SWEDEN: An Introduction to Public Procurement

Background 

The last year has been characterised by the ongoing war in Ukraine and its effects on the security in the rest of Europe, including Sweden. In Sweden, national defence is now facing a complete overhaul and the central planning of civil defence has resumed after years of disarmament.

The reconstruction of civil defence has influenced public procurements, especially the requirements imposed on suppliers. Swedish civil defence is built on the principle that if someone performs a certain service in peacetime, the very same organisation shall be responsible for performing and maintaining that service during wartime. The robustness of Sweden’s national defence, in particular civil defence, therefore requires the best efforts of all members of society, both private and public.

Swedish civil defence is still being reconstructed. The government has set up numerous governmental inquiries and commissions to analyse what needs to be done and in what order. Building administrative preparedness is at the centre of this initial stage, and in the next few years we can expect several new laws and regulations in connection with civil defence.

Private Suppliers in Civil Defence – Civil Preparedness Is Everyone’s Responsibility

Since the end of the cold war, there has been an era of peace in and around Sweden. During this period, the central planning of civil defence has been completely dormant, while simultaneously privatised welfare and the overall dependence on private companies for the provision of basic societal functions has increased.

A foundation in the structure of the Swedish civil defence is the principle of responsibility. The principle means that as a part of their peacetime activities, all suppliers must plan for and contribute to increased resilience in the event of war in or around Sweden. Those currently running schools or healthcare, for example, must take measures to ensure that they are able to maintain their operations even when society overall (including regarding trade and access to basic utilities) is not fully functional.

Measures must be taken by private and public operators alike, so that activities essential to the society may be carried out during war or impending war.

Public Authorities’ Actions Regarding Civil Preparedness in Public Procurement

Everyone has a role to play in the building and ensuring of a robust civil defence in Sweden. It is now essential for every procurement officer to ensure that civil preparedness issues are considered in relation to public contracts and in future procurements. In every procurement procedure, it must be clear how goods and services necessary for the provision of essential services can also be delivered during war or impending war.

It will therefore be necessary for every public authority to take several different measures in order to ensure robustness and continuity of essential services – for example:

i) managing supplier dependencies;

ii) building up stocks or insourcing certain essential functions; and

iii) introducing preparedness-related requirements and criteria in certain procurements.

In other words, we will likely see many different tools in action in the upcoming years.

Public Authorities’ Imposition of Requirements Regarding Civil Preparedness on Suppliers

There are two main ways in which the public sector can impose requirements on private suppliers. One, of course, is through legislation and the decisions based on such legislation. The much more common way, however, is for authorities to impose requirements on private parties through contractual obligations. Requirements now due to be imposed on private operators of activities important to Sweden’s defence will likely be handled in the same way.

Legislation may be appropriate for establishing the framework and objectives for companies’ preparedness work, but contracts are where authorities will be able to provide more detailed regulation on how a private company should increase the robustness of its operations. The legislature rarely has enough information and insight into how the large number of different suppliers playing a role in Sweden’s defence organisation works. It is therefore not possible for a legislative body to impose relevant requirements at a sufficiently detailed level. The only way to achieve a reasonable level of regulation is for the contracting authorities to formulate the requirements in dialogue with suppliers, and to then agree upon such terms in the form of certain contracts.

Public Procurement Law May Favour Civil Preparedness

Swedish procurement law offers relatively far-reaching opportunities to exclude suppliers who in previous contractual relationships have not done what is required, either generally or specifically in terms of preparedness. As preparedness requirements are introduced, these possibilities could also be used to distinguish those suppliers who prioritise national security and civil defence from those who do not.

In the authors’ opinion, a natural extension of the principle of responsibility, applied to public procurement, is that those who assume the most responsibility in terms of preparedness are also given the most opportunities to take part in the peacetime market for public contracts. Contrary to what is sometimes claimed, the public procurement framework is a way of enabling, rather than hindering, this type of broad horizontal initiative.