus, failure to participate shall not be considered as an admission to anything by that party, although it could be given evidentiary weight.

Answer contributed by Fredrik Norburg and Kristina Ljungström

29. What types of evidence are usually admitted, and how is evidence usually taken? Will the IBA Rules on the Taking of Evidence in International Arbitration generally be taken into account?

Sweden

The parties are free to agree on rules of evidence. In the absence of such agreement, the general rule is that arbitration is adversarial, and that it is for the parties to invoke and present the evidence they wish to rely on. The parties are free to present any and all evidence, in whatever form, that they wish to rely on. The arbitrators may only refuse evidence that is manifestly irrelevant, or if refusal is justified with regard to the time at which the evidence is submitted. If the parties have not agreed that the IBA Rules on the Taking of Evidence in International Commercial Arbitration should apply, they nonetheless commonly serve as guidelines in international arbitration. Currently, the Prague Rules do not have the same standing.

Answer contributed by Fredrik Norburg and Kristina Ljungström

30. Will the courts in your jurisdiction play any role in the obtaining of evidence?

Sweden

Under Swedish law, arbitrators cannot administer oaths. If a party would like to examine a witness under oath the party may, with the consent of the tribunal, file a request with a district court, and court assistance can then be obtained. As for document production, see answer to question 31.

Answer contributed by Fredrik Norburg and Kristina Ljungström

31. What is the relevant law and prevailing practice relating to document production in international arbitration in your jurisdiction?

Sweden

The tribunal may, upon request of a party, order the other party to produce evidence, including documents. The parties may agree on the procedure for the production of documents. In the absence of such agreement, the arbitrators may decide on these issues at their discretion. In international arbitrations, the IBA Rules on the Taking of Evidence in International Arbitration are commonly taken into account as guidelines.

Production orders by arbitrators are not enforceable in Sweden, but in practice parties usually agree to follow such orders. If a party refuses to provide documents as ordered by the tribunal, the other party may, with the approval of the arbitrators, file a document request with a district court. The court may then order production of the documents, provided that the documents are sufficiently identified and that it can be assumed that they may be of evidentiary value. Production orders issued by courts are enforceable.

Answer contributed by Fredrik Norburg and Kristina Ljungström

32. Is it mandatory to have a final hearing on the merits?

Sweden

According to section 24 of the Arbitration Act, the arbitrators shall give the parties the opportunity to present their respective cases to the extent necessary, and if a party so requests, at least one hearing shall be held, unless otherwise agreed.

Answer contributed by Fredrik Norburg and Kristina Ljungström

33. If your jurisdiction is selected as the seat of arbitration, may hearings and procedural meetings be conducted elsewhere?

Sweden

If the parties have not agreed on these matters, the arbitrators decide where hearings and meetings take place. This can be elsewhere in Sweden or abroad.

Answer contributed by Fredrik Norburg and Kristina Ljungström

Award

34. Can the tribunal decide by majority?

Sweden

The tribunal decides by majority, unless the parties have agreed otherwise. If no majority is attained for any opinion, the opinion of the chairman prevails, according to section 30 of the Arbitration Act.

Answer contributed by Fredrik Norburg and Kristina Ljungström

35. Are there any particular types of remedies or relief that an arbitral tribunal may not grant?

Sweden

An arbitral tribunal may generally grant the same types of remedies and relief that are available to a court. However, arbitral tribunals cannot order fines that are not based on contract.   

Answer contributed by Fredrik Norburg and Kristina Ljungström

36. Are dissenting opinions permitted under the law of your jurisdiction? If so, are they common in practice?

Sweden

Dissenting opinions are permitted, but they are relatively rare.

Answer contributed by Fredrik Norburg and Kristina Ljungström

37. What, if any, are the legal and formal requirements for a valid and enforceable award?

Sweden

The award must be in writing and signed by the arbitrators. If all arbitrators cannot sign the award, it is sufficient if a majority of the arbitrators signs it. The reason why all the arbitrators have not signed the award must then be noted in the award. 

The award should also state the date of the award and the seat of the arbitration, but the award is valid and enforceable without this information.

Answer contributed by Fredrik Norburg and Kristina Ljungström

38. What time limits, if any, should parties be aware of in respect of an award? In particular, do any time limits govern the interpretation and correction of an award?

Sweden

There are no specific provisions on time limits of an award in the Arbitration Act, although section 21 states that disputes shall be handled in a speedy manner. However, the parties are free to agree on a time limit for the rendering of an award in the arbitration agreement or otherwise. 

Under the SCC Rules a final award shall be rendered within six months from the date the dispute was referred to the tribunal. The SCC Board may extend this time if deemed necessary.

If the award contains an obvious inaccuracy in the form of a typographical error, miscalculation or similar mistake, or if the tribunal by oversight has failed to decide an issue which should have been dealt with in the award, the arbitrators may, within 30 days of the announcement of the award, decide to correct or supplement the award.

The arbitrators may also correct or supplement the award, or interpret the decision in an award, if any of the parties so requests within 30 days of receipt of the award. Such correction or interpretation shall be made within 30 days from receipt by the arbitrators of the request. If the arbitrators have decided to supplement the award, the supplementation shall be made within 60 days.

After having received an award a party has two months to challenge the award. This time period shall be calculated from the receipt of the final, corrected or supplemented award, if the tribunal has issued any such amendments. 

Answer contributed by Fredrik Norburg and Kristina Ljungström

Costs and interest

39. Are parties able to recover fees paid and costs incurred? Does the "loser pays" rule generally apply in your jurisdiction?

Sweden

As a general rule, the losing party is ordered to pay both for the costs of the arbitration proceedings and the reasonable legal fees and other costs incurred by its counterparty as a result of the dispute. However, the parties are severally and jointly liable to pay the compensation to the tribunal and the arbitral institution. Depending on the degree of success in a claim, the costs, both those incurred by the winning party and the costs for the tribunal, can be allocated between the parties according to the tribunal’s discretion. An allocation of costs which is proportional to the claimant’s success is common.

Answer contributed by Fredrik Norburg and Kristina Ljungström

40. Can interest be included on the principal claim and costs? Is there any mandatory or customary rate?

Sweden

Parties are entitled to claim interest on their principal claim and costs. The Swedish Interest Act is not mandatory, and the parties are free to agree on an interest rate. According to the main rule under the Interest Act the interest rate is equivalent to the reference rate as determined by the Central Bank of Sweden, plus eight percentage points.

Answer contributed by Fredrik Norburg and Kristina Ljungström

Challenging awards

41. Are there any grounds on which an award may be appealed before the courts of your jurisdiction?

Sweden

The Arbitration Act does not recognise any grounds for the appeal of an award on the merits. However, the parties are entitled to agree on a right to appeal the award to either a secondary arbitration tribunal, or a Swedish district court.

Answer contributed by Fredrik Norburg and Kristina Ljungström

42. Are there any other bases on which an award may be challenged, and if so what?

Sweden

An award can be challenged under two separate articles of the Arbitration Act, sections 33 and 34.

Section 34 includes grounds for the setting aside of the award due to certain grounds, namely: (i) if the award is not covered by a valid arbitration agreement; (ii) if the arbitrators delivered the award after the expiration of the time limit agreed on by the parties; (iii) if the arbitrators otherwise exceeded their mandate in a way that probably influenced the outcome; (iv) if the arbitral proceedings should not have taken place in Sweden; (v) if an arbitrator has not been duly appointed; (vi) if an arbitrator was not impartial, independent or if the arbitrator was otherwise unauthorised; or (vii) if, without fault of the challenging party, a procedural irregularity occurred which probably influenced the outcome. As a result of the challenge, the award can be set aside partially or wholly.

Section 33 includes grounds for an award to be declared invalid in whole or in part. The grounds are namely: (i) that the award includes determination of an issue that is non-arbitrable under Swedish law, (ii) the award, or the manner in which the award was made, is clearly incompatible with Swedish public policy, or (iii) the award is not in writing or has not been signed in the required manner.

Moreover, under section 36 of the Arbitration Act, an award whereby the arbitrators concluded the proceedings without ruling on the issues submitted to them (eg, for lack of jurisdiction) may be amended, in whole or in part, upon the application of a party. An action must be filed with a court of appeal within two months from the receipt of the award.

Answer contributed by Fredrik Norburg and Kristina Ljungström

43. Is it open to the parties to exclude by agreement any right of appeal or other recourse that the law of your jurisdiction may provide?

Sweden

In general, the parties cannot in advance agree to limit the right to challenge an award in accordance with the Arbitration Act. However, such waivers can be made a posteriori. Moreover, in commercial arbitration involving only parties outside of Sweden, the parties may limit or bar the grounds for setting aside an award in section 34 of the Swedish Arbitration Act (see question 42). Such an agreement must be express and made in writing.

Answer contributed by Fredrik Norburg and Kristina Ljungström

Enforcement in your jurisdiction

44. Will an award that has been set aside by the courts in the seat of arbitration be enforced in your jurisdiction?

Sweden

In accordance with section 54 of the Arbitration Act an award that has been set aside by a competent authority in the country in which, or under the law of which, the award was made will in principle not be enforced in Sweden.

Answer contributed by Fredrik Norburg and Kristina Ljungström

45. What trends, if any, are suggested by recent enforcement decisions? What is the prevailing approach of the courts in this regard?

Sweden

Swedish courts generally have an enforcement friendly attitude, which combined with the limited grounds for refusal of enforcement in the Arbitration Act has resulted in a prevailing approach towards the enforcement of foreign awards. Awards rendered in Sweden are recognised and enforced in the same way as national court judgments.

Answer contributed by Fredrik Norburg and Kristina Ljungström

46. To what extent might a state or state entity successfully raise a defence of state or sovereign immunity at the enforcement stage?

Sweden

A state can, in principle, only raise a defence of state or sovereign immunity towards enforcement against a property that is used primarily for state purposes. Conversely, enforcement against state property is acceptable if the property is used, or intended to be used, primarily for commercial purposes. 

Answer contributed by Fredrik Norburg and Kristina Ljungström

Further considerations

47. To what extent are arbitral proceedings in your jurisdiction confidential?

Sweden

Unless otherwise agreed, the parties do not have a duty of confidentiality, but the arbitral proceedings are private. The arbitrators have a duty of confidentiality which can only be lifted through the acceptance of both parties.

Answer contributed by Fredrik Norburg and Kristina Ljungström

48. What is the position relating to evidence produced and pleadings filed in the arbitration? Are these confidential? Is there any way that they might be relied on in other proceedings (whether arbitral or court proceedings)?

Sweden

Information disclosed in an arbitral proceeding can as a rule be referred to or relied upon in subsequent proceedings, irrespective of if they are arbitral or court proceedings. This does not overrule legal protection, such as for trade secrets. The parties are also free to agree on the issue of confidentiality with a binding legal effect.

Answer contributed by Fredrik Norburg and Kristina Ljungström

49. What ethical codes and other professional standards, if any, apply to counsel and arbitrators conducting proceedings in your jurisdiction?

Sweden

Sections 7 and 8 of the Arbitration Act list the requirements for arbitrators, the most relevant of which is each arbitrators’ impartiality and independence. The Swedish Supreme Court has also referred to the IBA Guidelines on Conflict of Interest in International Arbitration in several instances.

The Arbitration Act does not include any requirement for counsel, and the parties are free to choose their own representatives. If members of the Swedish Bar Association act as counsel or arbitrators, they are bound by the Code of Ethics of the Swedish Bar Association.

Answer contributed by Fredrik Norburg and Kristina Ljungström

50. Are there any particular procedural expectations or assumptions of which counsel or arbitrators participating in an international arbitration with its seat in your jurisdiction should be aware?

Sweden

The Swedish legal culture is a mixture of civil law and common law practices which in many respects is similar to generally accepted best practices of international arbitration. Together with the broad party autonomy given by the Arbitration Act this makes Sweden highly suitable for international arbitrations.

It should be noted that challenges of awards will, or might, involve a Swedish procedural perspective on the interpretation of the parties’ positions and pleadings in the arbitration process. This might influence the appellate courts’ interpretation of whether the arbitrators have, for example, exceeded their mandate through the inclusion of other circumstances than those that have been relied upon by the parties. The parties should therefore describe their positions in a reasonably clear manner. The requests for relief should also be precise.

Answer contributed by Fredrik Norburg and Kristina Ljungström

51. Is third-party funding permitted in your jurisdiction? If so, are there any rules governing its use?

Sweden

Third-party funding is permitted in Sweden. There are no specific provisions in the Arbitration Act governing its use. However, as a tribunal should be able to ensure its impartiality and independence, there is an ongoing discussion whether the parties nonetheless should disclose third-party funders.

Answer contributed by Fredrik Norburg and Kristina Ljungström

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