UNDERSTANDING THE BASIC FEATURES OF SWEDISH STANDARD CONSTRUCTION CONTRACTS
Partner, Foyen Advokatfirma, Malmö, Sweden
In Sweden there is no civil code or commercial code of the type found in some other countries. Furthermore, many of the key aspects of construction contracts between business entities, such as allocation of risk and responsibility in relation to quality, time and cost issues, are not subject to any specific legislation regarding construction. There is no construction code or similar. This has led parties who are frequently engaged in construction projects in Sweden to develop standard contracts for construction. Different standard contracts are used for different types of construction projects, e.g., civil works projects, industry projects and energy projects. For civil works projects, including major infrastructure projects such as road and railway construction, one of the following two standard contracts will typically be used:
AB 04—General Conditions of Contract for Building and Civil Engineering Works and Building Services (intended for “build only” projects).
ABT 06—General Conditions of Contract for Design and Construct Contracts for Building, Civil Engineering and Installation Works (intended for “design-build” projects).
AB 04 and ABT 06 have been prepared by the Swedish Construction Contracts Committee, an organisation consisting of various important and influential entities representing employer or contractor interests in Sweden (the “Contracts Committee”). AB 04 and ABT 06 are the latest editions of standard contracts which have been cornerstones of the Swedish construction industry since the 1950s.
Like their predecessors, AB 04 and ABT 06 are the results of lengthy negotiations within the Contracts Committee and are described by the Contracts Committee as being #x2018;‘agreed” documents. It is stated in the preface to these documents that the basis of the documents is a “reasonable balance between rights and obligations which is designed to give a financially optimised division of risk between the parties”. It is also stated that “amendments to these conditions should therefore be avoided”.
It is no exaggeration that AB 04 and ABT 06 completely dominate contracting within the civil works sector of the Swedish construction
Pt 2] Basic Features of Swedish Standard Construction Contracts
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