Sweden slammed for foreign company hurdles

James Savage
James Savage - [email protected]

Sweden has been warned by the European Commission that it is putting too many bureaucratic hurdles in the way of foreign companies that want to set up subsidiaries here.


Michel Barnier, the European Commissioner responsible for the EU's internal market, has told the Swedish government that laws that require some European service-sector companies to formally establish branches in Sweden before doing business here, forcing them to file separate accounts, was a breach of the EU's services directive.

In a statement delivered to the Swedish government last month, Barnier also criticized Sweden for requiring foreign service sector companies without a managing director in the country to appoint a Swedish resident as an official representative.

The document also gives Sweden a rap over the knuckles for taking up to four months to process the paperwork of foreign companies applying to set up Swedish branch or subsidiary. The Commission argued that two weeks should be ample in most cases.

"The Commission is of the opinion that the registration of a foreign branch should be a simple and automatic process that does not require such a long waiting time, particularly now that electronic processes make it possible to send applications, decisions and documents quickly," Barnier wrote.

The criticism marks the latest stage in a long-running disagreement between Sweden and the Commission over the way Sweden regulates the establishment of foreign companies.

Sweden was first warned in 2008 that its legislation violated EU law. It has now been given two months to take the necessary steps to comply with the Commission's demands.


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