Protect Your Business: Essential Contract Law Strategies

Contract Law

Contract lawyers with extensive expertise across diverse contractual matters.

We offer comprehensive assistance to individuals and companies in drafting and reviewing a wide range of agreements, including partnership agreements, confidentiality agreements, consultancy agreements, shareholder agreements, and cooperation agreements. By ensuring the creation of robust agreements, our Contract Law Agency aims to minimize the risk of potential disputes in the future.

Various Types of Contracts recognized in Sweden – 

When discussing contract law in Sweden, the various types of contracts recognized by prominent authorities and governing bodies in the country are listed below. 

Shareholder agreements

A Shareholders’ Agreement is a legally binding contract between the owners of a company, detailing their respective roles, rights, and responsibilities as shareholders. These agreements complement a private limited company’s articles of association and provide additional clarity on the governance and management of the company. 

When should I use Shareholder agreement

Use this Shareholders’ Agreement:

When you and other individuals hold shares in a private limited company exclusively comprising ordinary shares

To complement the company’s Articles of Association (i.e., articles) with clauses concerning shareholders’ powers and entitlements

To maintain confidentiality of these supplementary provisions within a private contract

To facilitate future modifications to provisions without the necessity of amending the company’s articles

Business transfer agreements

A Business transfer Agreement facilitates the sale of a business between two parties, namely a buyer and a seller.

Depending on the nature of the business and the transaction, this document may work as a:

• Business Sale Agreement
• Share Purchase Agreement
• Asset Purchase Agreement
• Business Transfer Agreement

Advantage contract law agency’s Purchase of Business Agreement is applicable in Sweden.

You may require a business sale agreement if you:

• Own a business and intend to sell its assets or shares
• Plan to acquire an existing business
• Intend to purchase specific assets from a business
• Engage in a merger or acquisition transaction

A Purchase of Business Agreement comprises details such as:

• Buyer and seller information
• Property particulars
• Payment terms and options
• Clauses and warranties
• Assumed liabilities
• Representations and Warranties
• Conditions precedent
• Dispute resolution methods, and more.

When drafting your Purchase of Business Agreement, you have the flexibility to tailor it by selecting only the options pertinent to your business acquisition.

When engaging in the purchase of a business, it’s crucial to determine whether you’re buying or selling shares or assets. Shares represent ownership interests in a company. Owning shares entitles you to a portion of the company’s profits, but may not grant you direct control over its operations. However, if you hold a majority stake, typically 51% or higher, you wield decision-making authority within the company. Assets encompass various items such as inventory, resources, property, and contracts. You have the option to acquire all assets or exclude specific ones according to your preferences. Unlike shares, purchasing assets does not confer control over the business itself.

After establishing the business price, negotiations regarding payment terms become necessary.

 If the full balance won’t be paid upon contract signing, determining a closing date is essential. Additionally, you’ll need to decide whether a deposit is required. It’s advisable to use a promissory note to record the amount owed and its due date if payment is deferred.

Payment options include

Lump sum payment of the outstanding amount: The entire balance is settled on the closing date.

Lump sum payment plus a promissory note for the outstanding amount: The buyer provides a deposit for the balance and commits to paying the remainder as per the promissory note’s terms.

Promissory note for the outstanding amount: No deposit is made, and the balance is paid according to the promissory note’s terms.

Employment contracts

An Employment Contract delineates the rights, responsibilities, and obligations of both employer and employee. Once the job offer is extended by the employer and the Employment Contract is signed by both parties, they are legally bound to adhere to its terms. In Sweden, an Employment Contract is frequently referred to as a Contract of Employment.

Employment Contracts serve as a fundamental element of the employer-employee relationship, despite the absence of a legal mandate requiring written documentation in the sweden. While not obligatory, utilizing a written Employment Contract is paramount for establishing a comprehensive record of mutually agreed-upon employment terms and safeguarding the interests of both parties. Verbal agreements are insufficient. Relying solely on verbal Employment Contracts should be avoided, as it becomes challenging—if not impossible—to substantiate their precise terms. In the event of a dispute, the absence of a written contract may lead to conflicting recollections of the arrangement, complicating conflict resolution. Conversely, written Employment Contracts offer a clear record of job terms, providing legal protection for either party in the event of a dispute or legal action.

Key Components of a Legally Binding Contract in Sweden

Contract Law is a nuanced process encompassing several essential elements:

Offer: One party must clearly and specifically extend an offer to another party, intending to establish a legal relationship.

The receiving party must unconditionally accept the offer, either verbally, through actions, or conduct, without any alterations or conditions.

Consideration: Both parties must exchange something of value, such as money, goods, or services, in return for the contract’s terms.

Intention to create legal relations: It’s imperative that both parties intend to be legally bound by the contract’s terms. Without this intent, the contract may not be considered valid.

Capacity: All parties involved must possess the legal capacity to enter into a contract, meaning they are of legal age, sound mind, and not subject to coercion or undue influence.

Consent: Consent from all parties must be freely given without coercion, fraud, or misrepresentation.

Legality: The contract’s purpose must be legal and not in violation of any laws or public policy.

These elements collectively form the foundation of a valid and enforceable contract in the Sweden.

Key Considerations for Drafting Contracts in the Stockholm, Sweden

When dealing with contract law in Sweden, it’s essential to consider key aspects of drafting. Here are some crucial considerations:

Identification of the parties: Ensure that parties are clearly named with their legal names and addresses for enforceability and mutual understanding.

Clarity of terms: Use clear and precise language to prevent misunderstandings. Provide definitions where necessary to enhance clarity.

Thoroughly describe the work, including nature, deliverables, deadlines, and other relevant details.

Intellectual property: Clearly define ownership and rights related to intellectual property produced under the contract.

Legal compliance: Ensure compliance with all applicable legal requirements, such as employment laws, health and safety regulations, and data protection laws.

Get help with Contract Law in Stockholm, Sweden

Whether you’re a business owner, tradesman, or anyone seeking assistance with Contract Law in Stockholm, Sweden, our contract law agency is here to help. Our team of experienced legal professionals is well-equipped to address all your Contract Law needs.

To get started, visit our contract law page. You can reach out to us via phone to speak with a member of our team who will assist you with your Contract Law matters or any other legal inquiries you may have. Don’t hesitate to get in touch with us.

Furthermore, last but the least we also offer support in the following;

Franchise agreements

Cooperation agreements

Confidentiality agreements

Rental agreements

Count on our contract law agency’s expertise to ensure precision and legal compliance in all your contract law agreements.

At Advantage Law Firm, our lawyers have extensive experience drafting and reviewing various contract law agreements. 

Contact us if you need help reviewing, revising, or drafting a contract!