Doing business in Sweden Essay
Sweden is situated in northern Europe, bordering the Baltic Sea, Gulf of Bothnia, Kattegat, and Skagerrak. The country lies between Finland and Norway and was once a significant military power in the region until the 17th century (“Sweden”, 2007). The country has not participated in any military action in the 20th century which has been seen as one of the primary reasons for the stability of the country’s economy in the said period (Grant Thorton Consultancy, 2002). It is highly industrialized and services oriented economy and has significant high-tech capitalism. Its labor force is highly skilled and educated.
Gross dometic product for 2006 was estimated at $371. 5 billion growing at the rate of 4. 2% with agriculture contributing 1. 1%, industry contributing 28. 1% and services contributing 70. 9% (“Sweden”, 2007). According to the UD Department of Commerce the key sectors for investment in the country are agricultural, travel and tourism, safety and security equipment, electric power incl. renewable, pollution control equipment, medical equipment, computer software, drugs and pharmaceuticals, automotive parts and telecommunications equipment and services (Sweden, 2006).
Considerations The legal system in Sweden is based on statutory law that is supplemented by case law. The country is governed under a
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The executive branch of government is made of ministries whose heads are appointed by the Prime Minister accordingly as part of his cabinet. There are also 21 public executive boards for each of the counties which are headed by government appointed director generals (Grant Thorton Consultancy, 2002). Government Regulations Sweden is one of the most liberal in terms of investment and finance in the world (Vinge, 2006). One of the reasons for the liberal setting is that the country is a member of most of trade organizations, particularly in Europe. This is also one of the reasons why the country is considered as haven for banking and finance.
The existing regulations in the country that can affect businesss operations are as follows (Grant Thorton Consultancy, 2002): Restrcitions on ownership – foreigners are not restricted from acquiring shares or interest in Sweding corporations and partnerships or acquiring real estate property except if the property is to be used for the purpose of fortestry, recreation or agriculture Restriction for business operations – only financial and insurance business interests are required to get approval from the Financial Supervisory Authority but all business operations must register at their local counties
Competition regulations and comsumer protection – Sweden operates a Competition Act to ensure free market operations. Under the supervision of the Swedish Competition Authority, operations or agreements that are anti-competitive can be considered as null and void Import and export controls – there are mo major regulatory measures except for those in compliance of EU regulations. The government also has created a Patent Registration Office for IPO rights protection. Though it is not a requirement, only those duly registered can be protected against infringement.
Price controls – none except for extraneous circumstances that can be defined under the Competition Act. Use of Land – though there is no restriction of the acquisition of land, usage has to be in consultation with the local government for real estate planning and regulation Exchange control – there are no exchange controls enforce but exchanges more than SEK75,000 are to be reported. Thirty percent of dividends are withheld except for cases were double taxation may occur. There are no restrictions for borrowing or lending.