The primary legal sources governing and regulating contracts for the design or execution of building works are the Planning and Building Act (plan-och bygglagen), the Contracts Act (avtalslagen), and the Consumer Services Act (konsumenttjänstlagen).
Last modified 13 Mar 2025
A building permit (bygglov) is generally required and must be obtained before commencing construction work. Additionally, depending on the project's nature, a demolition permit, site improvement permit, or notification may also be necessary. For all these permits, a starting clearance (startbesked) must be secured from the local building committee before construction begins, confirming compliance with all permit conditions.
Certain construction projects, particularly those involving industrial properties with potential hazard or activities that may pollute soil, water, or groundwater, require an environmental permit (miljötillstånd).
Last modified 13 Mar 2025
In Sweden, health and safety on construction sites are governed by the Work Environment Act (arbetsmiljölagen), the Planning and Building Act (plan- och bygglagen), and regulations from the Swedish Work Environment Authority (Arbetsmiljöverket). A work environment plan must be prepared before construction begins, detailing safety measures and risk assessments. Additionally, a work environment coordinator is appointed for the planning phase, as well as for the execution phase to oversee compliance with these measures. Regular inspections by the authority ensure adherence to safety standards, and any accidents must be reported and addressed.
These regulations also impact the post-construction phase by mandating that buildings are designed and constructed to ensure the safety and health of occupants. This includes considerations such as fire safety, structural integrity, and accessibility.
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Environmental assessment and sustainability in building works are governed by the Environmental Code (miljöbalken), and the Planning and Building Act (plan- och bygglagen). The Environmental Code aims to protect human health and the environment from pollution and other environmental hazards, encompassing regulations on environmental liability, impact assessments, and licensing. The Planning and Building Act integrates sustainability principles, requiring that buildings are designed to be energy-efficient and environmentally friendly.
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For new developments, municipalities and developers typically collaborate through a zoning plan that specifies infrastructure requirements, such as roads and sewers. Utility suppliers are involved to secure connections for essential services like water, electricity, gas, and telecommunications. Developers must obtain the necessary permits and approvals to comply with local regulations, ensuring a coordinated and efficient approach to infrastructure and utility provision.
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For commercial building works, no specific conditions are imposed by law, except that the Work Environment Act (arbetsmiljölagen) and the Planning and Building Act (Plan- och bygglagen) mandate safe working conditions and compliance with permits and regulations, influencing design and construction standards. For consumer-related building works, the Consumer Services Act (konsumenttjänstlagen) applies.
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The Construction Contracts Committee (Byggandets Kontraktskommitté) prescribes three main standard form contracts:
International contract forms, such as FIDIC, are rarely used in Sweden.
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In an engineering or construction contract, the primary parties are usually the contractor and the employer. The contractor is responsible for designing and executing the project, while the employer commissions and funds it. Additionally, professional consultants, such as architects and engineers, are often engaged to design the engineering works and produce the necessary drawings, although they are typically not part of the contract between the employer and the contractor.
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Under the general conditions AB 04 and ABT 06, the contractor is liable for any damage to parts of the construction that has not yet been handed over to the employer. However, the contractor is not liable for damage caused by the employer.
Additionally, these conditions specify that the contractor is not be liable for damage resulting from force majeure events, such as war, terrorism, insurrection, natural disaster or similar circumstances.
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It is possible to enter into a fixed-price construction contract, where the contractor agrees to complete the project for a predetermined price. However, these contracts often include provisions for adjusting the price under certain circumstances, such as changes in scope, unforeseen site conditions, or force majeure events.
Last modified 13 Mar 2025
The parties to a construction contract can agree that the price for the work shall be fixed. In addition to the fixed price, the contractor can charge the employer for works resulting from changes, amendments and/or variations to the agreed contract works. Such changes, amendments and/or variations do however generally need to be agreed upon in writing.
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Under the general conditions AB 04 and ABT 06, the contractor is required to obtain an all-risk insurance policy to cover any damage to the works, as well as third-party liability insurance for activities related to the contract. This insurance coverage must remain in effect throughout the construction period and continue for at least two years after the works have been officially approved as complete.
Furthermore, if motor vehicles are utilized on the construction site, obtaining motor vehicle insurance is legally required.
As for worker's liability insurance, it is not necessary for Swedish workers, as this is managed by the Swedish Social Insurance Agency (försäkringskassan), which provides compensation to employees who are injured or become ill due to their work.
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The employer often requests either a bank guarantee or a parent company guarantee from the contractor.
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The pricing for a construction project can be structured as either a fixed price or on a cost-plus basis. Payments to the contractor are typically organized through a payment plan mutually agreed upon by the parties, which may sometimes include an advance payment. Design consultants are generally compensated on an hourly basis. The contractor's payments to sub-contractors often reflect the payment structure established between the employer and the contractor.
Additionally, it is common for the employer to withhold a retention of up to 5% of the total price to ensure the rectification of any defects.
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The parties can agree on a fixed completion date, and delays are typically managed through liquidated damages. According to the general conditions for contracts AB 04 and ABT 06, the contractor is entitled to an extension of the contract period if they are prevented from completing the work within the agreed timeframe due to circumstances caused by the employer or any force majeure events.
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Under the general conditions for contracts AB 04 and ABT 06, the contractor has both a right and an obligation to execute variations prescribed by the employer. These variations can be compensated though an agreed fixed price or on a cost-plus basis. Furthermore, even if the variations are not prescribed by the employer, the contractor may be entitled to compensation if the construction site conditions or any other relevant data differ from what the employer represented or from what the contractor had the right to assume.
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The concept of completion in construction projects is primarily governed by general conditions for contracts, such as AB 04 and ABT 06, rather than specific statutory law. According to these general conditions, completion is typically achieved when the works are finished in accordance with the contract specifications and are fit for their intended use. This includes addressing any defects and ensuring that the project meets all contractual and regulatory requirements. The certification of completion is usually carried out by an independent inspector who is appointed according to the contract terms.
In most construction projects that require a permit or notification under the Planning and Building Act (plan- och bygglagen), a certified inspector (kontrollansvarig) is necessary to ensure that the construction work is carried out in accordance with applicable laws, regulations, and building permit documents. The certified inspector must be certified and independent from the party performing the construction work.
For constructions that require a starting clearance (startbesked), the local building committee must approve the building works through a final clearance (slutbesked).
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The liability period extends for ten years from the approval of the construction works, as stipulated by the general conditions for contracts like AB 04 and ABT 06, as well as the Limitation Act (preskriptionslagen). However, this ten-year liability period is subject to several limitations and exceptions.
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A developer's liability to end users for physical damage or economic loss from building works is governed by contract law, tort law, and special legislation such as the Consumer Services Act. (konsumenttjänstlagen). If there is a direct agreement between the developer and the end user, the contract terms will largely determine liability, often guided by general conditions for contracts like AB 04 and ABT 06, which include defect liability provisions. While liability can be limited or excluded through contractual terms, such exclusions are restricted by law, especially in cases of gross negligence or when consumer protection laws apply. In the absence of a direct contract, liability may arise under the Swedish Tort Liability Act (skadeståndslagen). Insurance is commonly used to mitigate potential liabilities.
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The liability of architects, designers, and subcontractors to end users for physical damage or economic loss is primarily determined by contract law and tort law. If there is a direct agreement with the end user, the terms of the contract will govern liability. While liability can be limited or excluded through contractual terms, such exclusions are restricted by law, especially in cases of gross negligence. In the absence of a direct contract, liability may arise under the Swedish Tort Liability Act (skadeståndslagen). Insurance is commonly used to mitigate potential liabilities.
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In Sweden, third parties like purchasers, tenants, and banks have limited direct rights against designers and contractors. Contractual protections, such as warranties and guarantees, are usually transferred though a direct agreement. Additionally, third parties may have claims under tort law if negligence results in damage.
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There are no courts which specialize in construction disputes. Disputes settled by a public court can be appealed.
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Yes, it is common for construction disputes to be referred to arbitration. Arbitration often resolves disputes more quickly than public courts. The court of arbitration often includes individuals with greater expertise, as the parties have the right to choose the members. However, resolving disputes through arbitration is typically more expensive for the parties involved.
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It is not very common for construction disputes to be referred to alternative dispute resolution (ADR) procedures, although it is possible under the general conditions for contracts, such as AB 04 and ABT 06. There is no form of ADR required by law in Sweden.
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Are any terms and conditions imposed or implied by law or mandatory in contracts for the design or carrying out of building works?
For commercial building works, no specific conditions are imposed by law, except that the Work Environment Act (arbetsmiljölagen) and the Planning and Building Act (Plan- och bygglagen) mandate safe working conditions and compliance with permits and regulations, influencing design and construction standards. For consumer-related building works, the Consumer Services Act (konsumenttjänstlagen) applies.
Last modified 13 Mar 2025