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Sweden Sectoral: Procurement - General Govt

Discussion on Sweden marketing requirements, customs information, legal issues, business resources, etc.

Sweden Sectoral: Procurement - General Govt

Postby bridgat » Mon Nov 17, 2008 1:48 am

The interest in franchising in Sweden continues. According to the Swedish Franchise Association there are some 300 franchise systems in Sweden, employing 100,000 people and reporting an annual turnover of SEK 80 billion ($10 billion). Franchising is especially popular in the area of fast food, retail trade and consulting/business services.

It is strongly recommended that U.S. companies considering franchising in Sweden, conduct a qualified legal study to ensure full validity and enforcement of franchising agreements. The use of an American franchising agreement without adjustments for Swedish laws and practices could be detrimental to the franchiser's business.

Franchise networks, which have been successful in the United States, will not automatically succeed in Sweden, but a name that is well known in the U.S. market does have a great advantage. However, to meet the needs of the Swedish market, U.S. franchisers should be prepared to modify their product mix or implement other changes in their marketing policy in order to boost competitiveness.

For detailed information on franchising contact should be made with the Swedish Franchise Association, Box 5243, SE-402 24 Goteborg, Sweden. Tel: 46-31-83 69 43; Fax: 46-31-81 10 72.


Web Address: Selling to the Government

In Sweden the EC Council directive on public works contracts has been implemented by means of the Public Procurement Act (Lagen om offentlig upphandling, LOU). Bodies governed by public law must procure goods and services in a businesslike, competitive and non-discriminatory way.

The act applies to bodies that award public works contracts: central government agencies, municipalities, county councils and Church of Sweden units. Also covered by the Act are central and local government-owned companies, associations, special districts and foundations established to perform tasks for the benefit of the public.

The act applies to large as well as to small procurement. In the case of procurement above certain threshold values, the EC directive’s rules on advertising, grace periods, and so forth must be applied. The threshold values for supplies and services are SEK 1.7 million (in the utilities sectors there are other higher values and for central government a lower value, around SEK 1.1 million), and for a construction contract just under SEK 44 million (threshold values in Swedish currency are determined in an ordinance and apply for a period of two years). To make it possible for all conceivable suppliers to become aware of forthcoming and concluded procurement, notification of such procurement shall be published in the Supplement to the Official Journal.

Procurement below the threshold values must follow the same basic principles as procurement above the threshold values, but the tender procedure is not regulated in as much detail.

The Public Procurement Board is responsible for contacts with public agencies, organizations and the public. One of the tasks is to provide information and general advice on how the Public Procurement Act and the WTO agreements shall be interpreted.

Under the WTO "Agreement on Government Procurement," signatories to the agreement, including Sweden, will not discriminate against or among the products, certain services and construction of other signatories in purchases covered by the agreement. The agreement's coverage extends to purchases of goods by specified government entities (e.g. ministries and Government authorities) listed in the agreement on contracts valued at 130,000 Special Drawing Rights (about $190,000). The list includes all the central government entities of the major developed countries.

The agreement does not apply to purchases of national security items, purchases by local governments, or purchases by any entity that has not been specified as being covered.

To eliminate discrimination against foreign products at all stages of the procurement process, the agreement includes detailed requirements as to how government procurement is to be conducted. And with more than SEK 400 billion estimated spent on public procurement each year, entry into this market could prove quite lucrative. Many Swedish government procurement announcements, covered by these codes, are published in the U.S. Department of Commerce's publication, Commerce Business Daily. Code-covered tenders are also published in the Journal of Commerce, a private sector newspaper.

- Local Government Procurement

Local government procurement has become increasingly significant and in some cases offers American companies excellent trading opportunities. Local governments are not subject to the national procurement procedures but are free to adopt their own procurement rules. The Swedish Association of Local Authorities and the Federation of Swedish County Councils have, however, adopted a recommendation aiming at rules for local government procurement, which follow closely the rules of the national procurement regulations.

As is also the case with procurement on the national government level, purely business considerations determine the methods and sources of procurement by local governments and similar bodies, and no distinction is made between domestic and foreign suppliers or contractors. The normal procedure in inviting bids is through circular letters addressed to firms known to be reputable and reliable. Such firms could be Swedish or foreign, the latter often being the local subsidiary or sales representative of a foreign company. Local governments and their procurement procedures and practices are reputed to be liberal and completely nondiscriminatory in character.

- Health Care Equipment Procurement

The county councils arrange centralized equipment procurement for the medical care sector. The 21 councils are autonomous units, and the degree of centralization varies.

The normal procurement procedure is for the county medical care authority, together with end-users of the equipment, to survey the equipment needs for hospitals and forward them to the purchasing departments. In the case of replacements, the procurement request originates in the hospital department involved, with the decision to purchase made by the county authority. There is a high degree of uniformity in the Swedish hospital organization.
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