The Company Act in Sweden is represented by the Swedish Companies Act 2005. The rules mentioned in the company act in Sweden are available for all companies that are set up in Sweden, except for the partnerships. There is a separate act that regulates partnerships and it is called the Partnership and Non-registered Partnership Act 1980. European Directives also apply for Sweden companies when it is necessary.
In order to fulfill the requirements of the company act in Sweden, foreign investors must decide upon the type of company to establish in Sweden. They can choose between private limited liability companies, public limited companies, sole proprietorships and partnerships, which can be general or limited.
The employment legislation in Sweden is as important as the company law in Sweden. Labour law is stipulated in the Employment Act and mentions some rules to protect the rights of both employer and employee. The relationship between employer and employee in a Swedish company is strictly defined in the legislation in order to be observed. The Employment Protection Act is entirely dedicated to the rights of the employees in Sweden.
Besides the employment law in Sweden, there are also different acts that regulate the professional relationships of employees and employers. The Trade Union Representatives Act stipulates the working conditions, the salaries and the conditions that have to be me in order to make a decision for dismissal. The Swedish Work Environment Act strictly refers to the work place and all the responsibilities derived from the professional environment.
Foreign investors in Sweden or even Swedish employers might choose to hire foreign employees. In this case, they must be aware of the fact that the foreign employee has to firstly obtain a work permit. This permit is issued by the Swedish Migration Board.