New ruling from the Swedish Competition Authority: Instructed ÄTA works deemed an unlawful direct award

The ÄTA rules and the LOU

The standard contracts AB 04 and ABT 06 regulate ÄTA works, i.e. changes, additions and omitted works that may arise during a construction project. For parties who work extensively with these standard contracts, the ÄTA rules are central, giving the parties tools to manage changed circumstances without entering into a new contract. Among other things, the ÄTA rules allow the contractor to receive additional compensation for carrying out change and additional works either instructed by the employer or made necessary by circumstances the contractor could not reasonably have foreseen when submitting its tender.

For public procuring entities, however, it is not sufficient that a change is permitted under a standard contract. When a public procuring entity is to enter into a construction contract, procurement legislation such as the Public Procurement Act (LOU) applies as a starting point. The starting point under the LOU is that a contract may not be amended without a new procurement procedure, unless such an amendment is permitted under specific exceptions in the LOU.

One exception under the LOU concerns amendments made pursuant to a change or option clause under Chapter 17, Section 10 of the LOU. Under that provision, a contract may be amended in accordance with such a clause if the overall nature of the contract is not changed and the clause (1) was stated in the procurement documents of the original procurement, (2) clearly, precisely and unequivocally describes the conditions under which it may be applied, and (3) states the scope and nature of the changes that may be made.

Another exception is found in Chapter 17, Section 12 of the LOU. Under that provision, amendments to the contract may be permitted as a result of circumstances that the public procuring entity could not have foreseen, provided the amendment does not (1) change the overall nature of the contract or (2) increase the contract's value by more than 50 percent.

The changes to the construction project

In December 2020, the Technical and Property Committee (Teknik- och Fastighetsnämnden) of the Municipality of Karlstad entered into a design-build contract under ABT 06 for the renovation and new construction of an equestrian facility. The procurement was advertised under the LOU, and the original contract had an estimated value of approximately SEK 45 million. Ahead of the procurement, the Committee commissioned an investigation into the stability of the ground where the construction was to be carried out. That investigation showed some uncertainty regarding ground stability and a need for further design work concerning stability risks. However, no further investigation was carried out before the procurement procedure concluded and the contract was awarded to a contractor.

When the construction work began, the contractor noted during the design phase that there were problems with the ground. The Committee therefore commissioned supplementary ground investigations from an external consultant, and the project was paused pending the results. When the supplementary investigations revealed further deficiencies in ground stability not identified in the earlier investigations, the Committee decided to proceed with an alternative proposal, which included relocating and demolishing buildings and rerouting a road. The estimated value of these changes was approximately SEK 38 million, after deduction for omitted works. The changes were handled as ÄTA works under the existing contract, without a new procurement being advertised. The total value of the contract thereby became approximately SEK 84 million.

The Competition Authority's assessment

The Committee considered the changes to be compatible with the procurement rules and relied mainly on two exceptions: (i) that the ÄTA rules in ABT 06 constitute a change clause under Chapter 17, Section 10 of the LOU and that the ÄTA works in the project had been ordered under those rules, and (ii) that the ground conditions were an unforeseen circumstance under the exception for unforeseen circumstances in Chapter 17, Section 12 of the LOU. The Committee considered that the changes largely constituted "likställda" (deemed/equivalent) ÄTA works under ABT 06 Chapter 2, Section 4, rather than instructed ÄTA works under ABT 06 Chapter 2, Section 3, and that this was relevant to the assessment.

The Competition Authority did not agree with the Committee's assessment on any point. In summary, the Authority found that the changes constituted instructed ÄTA works under ABT 06 Chapter 2, Section 3 — primarily because it considered that other alternatives existed to resolve the stability problems and that the ground conditions had not been unforeseeable. As regards the ÄTA rules, the Authority found that the wording of the provisions allows too broad and unpredictable a scope of interpretation to satisfy the requirements for a change clause under the LOU. The rules do not sufficiently clearly, precisely and unequivocally state the conditions under which ÄTA works may arise, or the scope and nature such works may have. On several points, the Authority referred to its earlier legal analysis of 4 October 2024.

Regarding unforeseen circumstances, the Authority found that there were already indications of ground stability risks before the original procurement, meaning the circumstances could not be regarded as unforeseen. In any event, the Authority noted that the value of the changes exceeded 50 percent of the contract's original value, meaning that exception was likewise inapplicable.

Since neither exception applied, the Committee should instead have advertised a new procurement procedure. According to the Competition Authority, the failure to do so meant the Committee had carried out an unlawful direct award.

What does the decision mean?

Despite the criticism, the decision has no financial consequences in this particular case. The Competition Authority may decide that an authority must pay a procurement damages fee (upphandlingsskadeavgift) for an unlawful direct award, but such a decision must be issued within two years of the contract being concluded. Since the changes in this case were made approximately five years before the Authority's supervisory review, no procurement damages fee could be imposed.

The practical significance of the decision therefore lies not in any sanction, but in the position it establishes, primarily for procuring organizations using the AB 04 and ABT 06 standard contracts in construction projects. Through the decision, the Competition Authority cements its position on how the ÄTA regulation relates to the procurement rules. Parties to construction contracts therefore cannot simply assume that changes permitted under the ÄTA rules of the standard contracts are also permitted under the LOU — at least not in the view of the Competition Authority. In a press release dated 1 June 2026, the Authority's Director-General, Marie Östman, emphasized the importance of procuring organizations already taking into account, when drafting tender documents and contracts, risks that could lead to changes later in the project, since such changes might otherwise force a new procurement procedure.

It is notable that the Competition Authority assessed the changes as instructed ÄTA works rather than deemed/equivalent ÄTA works, given the circumstances of the case. However, it is unlikely that the Authority would have handled the matter differently had the changes been considered deemed/equivalent ÄTA works, given the high value of the changes and the fact that, in its legal analysis, the Authority also considers that the provisions on deemed/equivalent ÄTA works fail to meet the requirements for change or option clauses under the LOU.

The supervisory decision shows that the Competition Authority's 2024 legal analysis was not an isolated statement, but that the Authority is now applying its conclusions in concrete cases. Procuring organizations carrying out construction projects may therefore need to consider more closely both their use of the ÄTA rules and the drafting of tender documents and contract terms, so that potential future ÄTA works can be managed with less risk of coming under the Competition Authority's scrutiny.