Sweden, an idyllic society, a beacon of freedom and respect of human rights, has now surprised her own citizens with a brand new surveillance law that has provoked unexpected, widespread protest from its critics, as well as support from those who understand that the world post-9/11 has new parameters.

In 2004, when then Swedish prime minister Göran Persson visited President George W. Bush in the White House, the President said: "... we spend a lot of time talking about our mutual desire for the world to be peaceful.... He [Persson] has this great ... optimism that people want to be free and ... have the ability to self-govern... We can discuss that because we are both democrats, and we are both strongly in favour of freedom and building democratic institutions."

Back in February 8, 1950, the Stasi, name given to the Ministry for State Security in Germany, was created and headquartered in East Berlin. Later, it became the secret police of East Germany, with roughly 68,000 employees, modelled on the USSR Ministry for State Security (MGB) and later an ally of the Soviet Union.

The Stasi influence in East Germany was vast; it infiltrated almost every aspect of life. About one in every 50 East Germans collaborated with the Stasi, becoming probably one of the most extensive police infiltrations in a civil society in history.

By 1989 it relied on 500,000 to 2,000,000 collaborators as well as 100,000 regular employees, and it maintained approximately 6,000,000 files on individuals - almost a third of East Germany's total population. Having ruthlessly ruled for almost 40 years, after the fall of the Berlin Wall, the Stasi was dissolved in 1989.

Fast forward to the 21st century: Recently, the Swedish government approved a law that allows its intelligence agency to intercept all international phone calls, emails and even faxes, giving Sweden's National Defence Radio Establishment broad authority to monitor international telephone and electronic communications passing through the country. This grants the Swedish intelligence bureau the powers to fight international security threats which are more than ever being planned via electronic communications.

Controversy

Symptom of the heightened controversy in the country is six million emails addressed to the Swedish Parliament, from concerned Swedes who feel their freedom threatened by an over-bearing government.

Some have likened this 'Orwellian' law to the one applied in China, and also an analogy with the United States has been mentioned.

Indeed, in the post-9/11 era, the United States made into law the Patriot Act that expands the authority of US law enforcement agencies in order to fight terrorism in the country and abroad. The Act increases, among other things, the ability of law enforcement agencies to search telephone, email communications, medical, financial and other records; eases restrictions on foreign intelligence gathering within the US, and much more.

On the other hand, the impact of the surveillance law in businesses operating from Sweden appears to be far greater than expected.

Recently, the CEOs of eight Swedish IT and telecom companies, have met and unanimously petitioned the government to explain whether or not it's really necessary and worthwhile to shake the traditional good image of Sweden as a haven for a wide array of Scandinavian companies.

To be sure, the Norwegian and Finnish authorities have asked their respective national post and telecommunications agencies to study the possible impact of the law in their countries. The Telekommunikationsindustrien from Denmark has also begun a similar investigation.

Prime Minister Fredrik Reinfeldt considers the law has been misunderstood and the Swedish Minister of Defence regrets that "one is forgetting the needs of our intelligence".

Outlined

The concerns outlined above have already had very real consequences for Swedish competitiveness and it's obvious that Sweden's position as one of the leading knowledge and IT nations is under threat.

For instance, Google has started down-scaling its presence on the Swedish market, just in case the situation does not evolve in the right direction.

At the same time, foreign IT companies are becoming more hesitant regarding their future investments in the Swedish market.

And Swedish industries, critical on the international market in the fields of telecommunication and data storage, are seeing their attractiveness diminish, and some are even considering moving overseas.

As per the latest news, it is reported that the Swedish legal organisation, Centrum för Rättvisa (CFR) has filed a complaint with the European Court of Human Rights (ECHR) arguing that the controversial warrant less wiretapping law could violate the right to privacy as per Article 8 of the ECHR.

The situation gets more complex as journalists see the anonymity of their sources endangered and opposition groups vividly complain the law could also allow interception of domestic communication.

Meanwhile, in an unprecedented fashion for Sweden, dissenters are loud and clear. And at times when finance and business are setting the tone for further developments of national interest in this global era, it's highly unlikely that the Swedish government will manage to ignore the strong opposition.

The bottom line is, what kind of compromise, if any, will the government and its strategists come up with before January 2009, date when the law is due to be enacted.

It is known that there is a revolutionary in most French and Italian citizens, while the majority of Swedes and Scandinavians are known to be dutiful and obedient result of their different histories.

Will this be the litmus test for the Swedes? Will they react and revolt, or will they understand the needs of societies in the post 9/11 era - national security and surveillance law vs. right to privacy and protection of business interests?

The ECHR has recently struck down a similar UK eavesdropping law, so it's now up to the Swedish government to find a solution or allow the ECHR to have the final say.

Eliana Benador is an independent writer based in New York and Zurich. She is the head of Benador Public Relations, Goodwill Ambassador of Children of Peace, UK, and Chief Advisor to the [Science] Washington Cosmos Group.