Can a foreign authority sue in Swedish court and which law is applies in such cases?

2020-11-26 i PROCESSRÄTT
From our Swedish company, we conduct e-commerce in the Danish, Swedish and Norwegian domains.A local authority in our market outside Sweden has contacted us with charges of violating the Marketing Act. It is believed that this is a violation of a criminal provision and it is noted that our information on the case may be included in a possible criminal case.Can a foreign authority sue a Swedish company in the same way as if we had been a local company in the country for the authority in question. What is our responsibility and limitation of liability in relation to this local Marketing Act when we as a Swedish company conduct business in other markets?

Hey and thank you for choosing Lawline.

I understand that you have a registered company in Sweden from which you conduct business in Denmark, Sweden and Norway. Also you have been contacted by an administrative authority (Ex Marknadsförningsnämnden) from another country, reason being that you have violated the marketing act which applies in that country.

I will answer your question by explaining if another administrative authority can sue you in Swedish court and also if Swedish court applies foreign law.

Your question is governed in Rättegångsbalken (RB),

Can a foreign authority sue in Swedish court?

The main principle is that a foreign authority can not sue in Swedish court, especially if the foreign authority wishes to impose criminal sanctions. In that case the dispute should take order in that country from which the authority is domiciled.

If it's a civil dispute (in which civil sanctions are being claimed) the foreign authority can sue in Swedish court. In that case it's the court where your head office is located that is authorized (10 kap. 1 § 3 st RB).

Which law will the Swedish court apply?

If Swedish court is authorized the dispute is a civil matter, which means that the parties also have contractual freedom regarding what law is supposed to be used to settle the dispute. If no such contract is settled, it's most likely that it will be law from the authority at hand domicil. In other words, Swedish courts can apply foreign law in some cases. There is no straight answer to this however, it all depends on the parties and what claims are being made.

I hope i have answered your question,

Best regards

André Blomquist
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