SWEDEN Law and Practice Contributed by: Annika Blomqvist, Sanna Frånlund, Henrik Lindstrand and Viktor Eriksson, Advokatfirman Cederquist
Notification is required where a transaction results in, among other things, the following: • acquisition of shares resulting in the investor hold - ing, directly or indirectly, 10%, 20%, 30%, 50%, 65% or 90% of the voting rights; • establishment of a new entity, including joint ven - tures, where the investor will hold at least 10% of the voting rights; • investments through which the investor otherwise obtains direct or indirect influence over the man - agement of the entity; • investments in protected activities conducted through partnerships, foundations or sole propri - etorships; or • investments through which the investor obtains influence over the relevant protected activities by other means, such as veto rights or equivalent. It is important to note that the notification obligation applies to Swedish and foreign investors alike, and the regime also covers intra-group reorganisations. 6.3 Mandatory vs Voluntary Notification Notification is mandatory for all transactions within the scope of the Swedish FDI Act, with only one limited exemption in relation to issuance of shares. Failure to notify, and implementation before a clearance deci - sion, may be subject to fines of up to SEK100 million. If the transaction is prohibited, the legal actions imple - menting said transaction may be declared invalid and forced to be divested. 6.4 Review Process and Timetable The review period for a notification is 25 business days from submission of a complete notification in Phase 1, whereby the authority will either clear the transaction or initiate an in-depth review (Phase 2). If an in-depth review is initiated, such review must gen - erally be completed within three months of its initia - tion. Where a special ground exists, the review period may be extended to a maximum of six months. Notifi - able transactions are subject to a standstill obligation and may not be completed before the transaction has been cleared.
The notification must be submitted by the investor, using the forms provided by ISP and required annex - es. The notification must include, among other things: • information concerning the investor, including its full ownership structure up to and including each ultimate owner holding 10% or more of the votes in any underlying entity; • information concerning the target and the protect - ed activities conducted by the target; • information concerning the transaction, such as its structure and purpose, financing and value, as well as the nature of the influence exercised by the investor before and after the transaction; and • relevant documents concerning the transaction and ownership-structure charts. 6.5 Assessment Criteria ISP provides only limited public guidance on how indi - vidual factors are assessed, as case-specific informa - tion is generally confidential. The following parameters are central to the assessment under the FDI Act: • the nature and scope of the protected activities; • whether the investor is controlled, wholly or partly, by a non-EU state through its ownership structure, significant financing or other means; • whether the investor or any entity in its ownership structure has previously been involved in activities that have or could have adversely affected secu - rity, public order or public security in Sweden or another EU member state; and • any other investor-related circumstances indicat - ing that the investment may have such an adverse effect. The assessment is conducted on a case-by-case basis, and the legislation does not prescribe an exhaustive list of relevant factors or fixed criteria auto - matically resulting in prohibition. 6.6 Conditions, Remedies and Prohibition There are no separate remedies available for transac - tions in the defence sector. ISP may grant clearance subject to conditions necessary to prevent the trans - action from adversely affecting security, public order or public security in Sweden. Such conditions may relate to:
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