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The European Arbitration Review 2018


Compared to many other countries, commercial disputes in Sweden are to a large extent settled through arbitration, in domestic as well as international cases. Historical tradition, a well-renowned arbitration institute and modern legislation on arbitration are a few of the many reasons for Sweden’s strong position as a venue for international arbitration.

Domestic and international arbitrations in Sweden are conducted either as ad hoc arbitrations or institutional arbitrations under specific rules such as the Arbitration Rules of the Arbitration Institute of the Stockholm Chamber of Commerce (SCC) or the Rules of Arbitration of the International Chamber of Commerce (ICC). The rules of the SCC are the most commonly used in Sweden. Under an ad hoc arbitration, procedure is governed solely by the Swedish Arbitration Act of 1999 unless the parties agree on another set of rules.

Compared to ad hoc arbitration, institutional arbitration gives higher cost predictability and control, supervision in respect of the time limits of the arbitration, independent control of conflicts of interests and procedural rules that may be of practical importance. Among the disadvantages that could be seen in institutional arbitration are the administrative fees to the institution, and also that the parties have less influence on the appointment of the chairman unless otherwise agreed.

Sweden is not a Model Law country, but the Swedish Arbitration Act generally follows the UNCITRAL Model Law and is seen as very modern and efficient legislation. Sweden has long since acceded the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, and the Swedish court system provides for efficient procedures in connection with the enforcement of foreign arbitration awards in Sweden.

The court system in Sweden is also ‘arbitration friendly’. The courts will, for instance, be ready to hear challenges to awards rendered in international arbitrations with no Swedish party involved as long as the arbitration had its legal seat in Sweden. Hence, there is no need for any Swedish party to be involved or for the actual hearing to take place in Sweden.

Sweden is regarded as a civil law jurisdiction, although Swedish court procedure in some respects shows similarities with the common law tradition. Among other things, the procedure is non-inquisitorial, and a Swedish arbitrator is likely to consider court precedents and arbitration awards as an important source of law along with the applicable legislation. However, the possibility of discovery is more limited than in common law jurisdictions.

In Sweden, the principle of ‘party autonomy’ has a strong foothold, and arbitrators decide the case on the basis of the rules of law, the pleadings submitted by the parties and the written and oral evidence presented. Hence, unless the arbitrators have been expressly given such mandate, the principle of ex aequo et bono or similar principles based on equitability will not be applied.

The Swedish Arbitration Act does not give powers to arbitrators to administer oath for witnesses, and testimony is thus not given under penalty of perjury. Swedish courts, however, provide assistance in hearing witnesses under oath upon request of a party and in making sanctioned orders for the production of documents (provided that the arbitral tribunal grants a party leave to apply to the court for such orders). Application for interim measures may also be made to the courts.

Institutional arbitration in Sweden: the SCC Institute’s role

As already mentioned, the Arbitration Institute of the Stockholm Chamber of Commerce (the SCC Institute) maintains a strong position as one of the world’s leading centres for international arbitration. Sweden gained its strong position as a ‘neutral venue’ for East-West disputes during the Cold War, and SCC arbitration has remained especially popular for disputes involving American, Russian (and the other states in the Commonwealth of Independent States (CIS)) and Chinese parties. The legal community in Stockholm includes arbitrators of which several are fluent in Russian, and the board of the Arbitration Institute includes American, Russian and Chinese nationals. For instance, many of the disputes concerning delivery of natural gas from Russia and other CIS states are adjudicated by arbitration in Sweden.

Due to the international focus, you will also find a large number of arbitrators and counsel experienced in international arbitrations. Since many of the international arbitrations decided in Sweden concern contracts not governed by Swedish law, Swedish counsel also have excellent experience in acting as local counsel.

The SCC Institute was first established in 1917 and has a modern set of arbitration rules (the SCC Rules); the current revision took effect on 1 January 2017. The SCC Rules contain provisions governing the appointment of arbitrators, consolidation, evidence, interim measures and separate awards for advance on costs and all other relevant aspects of arbitration proceedings. The SCC Rules also offer a lot of flexibility for the parties to agree or the arbitral tribunal to decide on how the proceedings are to be conducted once the case has been referred to the arbitral tribunal.

Emergency arbitrator

With the previous version of the SCC Rules (which took effect on 1 January 2010) the possibility of appointing an ‘emergency arbitrator’ was introduced. The rules have worked well and a number of applications have been made since then. As far as we are aware, an emergency arbitrator has been appointed in all cases within the given time limit of 24 hours.

The rules aim to provide parties with the possibility of obtaining interim measures prior to the constitution of the arbitral tribunal. These rules will thus allow for the establishment of security over assets and the preservation of documents also prior to when the case is handed over to the arbitral tribunal.

The emergency arbitrator rules are ‘opt-out’ rules, which means that they apply to all SCC arbitrations unless the parties expressly agree otherwise in their arbitration agreement.

Emergency interim measures may be requested before the case is referred to the tribunal (and thus both prior to and after the commencement of arbitration). It is not possible to receive an ex parte decision or award from the emergency arbitrator since the rules require that notice is given to the opposing party. The rules are not intended to and do not prevent a party from seeking the assistance of the local courts in Sweden or elsewhere to request interim measures; rather, they are intended to add another tool for parties in international proceedings.

The SCC Rules require that a request for emergency interim relief be reasoned. The duty to notify the opposing party lies with the Secretariat of the SCC Institute and not with the party. The board of the SCC Institute shall appoint an emergency arbitrator within 24 hours of receipt of the application.

Although there is an inherent urgency in interim procedures, the rules are clear in that each party shall be given an equal and reasonable opportunity to present its case. A decision on the application shall be made no later than five days from the referral of the case to the emergency arbitrator. The five-day time limit may be extended by the board upon a reasoned request from the emergency arbitrator or if it is otherwise deemed necessary; for example, if the defendant has not been served or the notification has taken a long time. The decision rendered by the emergency arbitrator may take the form of an order or an award.

The mandate of the emergency arbitrator ends when the case is referred to the arbitral tribunal. Until then, the emergency arbitrator may amend or revoke its decision upon request by a party. An emergency decision ceases to be binding if arbitration is not commenced within 30 days from the date of the emergency decision, or if the case is not referred to an arbitral tribunal, within 90 days. The SCC Rules provide that an arbitral tribunal is not bound by the decision of the emergency arbitrator and that an emergency arbitrator may not act as an arbitrator in the following ordinary arbitration proceedings related to the same dispute unless the parties agree otherwise.

The role of the SCC in arbitrations

The board of the SCC Institute also acts as appointing authority, takes prima facie decisions on the existence of a valid and applicable arbitration agreement, decides on advance on costs and on the extension of time limits for rendering the award. Unlike the International Court of Arbitration of the ICC, the SCC Institute functions solely as an administrative body and is not a court of arbitration. Thus, the procedure does not include any rules for scrutiny of awards by the SCC Institute, and once the matter has been referred to the arbitral tribunal the SCC Institute has very little involvement in the proceedings. The SCC Rules do not contain any requirements for terms of reference to be produced.


Although the Swedish Arbitration Act does not provide any time limits for the arbitration, it requires arbitrators to decide cases in a ‘practical and speedy’ manner. In this respect, the SCC Rules provides for a six-month time limit for rendering the award. For more complex cases this time limit is usually extended, but statistics from the SCC Institute show that an award is rendered in 80 per cent of all cases within 18 months from when the case is registered with the SCC, with almost 60 per cent being decided within 12 months. A speedy resolution is often cited as one of the main advantages of arbitration and this statistic shows that this is true for arbitrations under the SCC Rules.

Arbitration in Sweden


According to the Swedish Arbitration Act, any matter on which the parties may reach a settlement is considered arbitrable. This includes the effects of competition law as between the parties. The arbitration agreement may be concluded prior to when the dispute arises or thereafter. It must, however, be related to a specific legal relationship between the parties (and thus cannot, for instance, cover ‘all future disputes’ between two parties). A request for relief may include performance claims and declaratory relief, as well as the establishment of facts, contract interpretation and gap-filling.

Appointment of arbitrators

Under the Swedish Arbitration Act, the default rule is that the tribunal shall be composed of three arbitrators, where each party appoints one arbitrator and the appointed arbitrators then appoint the chair. In case of failing appointments, a Swedish district court may act as appointing authority. Arbitration agreements may, however, designate the SCC Institute or some other body as appointing authority.

As regards SCC arbitrations, the SCC Institute shall, unless the parties have agreed otherwise, determine the number of arbitrators (one or three) – taking into account the complexity of the case, the amount in dispute and other circumstances. The chair in SCC arbitrations is appointed by the SCC Institute unless otherwise agreed by the parties. There is no official or binding list of arbitrators. Also, there are no restrictions as to the nationality of arbitrators. Consequently, arbitrators from many jurisdictions appear frequently in arbitrations under the SCC Rules in Sweden.

Challenge of arbitrators

If issues regarding the independence or impartiality of an arbitrator appear in connection with the appointment of the arbitral tribunal or during the course of arbitration, the arbitrator has a duty to disclose any such circumstances. Grounds for challenge include, among other things, contacts between the arbitrator or their law firm and one of the parties, or if the arbitrator has delivered an expert opinion in a parallel case involving one of the parties. A non-exhaustive list of grounds for challenge is included in the Swedish Arbitration Act. In addition, it is worth mentioning that the Swedish Supreme Court has in recent case law referred to the IBA Guidelines on Conflicts of Interest in International Arbitration when deciding cases where an arbitrator’s impartiality or independence has been in question. By referring to these guidelines Sweden’s highest court has sent a clear signal that an international outlook is of importance.

In ad hoc arbitrations, challenges are determined by the arbitral tribunal itself unless the parties have agreed or agree otherwise. In case of unsuccessful challenge, the arbitral tribunal’s decision can be appealed to the district court within 30 days. In SCC arbitrations, challenges are determined by the board of the SCC Institute, the decision of which decision is final and binding.

Multiparty disputes or multiple proceedings and their consolidation

In respect of disputes concerning multiple claimants or respondents, or where the dispute relates to several arbitration agreements, the Swedish Arbitration Act does not contain any specific rules for consolidation. If such problems can be foreseen, it should preferably be taken into account in the arbitration clause. The parties may, however, agree on a solution once the dispute has arisen.

The SCC Rules include rules on the joint appointment of arbitrators and provide for the possibility of consolidation of proceedings upon consultation with the parties and the arbitral tribunal. This rule applies in disputes relating to the same legal relationship between the same parties (ie, in connection with closely connected or associated contracts). There may thus also be a need in SCC arbitrations to address such issues in the arbitration agreement.

Procedure and evidence

Evidence, oral and written, is usually summarised in a ‘statement of evidence’, which is submitted in connection with the pleadings of the parties. Written witness statements are the most common choice in international arbitrations conducted in Sweden. Where such written statements are used, normally only a short examination in chief (if any) is conducted, followed by a more lengthy cross-examination.


Although arbitration proceedings are generally treated as confidential, the Swedish Supreme Court has ruled that there is no express or implied obligation of confidentiality of the parties under Swedish law. It is therefore advisable to consider expressly providing for a duty of confidentiality concerning the arbitration proceedings either in the arbitration clause or in the contract. As regards the SCC Institute, the SCC Rules impose a confidentiality obligation on the SCC Institute itself and the arbitral tribunal but not on the parties.


Swedish lawyers normally bill on an hourly basis. Bar rules and the Swedish Arbitration Act provide that fees must be reasonable. Fees entirely agreed on a contingency basis are not permitted under the Bar rules, although the fees may vary depending on the outcome if agreed. Generally speaking, Swedish hourly rates are in line with or competitive, compared to many other European jurisdictions. The overall cost of arbitration depends upon the size and complexity of a dispute, and will of course vary considerably depending on the case.

Swedish law follows the principle of ‘costs follow the event’, and the losing party is thus generally liable to pay the winning party’s costs as well as the fees and costs of the tribunal and fees to any institution, if applicable. Where both parties win and lose on certain points, the costs are commonly apportioned between them.

Challenge of awards

According to the Swedish Arbitration Act as well as the SCC Rules, the tribunal may correct obvious errors in the award and may also, within certain time limits, supplement the award on request of a party in case the tribunal, due to an oversight, has neglected to determine some issue. Beyond this scope, an award is final and binding, and cannot be appealed under Swedish law. Once rendered, an award may be challenged only on the basis of certain procedural irregularities, in which case the award can be declared invalid or be set aside in part or in its entirety. For arbitrations with legal seat in Sweden where none of the parties is a Swedish entity, the parties may validly contract out such right to challenge the award.

An award is invalid if it rules on a matter that is non-arbitrable, if the award violates public policy or if it is not properly signed by arbitrators.

A challenge action to set aside the award may be granted if:

  • the issue decided was not covered by a valid arbitration clause;
  • the award was rendered after the expiration of the time limit for the arbitration (if such applied); or
  • the arbitrators have otherwise exceeded their mandate.

A challenge action can also be successful if:

  • the proceedings should not have been conducted in Sweden;
  • the procedure for appointing the arbitrators was not in accordance with the applicable provisions;
  • an arbitrator was unable to act due to legal incapacity or he was not independent or impartial; or
  • an irregularity occurred during the course of the proceedings which probably influenced the outcome of the matter and where the party changing the award has not been at fault in this respect.

It is quite uncommon for challenges to be brought, and it is rare that challenges are successful. In the past 10 years approximately 200 arbitral awards have been challenged. No statistics exist for the total number of arbitrations during the same period but the SCC alone administers approximately 200 cases per year, which would seem to suggest that less than 10 per cent of awards are challenged. Out of the 200 challenges approximately 10 have been successful, so the success rate in the few cases a challenge actually is brought is approximately 5 per cent.

A challenge must be brought by a party within three months from the date of receipt of the award. Notably, a party challenging an award may not rely on a circumstance which it should have objected to during the proceedings.


The SCC has adopted updated rules with effect from 1 January 2017. The main new features are summarised below. In addition, a committee appointed by the Swedish government to investigate potential improvements to the Swedish Arbitration Act has recently published its report, also summarised below. Although it remains to be seen what amendments will be made to the Swedish Arbitration Act, both the updated SCC rules and the report emphasise the arbitration-friendly approach of the Swedish judicial system as well as the international outlook of it.

Update to the SCC rules

The SCC updated its arbitration rules as well as the rules for expedited arbitration per 1 January 2017. Apart from a general update and some refining, some of the main new features are as follow.

The introduction of summary procedure

The rules introduces a case management tool allowing tribunals to, at the request of a party, decide one or more issues of fact or law by way of summary procedure. The intention with this feature is to allow tribunals to decide allegations deemed unsustainable in a summary manner. A request for a summary procedure may concern jurisdiction, admissibility or the merits, and can be made at any point during the arbitration.

Administrative secretary

The rules codify to some extent the use of administrative secretaries by giving tribunals the possibility to, with party approval, appoint administrative secretaries. The rules also include provisions governing when an administrative secretary can be removed (if justifiable doubts exist as to the secretary’s independence or impartiality).

Investor-state arbitrations

A special annex is introduced which only applies in investor-state arbitrations. These provisions allow non-disputing treaty parties and third persons to apply to the tribunal to be allowed to make a submission. The annex does not alter the SCC’s or the tribunal’s duty of confidentiality.

Multiparty and multi-contract arbitration

The new rules include provisions designed for more efficient resolution of complex disputes. Additional parties may be joined under certain circumstances. In multi-contract disputes the current SCC practice is codified by introducing provisions allowing parties to make claims arising out of more than one contract in a single arbitration as long as the arbitration agreements are compatible. These new provisions will not alter the tribunal’s power to decide on its jurisdiction over parties and claims since the decision by the SCC’s board will be preliminary.

Incentives for speedy resolution

Since a speedy resolution is a key feature of arbitrations both sets of rules have been amended with this in mind. This includes adding a provision expressly requiring the SCC, parties and tribunals ‘to act in an efficient and expeditious manner’ throughout the proceedings. In addition, language aiming at this goal has also been added to the provisions on costs. This includes that the SCC shall consider ‘the extent to which the tribunal acted in an efficient and expeditious manner’ when deciding on arbitrators’ fees. The tribunal shall also consider ‘each party’s contribution to the efficiency and expeditiousness of the arbitration’ when deciding on the apportionment of costs in the final award.

Proposed amendments to the Swedish Arbitration Act

Restrictions on of dual proceedings and challenges to awards

The Committee proposes that it shall no longer be possible to, at any time during the arbitral proceedings, initiate proceedings in the district court and challenge the arbitral tribunal’s jurisdiction and seek a negative declaratory award to that effect. Currently, this is a possibility regardless of whether the arbitral tribunal has ruled on its own jurisdiction or not.

The current model leads to a risk of costly and time- consuming dual proceedings if the arbitral proceedings continue and the award is rendered and then challenged before the court proceedings first initiated have been resolved.

The committee proposes that the arbitral tribunal’s decisions concerning their jurisdiction taken during proceedings may instead be appealed to the Svea Court of Appeal within 30 days of receiving notice of the decision which is in line with the Model Law.

Further, the Committee proposes some measures to clarify and improve the procedure when awards are challenged. These include:

  • that all challenge proceedings should be handled by the Svea Court of Appeal in Stockholm (the court currently handling the vast majority of all challenges);
  • that challenge proceedings should be handled according to the same procedural rules as applied by the court of appeal for appeals related to grave procedural errors in the district court – proceedings under these rules are primarily in writing and would allow a more streamlined procedure than now; however, a hearing should always be held if requested by either party; and
  • that English may be used if the involved parties agree to it (the most significant proposed change) – this would include written submissions being made in English, witnesses being heard in English and written evidence being presented in English. Awards and decisions should be made in Swedish but the court should provide a courtesy translation if so requested.

The Committee also proposed amendments to the rules on when awards may be set aside. As mentioned above very few awards are set aside, but the awards having been set aside in recent years have in most cases been due to the tribunal exceeding their mandate by relying on an argument not made by either party in the award. The Committee proposes a clarification to this rule so that the test of whether the mandate has been exceeded shall be whether the circumstances on which the tribunal relied in the award were introduced into the proceedings in such a way that the opposite party must have understood that it could constitute grounds for the award. This clarified rule is in line with case law.

It is further possible to have an award set aside if, without fault of the party, an irregularity occurred in the course of the proceedings that probably influenced the outcome of the case. In practice, the irregularity must be serious if the award is to be set aside, the Committee proposes that this is expressly included in the relevant provision of the Arbitration Act.

Arbitrators’ powers to order interim measures

The Committee also proposes that the arbitrators shall, if the arbitration agreement grants them that authority, be authorised to render decisions on security (interim) measures during the proceedings in the form of enforceable special awards.

Consolidation of multiple proceedings and multiparty proceedings

The Committee proposes that multiple proceedings between two parties should be possible to consolidate if:

  • both parties consent;
  • the same arbitrators are appointed in all of the arbitral proceedings to be consolidated; and
  • the arbitrators deem it advantageous for the arbitral proceedings.

In addition, the Committee proposes that the district court (or an arbitration institution if the parties have so agreed) should be empowered to appoint all arbitrators in multiparty proceedings if the respondent parties cannot agree on the arbitrator.

Additional resources provided to international users of arbitration in Sweden

Since 2012, the SCC has hosted the Swedish Arbitration Portal, a free online resource available through the SCC’s website (www.sccinstitute.com). The portal provides access to English translations of Swedish court decisions and cases related to domestic and international arbitration. The intention is that the portal shall increase transparency in arbitration by making Swedish case law more accessible to the international community. The portal has been updated regularly as new translations – of old and newer cases – are made available by the contributing authors.