In Euroflon Tekniska Produkter AB (Euroflon) v Flexiboys i Motala AB (Flexiboys), Supreme Court Case Ö 1590-11, Euroflon was in arbitration against A, claiming damages for breaches of a non-competition undertaking. To evidence the breaches and the damage suffered, it sought production of invoices issued by Flexiboys, a company owned and controlled by A.

Under section 26 of the Swedish Arbitration Act, a party may apply to the court for production of documents that may be of evidentiary value in the arbitration, provided that the tribunal gives its consent to such an application. The sole arbitrator had granted Euroflon permission to apply to the court for a disclosure order concerning specified invoices.

Flexiboys contested the application, arguing, among other things, that the invoices in question lacked evidentiary value for the claims submitted to arbitration. Further, Flexiboys argued that the documents contain trade secrets and, therefore, should only be disclosed in exceptional circumstances.

The district court found in favour of Euroflon, whilst the Göta Appelate Court found in favour of Flexiboys. The Appellate Court questioned the evidentiary value of the documents requested and also referred to the proportionality principle of Article 6 of the European Convention on Human Rights. On those grounds, and given that the documents contained trade secrets, the Appellate Court concluded that there were no exceptional circumstances that justified a disclosure order.

The Supreme Court noted that it is exclusively for the arbitral tribunal to decide if the evidentiary value of the requested documents justifies disclosure. The Supreme Court referred not only to the relevant articles of the Swedish Procedural Code but also to Article 3 of the IBA Rules on Taking of Evidence in International Arbitration as guiding the tribunal's assessment. If a tribunal does not consider a disclosure order to be justified, the party seeking disclosure cannot then turn to the courts for a disclosure order. On the other hand, if the tribunal finds that a disclosure order is justified, that assessment should be accepted by the court in a subsequent application to the court.

Therefore, the courts should not re-try the arbitral tribunal's assessment of the reasons for making or refusing a disclosure order. The courts should limit themselves to considering the legality of a disclosure order. That includes assessing whether:

In making those assessments, the Supreme Court concluded that a court should proceed as if the court itself had found the requested documents to have the required evidentiary value to make them disclosable.

Further, when balancing the interests of the claimant (in having access to the documents as evidence) and the respondents (in protecting its trade secrets), the assessment of the importance of the document as evidence rests with the tribunal. It is up to the tribunal to clarify how important the documents are to the arbitration, failing which the courts will usually have to proceed on the assumption that the value is the minimum value justifying a disclosure order. On that basis, the court should balance competing interests.

In the present case, the request was aimed against a third party. According to the Supreme Court, that should normally influence the assessment of whether there are exceptional circumstances justifying disclosure. However, it was irrelevant in this case, considering the close relationship between the respondent, Flexiboys, and A.

The court also noted that the documents were to be disclosed to the arbitrator and were not being made public as such. Therefore, there was no reason not to order their production for reason of protection of trade secrets.

One Justice dissented, finding that the arbitrator had wrongly assessed the evidentiary value of the requested documents . He found that, if it is obvious that the request is only part of a "fishing expedition", a production order is not legally grounded. In the opinion of the dissenting judge, the request was to be denied.

Comment: The scope of a Swedish court's assessment of a request for production of documents in arbitration is limited to the legality of the requested production order. The extent to which a court, when assessing the legality, may re-try the evidentiary value of the documents, and if so how, is not self evident. This case demonstrates the arbitration-friendly approach of the Swedish Supreme Court. It emphasises the exclusive role of the arbitral tribunal in assessing evidence. For arbitral tribunals, it is a reminder of the importance of being transparent in their assessments of the evidentiary value of documents requested to be produced.