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Arbitration agreements

Validity

What are the validity requirements for an arbitration agreement?

Under the Arbitration Act, an arbitration agreement is an agreement between two or more parties to refer a dispute regarding a particular legal relationship to resolution by one of more arbitrators.

The definition of an ‘arbitration agreement’ set out in the Arbitration Act involves the following requirements:

  • There must be an agreement between two or more parties.
  • The agreement must provide for resolution by arbitration.
  • The determination must be by one or more persons acting in the capacity of arbitrator.
  • The parties’ intention to choose arbitration must be unambiguous.

In cases involving arbitration agreements for arbitration of future disputes, the dispute in question must relate to an identified legal relationship. 

Enforcement of agreements

How are arbitration agreements enforced in your jurisdiction? What is the attitude of the national courts towards arbitration agreements?

Swedish courts are considered arbitration friendly.

A valid arbitration agreement excludes the jurisdiction of the courts.

If court proceedings are initiated despite an arbitration agreement, the opposing party must invoke an arbitration agreement on the first occasion that a party pleads its case on the merits in the court. The invocation of an arbitration agreement on a later occasion will have no effect unless the party had a valid excuse and invoked the agreement as soon as the excuse ceased to exist.

Consolidation

Can an arbitral tribunal with its seat in your jurisdiction consolidate separate arbitral proceedings under one or more contracts, and, if so, in what circumstances?

The Arbitration Act does not deal with the consolidation of separate arbitration proceedings. Thus, the consolidation of ad hoc proceedings would require, among other things, agreement between all parties.

However, the Arbitration Rules of the Arbitration Institute of the Stockholm Chamber of Commerce – which are the most frequently used institutional rules in Sweden – contain specific provisions on consolidation. Under these rules, the board of the institute may decide to consolidate a newly commenced arbitration with a pending arbitration at the request of a party, subject to the satisfaction of a number of requirements, including agreement by all parties to consolidate.

Choice of law

How is the substantive law of the dispute determined? Where the substantive law is unclear, how will a tribunal determine what it should be?

Where the parties have agreed that the law of a given state will apply to the merits of the dispute, the tribunal must base its award on that law. However, where no such agreement exists, this issue is to be decided on the basis of Swedish conflict of law principles. 

Separability

Are there any provisions on the separability of arbitration agreements?

Yes. Section 3 of the Arbitration Act provides that where the validity of an arbitration agreement which constitutes part of another agreement must be determined in conjunction with a determination of the arbitrators’ jurisdiction, the arbitration agreement will be deemed to constitute a separate agreement.

Multiparty agreements

Are multiparty agreements recognised?

Multi-party arbitration is recognised in Sweden.

The Arbitration Act contains no provisions on multi-party arbitration. Thus, multi-party arbitration in ad hoc proceedings requires agreement between all parties.

However, the Arbitration Rules of the Arbitration Institute of the Stockholm Chamber of Commerce contain provisions on the joinder of additional parties and multiple contracts.

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