New tools to strengthen competition in the private and public sectors in Sweden – part 3 – revised merger control rules

On 7 March 2026, the Swedish Government submitted the bill “New tools to strengthen competition in the private and public sectors” (prop. 2025/26:203; the “Bill”) to the Swedish Parliament. The Bill contains proposals for a new act on public commercial activities (the “Act”) and significant amendments to the Competition Act, including a new competition tool and revised merger control rules. Notably, the new rules are proposed to enter into force already on 1 August 2026 and are likely to have a far-reaching impact on both public and private market participants.

In a series of three blog posts, we examine the proposals in detail. Please find our first post regarding the new Act here, and the second post regarding the new competition tool here. In this third and last post, we focus on the proposal for revised merger control rules.

Background

The inquiry “Improved Competition in the Public and Private Sectors” was published on 7 March 2025 and was followed by a public consultation (please refer to our previous blog post here). After consideration of the responses received, the Government published its referral to the Council on Legislation on 12 February 2026 (please refer to our previous blog post here). Following its meeting on 4 March 2026, the Council issued an opinion raising no substantive objections. The Government has now submitted the Bill to the Parliament.

The Swedish Parliament is now set to vote on the proposals. Subject to the approval of the Parliament, the proposed amendments concerning the revised merger control rules are scheduled to enter into force on 1 August 2026.

Main objectives and key proposals regarding merger control

It is highlighted in the Bill that mergers are considered a natural part of a functioning market. An acquisition or a merger can result in stronger and more efficient companies, which ultimately benefit consumers, for example, by providing a more varied product range, as well as lower prices. In some cases, however, a merger may result in competition being hindered or significantly impaired. This could be the case if the merger would lead to a dominant position in the market, or if only a few companies remain in the market after a merger. These situations ultimately risk reduced competition, potentially leading to higher prices, lower quality, and a diminished selection for consumers.

The aim of the current Swedish merger control rules is to reduce the risks presented above. The Swedish Competition Authority (the “SCA”) may prohibit a merger if it is likely to materially impede the existence or development of effective competition in Sweden as a whole, or a significant part of Sweden. Furthermore, a merger must be notified to the SCA if the companies’ turnover reaches certain thresholds. The SCA does also have the power to require a notification of a below-threshold merger if special grounds are present (see our blog post regarding the SCA’s so-called call-in powers here).

The Government now proposes significant changes to the merger control rules in the Bill. The key proposals include a revised merger prohibition rule where competition on narrow local markets can be taken into account, merger disclosure obligations for certain companies, as well as extended deadlines for complex mergers, both during the SCA’s handing and in the case of an appeal to the Patent and Market Courts.

A revised merger prohibition rule taking in account also local markets

Under the current rules, a merger may be prohibited if it is likely to materially impede the existence or development of effective competition in “the whole country or a substantial part of the country”. This is set out in Chapter 4, Section 1 of the Swedish Competition Act. The assessment of whether a merger is to be prohibited is carried out in two stages: first, the relevant market must be established. Second, the effects of the merger in relation to the relevant market must be assessed.

The Government considers the regulation to have been ineffective in practice. Because it applies only where a merger affects “the whole country, or a substantial part of the country,” it captures primarily transactions in broad, national markets. From a consumer perspective, however, many markets are inherently local, such as pharmacies, opticians, veterinary clinics, car repair shops, and grocery retail. Competition in these sectors therefore falls outside the scope of the current rules and cannot be prohibited, even where a merger produces clear anticompetitive effects. The same limitation arises in other markets where large companies compete locally and where the impact of a proposed merger may differ significantly across geographic areas.

The proposal suggests that the current rules may further distort competition and lead to higher consumer prices. The Government therefore considers it important to expand the ability to intervene against mergers that risk reducing competition in local markets. It accordingly proposes amending the prohibition in the Competition Act by removing the current requirement of “the whole country, or a substantial part of the country” and replacing it with “the market”.

In this context, the Bill emphasizes that intervention against a merger does not necessarily require a full prohibition, given the existing possibility to offer or accept commitments. A party may be ordered to divest a company, a part of a company or to implement some other pro-competitive measure if such an action is sufficient to eliminate the harmful effects of the merger.

New reporting requirements for certain companies regarding upcoming mergers

The SCA’s ability to call in mergers depends on its awareness of them, whether through complaints or market monitoring. To address its limited ability to obtain information on upcoming mergers, the Government proposes introducing an additional power enabling the SCA to require companies to disclose relevant information. This disclosure obligation would apply to companies operating in markets whose structure or level of concentration is such that mergers may impede the existence or development of effective competition.

Regarding the information to be provided, the Government proposes that companies should be subject to burdensome obligations only where justified. Accordingly, parties may be required to provide information on the merging entities, a description of the transaction, the date of the agreement, and the intended date of implementation. Although the disclosure obligation is aimed at companies in markets where mergers may raise competition concerns, the Government notes that market conditions may change over time. Such obligations should therefore be limited to a period of two years. Under the proposal, decisions on disclosure obligations would apply immediately unless otherwise specified, and may be combined with a conditional fine (Sw. vite).

Whenever the SCA receives information on a merger following the issuance of a disclosure obligation, it must decide whether to call in the merger or take no further action. This decision must be made within 15 working days of receiving the information. Such a decision also triggers a standstill obligation for the companies concerned, unless the SCA decides to take no further action before the expiry of the 15-day period.

Extended deadlines for complex mergers

Another new feature is that the SCA will be granted more time to assess mergers in Phase 2. Under the current rules, the SCA has three months, following the maximum 25 working days in Phase 1, to decide whether to prohibit the merger, impose conditions, or take no action. Currently, the time limit may be extended by up to one month at a time.

Considering the complexity of the assessment, which often includes advanced economic evaluations, the Government proposes an extension of the deadline to 90 working days, with the possibility of further extensions of 25 working days at a time. Using working days rather than months is intended to exclude periods when no substantive review can be expected, which in practice results in longer deadlines. The Government considers this justified, as it gives the SCA a reasonable opportunity to complete its review and should not cause significant difficulties for the companies concerned.

In addition to extending the SCA’s time to assess mergers in Phase 2, the Government proposes longer statutory deadlines for court review of merger decisions. Where an SCA decision is appealed, the deadline for the Patent and Market Court would be extended by two months, from six to eight months. The deadline for the Patent and Market Court of Appeal, the final instance, would likewise be extended by one month, from three to four months.

Concluding remarks

The Government’s proposal for revised merger control rules presents a significant shift in Swedish competition law. As regards companies in narrow local markets the new rules, if voted by Parliament, may introduce an entirely new risk landscape. Early competition law assessment of mergers is therefore, as always, strongly recommended.

For private companies planning a merger, the new rules may give rise to increased costs if the company is subject to a merger disclosure obligation and therefore has to answer questions, compile data, and submit documents to the SCA. It should be noted, however, that the scope of the SCA’s reporting obligation is limited and is unlikely to impose substantial costs on the company concerned.

In complex merger cases, extended deadlines and longer proceedings may jeopardize the transaction. The proposed extension of court deadlines is therefore unfortunate, as it primarily serves the interests of the SCA rather than those of the companies concerned, for whom timing is often critical in merger transactions.

The purpose of the proposed revised merger control rules is to improve overall competition in the market and thereby benefit businesses, consumers and the economy. Whether the proposed changes will achieve these objectives remains to be seen.

We recommend companies that are contemplating a merger, whether horizontal, vertical or conglomerate, to assess potential competition law issues at an early stage. If there is any likelihood for creating or strengthening a dominant position, such assessment should also include assessing countervailing buyer power, efficiencies and potential remedies. In addition, it is important to be mindful about the extensive internal documentation that the SCA may require in connection with a merger filing as well as legal privilege (see the Delphi EU and Competition Blog regarding new merger control guidelines in May 2025 here).

Delphi has extensive experience in pre-merger assessments across a wide range of markets, including multi-jurisdictional filing analyses, coordination of filings, complex Phase 2 proceedings, and challenges to prohibited mergers before the Patent and Market Court. Please do not hesitate to get in touch with any questions. We will continue to monitor the proposed revised merger control rules and provide insights and updates throughout the legislative process.