In 2010, Falun Municipality and the company PEAB Sverige AB entered into a contract for the operation and maintenance of certain municipal roads. The Swedish Competition Authority (“SCA”) initiated legal proceedings against the municipality at the Administrative Court, claiming that the contract constituted an illegal direct procurement since no proper procurement process had taken place. The SCA claimed that the Administrative Court therefore should impose a procurement fine of SEK 10 million (approx. EUR 1.1 million), which is the maximum amount under the Swedish Public Procurement Act, on Falun Municipality. The Administrative Court imposed the fine but in the amount of SEK 7 million. Upon appeal, the Administrative Court of Appeal held that the level of the procurement fine must be decided in light of the facts of the individual case, where the value of the illegally procured contract and the term of the contract are among the relevant factors. Noting that the contract concerned a relatively long time period (approx. seven years) and a relatively high value (approx. SEK 161 million), the Administrative Court of Appeal set the amount of the procurement fine to SEK 8 million. The decision of the Administrative Court of Appeal was appealed by both parties and the Supreme Administrative Court has now granted appeal. The decision of the Supreme Administrative Court is expected to set the precedent for how the Swedish courts will calculate fine imposed in procurement cases in the future.Source: Swedish Competition Authority Press Release 20/02/2014