The City of Gothenburg is under formal investigation by the Swedish Competition Authority (Konkurrensverket) over allegations of systemic bias in a high-value public procurement process—a case that has ignited debate over transparency and legal compliance in Swedish municipal IT contracting.
At the heart of the controversy is a near-100-million-kronor (approximately €8.7 million) tender for the support and maintenance of a mission-critical IT system used by Gothenburg’s Social Services. The system, essential for managing child welfare, elder care, and social assistance caseloads, was previously maintained by a major IT supplier whose contract was set to expire. Rather than initiating a level playing field for renewal, internal communications and investigative reporting by public broadcaster Ekot reveal that the city steered rival bidders toward the incumbent vendor for technical clarifications—a move experts say contravenes fundamental principles of public procurement law.
Breach of Procurement Neutrality
According to leaked email correspondence obtained by Ekot, when competing firms submitted technical queries about the procurement, Gothenburg’s procurement team referred them directly to the existing supplier—effectively tasking a commercial competitor with interpreting tender requirements for its rivals. In at least one documented instance, a bidder was explicitly instructed to “contact […] for further details.”
“This is not just poor practice—it’s a clear violation of Swedish and EU procurement law,” said Andrea Sundstrand, Associate Professor of Public Law at Stockholm University and one of Sweden’s foremost authorities on public procurement. “All information necessary to formulate a competitive bid must be made available by the contracting authority in the tender documents. It is never acceptable to outsource that responsibility to a current supplier who is also a bidder. Doing so inherently advantages that supplier and distorts competition.”
Her assessment aligns with established jurisprudence from both the Court of Justice of the European Union and rulings by the Swedish Competition Authority, which have consistently held that contracting authorities bear sole responsibility for ensuring equal access to information.
Procurement Cancelled—But Contract Extended
Following a formal complaint from one of the excluded bidders, the City of Gothenburg ultimately cancelled the procurement in early 2025. However, rather than initiating a compliant re-tender, the municipality opted to extend its existing contract with the incumbent supplier under emergency provisions—despite no documented system failure or urgent threat to service continuity.
This decision has drawn additional criticism from governance watchdogs, who argue that such extensions, particularly after a flawed procurement has been invalidated, risk entrenching monopolistic practices and undermining market fairness.
City Acknowledges Missteps
In a rare public admission, Frida Johansson, Head of HR and Security at Gothenburg’s Social Administration Northeast, confirmed that the city recognizes its procedural failures. “We agree that the arrangement was not correct,” Johansson told the Nordic Business Journal. “It created an unfair advantage for the incumbent supplier and disadvantaged other potential vendors.”
While Johansson declined to comment further, citing the ongoing investigation by the Swedish Competition Authority, she emphasized that the city is cooperating fully with regulators. “This is now a matter for the Competition Authority. We await their findings and will act accordingly,” she said.
Broader Implications for Nordic Public Procurement
The Gothenburg case underscores a recurring vulnerability in public-sector digital transformation across the Nordics: the tendency of municipalities to rely heavily on incumbent vendors due to system complexity, legacy infrastructure lock-in, and internal capacity constraints. However, legal experts warn that operational convenience cannot override statutory obligations.
“This isn’t just about one contract—it’s about systemic integrity,” said Erik Lindqvist, a procurement policy analyst at the Nordic Institute for Public Governance. “When municipalities blur the lines between vendor and advisor, they erode trust in public procurement as a whole. In an era where digital services are core to citizen welfare, these processes must be beyond reproach.”
The Swedish Competition Authority has not disclosed a timeline for its investigation, but if it finds the City of Gothenburg in breach of the Public Procurement Act (LOU), it could impose financial penalties and mandate structural reforms to the city’s procurement protocols.
For now, the case serves as a cautionary tale for public authorities across the Nordic region: in the race to digitise essential services, legal compliance and competitive neutrality must remain non-negotiable.