Arbitration & ADR, Sweden updates

Arbitral award set aside for violation of due process
  • Sweden
  • 23 May 2019

In a recent decision, the Supreme Court confirmed that Section 34(7) of the Arbitration Act – under which an arbitral award must be set aside if an irregularity occurred in the course of the proceedings and probably influenced the case's outcome – should be applied restrictively. This decision is a rare example of a Swedish court setting aside an award based on procedural irregularities under Section 34(7).

Arbitral award challenge based on Achmea unsuccessful
  • Sweden
  • 14 March 2019

The Svea Court of Appeal has largely upheld two arbitral awards which Poland had challenged on the ground that the arbitration provision in the investment treaty between Poland, Luxembourg and Belgium was incompatible with EU law according to Achmea. However, the court granted leave to appeal to the Swedish Supreme Court, as it deemed the case to include issues of importance for the guidance of the application of law.

Does lack of impartiality justify a reduction in arbitrators' compensation?
  • Sweden
  • 14 February 2019

Although parties have the right to appeal arbitrators' compensation that has been decided by an arbitral institution and included in an arbitral award, a recent Svea Court of Appeal judgment suggests that strong reasons are required to adjust such a decision when it has been made in accordance with an arbitration agreement between said parties. Further, the existence of circumstances which could diminish confidence in an arbitrator's impartiality is insufficient to justify a reduction in compensation.

Counsel's personal liability for costs in challenge proceedings
  • Sweden
  • 25 October 2018

Often, the counsel representing a challenging party will also have acted as counsel in the arbitral proceedings and thus have personal and direct knowledge of the facts of the dispute (ie, what occurred during the arbitral proceedings). Therefore, a court may be less forgiving when a counsel makes an inaccurate statement of facts in challenge proceedings. Counsel representing parties challenging arbitral awards should be aware of this risk and are well advised to avoid potential grounds for personal liability.

Stricter rules on challenges in proposed Arbitration Act revisions
  • Sweden
  • 11 October 2018

A new government bill for revising the Arbitration Act was recently presented to Parliament. The proposed amendments concerning challenges of awards and jurisdictional decisions align with the ambition of restricting challenges and upholding the finality of awards. The proposed provision on multi-party arbitrations aligns with many institutional rules and could, along with the provision on the use of English in challenge proceedings, strengthen Sweden's attractiveness as a place for international arbitration.

Effects of 'ostrich approach' on right to challenge enforcement of foreign arbitral awards
  • Sweden
  • 19 July 2018

The Supreme Court recently rendered a decision concerning an application for enforcement of a foreign arbitral award. The decision clarifies whether a party that is passive in arbitral proceedings forfeits its right to invoke circumstances which were known to the party in the arbitral proceedings as grounds for non-enforcement of a foreign arbitral award. Before this decision, it had been unclear whether such a passivity rule existed in relation to enforcement.

Decisions on merits in form of procedural orders
  • Sweden
  • 01 March 2018

Two appeal courts recently ruled on two separate cases in which arbitral awards were challenged on the basis that the tribunals had departed from decisions made on issues of merits in procedural orders. Generally, procedural orders are not final and binding and a tribunal is free to amend previously issued procedural orders. However, procedural orders are sometimes used as a tool for making interim decisions on the merits of the case.

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