What is LOU?
LOU entered into force on 1 January 2017 and implements the EU procurement directive (2014/24/EU). It sets out when a public buyer must open a purchase to competition, how the tender is advertised, which requirements the buyer may set and how bids are evaluated.
In the act the buyer is called the contracting authority (upphandlande myndighet) and the company the supplier (leverantör). A company that submits a bid is a tenderer (anbudsgivare).
Who does LOU apply to?
- Government agencies, such as Trafikverket and Kammarkollegiet
- All 290 municipalities and 21 regions, such as Uppsala kommun and Region Skåne
- Municipal and state-owned companies such as housing, energy and port companies
- Joint municipal authorities, such as fire and rescue services
The act binds the buyer, not the supplier. But anyone selling to the public sector needs to know the rules, because they decide everything from where you find the tender to what happens if you lose.
The five principles
- Equal treatment: every supplier gets the same information and is assessed the same way.
- Non-discrimination: the buyer may not favour local or Swedish companies.
- Transparency: the process is predictable and the requirements clear from the start.
- Proportionality: requirements may not go beyond what the purchase needs.
- Mutual recognition: certificates from other EU countries must be accepted.
The principles are the supplier's best tool. A requirement set too high, or tender documents that can be read more than one way, can often be challenged on exactly these grounds, see appeals.
LOU, LUF, LUK, LUFS and LOV
| Act | Covers | Examples |
|---|---|---|
| LOU (2016:1145) | Public buyers in general | Municipalities, regions, agencies |
| LUF (2016:1146) | Utilities: water, energy, transport and postal services | Water companies, public transport, energy |
| LUK (2016:1147) | Concessions, where the supplier is paid by running the service | Parking, a café in a public building |
| LUFS (2011:1029) | Defence and security | Defence equipment, classified purchases |
| LOV (2008:962) | Freedom-of-choice systems, where the user picks the provider | Home care, primary care |
Above and below the threshold
Purchases above the EU thresholds follow the EU rules in chapters 1–18 and are published in the EU's TED database. Purchases below follow the simpler national rules in chapter 19. Below the direct award limit of SEK 700,000 the buyer may buy without a formal procedure.
Who enforces the act?
The Swedish Competition Authority (Konkurrensverket) supervises procurement and can ask a court to fine a buyer that bought without a tender. The National Agency for Public Procurement (Upphandlingsmyndigheten) gives guidance and publishes statistics. Suppliers can themselves ask an administrative court to review a procurement.
Frequently asked questions
- What does LOU stand for?
- Lagen om offentlig upphandling, the Swedish Public Procurement Act (2016:1145). It applies when municipalities, regions, agencies and publicly controlled companies buy goods, services and works.
- Does LOU apply to private companies?
- No, it binds the buyer. A private company does not have to procure under LOU, but must follow the rules of the tender when it bids for a public contract.
- What is the difference between LOU and LUF?
- LUF covers water, energy, transport and postal services. It is similar to LOU but more flexible, for example the direct award limit is SEK 1,200,000 instead of SEK 700,000.
This guide is a general description, not legal advice. Laws and amounts can change; the Swedish National Agency for Public Procurement (Upphandlingsmyndigheten) has the latest figures.