Speaking on a visit to Sweden on Tuesday, the company's global privacy counsel, Peter Fleischer, warned that Google would rule out making any major investments in Sweden should the controversial bill become law.
"We have contacted Swedish authorities to give our view of the proposal and we have made it clear that we will never place any servers inside Sweden's borders if the proposal goes through," Fleischer told Internet World.
The proposal, which would allow the National Defence Radio Establishment (Försvarets Radioanstalt - FRA) to monitor e-mail and telephone traffic coming in and out of the country, has met with fierce criticism from several quarters within Sweden. But Google had remained relatively silent on the issue, until now.
"We simply cannot compromise our users' integrity by allowing Swedish authorities access to data that may not even concern Swedish activity," said Fleischer.
Google's privacy chief went as far as to suggest that Sweden was in danger of embarking on a path usually reserved for dictatorial regimes.
"The proposal stems from a tradition begun by Saudi Arabia and China and simply has no place in a Western democracy," he said.
Fleischer added that Google has submitted its criticism of the proposed legislation to the Department of Justice.
"Sometimes Google needs to take a clear stance and my impression is that everybody has listened very intently to what we have had to say," said Fleischer.
The Swedish government has previously defended the proposal on the grounds that it will help in the fight against terrorism and international organized crime.
But the opposition, government agencies and a host of other organizations have accused the proposed legislation of being unconstitutional and a threat to individual freedoms.
Disagreements between the Moderate and Social Democrat parties on some of the finer points of the legislation have made it unlikely that the bill will be pushed through parliament in the near future.
Instead, the opposition parties are expected to make use of a constitutional regulation enabling them to postpone a parliamentary ruling until next year, meaning that the bill would come into law in 2009 at the earliest.