The Christian Democrats have convinced the other centre-right parties to set aside a new legislative proposal that would have scrapped the law, arguing that the issued is legally complex and needs to be examined further.
Opposition parties decried the move, claiming that a majority of members in the Riksdag support efforts to ditch the demand.
“It's too bad that the government and prime minister Fredrik Reinfeldt haven't taken into account that there is wide support in the Riksdag to scrap the [sterilization] requirement,” Social Democrat MP Lena Hallengren, deputy chair of the Riksdag social committee, told the TT news agency.
According to legislation passed in 1972, to undergo a sex change operation a person must be over 18-years-old, a Swedish citizen, be sterilized and unmarried.
In the proposal for new legislation, to be be presented by the government this spring, the conditions that sex change candidates are unmarried and Swedish citizens will be dropped, according to TT. But not the sterilization condition.
In the autumn of 2011, both the Moderate Party and the Liberal Party (Folkpartiet) expressed support for changing the law.
"We don't see it as modern, and it doesn't fit with our view of human beings," said party secretary Sofia Arkelsten to the TT news agency in September.
But concerns from the Christian Democrats were great enough to sway the other parties of the governing centre-right Alliance to put off new legislation and instead commission an inquiry into the matter.
According to Hallengren, the move amounts to an attempt to dodge the issue.
“It means that the Christian Democrats have won and that the Moderates don't think it's important,” she said.
Green Party MP Agneta Luttrop called the law outdated, arguing it should have been changed long ago.
“It's a macabre law. It's not dignified that in 2012 someone should be forcibly sterilized,” she told TT, questioning what good will come from additional examination of the issue.
“Other countries don't have demands like this and it hasn't presented an legal complications,” she added.
Christian Democrat MP called the decision a victory for social affairs minister and party head Göran Hägglund and an indication of the positive dialogue that takes place between the governing parties.
“It's important that we stand by the precautionary principle and don't rush into legislation. This question needs to be looked at more closely,” he said.
Liberal MP Barbro Westerholm had previously indicated she planned to push the issue in the Riksdag, but has been forced to retreat.
“I can live with this. It's a positive step forward where that had previously been deadlock. Sometimes it takes time to reach the goal, but it's better than having things stop completely,” she told TT.
In a statement, the Swedish Federation for Lesbian, Gay, Bisexual and Transgender Rights (Riksförbundet för homosexuellas, bisexuellas och transpersoners rättigheter – RFSL), criticized the decision, claiming that “government stability” had been given priority over respect for human rights.
“It's extremely remarkable that a democracy like Sweden now believes that this must be examined further,” RFSL chair Ulrika Westerlund said in a statement.
She pointed out that the National Board of Health and Welfare (Socialstyrelsen) proposed changing the law back in 2010.
“To now want to investigate the matter yet again can't be seen as anything else than that those who have ordered the inquiry want to reach a different conclusion for political reasons,” said Westerlund.