The incident occurred between the Swedish coastal town of Ystad and the Danish island of Bornholm.
ADVERTISEMENTOne person has died and another is missing after two cargo ships collided in the Baltic Sea, Swedish authorities have confirmed.
The incident -- involving a British and Danish vessel -- occurred between the Swedish coastal town of Ystad and the Danish island of Bornholm.
Carl-Johan Linde, press manager at the Swedish Maritime Administration told Euronews they received the first emergency call at 03:30 CET on Monday.
"One of the ships, the Danish ship, has capsized," he said, adding: "We're currently searching for two people right now at this place."
The body of one of the missing persons was later found inside the capsized vessel. The cause of the accident is not yet known.
Swedish Coast Guard prosecutors said they had opened a preliminary investigation on potential charges of gross negligence in maritime traffic and “gross sea drunkenness.”
Two people -- a British national and Croatian national -- have been detained as suspects.
The two missing persons were the two crew members of the Danish cargo ship, the Karin Høj, the owner of the 55-metre vessel had confirmed to AFP.
The ship was travelling to Nykoebing Falster in Denmark after leaving the Swedish city of Sodertalje the day before, according to MarineTraffic.
The British ship -- identified as the 90-metre long Scot Carrier -- was travelling in the same direction from the Latvian port of Salacgriva to Montrose, in Scotland.
The Scot Carrier has not reported any damage and its crew were unharmed.
Both Sweden and Denmark deployed a helicopter each as well as multiple search and rescue (SAR) boats to the scene in the morning, the Swedish Maritime Administration and Defence Command Denmark told Euronews.
The authority had confirmed that "Swedish Coastguard and rescue service have started diving to search for the crew members".
"We have not found any missing persons in the open sea, searching with helicopter and aeroplanes," said Valdemar Lindekrantz, a spokesperson for the Swedish Coast Gaurd.
"People have heard screams from the water but we have not been able to confirm this," he told Euronews.
The capsized Danish ship was towed just south of Sandhammaren, about 30 kilometres east of Ystad.
Earlier in the day, they had explained that towing the boat would prevent it from sinking and allow rescuers to "find out if any of the missing are on board or not".
The Swedish Coast Guard also said there were no ongoing spills and it was carrying out work “to prevent oil or other harmful substances" from being released into the sea.
ADVERTISEMENTCollisions in the busy shipping lane -- which links the North Sea and the Baltic Sea -- are rare.