{"id":137934,"date":"2026-04-21T13:12:04","date_gmt":"2026-04-21T13:12:04","guid":{"rendered":"https:\/\/my.legal500.com\/guides\/?post_type=comparative_guide&#038;p=137934"},"modified":"2026-04-21T13:12:04","modified_gmt":"2026-04-21T13:12:04","slug":"sweden-lending-secured-finance","status":"publish","type":"comparative_guide","link":"https:\/\/my.legal500.com\/guides\/chapter\/sweden-lending-secured-finance\/","title":{"rendered":"Sweden: Lending &amp; Secured Finance"},"content":{"rendered":"","protected":false},"template":"","class_list":["post-137934","comparative_guide","type-comparative_guide","status-publish","hentry","guides-lending-secured-finance","jurisdictions-sweden"],"acf":[],"appp":{"post_list":{"below_title":"<div class=\"guide-author-details\"><span class=\"guide-author\">CMS Wistrand<\/span><span class=\"guide-author-logo\"><img src=\"https:\/\/my.legal500.com\/guides\/wp-content\/uploads\/sites\/1\/2022\/03\/CMS_W_Sweden_RGB.png\"\/><\/span><\/div>"},"post_detail":{"above_title":"<div class=\"guide-author-details\"><span class=\"guide-author\">CMS Wistrand<\/span><span class=\"guide-author-logo\"><img src=\"https:\/\/my.legal500.com\/guides\/wp-content\/uploads\/sites\/1\/2022\/03\/CMS_W_Sweden_RGB.png\"\/><\/span><\/div>","below_title":"<span class=\"guide-intro\">This country specific Q&amp;A provides an overview of Lending &amp; Secured Finance laws and regulations applicable in Sweden<\/span><div class=\"guide-content\"><div class=\"filter\">\r\n\r\n\t\t\t\t<input type=\"text\" placeholder=\"Search questions and answers...\" class=\"filter-container__search-field\">\r\n\t\t\t<\/div>\r\n\r\n\t\t\t\r\n\r\n\r\n\t\t\t<ol class=\"custom-counter\">\r\n\r\n\t\t\t\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Do foreign lenders (including non-bank foreign lenders) require a licence\/regulatory approval to lend into your jurisdiction or take the benefit of security over assets located in your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>There is no general requirement that a non-Swedish lender be authorised or obtain regulatory approval merely to extend a loan on a cross border basis to Swedish corporate customers.<\/p>\n<p>However, the professional conduct of \u201cbanking or financing business\u201d (e.g. deposit-taking combined with lending) in Sweden is subject to authorisation under the Swedish Banking and Financing Business Act (Sw. lag (2004:297) om bank- och finansieringsr\u00f6relse) (the \u201cBFA\u201d). For EEA authorised credit institutions, the EU freedoms of establishment and to provide services permit cross border provision of banking and financing services into Sweden, whether on a branch or freedom of services basis.<\/p>\n<p>By contrast, a credit institution domiciled outside the EEA that intends to conduct banking or financing activities in Sweden must generally establish a Swedish branch and obtain authorisation from the Swedish Financial Supervisory Authority (SFSA).<\/p>\n<p>To the extent the aforementioned BFA authorisation requirement is not triggered, it should be noted that the Swedish Act on Certain Financial Operations (Sw. lag (1996:1006) om viss finansiell verksamhet) (the \u201cFinancial Operations Act\u201d) applies to the professional conduct of certain financial activities specified in the BFA, including the granting of credit. The primary purpose of the Financial Operations Act is to bring relevant providers within the scope of Swedish AML\/CTF regulations. For in-scope providers, there is a requirement to register with the SFSA under said act. However, the act generally does not apply to foreign undertakings that provide their services on a pure cross border basis, i.e. without establishment in Sweden through a Swedish branch or subsidiary.<\/p>\n<p>Taking security over assets in Sweden is generally not a regulated activity; however, facility agents and security agents should consider whether their activities may constitute \u201ccredit servicing\u201d under Directive (EU) 2021\/2167 on credit servicers and credit purchasers and, if so, whether any authorisation is required under the Swedish implementing legislation.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any laws or regulations limiting the amount of interest that can be charged by lenders?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>The Swedish Penal Code prohibits the charging of high interest that is deemed manifestly disproportionate (i.e. unreasonably high). The assessment of whether the interest is unreasonably high is made in relation to the specific transaction with regard to the credit terms, the lender\u2019s type of business activity and the borrower\u2019s financial situation.<\/p>\n<p>The Swedish Consumer Credit Act (Sw. konsumentkreditlagen (2010:1846)) includes specific interest rate and cost ceilings for certain types of consumer loans.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any laws or regulations relating to the disbursement of foreign currency loan proceeds into, or the repayment of principal, interest or fees in foreign currency from, your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>There are no Swedish laws or regulations specifically regulating (or distinguishing between) the disbursement of loan proceeds, the repayment of principal, interest or fees, in domestic or foreign currency.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Can security be taken over the following types of asset:  i.\treal property (land), plant and machinery; ii.\tequipment; iii.\tinventory;  iv.\treceivables; and v.\tshares in companies incorporated in your jurisdiction.               If so, what is the procedure \u2013 and can such security be created under a foreign law governed               document?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes, security can be granted over each listed asset, either in the form of a pledge (or, alternatively, a security assignment) or a registered security transfer (Sw. l\u00f6s\u00f6resk\u00f6psregistrering). The perfection steps set out below are required in order to obtain a perfected and enforceable security.<\/p>\n<p>Security over real estate is perfected by the delivery of written mortgage certificate(s) or the transfer of electronic mortgage certificate(s) (the transfer of electronic mortgage certificates requires that the mortgagee or its agent has access to the electronic mortgages system of the Land Registry).<\/p>\n<p>Security over moveable assets such as plants, machinery, equipment, and inventory can be taken either in the form of floating charges (a general security over certain moveable assets of the pledgor that confers a priority right upon attachment and in bankruptcy rather than a security in rem), by way of a registered security transfer of the specific asset (if the asset shall be left in the custody of the transferor), or by a pledge or security assignment and delivery of the specific asset (if the asset is not to be left in the custody of the pledgor), or, if the asset is held by a third party, by giving notice to that third party.<\/p>\n<p>The registration of floating charges is made in the floating charges register kept by the Swedish Companies Registration Office, and the chargee can either receive a written charge certificate or an electronic charge certificate (provided the chargee or its agent has access to the electronic charges title register).<\/p>\n<p>A perfected registered security transfer of movable assets in the form of chattels (to be left in the custody of the transferor) requires that (i) the asset is purchased by the transferee (typically for the consideration of SEK 1), (ii) the purchase has been proclaimed in a local daily paper accepted by the Enforcement Authority (Sw. Kronofogdemyndigheten), and (iii) the purchase is registered with the Enforcement Authority.<\/p>\n<p>Security (in the form of a pledge) over receivables is perfected by notification to the debtor of the pledge and instructed to only make payments to the pledgee (or that payments may be made to the creditor until otherwise instructed by the pledgee, in which case the pledge is not perfected until such instruction has been provided to the debtor), and that the pledge will be deemed released only when the pledgee so instructs. The same principles apply to security assignment.<\/p>\n<p>Perfection requirements for shares depend on whether or not the relevant limited liability company is a CSD-registered company (Sw. avst\u00e4mningsbolag). Security over shares in a private company (not CSD-registered) is perfected by delivery of the original share certificates to the pledgee. While not being formal perfection requirements, the pledgee typically also requires that the share certificates are endorsed in blank, that the company (which shares are subject to the security) is notified, and that the pledge is reflected in the share register of the company.<\/p>\n<p>Perfection over shares in CSD-registered companies (public companies) is made by registration with the Swedish CSD (currently Euroclear Sweden AB) for owner-registered shares, or by notification to the custodian of the securities account on which the relevant shares are registered for nominee-registered shares.<\/p>\n<p>While uncommon, there is no restriction prohibiting security agreements over Swedish assets from being governed by foreign law. Enforceability would however require fulfilment of the relevant perfection steps in order to create a valid security interest.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Can a company that is incorporated in your jurisdiction grant security over its future assets or for future obligations?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes, security may be provided in relation to future obligations (such as interest and damages) and future assets, but such security is perfected only once the relevant assets exist and relevant perfection measures are fulfilled.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Can a single security agreement be used to take security over all of a company\u2019s assets or are separate agreements required in relation to each type of asset?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>There is no restriction on including various types of security in one single security agreement. However, in practice, the need for asset specific perfection mechanics and related representations, warranties and undertakings makes such omnibus agreements complex to draft, which is why separate asset-specific agreements remain market standard.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any notarisation or legalisation requirements in your jurisdiction? If so, what is the process for execution?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Swedish law does not provide any notarisation or legalisation requirements relating to the granting of security.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any security registration requirements in your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Security registration requirements apply in respect of security transfers of chattels and for security over intellectual property rights, such as patents and trademarks, and security over dematerialised financial instruments. The issuance of floating charge certificates, real estate mortgage certificates and mortgages in ships and aircraft requires registration.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any material costs that lenders should be aware of when structuring deals (for example, stamp duty on security, notarial fees, registration costs or any other charges or duties), either at the outset or upon enforcement? If so, what are the costs and what are the approaches lenders typically take in respect of such costs (e.g. upstamping)?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Stamp duties apply in respect of the issuance of floating charge certificates, real estate mortgage certificates and mortgage certificates in aircraft. Applicable stamp duties are 1 per cent (floating charge certificates), 2 per cent (real estate mortgage certificates) and 1 per cent (aircraft mortgages) of the face value (which is a fixed amount) of the relevant certificate. Minor registration fees also apply, for example SEK 375 per real estate mortgage certificate.<\/p>\n<p>These stamp duties are always borne by the borrower; however, lenders should structure security in a manner that does not cause unnecessary stamp duty.<\/p>\n<p>The registration cost for a pledged Swedish patent is SEK 500, and for a pledged Swedish trademark SEK 1,800.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Can a company guarantee or secure the obligations of another group company; are there limitations in this regard, including for example corporate benefit concerns?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes, subject to the general loan prohibition and the financial assistance prohibition generally applicable to Swedish limited liability companies\u2019 provision of loans, guarantees and security (and any applicable exemptions); see further under Section 11. However, it must also be assessed whether the guarantee or security (below together referred as \u201csecurity\u201d) is permitted under the rules regulating the distribution of assets set out in the Swedish Companies Act (Sw. aktiebolagslagen (2005:551)), since a security, as a consequence of which the company\u2019s assets are reduced and which is not of a purely commercial nature for the company, may constitute a value transfer subject to the restrictions on dividends and may as such be unlawful.<\/p>\n<p>Thus, it needs first to be assessed whether the assets of the company providing the security are reduced as a consequence of the security. Factors to consider are e.g.;<\/p>\n<ul>\n<li>\u00a0the ability of the debtor to repay the debt (and therefor the ability to pay the subrogation right of the security provider if the security is enforced), including, as part of that assessment, whether the value of the shares in the company providing the security shall be taken into account (where these are owned by the debtor), and<\/li>\n<li>the consideration (if any) paid by the debtor to the company providing the security.<\/li>\n<\/ul>\n<p>If the conclusion is that the security reduces the company\u2019s assets, such security will still not constitute a value transfer if it is provided by the company for purely commercial reasons. Factors to consider are e.g.:<\/p>\n<ul>\n<li>\u00a0if the security is made in the ordinary course of business, and<\/li>\n<li>the difference in market value between the security and the consideration (if any) provided by the debtor.<\/li>\n<\/ul>\n<p>The legal doctrine and case law present a somewhat ambiguous picture as to which factor(s) should be decisive, and the above assessment should always be made on a case-by-case basis.<\/p>\n<p>Even if a security would be considered a value transfer as per above assessments, the granting thereof may still be in compliance with the Swedish Companies Act if the company had freely distributable equity corresponding to the value of the security at the time it was provided; any portion of the value transfer exceeding that amount would be considered unlawful and may be subject to restitution by the recipient, and those who participated in the decision to effect the value transfer may be obligated to recover any shortfall.<\/p>\n<p>As the above assessments can be complex, it is common that the parties agree in the finance documents that the validity of any upstream or cross-stream security shall be limited to the extent necessary to comply with the mandatory provisions in the Swedish Companies Act regarding distribution of assets (the so called \u201climitation clause\u201d).<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any restrictions against providing guarantees and\/or security to support borrowings incurred for the purposes of acquiring directly or indirectly: (i) shares of the company; (ii) shares of any company which directly or indirectly owns shares in the company; or (iii) shares in a related company?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p><strong>i) Shares of the Company<\/strong><\/p>\n<p>Yes. The prohibition of providing financial assistance (the \u201cfinancial assistance prohibition\u201d), outlined in the Swedish Companies Act means that such security may not be provided by the Company for the purpose of enabling the debtor to acquire shares in the Company. The financial assistance prohibition also covers situations where the shares are acquired by any natural or legal person connected to the debtor. The same applies in relation to the examples in (ii) and (iii) below.<\/p>\n<p><strong>(ii) Shares of any company which directly or indirectly owns shares in the Company<\/strong><\/p>\n<p>Yes. The financial assistance prohibition covers also acquisition of shares in any parent company of the Company in the same group. Please note that this only applies if the parent company is a limited liability company established in Sweden.<\/p>\n<p><strong>(iii) Shares in a related company<\/strong><\/p>\n<p>The financial assistance prohibition does not cover acquisition of shares in subsidiaries to the Company; however, there is a complementary restriction in the Swedish Companies Act that, depending on the circumstances, could be applicable. In the preparatory works to the financial assistance prohibition, it is stated that the prohibition also covers the acquisition of shares in companies that are owned by the same parent company as the Company. However, this statement has been criticised in legal doctrine and the situation is therefore somewhat uncertain.<\/p>\n<p><strong>(iv) Non-acquisition debt<\/strong><\/p>\n<p>In acquisition financing, providing upstream or cross-stream security or guarantees to secure non-acquisition debt such as refinancing debt or working capital loans is generally not captured by the financial assistance prohibition. That said, such security and guarantees may be subject to the general loan prohibition. However, there are various exemptions from the general loan prohibition that are often applicable in practice and can make such security or guarantees permissible, e.g. where the debtor is a company within the same EEA group as the Company.<\/p>\n<p><strong>(v) Workarounds<\/strong><\/p>\n<p>To avoid breaching the financial assistance prohibition, it is common practice for the Company to refrain from granting, or committing to grant, security and guarantees until a certain period after closing. Further, in certain types of transactions (particularly real estate acquisition financings), initiating a post-closing merger between the Company and the acquiring company typically serve as an alternative workaround.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Can lenders in a syndicate (or, with respect to private credit deals, lenders in a club) appoint a trustee or agent to (i) hold security on the lenders\u2019s behalf, (ii) enforce the lenders\u2019 rights under the loan documentation and (iii) apply any enforcement proceeds to the claims of all lenders in the syndicate?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes, the appointment of agents\/trustees is commonly used in the Swedish market. The agent\/trustee can have the function as described in (i)-(iii), provided that this is outlined in the underlying finance documentation.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">If your jurisdiction does not recognise the role of an agent or trustee, are there any other ways to achieve the same effect and avoid individual lenders having to enforce their security separately?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>N\/A.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Do the courts in your jurisdiction generally give effect to the choice of other laws (in particular, English law) to govern the terms of any agreement entered into by a company incorporated in your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes, the parties may choose the governing law (including English law) subject to and in accordance with the provisions of EU Regulation 593\/2008 (Rome I) of the European Parliament and of the Council on the law applicable to contractual obligations.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Do the courts in your jurisdiction generally enforce the judgments of courts in other jurisdictions (in particular, English and US courts) and is your country a member of The Convention on the Recognition and Enforcement of Foreign Arbitral Awards (i.e. the New York Arbitration Convention)?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Court judgments given by the courts of other EU member states or the courts of the member states of the EEA are enforceable in Sweden pursuant to the recast EU Regulation No 1215\/2012 on judgments rendered in EU Member States in Civil and Commercial Matters (the Brussels 1a Regulation) and the 2007 Lugano convention (Lugano II) respectively.<\/p>\n<p>Court judgments obtained from courts in other countries (such as England and the US) are not enforceable in Sweden, and new proceedings will need to be initiated in Sweden. An exception to this rule is court judgments which fall within the applicable scope of the Hague Convention of 30 June 2005 on the Choice of Court Agreements or within the Hague Convention on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters of 2 July 2019, when applicable between Sweden and the country in which the judgment was rendered (such as England). A judgment rendered in accordance with the rules of any of these conventions is enforceable in Sweden subject to certain procedural requirements. If the foreign judgment is not enforceable in Sweden it may nevertheless be used as evidence in the Swedish proceedings.<\/p>\n<p>On 27 February 2025 the CJEU issued its judgment in the case known as Societ\u00e1 Italiana Lastre SpA (SIL) v Agora SARL (Case C-537\/23). The case concerned the validity and enforceability of asymmetric jurisdiction clauses, whereby an exclusive jurisdiction is chosen for both parties but under which one of the parties is entitled to file writs in the courts of any other jurisdiction. Within the context of the Brussels 1a Regulation the court determined that only asymmetric clauses providing for the courts of another EU Member State or a state party to the Lugano II Convention was acceptable and that the choice of court agreement should identify the objective factors which are \u201csufficiently precise to enable the court seised to ascertain whether it has jurisdiction\u2026\u201d. The judgment has created several uncertainties, including in relation to choice of court agreements under which e.g. English courts are the exclusive forum but where one of the parties may also file writs in the courts of other jurisdictions and in relation to the application of the 2019 Hague Convention.<\/p>\n<p>Sweden is a member of the New York Arbitration Convention providing for the enforceability in Sweden of foreign arbitration awards (as provided for under the convention).<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What (briefly) is the insolvency process in your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p><strong>Bankruptcy<\/strong><\/p>\n<p>A condition for the court to grant a bankruptcy petition is that the debtor is considered insolvent, i.e. that the debtor cannot pay its debts when due, and that this incapacity is not merely temporary. Proof of insolvency may be that an unsuccessful seizure attempt was made within six months of the bankruptcy petition. Another proof may be that the debtor has been requested to pay a clear and due debt, but has not done so within a week, and the bankruptcy petition is submitted within three weeks thereafter, provided that the debt is still unpaid.<\/p>\n<p>Under certain circumstances, a bankruptcy petition will be denied. For instance, if the creditor applying for bankruptcy has a sufficient security in the assets of the debtor, the petition will be denied. However, that creditor may instead apply for a seizure of assets.<\/p>\n<p>The administrator is appointed by the court and has the duty to liquidate the bankruptcy estate as soon as possible and as beneficial as possible to the creditors.<\/p>\n<p>When the debtor\u2019s assets have been converted into liquid funds, these shall be distributed to the creditors, and the Swedish Rights of Priority Act (Sw. f\u00f6rm\u00e5nsr\u00e4ttslagen (1970:979)) regulate the order of priority of the creditors. The administrator must submit the distribution proposal to the court, which will examine and decide upon the proposal.<\/p>\n<p><strong>Company reconstruction<\/strong><\/p>\n<p>A debtor in financial difficulties can obtain a court order for the reconstruction of its business. Both the creditor and the debtor may apply for such order, but an application of a creditor will be rejected if denied by the debtor. A reconstructor appointed by the court shall then investigate whether the business of the debtor can be continued (in whole or in part) and whether it is possible for the debtor to reach a financial settlement with its creditors, i.e. a write-down of debts (composition). Every three months the court considers whether or not the reconstruction shall continue and, as a general rule, the reconstruction may not continue for more than one year.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What impact does the insolvency process have on the ability of a lender to enforce its rights as a secured party over the security?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p><strong>Bankruptcy<\/strong><\/p>\n<p>In general, following a court decision on bankruptcy, assets of the bankruptcy estate may no longer be seized separately for a claim against the debtor. However, a creditor with a perfected security interest (other than in the form of a floating charge) can request a seizure of the security assets with the Enforcement Authority, even if the debtor has been declared bankrupt. If a seizure has been decided prior to the bankruptcy, the main rule is that such seizure procedure may continue irrespective of the bankruptcy (and regardless of whether the creditor has a perfected security interest or not).<\/p>\n<p>Further, a creditor may under certain circumstances enforce a sale of moveables held by the creditor as a pledge, which generally requires the consent of the administrator.<\/p>\n<p><strong>Company reconstruction<\/strong><\/p>\n<p>The same general rule against seizure applies as in bankruptcy, but the exception for any seizure decided prior to the decision on company reconstruction does not apply.<\/p>\n<p>As in bankruptcy, exceptions are made for assets covered by certain types of security interests (e.g. a share pledge and right of retention, but not a mortgage in real property or certain other security interests). However, the application of such exceptions has been limited due to changes in the company reconstruction legislation in 2022.<\/p>\n<p>Further, there are certain restrictions on a creditor&#8217;s right to terminate an agreement due to the debtor&#8217;s payment default during a company reconstruction.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Please comment on transactions voidable upon insolvency.<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Below are some typical situations briefly described, where recovery may be relevant in a bankruptcy or company reconstruction. If the relevant transaction was made with a related party, the recovery periods mentioned below are generally longer.<\/p>\n<p><strong>Transactions in general<\/strong><\/p>\n<p>A transaction or legal act that took place within five years of the bankruptcy petition and in which a particular creditor has in an unfair manner been favored, or the debtor\u2019s assets been reduced or the debts increased, will be annulled if the debtor was insolvent at the time or became insolvent because of it, and the other party knew or should have known about the debtor\u2019s insolvency and the circumstances that made the transaction or legal act improper.<\/p>\n<p><strong>Payments<\/strong><\/p>\n<p>The payment of a debt which has been made later than three months prior to the bankruptcy petition, and which was made through other than customary means of payment, prematurely or in an amount that has considerably deteriorated the debtor\u2019s financial position, will be annulled unless the payment is nevertheless regarded as ordinary.<\/p>\n<p><strong>Security<\/strong><\/p>\n<p>Security granted by the debtor later than three months prior to the bankruptcy petition and which was not provided when the debt was created or which has not been transferred without delay after the creation of the debt, will be annulled unless the security is nevertheless regarded as ordinary.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is set off recognised on insolvency?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>The general rule is that a creditor may set off against a claim that the debtor had against the creditor when the debtor was declared bankrupt (in the case of a company reconstruction, the corresponding rules apply).<\/p>\n<p>However, there are certain limitations in the right to set off, e.g. if the creditor was aware of the insolvency when the receivable was acquired, or if the bankruptcy was imminent when the receivable was acquired.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any statutory or third party interests (such as retention of title) that may take priority over a secured lender\u2019s security in the event of an insolvency?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>A retention of title right might give such priority ahead of a secured lender. There are a number of conditions in order for a retention of title to be valid against the buyer\u2019s creditors. For example, it is required that the retention of title is made no later than when the property is transferred to the buyer. A retention of title will not be valid if it is clear from the circumstances that the buyer has the right to sell the goods, or to consume them, before being fully paid.<\/p>\n<p>Certain other third-party rights give priority ahead of a lien, e.g. a buyer\u2019s right to certain movable property that has remained in the seller\u2019s possession and has been registered in accordance with the same requirements as for registered security transfers (discussed under Section 4 above). Other examples are the right to accounting funds and goods received on behalf of another person for sale (commission).<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any impending reforms in your jurisdiction which will make lending into your jurisdiction easier or harder for foreign lenders?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>The Swedish Screening of Foreign Direct Investments Act (Sw. lag (2023:560) om granskning av utl\u00e4ndska direktinvesteringar) entered into force on 1 December 2023 and has been introduced in order to prevent certain strategic acquisitions by foreign investors of companies whose operations, information or technology are important for Sweden&#8217;s security or for public order or public safety in Sweden. The regulation applies mainly to investments pursuant to which an entity acquires more than ten (10) per cent of the shares or votes in a target entity involved in a security sensitive business, such as infrastructure, central functions, critical primary products, new technologies, munitions and products that may be used for both military and civil purposes.<\/p>\n<p>The regulation has caused some uncertainty in the market and may have an impact on a lender\u2019s decisions to finance assets that may fall under the regulation, mainly due to that a sale of pledged assets could be subject to approval of the competent authority. During 2025, the number of reports to the authority increased by 60 per cent to 1,987 reports. The authority performed extensive investment reviews on 45 reports, but only 2 investments were forbidden.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What proportion of the lending provided to companies consists of traditional bank debt versus alternative credit providers (including credit funds) and\/or capital markets, and do you see any trends emerging in your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Sweden remains largely bank-dependent, with loans accounting for roughly 85 percent of aggregate debt financing for non-financial companies, while debt securities account for roughly 15 percent. However, capital markets financing has been gaining share over time, with the OECD noting a more pronounced shift toward debt securities from around 2011 onward.<\/p>\n<p>According to the Riksbank (the Swedish Central Bank), alternative lenders\u2019 share of corporate lending in Sweden remains difficult to estimate due to limited data availability, but the sector is characterised as currently small, with indications of growth, particularly in certain segments such as real estate.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Please comment on external factors causing changes to the drafting of secured lending documentation and the structuring of such deals such as new law, regulation or other political factors<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Please see regarding the new CJEU judgment on asymmetric jurisdiction clauses under section 15, which may have an impact on the drafting of jurisdiction clauses in e.g. finance documents.<\/p>\n<p>The EU\u2019s Capital Requirements Directive VI (CRD VI) includes new rules for e.g. third-country credit institutions operating in the EEA. These rules are currently being implemented in Sweden.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\r\n<div class=\"word-count-hidden\" style=\"display:none;\">Estimated word count: <span class=\"word-count\">4740<\/span><\/div>\r\n\r\n\t\t\t<\/ol>\r\n\r\n<script type=\"text\/javascript\" src=\"\/wp-content\/themes\/twentyseventeen\/src\/jquery\/components\/filter-guides.js\" async><\/script><\/div>"}},"_links":{"self":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/comparative_guide\/137934","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/comparative_guide"}],"about":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/types\/comparative_guide"}],"wp:attachment":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/media?parent=137934"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}