The Swedish legal system is based on a civil law tradition where the main sources of law are statutes. In addition to statutes, other sources of law are the official preparatory works to statutes, case law and legal doctrine. Sweden is a member of the EU, and thus bound by the EU’s entire regulatory framework (primarily treaties, regulations and directives) as well as case law from the CJEU. Furthermore, case law from the ECHR is increasingly important, also in a commercial context. 

Civil litigation in Swedish courts is governed by the Swedish Code of Judicial Procedure (the “Procedural Code”).

Swedish civil litigation is primarily adversarial and decisions and judgments will be based on the claims and evidence made and presented by the parties. In line with this, witness examination, which is oral, is conducted by the parties and not by the court. However, the court has the opportunity to, at its own initiative, appoint experts, but this opportunity is very rarely used.

Proceedings in Swedish courts involve a combination of written submissions and oral arguments. Significant weight is placed on the final hearing where, in principle, all evidence is to be presented (documentary evidence as well as witnesses of fact and experts) and the judgment may only be based on what was presented during the final hearing. These principles have, however, softened in recent years, and in practice all documentary evidence is not presented in extenso during the final hearing, instead reference is made to it, and key parts of the evidence is presented in more detail. Written witness statements are still very rare, and a full examination in chief and cross-examination is made of witnesses.

There are three types of courts in Sweden: general courts, administrative courts (administrative courts, administrative courts of appeal and the Supreme Administrative Court) and some specialised courts (for instance the Labour Court, which hears employment cases only). Civil litigation is conducted in the general courts, and hence the focus of this article will be on the general courts.

There are three levels of general courts: district courts, courts of appeal and the Supreme Court.

There are 48 district courts and six courts of appeal in Sweden. In principle, all courts have jurisdiction for all types of cases – criminal and commercial as well as family law, therefore, for example, there are no specialised commercial courts. However, environmental cases, patent cases, certain other intellectual property matters, law of the sea, unfair marketing practices and competition law cases are handled by specific district courts and specific courts of appeal.

For all commercial cases, leave of appeal is necessary for a case to be tried by the court of appeal as well as the third and final instance, the Supreme Court. See 10.2 Rules Concerning Appeals of Judgments. Leave of appeal to the court of appeal level is granted fairly often, especially in more complex commercial cases, whereas leave of appeal to the Supreme Court is very rarely granted. 

As a main rule, the entire proceedings before Swedish courts are available to the public. This includes that the public may obtain copies of all written submissions and evidence submitted and that all hearings are open to the public.

However, the court may, upon its own assessment, and normally upon request by a party, determine that certain documents should not be publicly available or that a hearing (or part thereof) is held behind closed doors. For commercial cases, the most relevant grounds for such a decision is that the document or testimony contains sensitive commercial information which, if disclosed, could cause considerable harm to a party involved.

If commercially sensitive information is to be included in a written submission or during a hearing, it is advisable to include an explicit request for confidentiality, including the reasons therefor and to provide the court with a redacted copy of the relevant document(s). The same applies if one wishes that part of the proceedings shall be pursued behind closed doors.

It is not possible for the parties to agree that certain documents shall be kept confidential or under seal, since the issue is governed by public interest.

In Swedish court proceedings, a party may always represent itself. Hence, an authorised representative of a company or other legal entity may represent that entity, and natural persons may represent themselves. A party may also appoint counsel to represent them in court. The formal requirements for a person to be allowed to act as counsel are low; it is not necessary to have legal training and it is not necessary to be a member of the Swedish Bar Association or otherwise be licensed.

The formal requirements are limited to that counsel must:

• have a sufficient knowledge of Swedish;
• be domiciled in Sweden, another member state within the EU, European Economic Area (EEA) or Switzerland; and
• have full legal capacity (be at least 18, not be in bankruptcy nor have a guardian appointed).

The court may allow counsel from other countries as well.

In practice, in all commercial cases of any significance, the parties will be represented by a Swedish Advokat (member of the Swedish Bar Association) and, more rarely, by other counsel with legal training (for instance in-house counsel). The concept of “rights of an audience”, which usually is applicable in common law countries, is not used in the same way in Sweden.

Further rules regarding legal representatives can be found in Chapter 12 of the Procedural Code and rules concerning attorneys exclusively are to be found in Chapter 8 of the Procedural Code.

In most cases, litigation costs are carried by the parties to the dispute. In addition to this, legal expense insurance is included in most standard insurance policies for SMEs, and commonly available as stand-alone insurance, but normally only covers a fairly limited amount.

Third-party litigation funding, which is a growing market in Sweden, is unregulated and permitted in Sweden. Several third-party funders, both domestic and international, are active in Sweden and there are several examples of funded cases, including contemplated group actions. Although the number of funded cases is increasing, the prevalence of third-party funded cases remains limited.

All types of lawsuits are available for third-party funding, including, for example, tax recovery.

Third-party funding is available for both the plaintiff and defendant.

There is no maximum or minimum amount for third-party funding.

A third-party funder will normally fund the legal costs of the funded party (fees for counsel, experts and other costs, for example the funded party’s related operating costs); funding of potential adverse costs may be included in the funding arrangement as well. As the market is still developing, the influence from other more mature markets, such as the UK, is significant, which means that the terms of funding agreements are affected by trends from other more developed markets.

The Procedural Code does not prohibit the use of contingency fees; accordingly, such arrangements are permitted. However, under the Code of Conduct of the Swedish Bar Association (Section 4.2.1) it is not permitted for bar members to enter into contingency fee arrangements except for in certain exceptional situations, such as:

• if the Swedish Advokat is local counsel in a case where a contingency fee has been agreed in the main jurisdiction;
• in a Swedish class action, within certain limitations (see 3.7 Representative or Collective Actions); or
• in cases where the claimant otherwise would be denied access to justice due to a lack of funds.

There are no time limits with regard to when a party to a litigation should obtain the funding from a third party.

There are no mandatory pre-action requirements in Swedish law under the Procedural Code or otherwise. Accordingly, a plaintiff may sue the respondent without giving any notice. It is, however, customary for a plaintiff to notify a prospective defendant before initiating proceedings. If the plaintiff does not notify the potential defendant before initiating proceedings and the defendant concedes and complies with relief sought, the court may order the plaintiff to bear the defendant’s costs for litigation, Chapter 18, Section 3 of the Procedural Code.

Furthermore, according to Section 5.2.1 of the Swedish Bar Association’s Code of Conduct, an Advokat is obliged to notify the counterparty before initiating legal proceedings. This obligation does not apply if there are compelling reasons not to notify the counterparty, for instance that the matter is urgent or that a time limit is about to lapse.

The main rule under the Swedish Act on Statutes of Limitation (the “Limitation Act”) is that a claim is time-barred when ten years has passed from the occurrence of the debt (ie, the event giving rise to the claim). Determining the starting date is unfortunately complex and there is no simple rule to apply.

The Limitation Act covers claims based on a contract (deviations from it may be agreed) as well as non-contractual claims (such as damages). For claims against consumers, the time period is three years. The Limitation Act does not cover property rights claims, such as rights of ownership, right of retention, right of use, etc. The period of limitation can be renewed before it has passed through a notice to the debtor, through initiating legal proceedings or if the debtor acknowledges the debt.

In addition to the main rule described above, there are numerous specific statutes governing the limitation period in different situations. These limitation periods are normally shorter and are relevant, for instance, in relation to sale of goods, employment law claims and in insolvency proceedings. Regarding contractual claims, a creditor who is aware of a claim and remains passive may also lose the right to bring forward the claim.

The main rule is that the district court where a defendant is domiciled has jurisdiction (Chapter 10, Section 1 of the Procedural Code). For legal entities, the domicile is the registered seat of the legal entity. The main rule applies also for lawsuits against a government authority, the state or a municipality.

If a person (or legal entity) is not domiciled in Sweden, a Swedish court may still seize jurisdiction if the dispute concerns real property located in Sweden. Similarly, a Swedish district court may seize jurisdiction if a person (or legal entity) has other assets within the court’s domicile. However, it is not certain that the court would accept jurisdiction, and the defendant may successfully argue that the Swedish court would not be appropriate (forum non conveniens) for such claims, or that international regulations take precedence.

Swedish courts will also accept jurisdiction of a case if the jurisdiction of the Swedish court has been agreed by the parties; there is no requirement for a written form.

For disputes involving international matters, the recast Brussels I Regulation (EU Regulation No 1215/2012 on the Recognition and Enforcement of Judgments in Civil and Commercial Matters) is of relevance for disputes involving parties from the European Union as is the Lugano Convention in relation to matters involving parties from Iceland, Norway and Switzerland.

A lawsuit is initiated by the plaintiff by submitting an application for summons. The application shall be submitted to the court which has jurisdiction (see 3.3 Jurisdictional Requirements for a Defendant) and there is no need to send a copy to the defendant.

The application must be signed in original (certain digital signatures are acceptable), must be in written form and include certain basic information about the parties as well as an original of the power of attorney. The application must contain:

• the specific relief sought;
• an account of the operative facts and circumstances upon which the claim is based;
• a preliminary statement of evidence including copies of documentary evidence relied upon as well as a list of witnesses;
• evidence of the court fee having been paid – the court fee varies but is capped at SEK2,800 (approximately EUR280); and
• evidence that the court has jurisdiction to hear the claim.

If the application does not comply with the above-mentioned requirements or is otherwise incomplete, the court may order the plaintiff to correct the deficiencies. A failure to comply with such an order may result in the application being dismissed.

Once an application for summons is complete it will be issued on the defendant by the court.

It is possible for the plaintiff to amend its relief sought as well as to invoke new facts and circumstances. In brief, a claim may be amended and new requests for relief may be introduced as long as the new claim is based on, in essence, the same set of circumstances as the initial claim. Once the final hearing has commenced, the possibility to amend a claim is very limited.

The applicable rules of service follow from the Swedish Service of Process Act. It is the responsibility of the court to serve the defendant with the application for summons as well as to ensure that the parties and witnesses are served with other documents (ie, summons to appear) when necessary.

Normally the court will first seek to serve the defendant by ordinary post and ask for the defendant to sign and return a certificate of receipt. If service through post is not successful, the court may seek to serve the defendant through other means, for instance a process server. The plaintiff may also petition the court to be granted the opportunity to serve the application on the defendant, which the court normally grants if it has not been possible to serve the defendant after a few attempts.

If the respondent is domiciled outside Sweden, the manner of service will be governed by applicable international treaties or regulations. Between EU member states, the EU Service Regulation will apply. If the defendant is domiciled in the Nordic countries (Finland, Denmark, Iceland, Norway and Sweden), a Nordic agreement applies. In addition, Sweden has ratified the Hague Service Convention, which applies in relation to other parties thereto.

If service is to be made in countries that are not party to any relevant international instrument, or where the applicable instrument so requests, the courts will turn to the County Administrative Board of Stockholm as it is the appointed Central Authority for international service of documents in Sweden and abroad. The Central Authority will then forward the document for service abroad.

When the defendant is served the application for summons, the defendant is also ordered to submit its answer or statement of defence within a certain deadline. If the defendant fails to comply, the court may deliver a default summary judgment in accordance with the relief sought by the plaintiff. The court will, in such case, make a prima facie assessment of the plaintiff’s claim, to reasonably ensure that it is justified. Similarly, the court may issue a default judgment against the defendant (or the plaintiff) if they fail to a appear at a hearing and have been notified that the failure to appear may result in a default judgment.

If a default judgment has been ruled, the defendant may, however, apply for the case to be reopened. The case can be reopened if the defendant applies to the court within a month from the day the default judgment was announced. If no application is made, or if it is late, the default judgment becomes legally binding with res judicata effect.

Various forms of representative group litigation are available in, for instance, the Labour Court, where trade unions and employer’s organisations may bring forward cases. In addition to this, the Group Proceedings Act (GPA) allows for different forms of group actions in general courts. The GPA allows three forms of group actions.

• Private group actions – any person (physical or legal) may initiate a private group action if the person has standing as a party to the proceedings with respect to one of the causes of action.
• Organisation group actions – these are available in consumer and environmental law; group actions may be initiated by non-profit organisations which fulfil certain criteria.
• Public group actions – these may be initiated by the public authorities appointed by the government, currently the Consumer Ombudsman and the Swedish Environmental Protection Agency.

The proceedings are opt-in. There is no specific “certification” required; whether a case fulfils the criteria of a group action is handled by the court as any other motion to dismiss an action without trying it on the merits.

A group action is available if:

• the action is based on circumstances or matters of law which are common or similar with respect to the claims of the members of the group;
• group proceedings do not appear inappropriate;
• the group is sufficiently defined; and
• counsel for the group is a member of the Swedish Bar Association.

The court’s judgment in a group action gains legal force both for and against all who have opted in to the group. Group members are not bound by a settlement unless it is approved by the court.

The group representative assumes the risk of having to bear the defendant’s costs if the group loses the case. A more significant risk element is permitted in the fee arrangements between a group and their counsel; however, a full contingency fee arrangement is still not permitted.

There is no general obligation to provide a client with a cost estimate of the potential litigation at the outset. However, members of the Swedish Bar Association are, under the association’s code of conduct, obliged to make sure that the client understands the principles the lawyer applies for debiting and invoicing.

In practice, fee estimates and budgets are of course common.

Interim applications and motions as understood in a common law system are not available in Swedish court proceedings.

Applications related to case management issues (extensions of time for instance) are available and a court may also, ex officio, issue a default judgment if the respondent is not following the procedural requirements, see 3.6 Failure to Respond, or dismiss the case due to, for example, the court’s lack of jurisdiction, see 4.3 Dispositive Motions.

A party may also seek injunctive relief (see 6. Injunctive Relief) and the court may issue partial awards (see 4.2 Early Judgment Applications).

Generally, cases are not decided before the main hearing where the parties have had the opportunity to present their case in full and the court has heard all evidence.

However, there are some exceptions to this main rule.

• A default judgment may be issued (see 3.6 Failure to Respond).
• A court may dismiss the case due to various procedural shortcomings (see 4.3 Dispositive Motions).
• Upon the application of a party, a court may also give a separate partial judgment on a separate and independent claim before the substantive hearing of the entire case; such partial judgments are relatively rare.
• If the resolution of a particular issue may be decisive for the relief sought by a plaintiff (for instance whether a claim is time-barred), a party can apply for its early judgment and the court may try such an issue in an intermediate judgment. It is at the court’s discretion to decide whether such proceedings are suitable.

As mentioned in 4.1 Interim Applications/Motions and 4.2 Early Judgment Applications, a case is usually decided after the main hearing. In some cases, the court may dismiss a case without examining it based on the merits following a motion by one of the parties. Some examples are as follows.

• A challenge to the court’s jurisdiction – if the court lacks jurisdiction it shall reject the claim (Chapter 10, Section 17 of the Procedural Code); in certain circumstances, the case may be transferred to the correct court.
• A motion for dismissal may also be brought forward if the court does not have capacity to try the case due to res judicata or lis pendens; ie, that the case has already been tried or is currently up for trial in another court or trial.

Chapter 14 of the Procedural Code governs joinder of cases and participation by third parties in court proceedings. A third party may join an already existing lawsuit either as a party or as an intervenor.

To join as a party, the claim by a third party must be based on essentially the same ground as the already existing lawsuit. A claim can be brought forward either by one plaintiff against one or more defendants, or by one or more plaintiffs against one or more defendants.

If a third party may not join as a party to an existing lawsuit but the matter in dispute concerns their legal right or obligation, and shows probable cause for this statement, they may appear as an intervenor in the suit, on either the plaintiff’s or the defendant’s side. To act as an intervenor, an application shall be made to the court which shall be decided on as soon as possible. The existing parties shall be given a chance to provide comments on the application.

There is no right to apply for an order against a plaintiff to provide security for costs under Swedish law except if the plaintiff is domiciled outside the EU or the European Economic Area.

If the plaintiff is domiciled in a country outside the EU or the European Economic Area, the plaintiff must, upon the request of the defendant, furnish security for a reasonable estimate of the defendant’s costs for the entire proceedings (including appeal). Security for costs is normally provided in the form of a bank guarantee or other guarantee. If an order to provide security is not adhered to, the case will be dismissed. There are some exceptions to this provision where the plaintiff does not have to provide security.

The court deals with the costs in interim applications in the same way as the costs for the case in full, see 11. Costs.

There is no specific timeframe for a court to deal with an application/motion, but a party may request that an application is dealt with urgently. See 6. Injunctive Relief concerning urgency and the possibility to have applications granted ex parte.

Discovery in civil cases in the way it exists in Anglo-American countries is not recognised under Swedish law. The available mechanism is instead the right of the court to order a party or a third person to produce certain important documents in civil cases. See 5.4 Alternatives to Discovery Mechanisms.

See 5.4 Alternatives to Discovery Mechanisms.

See 5.4 Alternatives to Discovery Mechanisms.

As mentioned in 5.1 Discovery and Civil Cases, broad discovery is not available to parties in Swedish court proceedings and each party is responsible for securing, collecting and submitting the evidence it deems necessary. Having said that, it is possible to apply to the court and request production of documents under Chapter 38, Section 2 of the Procedural Code. For such an order to be successful the application must fulfil the following criteria:

• the document sought must be sufficiently identified, and so should categories of documents, as long as the definition is fairly narrow to be acceptable;
• the document sought must be important to the dispute in terms of being relevant and material to the outcome of the case; and 
• the defendant or a third party must have the document in its possession.

Also, electronic “documents” may be included in a request and a party may be ordered to provide electronic documents in the electronic format. If a document covered by a request constitutes a trade secret, the responding party will not be ordered to disclose it unless there are compelling reasons.

Attorney-client privilege is recognised under Swedish law and governed by the Procedural Code as well as the Swedish Bar Association’s Code of Conduct. Attorney-client privilege applies to both documents and testifying in court. 

Attorney-client privilege does not apply for in-house counsel, only for members of the Swedish Bar Association. However, counsel representing a client in court proceedings is covered by the attorney-client privilege and may not be forced to testify. 

There are certain exceptions to attorney-client privilege, related to, for instance, the obligation to report certain matters to the police in relation to the EU-wide legislation intended to combat money laundering and financing of terrorism.

See 5.4 Alternatives to Discovery Mechanisms.

Chapter 15 of the Procedural Code provides rules regarding provisional relief, including the possibility of awarding injunctions freezing assets. A party seeking provisional relief must make an application to the court, asking it to freeze the opposing party’s assets equivalent to the value of the claim. The request for provisional relief will be sustained if the applicant shows that there is probable cause for the principal claim to be successful and that there is reasonable suspicion that the defendant will try to evade fulfilment of its performance, such as, for example, payment of a debt.

The applicant must also provide security for the potential loss that the opposing party may suffer as a consequence of the provisional relief.

Moreover, a party may ask the court to make an order for any provisional measure suitable to secure the applicant’s rights, if there is reasonable cause that the opposing party will impede the exercise of the applicant’s right or substantially diminish the value of the forthcoming performance. A court may also order a party, upon the application of the other party, to temporarily refrain from something, tolerate something or do something. Such an order can be made under the penalty of a fine.

If an applicant was granted such injunctive relief, it must, if an action has not already been initiated, initiate appropriate judicial proceedings within a month of the order (see Chapter 15, Section 7 of the Procedural Code).

Anti-suit injunctions to prevent parallel proceedings are not used (although not formally prohibited). However, the principle of lis pendens prevents parallel proceedings from being initiated in another court if the cases are between the same parties and regarding the same matter (see Chapter 13, Section 6 of the Procedural Code).

There are no specific timeframes provided for obtaining urgent injunctive relief. The time needed by the court to process an application will depend on the complexity of the case and the injunctive relief in question. However, in principle the application shall be processed the same day the request is received by the court.

There are out-of-office judges available during weekends and holidays in order to handle criminal law matters, such as detention orders. In urgent matters, it would be possible to contact such a judge since they would have the necessary authority, but there is no standard procedure that applies. Normally, a party would wait for the next business day in order to file the application.

It follows from Chapter 15, Section 5, paragraph 3 of the Procedural Code that the opposing party must be given a chance to respond to the order. Nevertheless, an immediate decision ex parte is possible if a delay would put the applicant’s claim at risk, which is often the case. Once such injunctive relief has been awarded, the opposing party shall have the right to comment on the application and the court must then revisit the application and assess whether the decision should still be upheld.

In order to be granted a provisional relief, the applicant must generally provide security for the potential loss. In exceptional cases, the court may exempt the applicant from this requirement (see Chapter 15, Section 6 of the Procedural Code). The security generally consists of bank guarantees or guarantees provided by the applicants or others. The requirement regarding security also applies in ex parte proceedings.

Injunctive relief may be awarded against worldwide assets, which is the standard approach since the order does not normally specify the assets. It should, however, be noted that awarding injunctive relief is not equivalent to the relief being possible to enforce.

Enforcement in the country where the assets are located is of course dependant on the country in question recognising the decision.

Injunctive relief may only be obtained against a person or entity that is a party to the proceedings, and thus not against a third party.

If a judgment for injunctive relief has been rendered, the successful applicant must notify the Swedish Enforcement Authority and apply for enforcement if the applicant wishes to have the judgment enforced (see Chapter 15, Section 10 of the Procedural Code). If the injunctive relief was awarded under the penalty of a fine, a non-complying defendant may risk having to pay the fine. In addition to the above, a non-compliant party will, of course, also always increase the risk of the court drawing negative inferences. There are, however, no rules regarding contempt of court that would apply.

Initial Proceedings

Once an application of summons has been served on the defendant (see 3.4 Initial Complaint), the procedure provides for an initial exchange of written pleadings commencing with a written answer or statement of defence. This is part of the so-called preparatory phase of the trial. The preparatory phase also includes an oral preparatory hearing with the main purpose of clarifying the parties’ respective positions in relation to the request for relief and factual allegations. At the preparatory hearing the court will normally also proceed with other issues such as document production and planning of the remaining part of the trial. The court also has an obligation to investigate if the parties are interested in finding an amicable settlement of the dispute.

Following the preparatory hearing, there is often another round of exchange of written pleadings together with submission of final statements of evidence. For larger and more complex cases, there may of course be additional rounds of written pleadings, as well as additional oral preparatory hearings.

The case must be decided after an oral main hearing, except regarding disputes concerning very low amounts or if it is otherwise appropriate to decide the case without a hearing. Rules regarding the main hearing can be found in Chapter 43 of the Procedural Code.

All main hearings, with some exceptions, are open to the public, in both civil and criminal cases. See 1.3 Court Filings and Proceedings.

The Trial Proceedings

First, the court will make sure that there are no procedural impediments such as a party or a witness not presenting themselves, or the more unusual situation that a party has submitted new factual allegations or evidence shortly before the start of the hearing or even at the beginning of the hearing. If that is the case, the other party will be allowed reasonable time to answer or the new material may be ruled inadmissible. If the court determines that there are no impediments, the hearing will proceed.

The hearing starts with opening statements, which shall be oral according to the principle of oral proceedings. The parties may only submit written memorandums of their opening statements if the court makes the decision that it would ease the understanding of the opening statement or assist the proceedings in another way.

The plaintiff begins by stating its request for relief, whereby the respondent presents its reply and possible request for relief regarding counterclaims. During the opening statements, the parties, each in turn, present the factual basis for their respective claims or position together with a presentation of written evidence. In comparison, opening statements take more time in a main hearing under Swedish procedure than in many other jurisdictions, since written evidence will not be presented during the witness testimonies unless it is necessary to refer the witness to a document in order to put a question to them. Presentation software is commonly used by parties in more complex cases.

After opening statements, oral witness examinations will take place, starting with any party representatives followed by the plaintiff’s witness and experts and thereafter the respondent’s witnesses and experts.

Closing Arguments and Deciding the Case

The main hearing will be finalised with closing arguments from each side. Post-hearing briefs are not allowed, and if there is any reason to continue the trial, such as new and unknown evidence surfacing after the main hearing, the hearing will instead be re-opened.

As a final note, the court may only decide the case on the factual allegations and evidence that has been presented during the main hearing, which follows from the principle of immediateness. This means that the court may not take into consideration facts or allegations that have not been raised or referred to during the main hearing and have only been included in written submissions or otherwise during the preparatory phase of the trial or after the main hearing (see Chapter 17, Section 2 of the Procedural Code).

Case management during the preparatory phase has been briefly described in 7.1 Trial Proceedings.

Except for cases concerning freedom of the press, jury trials are not available in civil cases (see Chapter 1, Section 3a of the Procedural Code).

Rules regarding admission of evidence can be found in Chapter 35 of the Procedural Code.

As a rule, all forms of evidence are admissible. However, evidence can be declared inadmissible if it is not important to the case or if the evidence can be presented in another way which would entail less effort, trouble or cost; or if the taking of evidence would delay the case in an unnecessary way. As an important exception to the above, written witness statements or affidavits are inadmissible unless the parties agree that they should be allowed.

In relation to evidence that is admissible, the court has freedom to evaluate all evidence presented as it seems fit. There are no formal rules that certain evidence as such would have a higher probative value than other forms of evidence.

In relation to circumstances that are undisputed or considered notorious, no evidence is required. Similarly, evidence is not required to prove legal rules and instructions. Since evidential hearings are subject to the so-called principle of immediateness, all types of evidence shall, as far as possible, be presented at the main hearing and not by way of written submissions.

Expert testimony is permitted at trial and such evidence is normally introduced by the parties, not the court. However, in Chapter 40, Section 1 of the Procedural Code, it is stated that the court itself may seek expert guidance if it is necessary in order for the court to be able to assess the matter. Before an expert is appointed on the court’s initiative, the parties shall have the opportunity to provide comments.

As a rule, hearings are open to the public. There are a few exceptions to this (see 1.3 Court Filings and Proceedings).

The court has a duty to guide the parties as needed during both the preparatory phase of the trial and during the main hearing, although the actual impact of this duty depends heavily on the character of the case and if the parties are represented by professional counsel or not. The purpose of any intervention of the court is to clarify any ambiguities in the statements made by the parties and to safeguard the rule of law by, among other things, assuring that the case is properly investigated and that procedural errors are avoided. Procedural issues will almost without exception be handled in separate decisions and not in the final judgment.

In civil cases, it is generally the case that the court shall intervene only when necessary. The court may direct the proceedings as long as it remains impartial and pursues the overall purpose of efficient proceedings. As a rule of thumb, directives by the court during the proceedings in civil cases where out-of-court settlements are allowed shall be limited to guiding the parties in order to clarify what relief they are seeking and what factual allegations they invoke as the basis for their claims.

It is difficult to state a general timeframe for proceedings since it depends both on the circumstances of the case and the workload of the court. Normally, the preparatory phase in a commercial dispute would require six months to one year depending on the complexity of the case, and ideally the main hearing will be held shortly thereafter. However, in more complex commercial cases it is not unusual for a trial at first instance to require two or even three years. Typically, procedural issues like document production would lengthen the timeframe considerably since certain procedural issues may be appealed to the court of appeal.       

Court approval is not required to settle a lawsuit in Swedish civil cases. However, upon the parties’ joint motion, the court can confirm the settlement in a consent judgment in order to achieve enforceability and res judicata effect.

A settlement in a civil case could be entered into either out of court or during the court proceedings. If the settlement is made out of court, it will remain confidential if the parties agree to a confidentiality undertaking. However, if the parties request that the settlement is confirmed by the court in a consent judgment, there will be no confidentiality since judgments become available to the public.

If a settlement has been confirmed by court, it constitutes an enforceable judgment. This means that the parties may use the judgment to seek enforcement if the other party omits to fulfil the settlement and judgment.

If the settlement is not confirmed by a court, it is regarded as an ordinary agreement between the parties and thus does not constitute an enforceable judgment. See, however, also the possibility to achieve enforceability through Article 6 of the Mediation Directive (2008/52/EC) incorporated by Sections 7–12 of the Swedish Mediation Act.

A settlement that has been confirmed by a court in a judgment is final and cannot be set aside unless one of the parties successfully appeals against the judgment due to a procedural error (which is extremely rare).

A settlement that has not been confirmed by a court is binding on the parties in the same way as any other agreement. Whether or not a settlement agreement can be set aside due to invalidity is a contractual issue and not subject to procedural rules.

There are two different forms of awards or judgments in Swedish law for a successful litigant.

First, there are judgments that oblige a party to perform or refrain from performing something (see Chapter 13, Section 1 of the Procedural Code). Such judgments are enforceable by the Swedish Enforcement Authority. Second, there are declaratory judgments, which determine or establish the existence or the content of a legal relationship (see Chapter 13, Section 2 of the Procedural Code). These are non-enforceable.

Damages may be awarded, among other things, due to breach of contract or in torts in accordance with the Swedish Tort Law Act, but also in numerous other instances. Damages may only be awarded if the plaintiff can present sufficient evidence to prove the amount of the damage. However, if it is impossible to prove the damage in spite of the plaintiff having done all that could be reasonably expected to prove the damage, the court may assess the damage on the basis of reasonability (see Chapter 35, Section 5 of the Procedural Code).

The statute of limitation for a claim for damages is ten years except for claims against consumers, where the statute of limitation is three years.

Punitive damages are not available in Sweden.

General provisions regarding interest are found in the Swedish Interest Act, and rules regarding interest are not considered to be of a procedural nature except for interest awarded on cost, which also refer to the Interest Act. Interest on cost accrues from the day of the judgment.

Interest on a claim shall be paid from the day the claim is due for payment. If a fixed due date is not agreed on, the claim falls due for payment no later than 30 days after the creditor has made a claim for payment of the claim. Notwithstanding this, interest shall be paid no later than the date of service of a summons in a case concerning the issue of payment.

The default interest is calculated as the official reference rate of the Swedish Central Bank (Riksbank) plus eight percentage points (see Section 6 of the Swedish Interest Act).

A Swedish judgment or Swedish arbitral award may be enforced by the Swedish Enforcement Authority (see Chapter 3 of the Swedish Enforcement Act).

A judgment regarding a payment order becomes immediately enforceable, and other judgments become enforceable after expiry of the appeal period, unless the court by specific order decides that the judgment shall be immediately enforceable. The appeal period is three weeks from the day of the judgment by the district court and four weeks when the judgment was issued by the court of appeal. In relation to judgments from the Supreme Court, no appeal is possible, meaning that such a judgment is immediately enforceable.

As a main rule, foreign judgment in civil cases that are issued in a foreign country by a foreign court are not recognised or enforceable in Sweden, unless provided for in an international treaty or in either EU or national legislation.

A judgment in a civil matter from another EU member state is both recognised and enforceable under the recast Brussels I Regulation (EU Regulation No 1215/2012 on the Recognition and Enforcement of Judgments in Civil and Commercial Matters). Regarding judgments issued by courts in Norway, Iceland or Switzerland, the Lugano Convention is applicable and governs recognition and enforcement in Sweden.

As mentioned in 1.2 Court System, the general courts consist of three levels: district courts, courts of appeal and the Supreme Court.

A party may appeal a judgment made by a district court, to the court of appeal. The court of appeal needs to grant leave to appeal to be able to try the case.

In very rare situations, judgments that have achieved res judicata effect though a binding final judgment can be rescinded due to substantial errors, if there are circumstances that show that the court judgment is manifestly wrong due to false evidence or an application of the law that is obviously in contradiction with the law, or if a party has omitted to appeal against a judgment due to circumstance beyond its control such as the appeal getting lost in the mail, sudden illness or similar excusable situations.

The unsuccessful party to a litigation may appeal the judgment. However, leave of appeal is necessary from the court of appeal. For the court of appeal to grant leave, one or more of the following prerequisites must be available:

• the court of appeal is in doubt as to whether the district court has ruled correctly;
• the appeal is necessary for the court of appeal to be able to assess whether the district court has ruled correctly;
• the case is of importance as a precedent; and
• there are otherwise special reasons to try the appeal (eg, if the district court made a substantial procedural error).

When appealing a judgment from the court of appeal to the Supreme Court, leave for appeal is demanded (see Chapter 54, Section 10 of the Procedural Code). The grounds for leave are the following:

• if the case is of importance as a precedent; or
• there are special reasons for an examination, such as grounds for rescission or that there has been a substantial procedural error or that the outcome of the case in the court of appeal was obviously due to manifest errors.

An appeal of a decision or a final judgment of a district court shall be put to the relevant court of appeal but must be submitted to the district court within three weeks from the date of the judgment in question (see Chapter 50, Section 1 of the Procedural Code) in order for the district court to assess whether the appeal has been submitted within the time limit. If the appeal has indeed been submitted within the time limit, the district court forwards the appeal to the court of appeal. The appeal must be in writing and must include the following information:

• what judgment the plaintiff wants to appeal;
• what part of the judgment the plaintiff wishes to have reversed in the court of appeal;
• the grounds on which the judgment shall be changed;
• the grounds to grant leave of appeal; and
• which evidence the plaintiff wishes to invoke (see Chapter 50, Section 4 of the Procedural Code).

If the appellant court has granted leave of appeal, the respondent will be ordered to submit a written response to the claimant’s appeal. The court of appeal may order further exchange of documents or a preparatory hearing as needed (see Chapter 50, Sections 8–10 of the Procedural Code).

If the case should be decided after a main hearing, the same rules apply as in the district court.

Deciding a Case Without a Hearing

The court of appeal may decide the case without a main hearing if the claimant’s appeal is admitted by the respondent or if it is obvious that the appeal is baseless. Moreover, the appeal court may also decide the case without a main hearing if neither of the parties, after having been heard, objects to it, or if both parties have requested a judgment without a hearing. In addition, a case may be decided without a main hearing if such a hearing is unnecessary (see Chapter 50, Section 13 of the Procedural Code).

The Supreme Court may also decide a case without a main hearing (see Chapter 55, Section 11 of the Procedural Code).

Amending Requests

Generally, the plaintiff is not allowed to amend its request for relief or cause of action (see Chapter 13, Section 3 of the Procedural Code). There are, however, a few exceptions to this rule, for example if a circumstance occurred during the proceedings or only became known to the plaintiff at that point or if a new request for relief is based essentially on the same set of operative facts. During an appeal, a plaintiff may only amend its cause of action due to circumstances that occurred during the proceedings or if there is a justifiable excuse for other reasons.

The court is not able to impose any conditions on granting an appeal, but in certain cases (such as cases concerning certain intellectual property rights, challenge of arbitral awards and competition law cases), the court of appeal must allow the judgment to be appealed to the Supreme Court by way of a special declaration.

After a main hearing, the appellate court has a few options. The court is only allowed to rule on the matters that were appealed by the parties and not on other matters.

The court can decide the case based on the merits and either affirm, amend or reverse the appealed judgment, as well as remand a case to a lower court for a retrial. The appealed ruling may also be set aside if a substantial procedural error occurred during the trial in the lower court.

According to Swedish law, the general rule is that the litigation costs are to be paid by the losing party (see Chapter 18, Section 1 of the Procedural Code). The responsibility to cover the litigation costs includes all expenses such as court and attorney’s fees, cost for preparation and for participating at hearings (see Chapter 18, Section 8 of the Procedural Code). If neither party can be considered to have won the case, each party will normally bear its own costs, and the court may also award a part of the costs if a party only prevails in part.

If the claim of the litigation does not exceed half of the so-called price base amount (currently approximately EUR2,200), each party is responsible for its own litigation costs (see Chapter 18, Section 8 a of the Procedural Code).

Aside from the main rule mentioned in 11.1 Responsibility for Paying the Costs of Litigation, there are several factors to consider when awarding costs, and the court may deviate from the main rule due to the behaviour of the prevailing party. If a party has initiated proceedings without the other party giving reason to do so, or if the prevailing party otherwise has intentionally or through negligence caused an unnecessary litigation, it shall reimburse the other party for its legal costs, or if the circumstances give rise to it, each party shall bear its own costs.

Furthermore, in order to be awarded compensation, the requested cost must be reasonable given the amount in dispute, the complexity of the case, etc.

Interest, in accordance with Section 6 of the Swedish Interest Act, is awarded from the day of the judgment until full recovery of the costs is made (see Chapter 18, Section 8, paragraph 2 of the Procedural Code).

Arbitration and mediation are two ADR mechanisms available in the Swedish legal system, although arbitration nowadays is seldom referred to as an ADR procedure but as a dispute resolution method in its own right. The basis for using ADR is an agreement between the parties. Mediation is less common even if it is on an upward trend. Other ADR methods such as mini-trials or dispute boards are not common to the general legal community, but dispute boards are sometimes used in relation to larger construction contracts.

In the Procedural Code, it is expressively stated that the court in both the district court and court of appeal shall endeavour to settle the dispute (see Chapter 42, Section 17, paragraph 1 and Chapter 50, Section 11, paragraph 1 of the Procedural Code).

It is also possible for the court to order the parties to use mediation if the parties agree to it, or to arrange settlement hearings that are similar to a mediation, but less formal in relation to the procedure (see Chapter 42, Section 17, paragraph 2 and Chapter 50, Section 11, paragraph 2 of the Procedural Code).

There are several institutions in Sweden that are well organised and offer ADR. First, the Arbitration Institute of the Stockholm Chamber of Commerce (SCC) and the Arbitration Institute of the West Sweden Chamber of Commerce both provide mediation as part of their services. The Swedish Mediation Institute gives parties in labour disputes the opportunity to solve their issues through mediation. Of the above-mentioned institutions, the SCC is an internationally renowned institution, and it handles several hundred arbitrations, and some mediations, every year.

The conduct of arbitration is regulated in the Arbitration Act of 1999, which is applicable to all arbitrations where the seat of arbitration is in Sweden. It provides the primary legislative framework relating to arbitration. The act regulates, among other things, the arbitration agreement, the award, the procedure, the arbitrators, enforcement of arbitral awards and some international issues. The Swedish Arbitration Act implements the New York Convention regarding awards rendered outside of Sweden.

The Swedish Arbitration Act is not officially based on the UNICITRAL Model Law but is nevertheless inspired by and draws much of its content from the Model Law.

Disputes that are not arbitrable are disputes that the parties may not settle by way of agreement. Generally, this is the case when the case concerns a public interest or a third-party interest – eg, security rights in property. In relation to consumer disputes, they are arbitrable if the agreement is entered into after the dispute arose.

In the Arbitration Act, a distinction is made between challenging an award and seeking to invalidate an award.

A challenge of an award must be filed within three months from the receipt of the award. The grounds for challenge are exclusively related to procedural errors. Errors related to the merits of the case cannot be challenged. The procedural grounds that may be subject to challenge are stated in Section 34 of the Arbitration Act.

The invalidity of an award is limited to awards that violate Swedish public policy and awards that are not rendered in written form or signed by a majority of the arbitrators. An award is also invalid if it decides a matter that was not arbitrable. Invalidity may be invoked without any time limit (see Section 33 in the Arbitration Act).

Arbitral awards are enforceable according to Chapter 3, Section 1, paragraph 1, point 4 of the Swedish Enforcement Act. In order to be enforceable, the award must be made in writing and signed by a majority of the arbitrators. The enforcement agency needs to verify that the opposing party is allowed an opportunity to comment on the enforcement application before taking any action. 

In relation to foreign arbitration awards, it is required that the court of appeal declares the award to be enforceable before it can be enforced in Sweden. As soon as the declaration of enforceability has been obtained, the applicant can turn to the Swedish enforcement agency in the same way as regards a domestic award. The court only reviews that the award meets the formal requirements and not the merits or substance of the award (which is largely the same as set out in the New York Convention).

There are no overall proposals to modify or reform the Acts dealing with dispute resolution, but the Swedish Arbitration Act was recently revised.

As mentioned in 2.5 Types of Cost Considered Under Third-Party Funding, the influence from the UK market is significant as regards the development of the third-party funded market in Sweden. In the newly released judgment regarding litigation funding agreements, Paccar Inc v Road Haulage Association Ltd [2023] UKSC 28 the Supreme Court in the UK held that an agreement with third parties who play no part in the conduct of a litigation process, but are to be paid a share of any damages recovered by the claimant, constitutes a “damages-based-agreement” (or DBA) in the meaning of the applicable legislation which regulates such agreements. According to English law, these agreements must be in compliance the relevant regulatory regime; if not, they are unenforceable. From a Swedish perspective, this judgment is unlikely to have any direct impact on the Swedish third-party funded market, since Swedish law does not regulate DBAs.

In recent years, the Swedish market for commercial disputes has experienced growth in areas such as competition law, crypto-assets, and anti-money laundering-related cases. With respect to competition law, a third-party-funded, multi-billion-euro claim for competition damages against a global search engine provider is currently ongoing at the Patent and Market Court in Stockholm, Sweden. Additionally, disputes arising from Russia’s offensive campaign against Ukraine have led to an increase in cases involving the rescission of contracts connected to Russian interests in Western Europe.