SWEDEN Trends and Developments Contributed by: Louise Rodebjer, Ólafur Steindórsson, Per Dalemo and Johannes Wårdman, CMS Wistrand
markets in ways that distort competition with private companies. This reform is of particular relevance for M&A in sectors where public and private operators co- exist, such as healthcare, education, waste manage - ment and energy. Buyers conducting due diligence on targets in these sectors will need to consider the new rules and the enhanced enforcement powers pro - posed for the SCA in this area. The proposed legislation is subject to parliamentary approval. The government has submitted the Lagråd - sremiss to the Council on Legislation ( Lagrådet ) for legal review, and if approved by parliament the rules are expected to enter into force on 1 August 2026 – notably ahead of the Swedish general election in Sep - tember 2026. The SCA’s budget has been increased by SEK11 million from 2026 to enable the authority to take on its expanded mandate. Deal advisers would be well-advised to monitor the legislative progress closely, as the new law – if enacted as proposed – would meaningfully raise the competition law risk pro - file of M&A activity in Sweden, in particular for trans - actions in concentrated or regulated sectors. Consequences of the US Tariffs The US tariff announcements of April 2025 had a tan - gible impact on the Swedish M&A market in the first half of the year. Investor confidence fell sharply fol - lowing the announcement, and deal activity slowed as boards and management teams paused to reassess risk. Swedish companies with significant exposure to transatlantic trade – particularly in the automotive, manufacturing and technology hardware sectors – faced heightened scrutiny from potential acquirers. Non-European investors did become more cautious in H1 2025, as tariff risk eroded the near-term prof - itability projections for export-dependent Swedish companies. Domestic and European acquirers, by contrast, were generally less deterred. In some cases, the tariff environment accelerated intra-European con - solidation, as Swedish companies sought to establish or acquire local production capability within trading blocs to mitigate tariff exposure. The tariff agreements reached over the summer of 2025 reduced the most immediate risks of trade escalation and helped restore deal confidence in H2
2025. Nevertheless, trade policy uncertainty remains elevated going into 2026, and investors continue to factor tariff risk into their deal analysis – particularly for Swedish companies with significant US revenue exposure. Capital continues to flow towards sectors perceived as more domestically or regionally insulat - ed, including technology, renewable energy, defence and digital services. Investments in AI Sweden has long been recognised for its innovative tech scene, home to successful companies such as Spotify, Ericsson and Klarna. Throughout 2025, AI drove a significant surge in deal activity globally – tech M&A rose approximately 77% globally in 2025 – and Swedish AI and tech start-ups attracted meaningful capital flows. Swedish companies, with their strong focus on sustainability and digital transformation, proved well positioned to attract venture capital and private equity funding, particularly in areas combining AI with green technology. For example, AI-driven solutions in areas such as autonomous transportation, renewable energy optimi - sation and smart cities are expected to gain significant investor interest. These sectors align well with Swe - den’s ambition to lead the way in sustainable innova - tion. AI is also increasingly being used in industries such as waste management, water purification and sustain - able farming to improve efficiency, reduce waste and minimise environmental impact. These innovations are aligned with Sweden’s green transition; as a result, AI-powered companies in the cleantech sector may be prime targets for investment. The EU Artificial Intelligence Act (the “AI Act”) is now progressively coming into force, imposing stringent compliance requirements on AI system providers, deployers, importers and distributors. The AI Act cat - egorises AI systems based on risk levels, imposing strict regulations on high-risk applications, including requirements for human oversight, comprehensive technical documentation and ongoing post-market monitoring. Investors are increasingly factoring AI Act compliance – and the attendant regulatory risk – into their due diligence and deal structuring when acquir -
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