The EU has found that the agency discriminated against the couple in denying them their rights under Spanish law and custom to bestow both their names on their child.
"Sweden has, by refusing to register a child with dual Spanish-Swedish citizenship under a double surname, in accordance with Spanish law and custom, failed in its obligation according to articles 12,17 and 18 of the EU treaty," the EU commission explained in a statement outlining its decision.
Susana Benedet Perea and Christian Andersson had complained to the EU on behalf of their son, Roque Andersson Benedet, regarding the Swedish national registration system and the tax agency's refusal to register a double surname.
The couple are married, live in Sweden and Roque, their only son, holds dual Spanish and Swedish citizenship.
The couple argued to the tax agency that they would like their son registered according to the Spanish custom as "it would facilitate his full identification in the exercise of his rights in both Sweden and Spain."
The tax agency rejected the couple's application on October 15th 2004 and registered the child as Roque Andersson as the authority ruled that according to existing legislation the child could be given only one surname - either the mother's or the father's, but not both.
According to the Swedish name law, parents can then apply to change the child's name at the Patent and Registration Office (Patent– och registreringsverket – PRV), but must pay for the privilege. The original name registration is however free of charge.
The couple's appeals in the Gothenburg Administrative Court (Länsrätten), the Administrative Court of Appeal (Kammarrätten) and the Supreme Administrative Court (Regeringsrätten) were all rejected on the grounds that the decision was in line with EU law.
But the EU Commission stated in a letter of formal notice sent on October 23rd 2007 that Sweden's application of the same rules on children with only one citizenship as for those with dual citizinship constituted discrimination on the basis of nationality, and was a restriction on free movement within the union.
Sweden argued in return that children with a double surname registered in another member state are given the possibility to submit an application for a name change with the PRV.
In its notice the EU Commission made special mention of the existence of a fee for the subsequent change of the child's name at the PRV.
Sweden pledged that the government was planning to propose changes to the name law so "that people with dual nationality within the EU can more easily gain approval for their foreign names in Sweden." Sweden also said that the charge for a name change would in the meantime be waived in such cases.
While the EU commission in its March ruling welcomed the changes outlined in Sweden's reply, it is argued that the country is not meeting its obligations according to EU law and thus the treatment of dual EU citizens amounts to discrimination.
The EU Commission has now issued a Reasoned Opinion instructing Sweden "to take the steps necessary to comply within a period of two months."
Sweden began regulating names in the early twentieth century amid concern that disreputable people were adopting noble names. The laws have been reformed on several occasion's since then; in 1983, for example, it was made possible for men to adopt their wife or partner's name.
In accordance with the name law, the tax agency is also responsible for the approval of first names - a practice which regularly grabs headlines over name proposals such as Metallica, Q or Dark Knight, as well as more mundane requests to register accepted male names for females, or surnames as first names.