The global pharmaceutical industry is a highly competitive and rapidly changing environment, defined by rigorous regulations and a constant need for new discoveries and developments. Pharmaceutical MNCs operate in a variety of legal and cultural contexts, making it crucial for them to possess a thorough understanding of local laws and customs to ensure regulatory compliance and long-term business sustainability. The combination of a strong economy, a robust research and development infrastructure, and a highly skilled workforce has positioned Sweden as an appealing destination for pharmaceutical MNCs seeking to expand their global presence. This thesis investigates the impact of Swedish labour law, specifically the Co-Determination Act (MBL) and the Employment Protection Act (LAS), on multinational pharmaceutical companies operating in Sweden. Through a qualitative study incorporating semi-structured interviews with HR directors from two leading pharmaceutical MNCs and legal experts from two corporate law firms, the study explores how these regulations influence operational strategies, decision-making processes, and human resource management practices. The findings highlight the complexities MNCs face in complying with MBL and LAS, including extended decision-making timelines and challenges with employee retention and termination due to the “last in, first out” principle. However, the study also identifies benefits such as enhanced employee morale and trust, which contribute to a positive work environment. The conclusions suggest that while these two regulations impose significant operational constraints, they also offer strategic advantages that can lead to improved employee engagement and organisational stability. While primarily focusing on the management perspective within MNCs, this study leaves the employee viewpoint unexplored. Future research could explore the employeee xperience to provide a more comprehensive understanding of the impact of MBL and LAS. Additionally, while centred on the pharmaceutical industry, the findings may have broader implications for other industries and could pave the way for further research into how these regulations affect various industries and potentially influence foreign direct investment in Sweden. Given the limited sample size, further research with a larger and more diverse sample is also warranted to validate and generalise these results. Nevertheless, this study provides insights for new MNCs navigating the Swedish labourlaw landscape, aiding in strategic planning and decision-making.