SWEDEN Law and Practice Contributed by: Björn Tude, Daniel Waerme, Caroline Gulliksson Dock and Sandra Aljassani, Gernandt & Danielsson
A valid arbitration agreement bars court proceedings. When parties have agreed to arbitrate, courts will decline jurisdiction over disputes that fall within the arbitration clause’s scope upon request of an object - ing party. Parties must actively invoke their arbitration clauses – courts will not automatically dismiss pro - ceedings without an objection from a party. The Swedish framework balances respect for party autonomy with procedural fairness, requiring parties to actively invoke arbitration rights while protecting against agreements that undermine equitable dis - pute resolution. Courts will refuse enforcement only in limited circumstances. In recognition of the parties’ contractual freedom, courts will uphold an arbitration agreement unless it is contractually void – for exam - ple, if it was produced through duress or fraud. 3.2 Arbitrability Pursuant to Section 1 of the SAA, disputes are gen - erally considered arbitrable if the parties may validly settle them out of court (dispositive disputes). This excludes disputes involving non-dispositive issues, such as proceedings concerning the formation, divi - sion or consolidation of land parcels under property law, as well as family law proceedings determining legal status (including divorce, paternity and adop - tion). Arbitrability is thus determined primarily by sub - stantive law, rather than national procedural law. Within the commercial sphere, the Swedish approach to arbitrability is permissive, with restrictions largely confined to areas implicating overriding public inter - est or the rights of third parties. Illustrative examples include disputes concerning the legal status of indi - viduals or legal entities, bankruptcy declarations, the validity of registered intellectual property rights, and rights in rem (with the exception of those rights in rem that may be disposed of out of court once a dispute has arisen). Matters relating to taxation are likewise regarded as non-arbitrable. Furthermore, certain forms of relief are inherently reserved to state authorities and therefore cannot be granted by an arbitral tribunal. These include: • the imposition of public law penalties; • fines payable to public bodies;
• the appointment of officials; and • comparable forms of state-centred remedies. Consumer disputes are also subject to specific statu - tory limitations. While conflicts between a business entity and a consumer concerning goods, services or other products primarily intended for personal use are, in principle, arbitrable, such disputes may only be referred to arbitration if both parties agree after the dispute has materialised. 3.3 National Courts’ Approach Under Section 48 of the SAA, the law of the seat gov - erns the arbitration agreement. Accordingly, where Sweden is chosen as the seat of arbitration, Swedish law applies to the arbitration agreement, unless the parties have expressly designated another law. This reflects the Swedish approach that the law applicable to the arbitration agreement is determined by the lex arbitri, which differs from, for example, the English approach, where the governing law of the main con - tract (lex contractus) is decisive. Swedish courts consistently respect and enforce arbitration agreements. If proceedings are initiated before a national court despite the existence of such an agreement, the case is generally dismissed upon objection from the opposing party. Only in exceptional circumstances – for example, where the agreement is invalid under general principles of contract law – will a Swedish court refuse to uphold it. Following recent precedents from the Swedish Supreme Court, courts also take a very arbitration-friendly stance regarding the scope of arbitration agreements; it is generally presumed that the parties intended to resolve all dis - putes relating to a particular contract in a single forum, ie, arbitration. In practice, arbitration agreements are almost always enforced in Sweden. The judiciary adopts a support - ive, non-interventionist approach, reflecting Sweden’s long-standing pro-arbitration tradition and its estab - lished role as a leading arbitral seat. 3.4 Validity Under Section 3 of the SAA, the arbitration agreement shall be considered as a separate agreement (the rule of separability). Consequently, if a party claims that a
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