As of 15 February 2008 it is possible to decide on mergers between enterprises in different member states within the EEA.
This applies to limited liability companies merging into limited liability companies abroad and economic associations merging into economic associations abroad. Furthermore, it is possible for a wholly owned subsidiary of an economic association to merge into the association.
The regulations are based upon an EG directive and the provisions on national mergers in the Companies Act and in the Economic Associations Act shall now to a large extent be made applicable for cross-border mergers as well. Furthermore, special provisions regarding cross-border mergers will be introduced in the above-mentioned legislation.
How to proceed
The involved limited companies, economic associations respectively, shall draw up a merger plan which is to be submitted to Bolagsverket for registration. The general meeting of the company or association taken over must approve of the merger plan. Bolagsverket shall give permission for the execution of the merger and issue a special certification of the merger stating that the enterprise has fulfilled the requirements as stipulated in the legislation.
The enterprise shall hand over the merger certification to the registration authority of the country where the enterprise resulting from the cross-border merger has its registered office. Special provisions apply regarding the participation of the employees, and the merger cannot be registered if these provisions have not been observed.
Skatteverket (the tax authority) may oppose
If Skatteverket has decided on auditing of a limited company or an association, Skatteverket may decide that obstacles exist against the implementation of the merger plan. Bolagsverket must then issue a writ of superseding the matter of implementation of the merger plan as dormant for a maximum period of one year. This period may be prolonged. The new provisions apply to both Swedish mergers and to cross-border mergers.
Economic associations and merger
The provisions regarding mergers between economic associations shall now be adapted to the provisions regarding mergers between limited liability companies. This means among other things that the associations must notify their creditors of the merger plans and that Bolagsverket will from now on be the authority to grant permission for the merger to be executed (see government bill prop. 2007/08:15 and the Swedish Code of Statutes, SFS 2008:3, 2008:12, 2008:14 and 2008:15)