LB175 p68-83

68 Legal Business June 2007

MIDDLE EAST

The speed of transformation amongsome Middle Eastern countries over thepast few years has been staggering. Themultitude of glittering skyscrapers thathas emerged from the desert symbolisesthe dramatic shift from developing-worldpoverty to first-world wealth in the spaceof a generation. The oil-rich emirates aresuccessfully transforming themselvesfrom dependence on primary industriesto multi-faceted economies.

For all the growing sophistication ofthe Middle Eastern economies, the locallegal scene remains dominated by smallfirms whose reputations are almostentirely reliant on the personal standingof their founding fathers. The wild aban-don with which western firms shed thenames of their founders in the search forbrevity would be inconceivable in theMiddle East. In societies where familyand tribal ties remain strong, the individ-ual reputations of founding partners

remain the paramount selling point oflocal law firms.

‘Family connections are still the mostimportant thing,’ says Mohammed AlNoor, lawyer at leading Kuwait firm Al-Twaijri & Partners. ‘It’s unfortunate, butthe questions that are always asked are:“What’s your background? Who are youmarried to?” The extent of this variesfrom country to country, but it’s thereacross the region.’

In the Middle East, much business stilldepends on word of mouth. In some juris-dictions, getting the ear of the right peo-ple can make the difference between thesuccess and failure of a deal or project.

Nevertheless, the importance of per-sonal reputation in the Middle East goesbeyond simply having the right familyconnections. While they may often havebeen born into the right families, theindividuals who have forged stellar repu-tations have had to earn them. ‘It comes

Much attention has been focused on the activities ofinternational firms in the Middle East, but the rapiddevelopment and diversification of the Gulf states ishaving a profound effect on the leading local lawfirms in the region’s key jurisdictions DEREK BEDLOW

The newbreeds

Illustration DAVID YOUNG

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June 2007 Legal Business 69



MIDDLE EAST

down to personality,’ saysJochen Hundt, a German lawyer atAl-Soaib Law Firm in Saudi Arabia.‘They need a lot of energy and theyhave to be tough and imposethemselves on the authorities.’

However, perhaps the biggestsingle factor in the persistence ofthe cult of personality amongMiddle Eastern lawyers is the lackof any other forms of regulation oroversight of legal practice. In juris-dictions where conflict-of-interestrules are non-existent and there isno independent authority toenforce a firm’s commitment toclient interests, the best guaranteeof ethical treatment comes fromthe preservation of the foundingfather’s personal reputation.

A typical example is AbdullahKhalid Al-Ayoub in Kuwait. A for-mer district attorney of Kuwait, heestablished his eponymous firm in1982, served as president of theKuwait Bar Association in 1994,and maintains wider connectionsthrough charitable and socialactivities, such as his membershipof the benevolent Martyrs’Committee of the Amiri Diwan,the office of the Emir of Kuwait.‘He’s the owner of the name andthe regulator of the firm,’ saysJasmin Kohina, a lawyer atAbdullah Kh Al-Ayoub &Associates. ‘He is a person of very strict principles, which areinstilled in every member of thefirm, and this ensures that ourclients receive the best treatmentand service.’

Not all of the big beasts of theMiddle Eastern legal world arenative to their jurisdictions. DavidWells in Saudi Arabia, for exam-ple, is a US national, while one ofOman’s leading lawyers, MansoorJamal Malik, is an English barristerof Pakistani origin. Nevertheless,the legal scene is still dominatedby the firms created by big-namelocal lawyers, such as The Allianceof Abbas F Ghazzawi & Co andHammad & Al-Mehdar; LawOffices of Dr Mujahid M Al-Sawwaf; Law Office of Hassan

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COUNTRY FOCUS 1:

BAHRAINTHE MARKETFormerly the financial capital of the Middle East before losing its crown to Dubai, Bahrain retains an important role inbanking and is trying to regain some of itsformer glory through the Bahrain FinancialHarbour development, a hi-tech office andretail complex that opened this year at acost of $1.3bn. Although the smallest of theArab nations, Bahrain has one of theregion’s healthiest economic growth rates and, according to The Wall StreetJournal, enjoys the freest economy in theMiddle East.

Projects work is also an important part of the legal scene in Bahrain. The oil and gas industry is in the process of being modernised and the country is alsoembarking on a number of infrastructureschemes, including new power and desalina-tion plants, as well as a 28-mile bridgebetween the island of Bahrain and neigh-bouring Qatar, which is currently at theplanning stage.

THE DEALSAcquisition of a stake in Bahrain Telecommunications Company (Batelco)Value: $506m Date: January 2007In Bahrain’s largest telecoms deal to date,Bahraini public sector bodies – the BahrainMumtalakat Holding Company, the PensionFund Commission and the General Organisa-tion for Social Insurance – purchased a 20% stake in Batelco from UK companyCable & Wireless.Advisers: Charles Adams Ritchie &

DuckworthMaples and CalderNorton RoseTrowers & Hamlins

Acquisition of Moody International by InvestcorpValue: $311m Date: January 2007Bahraini investment bank Investcorp boughtoil industry company Moody Internationalfrom Close Brothers Private Equity. CloseBrothers acquired Moody for $55m in 2004.Advisers: Berwin Leighton Paisner

Dundas & Wilson Gibson, Dunn & Crutcher

KEY FIGURE: BAHRAINQays H Zu’bi, managing partner, Qays H Zu’bi Attorneys & Legal Consultants After graduating from Duke University (US), and obtaininghis law degree from the University of Cambridge (UK),Qays H Zu’bi joined his father’s legal practice, Hatim SZu’bi, in 1980, where he practised Bahraini law for 17years. Subsequently, seeking international experience andexposure, Zu’bi became the executive resident partner ofthe Bahrain branch office of the US law firm White & Case.Today, having taken over the White & Case Bahrainpractice, Zu’bi is senior partner of the law firm Qays HZu’bi Attorneys & Legal Consultants, based in Bahrain and Dubai (UAE). Describ-ing his role in the firm as that of a ‘strategic thinker’, Zu’bi still lists his father asamongst his stiffest competition in Bahrain.

Mahassni; and Yousef & Mohammad Al-Jadaanin Saudi Arabia; Said Al Shahry Law Office inOman; and Al-Sarraf & Al-Ruwayeh in Kuwait.

SHIFTING SANDSWhile this system persists for now, there aregrowing signs that the dominance of the found-ing fathers may be on the wane. On a macro

level, the environment in which these firms havegrown is changing rapidly. The diversification ofmany Middle Eastern countries away from theirdependency on oil alongside their accession tothe World Trade Organisation (WTO) – SaudiArabia being the most recent to join in 2005 – is creating, in turn, a legal market that isquickly becoming more sophisticated and, �




MIDDLE EAST

gradually, becoming more trans-parent. ‘WTO rules are having amassive impact on business and thelegal structure in the Middle East,’says Mohammed Rashid AbuHussain, founder of MRH Law Firmin Bahrain.

The extent of market liberalisa-tion is uneven: Dubai, Bahrain andOman lead the way; Abu Dhabi,Kuwait and Saudi Arabia are someway behind. Ironically, perhaps, itappears that the pace of liberalisa-tion is inversely related to thelevel of democracy. Kuwait iswidely considered to be the mostdemocratic country in the region,but its elected parliament hasproved to be a significant brake onliberalisation. Conversely, theabsolute power wielded by the AlMaktoum family in the emirate ofDubai has facilitated the creationof the Middle East’s most openmarket by far.

Even some of the more rigidregimes, such as Saudi Arabia’s, arebecoming more open and business-friendly. Hundt at Al-Soaib LawFirm cites the Saudi ArabianGeneral Investment Authority asan indicator of the way the wind isblowing. ‘They are very transparentand customer-friendly,’ Hundt says.‘A lot of information is not madepublic and Saudi Arabia is still an

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KEY FIGURE: KUWAIT

Mohammed Al-Twaijri, managing partner, Al-Twaijri & Partners

Prior to establishing his law firm in 1989, Mohammed Al-Twaijri

spent 18 years in the state-owned oil industry, as head of labour

relations and contracts, before becoming head of legal in the

same organisation.

Since setting up in private practice, Al-Twaijri has developed

his firm rapidly and it is now one of the region’s largest law

firms. It has 95 fee-earners, an office in Bahrain, and plans for

wider expansion in the Gulf region. Al-Twaijri’s son Faisal and

brother Abdul (who manages the firm’s Bahrain office) are also

partners of the firm.

COUNTRY FOCUS 2: KUWAITTHE MARKETWith the most democratic but, at present, least liber-alised economy of the Gulf states, Kuwait’s new Emir,Sheikh Sabah Al-Ahmed Al-Jaber Al-Sabah, is attempt-ing to push a major liberalisation programme throughthe country’s parliament. If successful, this will lead toprivatisations and the opening up of the country’s oilindustry to foreign investment.

But, for now, the government remains the majorplayer in the economy, with more than 90% of thepopulation employed by the public sector. As a result, Kuwaitis are huge investors outside their owncountry, both into other Gulf states (especially Dubai)and further afield – for example, providing thefinancial backing for the £479m acquisition of AstonMartin from Ford this year. Kuwait is predicted to bethe main base for reconstruction efforts in neighbour-ing Iraq if and when the political situation in thecountry stabilises.

THE DEALSPurchase of controlling stake in Kuwaiti mobileoperator Wataniya by QtelValue: $3.8bn Date: March 2007Qatari telecoms company Qtel bought a 51% stake inWataniya from a shareholder consortium led byKuwait Projects Company Holding KSC, the largesttelecoms acquisition in the Middle East to date.Advisers: Trowers & Hamlins

Weil, Gotshal & Manges

Acquisition of Aston Martin by Kuwaiti-backed UK consortiumValue: £479m Date: March 2007Dave Richards, head of UK motorsports firm Prodrive,and former banker John Sinders bought the sports carmarque from Ford with funding from Investment Darand Adeem Investment, both of Kuwait.Advisers: Clifford Chance

LovellsSkadden, Arps, Slate, Meagher & Flom

insiders’ market, but since KingAbdullah took power in 2005, hehas been very committed toreforming the system. The Ministryof Commerce has also seen manychanges. For example, getting limit-ed company articles approved onlytakes a couple of days now, where itused to need five or six visits. It isheading towards internationalstandards and transparency.’

These reforms are creating high-quality legal work, according toAndreas Haberbeck, a lawyer atThe Alliance of Abbas F Ghazzawi& Co and Hammad & Al-Mehdar.‘There is a strong possibility thatM&A work may grow substantiallyin years to come,’ Haberbeck pre-dicts. ‘The first Saudi Arabian com-petition legislation is slowly com-ing into force, and there is plenty ofopportunity for growth, since thereis currently relatively little M&Aactivity. Overall, most legal servicesin Saudi Arabia have changed sig-nificantly in recent years. Since2000, more than 50 keystatutes/codes have been enacted,in some cases regulating previouslyunregulated areas, such as insur-ance, the environment and capitalmarkets. Therefore, there is poten-tial growth for sophisticated legalservices in a number of sectors.’

If this process continues, thenthe result can only be furthergrowth in both the volume andsophistication of legal work in theregion. For local law firms thismeans that some of the statu-tory protection they have

‘We are in favour ofinternational firmscoming to theregion. They willmake regional lawfirms more efficientand competitive.’Mohammed Al Noor, Al-Twaijri & Partners

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previously enjoyed may begradually eroded. Many MiddleEastern jurisdictions still haverestrictions on the activities of for-eign law firms – in most casesrequiring them to partner with alocal practice – but, one by one,these protections afforded to localfirms are disappearing.

LIBERAL VALUESThe Bahraini government liftedrestrictions on foreign firms earlierthis year. This is presently the sub-ject of a lawsuit being brought bylocal lawyers attempting to restrictthe activities of foreign firms inlocal law matters. Abu Dhabi is inthe process of relaxing its legisla-tion to allow more foreign lawfirms to set up independently.

Not all local firms regard therelaxation of restrictions with hor-ror. ‘We are in favour of interna-tional firms coming to the region,’ says Al-Twaijri’s Al Noor,whose firm is based in Kuwait and Bahrain. ‘They will add valueto the profession by makingregional law firms more efficientand competitive.’

The trailblazer in this respecthas been Dubai, where leadinglocal firm Al Tamimi &Company’s managing partner,Hoda Barakat, points out that lib-eralisation and diversificationhave had a clear effect on the qual-ity of business conducted in theemirate. ‘If you look at Dubai as an example, [liberalisation] will

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BB2374banner.indd 1 21/5/07 15:50:26

COUNTRY FOCUS 3: OMANTHE MARKETOman is another oil-producing Gulf state that is using buoyant oilprices to fund an upgrade of its petrochemical, electricity andwater infrastructure and broaden its economic base. The largest ofall is its Salalah Port Project, the creation of a major seaport that isintended make Oman the leading trans-shipment centre in theMiddle East.

Tourism is a growth industry and much of the additional oilrevenues have been poured into leisure-related real estate, mostnotably the Blue City development, an ongoing $20bn project tocreate a new tourist city of 200,000 people on the coast of the Gulfof Oman.

THE DEALSFinancing of Omani power deal for Suez Energy InternationalValue: $800m Date: March 2009Finance was provided by HSBC and Sumitomo Mitsui Banking Corporation for the acquisition and refurbishment of the Al-Rusailpower plant and the development of a new site at Barka.Advisers: Berwin Leighton Paisner

Milbank Tweed Hadley & McCloyShearman & Sterling

International bond financing for Blue City developmentValue: $925m Date: November 2006The first public structured bond issue coming from Oman, the$925m issue will finance the first phase of the Blue City develop-ment and is listed on the Irish Stock Exchange. Lead arranger wasBear Stearns, with joint managers being Credit Suisse, StandardChartered and SHUAA Capital. Advisers: Al Alawi, Mansoor Jamal & Co

Allen & OveryClifford Chance Maples and Calder Shearman & Sterling Trowers & Hamlins Walkers

KEY FIGURE: OMANMansoor Jamal Malik, managing partner, Al Alawi, Mansoor Jamal & Co

An English barrister (called in 1983) who began practising in

Oman in 1986, Mansoor Jamal Malik heads up the international

section of Al Alawi, Mansoor Jamal & Co. Al Alawi focuses

primarily on local clients, which includes the Omani government

for projects and privatisation work.

After establishing his own firm in 1986, Mansoor Jamal & Co,

Malik joined forces with Al Safa Legal Consultants in 2000 and

Said Al Busaidey Legal Consultants in 2004, to create Oman’s

largest law firm, with 33 lawyers. Malik is an associated tenant at

4-5 Gray’s Inn Square in London.

dramatically increase the qualityof business,’ she says. ‘If the political situation continues tostabilise, then markets will openup across the Middle East.’

Some local law firms havethrived in this environment. Theleading firms in Dubai – AlTamimi & Co; Hadef Al Dhahiri &Associates; and Habib Al Mulla &Company – are increasingly com-peting head-on with foreign firmsin many areas of commercial work,and have developed many featuresof western law firms, expandingthe equity beyond the foundingpartners, developing some special-ist departments, and recruitingexpatriate lawyers.

‘If the politicalsituation continues to stabilise, thenmarkets will open upacross the MiddleEast.’ Hoda Barakat, Al Tamimi & Company

Barakat: liberalisation aids business

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MIDDLE EAST

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COUNTRY FOCUS 4:

QATARTHE MARKETAlongside Saudi Arabia, Qatar is theGulf’s most important target for lawyersas, like Saudi, the country is embarkingon a programme of economic diversifica-tion and moving its oil and gas industryup the value chain. Particularlyimportant is the construction of theworld’s biggest liquid natural gas plant.Qatar also has a growing media industryand is the base of the Middle East’s best-known television station, Al-Jazeera.

The country’s future plans are grander still. In 2005, the governmentannounced plans to establish the Qatar Financial Centre, a ring-fencedfinancial free-trade zone along similarlines to Dubai’s DIFC, with its own legaland regulatory regime. To do this, theQatari government has decided it needsthe assistance of international lawyers,and has relaxed restrictions on theiractivities in the country, although it has at the same time withdrawn thelicences of non-Qatari Arab lawyers asthe number of Qatari national lawyershas grown.

THE DEALSEuro medium-term note (EMTN) anddeposit note programme established byCommercial Bank of Qatar Value: $1.5bn Date: October 2006

The EMTN programme, listed on the London Stock Exchange, was the first ever debt issuance programme established in theState of Qatar, and provides the framework for Commercial Bank to issue bonds and other debt instruments with a total value of up to $1.5bn. Advisers: Allen & Overy

Clifford Chance Hassan Alkhater Law OfficeThe Law Office of Ahmed Abdel LatifAl-Mohannadi (managed by legalconsultant Gebran Majdalany)

Qatar Electricity & Water Co’s limitedrecourse project financing for the

construction of the Ras Abu Fontas B2water and power project in QatarValue: $623m Date: June 2006The power generation and water desalina-tion project was financed by Bank of Tokyo-Mitsubishi UFJ, Calyon Corporate and Investment, Commercial Bank of Qatar, Gulf International Bank, HSBC and QatarNational Bank.Advisers: Allen & Overy

Majdalany & Company – now TheLaw Office of Ahmed Abdel Latif Al-Mohannadi (managed byGebran Majdalany)Shearman & Sterling

KEY FIGURE: QATARGebran Majdalany, The Law Office of Ahmed Abdel Latif Al-Mohannadi (managed by Gebran Majdalany) Gebran Majdalany is one of the real veterans of the Middle Eastern legal scene. His firm,the Law Offices of Gebran Majdalany, opened for business in Beirut as long ago as 1967,moving to Doha, Qatar, in 1981. Since then, the firm has expanded into a multinationalpractice of 14 lawyers and has become the leading firm in the rapidly expanding Qatarilegal market. Best known for its projects work – clients include Bechtel and Cono-coPhillips – Majdalany’s firm is also the Qatari counsel for a number of leading interna-tional law firms, including Clifford Chance, and covers a wide range of practice areas,including banking and securities law. More recently, the Qatari government’s policy of withdrawing licences from non-Qatari Arab lawyers has required Lebanese-born Majdalany to operate under theumbrella of Qatari lawyer Ahmed Abdel Latif Al-Mohannadi and change the name of the

firm accordingly.




MIDDLE EAST

‘Clients are becoming moresophisticated,’ Sadiq Jafar, manag-ing partner of Hadef Al Dhahiri’sDubai office, notes. ‘A growingnumber of local clients have in-house counsel, and that, at least ini-tially, tends to have the effect ofincreasing their legal spend. All thisis raising the bar. And many preferto use local counsel in our strongareas.’ He adds: ‘It has also becomeeasier to recruit expat lawyers. Wehave more competition from inter-national firms for staff, but theinflux of these firms has made farmore expats interested in workingin this part of the world.’

The key to the domestic firms’success, they claim, is being able tobring a combination of local

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COUNTRY FOCUS 5:

SAUDI ARABIATHE MARKETOil accounts for 90% of Saudi Arabia’sexports, but the challenges of a youngand rapidly growing population and theuncertainty of commodity prices haveled its government to try to diversifythe country’s economic activity, towhich end the Kingdom of Saudi Arabiajoined the World Trade Organisation in2005. Targeted growth areas includepharmaceuticals, tourism and finance.Within the oil and gas industry, SaudiArabia is in the process of upgrading itsextraction technology and raising thevalue of its industry by developing hi-tech petrochemical processing capacityto complement its reserves of crude oil.

Abdulaziz Al-Fahad, Law Office of Abdulaziz H Al-Fahad

Yale-educated Abdulaziz Al-Fahad is one of the best-connected lawyers in the

Kingdom. He has been a member of the Advisory Commission to the Supreme

Economic Council and a member of the Committee for the Development of

International Trade of the Riyadh Chamber of Commerce.

Al-Fahad’s connections and expertise – mainly in inward investment, privatisa-

tion, securities offerings and project finance – have earned him a long list of local

and multinational blue-chip clients. His eight-lawyer Saudi firm was formerly asso-

ciated with Akin, Gump, Strauss, Hauer & Feld, but in 2006 he affiliated his firm

with DLA Piper.

Al-Fahad is also a prolific writer and speaker on many aspects of Middle Eastern

affairs, including history, religious fundamentalism and economics.

As a result, both the number and scale ofprojects in the Kingdom have grown exponen-tially, attracting the interest of a phalanx ofmajor international law firms.

THE DEALSFinancing for expansion of Rabigh petrochemical plant Value: $5.8bn Date: November 2006Rabigh is a joint venture between Saudi Aramcoand Japanese petrochemical companySumitomo Chemical. Finance came from a com-bination of domestic and international institu-tions – Japan Bank for International Coopera-tion (JBIC), the Saudi Public Investment Fundtranche, Islamic Development Bank and BankAlbilad. The latter two’s contribution of $600mwas the longest-term Islamic financing to date.Advisers: Clifford Chance

Herbert SmithThe Law Firm of Yousef &Mohammed Al-JadaanThe Law Office of Mohammed Al-Sheikh in association with White & Case

Financing of Al-Jubail petrochemical production site Value: $2.4bn Date: June 2006Al-Jubail is a polyethylene production siteowned by Eastern Petrochemical Company. Thefinancing syndicate was led by JBIC, which con-tributed $1.2bn.Advisers: Allen & Overy

Baker & McKenzie LeBoeuf Lamb Greene & MacRaeThe Law Office of Dr Mujahid M Al-Sawwaf

knowledge and technical expertise.In a more developed market suchas Dubai, one aspect they do notemphasise is the role and contactsof their name partners. ‘Havingcontacts is less critical in Dubai,’Barakat says. ‘It’s a well-troddenpath and there are systems in placewithin government, regulators andthe courts. It’s about knowing theprocedures and the policies ratherthan who you know.’

If the dynamics in Dubai arereplicated across the region, thenthe traditional demarcation

KEY FIGURES: SAUDI ARABIAAndreas Haberbeck, The Alliance of Abbas F Ghazzawi & Co and Hammad & Al-Mehdar Haberbeck is a German national who has built one of SaudiArabia’s pre-eminent shipping and insurance practices. Hebegan his legal career as a pupil barrister at London’s 3Essex Court (now 20 Essex Street) before joining CowardChance (now Clifford Chance) in 1982, which provided hisfirst taste of life in Saudi Arabia. Stints at P&I Clubmanager Thomas Miller & Co and Richards Butler in Londonpreceded his return to Saudi Arabia in 1991, where he hasremained ever since. Haberbeck is married to DahliaRahaimy, a Saudi national who represents the Saudi Arabian General InvestmentAuthority in Germany. Haberbeck has also converted to Islam.

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36-38 Cornhill London EC3V 3NGTel: +44 (0) 20 7645 8500 Fax: +44 (0) 20 7645 8501

Search for positions online at www.laurencesimons.com

The experienced recruiters at Laurence Simons International are committed to guiding you through

every stage of your career move. We take the time to get to know you as an individual and understand

your overseas ambitions, both long and short term.

We believe in a proactive and individual approach to recruitment which works as well for candidates

as it does for our clients.

That’s why so many of the international law firms and multinational companies who work with us to find

lawyers at all levels, know that anyone we recommend for a position merits serious attention.

Our specialist Middle East team consists of Mark Anderson in London and Louise Wall in Dubai.

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Mark Anderson in London ([email protected] or +44 (0) 20 7645 8505)

Louise Wall in Dubai ([email protected])



MIDDLE EAST

between local and internationalfirms – where international firmsproject manage transactions onbehalf of multinational clients,while local firms handle litigation,local law opinions and serve localclients – is going to becomeincreasingly blurred. Across theMiddle East, many local firmshave developed separate interna-tional practices, often under theauspices of expat lawyers fromEurope and America. Increasingly,they are targeting international aswell as their local clients, not leastbecause they pay better, and ontime. ‘Our targets are internationalclients with business in the regionand regional companies that havestarted to engage in cross-bordertransactions as the relationshipsbetween the Gulf states have liber-alised,’ Mohammed Al Noor, of AlTwaijri & Partners, comments.

An increasing number see tie-ups with international firms as the best means to achieve theseends. ‘It’s very important for us toglobalise our service,’ MRH’sHussain explains. ‘Sooner or later,the services required by the mar-ket will require co-operation withinternational law firms.’

OUTWARD BOUNDConversely, international firms arebecoming more interested in localclients. In the less openeconomies, such as Kuwait,

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Jafar: prefers to remain independent

outward investment is bigger business thaninward, and local firms have a role to play inintroducing lucrative local clients to westernlaw firms. ‘Local clients are an increasinglyimportant factor, given the surplus of capital inthe region, and I would expect to see more andmore local institutions making increasedinvestments outside the Islamic world again,’comments George Macdonald, a project financepartner at Salans in Paris.

For example, Kuwaiti families are the sec-ond-biggest investors into Dubai (after AbuDhabi), buying, for example, the Australasianislands of ‘The World’ complex in Dubai for$4bn. ‘Local clients should not be underesti-mated,’ remarks Mary Ann Sharp, a US-quali-fied lawyer at Anwar Al-Bisher & Partners inKuwait. ‘They have some huge transactionsgoing on.’

While some domestic companies are begin-ning to approach foreign firms directly, mostinternational lawyers lack the cultural and lin-guistic knowledge to make inroads into localclient-bases in the Middle East. ‘Local firmshave significant advantages in dealing with theexecutives of local companies,’ says StephenSayers, an English lawyer at Said Al Shahry Law Office.

In addition, given the cultural,legal and political differencesbetween the Middle Eastern coun-tries, the strategy of using Dubai asa hub for the wider region stillrequires local presence and experi-ence. ‘We have more continuity ofstaff and connection to the region,which allows us to gain a greaterdepth of knowledge,’ Jafar at HadefAl Dhahiri says. ‘It takes a long timeto get to know how things are donein Dubai. Much of the law here isunwritten – it’s often a question ofknowing where to locate relevantregulations and what the practice is,meaning that often what is notwritten is more important.’

Local recruitment consultantsagree. ‘There’s been a step-changein the quality of lawyers recruitedby local law firms and there aremore western and western-trainedlawyers working for them thanever before,’ Mark Anderson, ofrecruiters Laurence Simons, says.

At the same time, many localfirms admit that they are struggling


MIDDLE EAST


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Kuwait – Head OfficeBahrain – Branch

‘Much of the law inDubai is unwritten –it’s often a questionof knowing what thepractice is, meaningthat often what is not written ismore important.’Sadiq Jafar, Hadef Al Dhahiri

to win international clients. Given the mutualadvantages for local and foreign law firmsworking together, it might appear to be amatch made in heaven. ‘Our contacts are localand regional, but we lack international reach,while international firms lack local knowledgeand it will take them a long time to win thatbusiness,’ Al Noor says. ‘We are looking forsomebody to develop a long-term associationwith. If we work together, we can support eachother, and this will be beneficial for both.’

But the history of association and alliancesbetween local and international firms is not aparticularly happy one, especially in SaudiArabia, where one international lawyerdescribes the last few years as ‘musical chairs’.Local and foreign lawyers put this down to alack of communication about what suchalliances are intended to achieve, but interna-tional lawyers also report that, as the market

gets busier, finding competentlocal lawyers is a growing chal-lenge and some are playingincreasingly hard to get, especiallyin booming jurisdictions such asSaudi Arabia.

‘Affiliations are attractive, butnot just any affiliation,’ Al-SoaibLaw Firm’s Hundt says. ‘It onlymakes sense with top-notch firmsthat can provide access to thebiggest projects, for example byacting for large banks that arefinancing projects in the region.Otherwise, there are a lot of advan-tages to remaining independent –you can be more flexible.’

In Dubai, the leading firms areconfident enough that they can goit alone. ‘Our preference is to �



MIDDLE EAST

remain independent,’ Jafarconfirms. ‘We receive a stream ofreferral work from other firms. Ifwe choose to ally, we may receivesupport and systems from theinternational firm and, for market-ing purposes, would be able to telllocal clients that we are an inte-gral part of a large firm. But thatwould need to outweigh the workwe would lose from other interna-tional firms. There are around 25international law firms withoffices in Dubai, but there are alsoseveral multiples of that numberthat have work in the region whoare not here, and we manage tocapture some of that business.’

Amongst both the firms thatseek international tie-ups andthose who intend to remain inde-pendent, there is also a growingtrend toward the creation of pan-Middle Eastern firms. ‘We intendto be a local firm in each jurisdic-tion,’ says Al Tamimi’s Barakat.

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COUNTRY FOCUS 6: UAETHE MARKETThe open attitude and liberal business environ-ment promoted by its ruling family have madeDubai the premier business centre of theMiddle East. Dubai’s avowed aim is to becomeone of the world’s leading financial centres,opening the tax-free Dubai InternationalFinance Centre (with a regulatory systembased on the UK’s Financial Services Authority)in 2004. The emirate – one of seven that con-stitute the United Arab Emirates – is already aconduit for investment into the gulf region, theIndian subcontinent and eastern Africa. Alongthe coast in the oil-rich emirate of Abu Dhabi,however, covetous eyes are being cast towardDubai, and Abu Dhabi has plans to emulate itssuccess as a business and financial centre.

THE DEALSBond issue for Abu Dhabi National Energy Company (TAQA)Value: $3.5bn Date: November 2006The largest Eurobond issue by a Middle Easterncompany to date, TAQA issued three tranchesof bonds on the London Stock Exchange. Jointlead arrangers were Abu Dhabi Commercial

Bank and the National Bank of Abu Dhabi; thebookrunner was Goldman Sachs.Advisers: Al Tamimi & Co

Linklaters Simmons & Simmons

Financing for Abu Dhabi-listed Aldar PropertiesValue: $2.5bn Date: March 2007The first Islamic convertible bond to be issuedand the first sukuk issue (a Sharia-compliantequivalent of a bond) to be listed on theLondon Stock Exchange’s Professional Securi-ties Market. Joint lead arrangers wereBarclays Capital, Credit Suisse and theNational Bank of Abu Dhabi.

Advisers: Bedell CristinClifford Chance Denton Wilde SapteSimmons & Simmons

Syndicated loan for Abu Dhabi Commercial Bank Value: $1.5bn Date: April 2007The biggest syndicated loan for a MiddleEastern bank to date, the loan was arranged by Bank of Tokyo-Mitsubishi UFJ,BNP Paribas, Commerzbank, ING andStandard Chartered. ING was the leadarranger and lender.Advisers: Linklaters

Reed Smith Richards Butler

the notepaper is a distinct risk for local firms.And, although the issue of succession is fast rising up the agenda, it remains unresolved atmany. ‘Our firm would collapse if our founderdied,’ one Middle Eastern lawyer admits.

Many domestic firms are relying on thefounder’s children and brothers to continue thefamily line, while some, such as Bahrain’s QaysH Zu’bi Attorneys & Legal Consultants, havegone further by extending the equity to partnersbeyond the founding family. ‘I am not a one-manshow,’ founding partner Qays H Zu’bi confirms.

Similar measures have been put in place atSaid Al Shahry Law Office in Oman. ‘We are set-ting up a management group so that the firm isnot just associated with one man and can con-tinue after Said Al Shahry has stepped aside. Weare not exposed in that way – but it would havebeen a risk five years ago,’ Sayers says. ‘We wantthe firm to become part of the fabric of Oman.’

‘We want to be a truly MiddleEastern firm.’

PERSONALITY DISORDERSNone of these trends suggests thatthe pre-eminence of personality-led law firms will last indefinitely,and internally the model is alsounder pressure. Many of today’sleading local firms were set up inthe 1980s and the founding part-ners are either growing old orfalling behind the times. ‘The life-span of a law firm in the MiddleEast is generally that of the found-ing member’s career – about 25-30years,’ says Al Noor at Al-Twaijri.‘We would like this to change, butit will need legislation to allowlaw firms to be reg-ulated throughproper agencies. Itis not as regulatedas we would like.’

Over-relianceon the name on

KEY FIGURE: DUBAIEssam Al Tamimi, senior partner, Al Tamimi & Company

A Harvard-educated United Arab Emirates national, EssamAl Tamimi has steered his eponymous firm from its founda-tion in 1989 to become the largest independent law firm inthe Middle East. In all, Al Tamimi has more than 20 years’experience in the Dubai legal market, having begun hiscareer with Clifford Chance in 1984, first in London and thenin its Dubai office. More recently, Al Tamimi has stepped aside from day-to-daypractice, but remains the figurehead of the firm. It now has88 local and international lawyers, and last year became one of the first to launch apractice at the Dubai International Finance Centre (DIFC), the site of the MiddleEast’s leading stock exchange.


MIDDLE EAST


At the same time, the next gen-eration – many of whom have beeneducated in the west – have ambi-tions beyond just maintaining theirgood family names. MiO Advocatesin Abu Dhabi, for example, recentlyrebranded away from its fullfounder’s name in an attempt toemphasise its collective approach.

Ahmed Odeh, son of the firm’sfounder Mohammed Issa Odeh,

‘If firms do not become partnerships,they cannot expand beyond a certainpoint. We have to think long term.’Ahmed Odeh, MiO Advocates

who established the firm in 1985,says his father took some persuad-ing to agree to the name change.‘There are other people that thefirm needs to give recognition to aswell as the founder,’ he says. ‘It willbe a team business in future. If firmsdo not become partnerships, theycannot expand beyond a certainpoint. We have to think long termand this is the only way to survive.’

In the Middle East, it appears that the sandsare shifting. ‘Some local firms are providingeffective competition to foreign firms, but they will have to emulate the model of thewestern firms, which has been proven to work,’notes Shahram Safai, an associate at Afridi &Angell, a United Arab Emirates law firm thatspun off from Chadbourne & Park in 1991. ‘Youneed to spread the wealth for growth to occur,or your quality will fall away and you will berelegated to “family firm” status.’

The era of dominance by the founding fathersmay not be over yet, but its end could well be insight. ‘We think that all qualified lawyers areequally important,’ explains Mohammed Al-Soaib, managing attorney of his eponymous lawfirm in Saudi Arabia. ‘Those who are most awareof the fast legal and economic changes have thebest chance of success.’ LB

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Documents

LB175 p68-83