Treaty Between the Kingdom of Sweden and the Portuguese Republic on Economic and Industrial Cooperation
Preamble
Recognizing the mutual desire to strengthen economic ties and promote industrial development, the Governments of the Kingdom of Sweden and the Portuguese Republic have agreed to cooperate in the establishment of key industries in Portugal focused on agricultural, consumer, and light industrial goods.
This Treaty outlines a framework for long-term economic collaboration through joint ventures between Swedish industrial firms and a Portuguese state-backed holding company.
Article I – Purpose and Scope
The objective of this Treaty is to encourage the establishment of joint venture enterprises between Swedish industrial firms and a Portuguese national holding company in strategic sectors, including:
- Agricultural machinery and equipment
- Light consumer goods (e.g., home appliances, tools)
- Small-engine manufacturing and light vehicles (e.g., mopeds, small tractors)
- Components and systems for industrial and rural electrification
Article II – Participating Entities
The following Swedish companies shall participate in joint ventures under this Treaty:
- Electrolux AB – Home and industrial appliances
- Husqvarna Vapenfabriks AB – Tools, small engines, and agricultural equipment
- AB Bolinder-Munktell (BM-Volvo) – Tractors and farm machinery
- Crescent (Nymanbolagen AB) – Mopeds, bicycles, and light motor vehicles
Portugal shall designate a national industrial holding company, hereinafter referred to as Indústrias Luso-Nórdicas, to act as the Portuguese partner in these ventures.
Article III – Investment and Operational Framework
Capital and Infrastructure:
The Portuguese partner shall provide capital investment, factory construction, machinery and production tools, basic infrastructure, and workforce recruitment and training.
Technical Contributions:
The Swedish partners shall provide:
- Technical expertise and managerial training
- Licensing of intellectual property and designs
Ownership and Governance:
Each joint venture shall be established as a 50-50 ownership entity between the Swedish company and Indústrias Luso-Nórdicas.
Governance shall be shared, with management boards comprising an equal number of Portuguese and Swedish representatives.
Profit Sharing:
Net profits from joint venture operations shall be divided equally between both parties.
Article IV – Market Access and Trade
Products manufactured by these joint ventures shall be:
- Primarily sold in the Portuguese and Spanish markets
- Eligible for further export upon agreement of both partners
Both governments commit to facilitating favorable customs treatment, export certification, and transportation infrastructure to support this regional trade.
Article V – Confidentiality and Technology Safeguards
The Parties agree that all technical documents, designs, and intellectual property shared under this Treaty shall be protected by strict confidentiality agreements and used exclusively within the scope of the joint ventures established herein.
Any transfer of technology or licensing beyond the agreed sectors and scope shall require express written consent by both parties.
Article VI – Duration and Review
This Treaty shall remain in effect for 15 years, subject to renewal by mutual consent.
A bilateral commission shall meet annually to review progress, resolve disputes, and propose adjustments.
