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A.1       Legislation

The Swedish Arbitration Act (SAA) continues to be the primary source of arbitration law in Sweden which governs both domestic and international arbitration proceedings. The SAA does not differentiate between domestic and foreign proceedings with the exception of the enforcement and recognition of foreign awards and proceedings. There have been no legislative amendments in 2022.

A.2       Institutions, rules and infrastructure

SCC is the central arbitration institute in Sweden that administers domestic and international arbitrations. SCC has changed its name in English from Arbitration Institute of the Stockholm Chamber of Commerce to SCC Arbitration Institute.

The SCC Rules

In 2022, a revision of the SCC Rules was made with new rules coming into effect on 1 January 2023. The revision included, inter alia, the SCC Arbitration Rules and the SCC Rules for Expedited Arbitrations. Some of the new provisions include article 32 in the SCC Arbitration Rules and article 33 in the SCC Rules for Expedited Arbitrations which clarify that the arbitration tribunal is able to decide on whether hearings shall be conducted in person or remotely. There are also amendments to article 29 of the SCC Arbitration Rules clarifying which information shall be included in the statement of claim and statement of defense, and SCC has removed the agreement on the number of arbitrators as a recommended addition to the SCC model clause.

New Secretary General of SCC

Caroline Falconer has been appointed as new Secretary General of the SCC Arbitration Institute and succeeds Kristin Campbell Wilson. Caroline Falconer started her role on 17 January 2023.

New office

SCC changed office to Regeringsgatan 29 in Stockholm. The new address is as follows:  

SCC Skiljedomsinstitut
Regeringsgatan 29
Box 16050
103 21 Stockholm

SAA/SCC International Diploma course on international arbitration for foreign arbitrators
SCC and the Swedish Arbitration Association launched the “SAA/SCC International Diploma course on international arbitration for foreign arbitrators.” As made clear by the name, the course provides training for international arbitrators (non-Swedish lawyers with 10+ years of experience) on arbitrating disputes in Sweden. The course covers an introduction into the regulatory framework, formal and subjective validity of the arbitration agreement, and the SCC Rules and policies. The participants receive the SAA/SCC course diploma upon completion of the course.

SCC Arbitrators’ Council
SCC introduced a new advisory body in 2022; the SCC Arbitrators’ Council. The council consist of arbitrators practicing in ten different jurisdictions and the main objective of the council is to widen the SCC’s network of users by engaging in dialogue with arbitration users in their respective jurisdictions. The council will work to ensure growth and relevance of the SCC services on international markets.

B.         CASES

B.1       Remote hearings held to be compliant with the SAA and the SCC Rules

Under section 24 of the SAA, an “oral hearing” is to be held when requested by a party, barring any differing agreement between the parties. Article 32 of the 2017 SCC Rules also provides that a hearing is to be held when a party so requests. In ICA Sverige AB v. Bergsala SDA AB[1], the Svea Court of Appeals ruled on the issue of whether the arbitration tribunal can decide to conduct remote hearings, against the objection of a party.

The case, which was a set-aside action brought by ICA, originated in a dispute between ICA and Bergsala. The arbitration proceedings were commenced in mid-2019 and the main hearing was scheduled to occur in May 2020. Given the COVID-19 pandemic, the tribunal invited the parties to discuss postponing the hearing. However, the tribunal ultimately decided that the hearing was to take place on the dates planned, but that it would be conducted remotely. ICA objected to the tribunal’s decision, citing difficulties to prepare for the hearing and conduct witness interviews with its counsels due to ICA’s internal COVID-19 guidelines. The tribunal dismissed the objections.

Having received the award, ICA brought an action in the court moving that the court either set aside the award or declare it invalid due to public policy. ICA argued, inter alia, that by ordering the remote hearing against ICA’s objection, the tribunal conducted the proceedings in violation of the mandatory provisions of the SAA and the SCC Rules.

The court, which denied ICA’s action, provided quite detailed reasoning for allowing remote hearings. Initially, the court remarked that the SAA contains no definition of “oral hearings” but that the preparatory works of the provision indicate that it has its origin in the provisions regarding the right of a party to a court hearing and a fair trial in the Swedish Code of Judicial Procedure and article 6 of the ECHR. Moreover, the preparatory works state that issues relating to the hearing is to be decided by the tribunal in such cases when the parties are not in agreement. Further, the court made a comparison with chapter 5, section 10 of the Code of Judicial Procedure which provides that a court in certain cases may decide that a participant in a court proceeding (party, counsel, witness etc.) is to attend remotely, either via audio or audio and video feed. The court then concluded that given its background and purpose, there is reason to also view section 24 of the SAA as technique neutral, thereby not excluding remote hearings. Finally, the court held that when the parties are not in agreement, the tribunal may decide whether the hearing is to be conducted remotely, but that in doing so it must consider the parties’ right to be heard and that the proceedings are to be conducted impartially, purposefully, and swiftly. Therefore, it is important that the technical conditions allow for good communication. Grounds for setting aside the award exists only when the tribunal’s decision in this matter can be considered “indefensible,” the court held.

The case settles a previous state of uncertainty in regard to whether remote hearings qualify as such “oral hearings” as provided in section 24 of the SAA. While a large amount of commentary had taken the stance that remote hearings do indeed qualify, there have also been opposing stances. The ruling provides clarity on the issue. Especially for foreign parties, the ruling allows for more cost-efficient proceedings, since it allows for witnesses, parties and counsels that are located abroad to participate remotely.

B.2       Award partially set aside due to tribunal’s excess of mandate

Under section 34 of the SAA, an award is to be set aside if the tribunal exceeded its mandate in a manner probable to have affected the outcome of the proceedings. In the case Public Joint Stock Company Chelyabinsk Metallurgical Plant v. Minmetals International Engineering Co. Ltd.[2], the court of appeal partially set aside an award due to such excess of mandate.

In October 2009, Public Joint Stock Company Chelyabinsk Metallurgical Plant (CMP) entered a construction agreement with Minmetals International Engineering Co. Ltd (“Minmetals”) concerning the reconstruction of CMP’s production plant. The contract provided that partial payments were to be made to Minmetals upfront, during construction and after the project was finished.

In March 2014, when Minmetals had performed most of its obligations under the contract and CMP had paid most of the contract sum, CMP terminated the contract. Minmetals subsequently commenced an arbitration against CMP under the rules of SCC. The proceedings were held in Stockholm and governed by the SAA, while the substantive law applied was Russian. After the tribunal rendered an award ordering CMP to pay USD 16.7 million to Minmetals and ordering CMP to assist in the deconstruction of a temporary construction site, including aiding Minmetals in securing necessary permits for its employees, CMP brought a set-aside action before the Svea Court of Appeal. The monetary relief requested by Minmetals was, inter alia, based on CMP’s obligation to make payments under the contract.

CMP argued that the arbitration tribunal exceeded its mandate by ordering CMP to pay Minmetals based on damages for the costs of performed work, rather than CMP’s contractual obligation to pay under the contract. Since Minmetals had based its claim on the latter, rather than the first, the tribunal had exceeded its mandate, CMP argued. The Svea Court of Appeal initially explained the long-established Swedish doctrine of coherence between requested relief and basis for the request. Under the doctrine, courts and tribunals are bound by the legally relevant facts cited by the parties as the basis for their claims and defenses respectively and are not allowed to base their judgments and awards based on other facts that may be available in the case file. However, as the court explained, case law holds that this view is not always the standard abroad and that a more liberal approach is justified in cases of arbitration between foreign parties. In this case, the court held that the difference between what Minmetals had based its claim on (i.e., contractual performance) was different from what the tribunal based its award on (i.e., damages for costs caused by breach of contract). Moreover, the court recognized that although a more liberal approach in cases involving foreign parties is provided for in case law, there still exists an outer limit of what the tribunal may base its award on. Basing its award on other legally relevant facts than those explicitly cited by the claimant, which the court found had happened in this case, was beyond that limit. Therefore, the tribunal had exceeded its mandate, the court held.

CMP had furthermore argued before the Svea Court of Appeals that the tribunal had exceeded its mandate by basing its award on its own industry-specific knowledge, which is not common knowledge. In awarding Minmetals damages for CMP’s breach of contract, the tribunal applied an expected profit margin of 15%. The tribunal arrived at this conclusion by holding that the profit margins in the construction business usually are 10-15%. None of the parties had however made any claims about the profit margins in the construction business, nor had they introduced any evidence on the subject. The court agreed with CMP’s claims in the set-aside proceeding and held that the tribunal had based its award on the personal knowledge of the arbitrators, without the knowledge being of such general nature that it does not have to be claimed or proven, and that in doing so, the tribunal had exceeded its mandate. The court therefore held that the tribunal also had exceeded its mandate in this regard.

Moreover, CMP had argued that Minmetals did not complain about CMP’s breach of contract in time and further that the claims were barred from being brought due to the statute of limitations, and that the arbitration tribunal had not regarded its defenses in this regard. The court remarked that while the award did not contain an express position on one of CMP’s statute of limitation defenses it did however provide that the tribunal had elected not to include all the parties’ legal argumentation but that all arguments had been considered. This general statement could not, according to the court, be deemed to contain a position on the statute of limitations defense in question. Hence, the court held that the tribunal had not tried CMP’s defense in this regard. The court further explained that while issues relating to statutes of limitations are considered to be substantive law in Sweden — meaning that a mistake made by the tribunal in in this regard cannot constitute grounds for challenge — the situation is different when the tribunal, like in the present case, has failed to try the defense. Thus, the court held that the tribunal had exceeded its mandate in this regard as well.

Given that the tribunal had exceeded its mandate, and that this had affected the outcome of the proceedings or that it at least could not be ruled out that the outcome had been affected, the award was set aside in its relevant parts.

B.3       An arbitration award concerning an intra-EU investment agreement was declared null and void due to incompatibility with the principles of the Swedish legal system

The case Republic of Poland v. PL Holdings S.a.r.l.[3] has its origin in an intra-EU investment agreement containing an arbitration clause. Belgium and Luxembourg on one side, and Poland on the other, entered into an agreement about mutual recognition regarding promotion and protection of investments. PL Holdings, a company registered in Luxembourg, then obtained shares in two Polish banks, which then merged. The company’s ownership of the shares in the bank amounted to 99%. After the merger, PL Holdings sold the shares, due to a decision by the Polish Financial Supervision Authority which meant that the voting rights of PL Holdings’ shares in the bank were suspended and that they would be sold by force. PL Holdings subsequently initiated arbitration proceedings against Poland in SCC, whereby an arbitration clause in the contract was referred to, to support the jurisdiction of the arbitration tribunal. SCC issued two arbitration awards, one in June 2017 (separate award), and one in September 2017 (final award), which became subject to annulment and protest actions.

A central question was whether the principles stated in Achmea, C-284/16, EU:C:2018:158, meant that an arbitration clause, such as in the case, was to be deemed void. It further raised the question whether it prevented a member state and investor, by their actions, to enter into an arbitration agreement ad hoc concerning a certain dispute. The EU Court of Justice ruled that an intra-EU investment agreement, allowing investors to, in one member state, against the other, initiate arbitration proceedings concerning investments, is not in accordance with articles 267 and 344 of The Treaty on the Functioning of The European Union (TFEU). The Swedish Supreme Court concluded that such a clause is incompatible with the principle of loyalty, as well as undermining the autonomy of European Union law.

The Swedish Supreme Court raised the question of whether articles 267 and 344 TFEU should be interpreted in a way that they hinder national legislation that allow a member state to enter into an ad hoc agreement with an investor from another member state, which enables the parties to continue arbitration proceeding based on such an arbitration clause which was deemed void in Achmea. To bring clarity, the Swedish Supreme Court requested a preliminary ruling from the EU Court of Justice concerning the interpretation of the articles, formulated as above. The question was based on the assumption that Poland, by implied action, had agreed to the offer of PL Holdings concerning arbitration proceedings in accordance with Swedish law. The EU Court of Justice was of the opinion that the question should be answered affirmative.

The Swedish Supreme Court explained that a material review of arbitration awards based on an arbitration clause in an intra-EU investment must be made by a court in order to ensure compatibility with EU law, but that such a review is not available in Sweden. Therefore, the arbitration in question was in conflict with the fundamental principles of the European Union, and not acceptable. Thus, on the basis of an arbitration agreement by implied action, as was considered void in Achmea, continued arbitration proceedings were not possible, which is why the arbitration tribunal was not competent to try the case. Hence, the Swedish Supreme Court concluded that it was immaterial whether Poland had approved of the arbitration proceedings based on the ad-hoc arbitration agreement.

Regarding the preliminary ruling of the EU Court of Justice, PL Holdings claimed, inter alia, that the interpretation of the court was contrary to central principles of EU law, and that the revocation or invalidation of the arbitration awards would deprive the company of its right to a fair trial and an effective remedy. The Swedish Supreme Court stated that the principle of the primacy of European Union law does not permit national courts to deviate from interpretations of the EU Court of Justice, unless the application would result in a clear and serious breach of an individual’s rights pursuant to the ECHR, which was not the case.

Furthermore, the Swedish Supreme Court declared that the issue of whether such arbitration awards should be examined under Swedish law is a question for Swedish courts, whereafter it was explained that after an award has been delivered it cannot, in the usual sense, be appealed. In the event of a formal error or if there are other reasons to question the accuracy of the proceedings, a party may initiate court proceedings in accordance with section 33 of the SAA concerning annulment and ordre public, or section 34 of the SAA concerning protest. It was then explained that, in terms of intra-EU investment disputes, a member state that enters into an agreement such as in the case means that the dispute may not be solved in a way which ensures the full effect of EU law, due to the inability to appeal.

Furthermore, the ordre public rule was explained to intend to protect crucial legal principles of Swedish law. The court deemed that preliminary rulings from the EU Court of Justice, concerning the question of whether member states may hinder the authorities’ application of union law in the court system of the union, were fundamental procedural legal principles. Therefore, the annulment should be examined pursuant to section 33 of the SAA. It was further stated that a clause as in the case, may result in that an arbitration tribunal makes decisions that may concern applicability or interpretation of EU law. Such a clause was, according to the Swedish Supreme Court intended to undermine the principle of mutual recognition between member states, as well as the characteristics of the EU, which is ensured by the preliminary ruling from the EU Court of Justice. The clause was considered to undermine the autonomy of the union and contrary to the principle of loyalty. In conclusion, an arbitration award, based on such a clause, was deemed to be created in an unlawful manner because it was incompatible with the principles of the European Union, and therefore Sweden. The Swedish Supreme Court concluded that maintaining such arbitration awards would constitute incompatibility with the fundamentals of the Swedish legal framework. Thus, the arbitration awards were annulled.

[1] Svea Court of Appeal, 30 June 2022, Case no. T 7158-20.

[2] Svea Court of Appeal, 4 November 2022, Case no. T 1356-18.

[3] The Supreme Court, 14 December 2022, Case no. 1569-19.


Erik Forsin is a partner in Baker McKenzie's Stockholm office. He focuses his practice on international arbitration and commercial litigation across a broad range of industries. Erik leads Baker McKenzie's Dispute Resolution Practice Group in Stockholm.


Magnus Stålmarker is a senior associate in Baker McKenzie's Stockholm office. He focuses on dispute resolution in the fields of international commercial arbitration and litigation, procurement, and construction.


Natasha Blomqvist is an associate in Baker McKenzie's Stockholm office. Natasha focuses her practice mainly on litigation and arbitration. She assists clients in various types of disputes within the fields of commercial, insolvency and insurance law.


Dustin Zojaji is a trainee in Baker McKenzie’s Dispute Resolution Practice Group in Stockholm.