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Bruce McAlister, GE Global Growth Organization

I’ve been with GE just over 20 years. In that time, 14 have been in the UK and now over five have been in the Middle East.

I think the challenge of being able to operate here from a multinational corporation is with distance from headquarters; as soon you have distance from headquarters, it slows down the ability to react, while at the same time your commercial deals progress quicker. You want fully empowered, competent, experienced legal counsel being able to do some of your deals. The size of the deal, in this region, especially the type of infrastructure projects that we get involved with (which are in the health, power, aviation, and removal sectors) are large. They can run from hundreds of millions to billions of dollars.

I think the role of the general counsel in this region is multi-faceted. You are having to tackle a lot of issues, and there is scarcity of resources. So when you have to build up a team that is competent and qualified, you are fighting for resources and I think the key thing is, it will be resources from the region. My experience has been that being able to have an Arabic speaker is important – someone that can understand the laws in these countries. Most of [the laws] are codified, but you need someone that can understand Arabic and deals with the customers, but also deals with the laws. Because you are contracting out of the local office and you’re working with the government, you’re contracting under the local laws.

There’s a requirement for steady hands – someone that has had the experience to be able to sift the business leadership – so the business leadership was constantly looking for that trusted adviser to drive strategy, be that commercial strategy adviser, fill that stewardship role of being able to protect the brand and reputation. You’re operating in a region which Transparency International will tell you is one of the most challenging – but, within that, the UAE obviously not. The UAE is far more mature in terms of ease of doing business and business conduct – it is very good. But you leave the UAE and it becomes very challenging. If you look at the likes of Iraq, Egypt, Tunisia and Pakistan – those are difficult jurisdictions to operate in.

In terms of the stewardship role, there’s a lot of challenging work that you’re undertaking when you’re dealing with large engineering deals, B2B-type arrangements and large consortium agreements. We’re always dealing with partners, and you’ve got to be very careful about who you select as a partner, because you know we all are subject to the extraterritorial reach of the Bribery Act and the Foreign Corrupt Practices Act.

We know that obviously there is a legal side to this, but your brand can be impacted so badly by choosing the wrong kind of a partner to go into a major transaction with. It’s quite a role to try and do here in the Middle East. It’s work keeping your company and its resources safe. If you’re operating in some of these countries, you’ve got to make sure you’ve got a safe environment for your employees, that you know your employees that are coming into that country, and you’ve considered all the measures that are required to protect them when they come in. n

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Hashemite Kingdom of Jordan

Since 2009, Jordan has faced a raft of challenges: the global financial crisis, the Arab Spring, border closures with Iraq and Syria, as well as a massive refugee influx. These events have placed immense pressure on Jordan’s economic and political prospects. Yet, despite this, Jordan has retained its status as an important commercial hub within the Middle East.

Jordan is proudly described as the business capital of the Levant. Despite lacking valuable oil and gas reserves, it has managed to build a strong economic base around its manufacturing, finance and banking sectors.

‘The business environment in Jordan is safe, stable and secure, especially when compared to the countries that surround it. This is a big advantage for Jordan,’ explains Abdelrazzaq Al Shurbaji, assistant vice president and legal counsel at Citibank.

‘A lot of countries situated around Jordan are experiencing challenges. In comparison, Jordan has become quite a secure environment. It has become an attractive place in the Middle East to work and to invest.’

Jordan is located at the crossroads between Asia, Africa and Europe. Linah Yazbak, legal and compliance manager at Ferring Pharmaceuticals, says Jordan’s location makes it an ideal base for large multinational companies.

‘Jordan is well placed – it acts as a hub for international companies operating there due to its strong relationships with a number of global markets. Luckily, it is one of the most secure and stable countries in the Middle East,’ she says.

Only the beginning

Jordan’s reputation as a stable and secure business environment has made the country a desirable location for in-house counsel within the Middle East.

‘Jordan’s stability and strategic location have been reinforced with sound economic policies and a vision to ensure that Jordan will become a key market in the MENA region,’ says Dr Wadah Hajjat, legal adviser at the Jordan Investment Commission.

‘Jordan stands to be an active partner in the reconstruction and development of neighbouring markets, too. All of these factors have made Jordan a unique place to be an in-house counsel.’

Despite lacking oil and gas reserves, the country has managed to build a strong economic and commercial framework. Its business activities are varied: from the exportation of manufactured goods such as pharmaceuticals, to building a robust financial sector and promoting foreign investment in initiatives such as renewable energy.

‘The investment atmosphere in Jordan makes it easier for investors to come and establish their businesses here,’ says Dr Kamal Jamal Alawamleh, legal counsel at Arab Telemedia Group.

‘Overall, the legislation itself, the legislator and the close relationships which we have here in Jordan have made the country an attractive destination for investment.’

Despite an overall positive environment, legal ambiguities have made doing business in Jordan problematic at times. Combined with the introduction of a host of new laws and regulations, in-house counsel have had to ensure they remain at the forefront of what can seem like a constant stream of new developments. And, as Jordan continues to develop its legal frameworks, in-house counsel in the region will be exposed to a wider selection of business opportunities. As the push towards boosting investment and strengthening Jordan’s economy continues, the need for well-trained and in-house counsel stands to become even more essential.

A hard pill to swallow

In particular, the stability of the business environment in Jordan has been favourable in helping develop its export industry. Its main exports include textiles, potassium, phosphates, fertilisers and pharmaceutical products. Its main export partners include the United States, India and Saudi Arabia.

‘Jordan is a vital country in the Middle East. Although parts of the region have been hit by political instability in recent years, continued economic and population growth have continued to present some strong export opportunities,’ explains Yazbak.

One area where companies are capitalising on the strong export opportunities available in Jordan is the pharmaceuticals industry. Jordan is a leading pharmaceuticals manufacturer in the MENA region. A major international player in the industry is Swiss multinational company Ferring Pharmaceuticals – which bases its Middle East headquarters out of Amman.

‘Ferring decided to have their regional offices for the Middle East and Africa region based in Jordan over 20 years ago. We are based here for taxation purposes, marketing issues and for manufacturing reasons,’ says Yazbak.

In-house lawyers working in Jordan’s pharmaceutical sector are regulated by the Ministry of Health. The industry is also under the close supervision of the Jordan Food and Drug Administration. Having worked at Ferring for the last four years, Yazbak has overseen a range of legal and compliance matters.

‘I have been managing the compliance team for the whole Middle East area, which includes the Levant, Turkey, and Africa. My role is split into two parts: legal and compliance. On the legal side, I provide advice, guidance and legal interpretation to clients within our organisation,’ she says.

‘I also manage compliance across the region. One area where we need to provide specific advice is in relation to the “Sunshine Act” from the European Union.’

The legislation that Yazbak refers to strengthens the transparency obligations between pharmaceutical companies and healthcare professionals. The government of Jordan considers the pharmaceutical sector a crucial part of the economy. Ensuring the industry adheres to both local and international standards is fundamental in maintaining its status as a pioneer within the industry.

Cashing in

The Jordanian economy is highly dependent on its banking and finance sector. It plays an important role in fostering stability and boosting economic growth. One of the leading financial providers in Jordan is Citibank.

Al Shurbaji has been running legal operations at Citibank for the last four years, and has overseen a large portfolio of legal work.

‘My main responsibility is to provide local and cross-border assistance for legal. This means providing proactive, timely and accurate support to all of the departments and regional lines,’ he says.

‘Living in Jordan and working as in-house legal counsel can be a challenge, because you need to find a balance between building revenue within ongoing projects and protecting the entity at all times.’

Although this is a common challenge faced by in-house counsel, ambiguities within the Jordanian legal framework can make overcoming this more difficult.

‘Sometimes there is a lack of laws and regulations governing specific transactions, so you have to study the transaction very well and you have to advise in terms of your interpretation of the law or regulation. This is very challenging for legal counsel here in Jordan,’ says Al Shurbaji.

The government of Jordan has tried to combat legal ambiguities by introducing new laws and regulations. Over the last five years, in-house counsel working in the banking and finance sector have been at the forefront of major regulatory reform.

Al Shurbaji has overseen the implementation of new laws in areas including insolvency, bankruptcy and property law. With more regulatory changes expected in the future, in-house counsel working in the banking and finance sector require a sound understanding of what new laws mean in relation to the current legal framework.

‘The government is working on new laws and regulations which support the financial market here in Jordan,’ says Al Shurbaji.

‘When new laws are introduced or implemented in Jordan, you still need a solid understanding of what exactly the consequences of these new laws are – this is a real challenge we face here in Jordan.’

Investing in the future

The Jordanian government has also introduced new regulations supporting investment initiatives by local and national enterprises. Hajjat says the aim of the Jordan Investment Commission is to be a strategic partner to help facilitate international investment.

‘Jordan aims to attract, encourage and promote domestic and foreign investment to all sectors which are covered by investment law, which include industrial, agricultural, tourism, media, vocational and services industries,’ says Hajjat.

‘I work in the legal and policy studies department. With my colleagues, I work to develop a more attractive framework for investment. I review comparative studies among various investment laws and make recommendations aimed at improving Jordanian investment law.’

Legal advisers such as Hajjat are at the centre of improving regulations for prospective investors in Jordan. The Commission was formed in 2014 in an effort to stave off the prospect of corruption facing potential foreign investors, unifying what had previously been a disparate set of agencies.

‘It is important to ensure that we promote a sustainable and attractive investment climate, activate economic movements, enhance confidence, develop and organise the investment environment, as well as increase exports,’ he says.

‘Accordingly, all sectors were given the same incentives – with some extra incentives to the information and communication technology sector.’

The push towards boosting foreign investment has been particularly prominent with regards to sustainable and renewable sources of energy, with an aim to have 10% of all energy in Jordan sourced from renewables by 2020, as outlined in the 10-year National Energy Strategy.

‘We do not have an abundance of natural resources here in Jordan. I think one of the things that support Jordan’s economy is investment opportunities. We have a lot of projects related to solar and other renewable energy. These projects are supporting the industry here in Jordan,’ says Al Shurbaji.

Jordan’s renewable energy sector is developing quickly. According to the BloombergNEF Climatescope 2018 Index, Jordan is ranked as the third most attractive investment destination for renewable energy. Placing third out of 103 countries is a huge achievement for Jordan, explains Shurbaji.

‘I believe that new legislation, and continuous legislative developments in Jordan have played a fundamental role in this achievement,’ he says.

‘For in-house counsel in the region, this presents an opportunity to gain more exposure and work on different transactions. This is a very important point for in-house counsel, as more investment presents more opportunity within the Jordanian legal market.’

It's showtime

One area where new investment opportunities might come as slightly more of a surprise, is within the film and television industry in Jordan.

‘Economically, Jordan does not have oil or gas reserves. The only source of revenue it does have derives from within the Jordanian people and their efforts to improve,’ says Alawamleh.

Arab Telemedia Group is one of the most popular production companies in the Middle East. Established in 1983, the group is known for producing award-winning Arabic TV series and films. One of the main legal responsibilities as legal adviser of Arab Telemedia group is overseeing the registration of new scripts, says Alawamleh.

‘We protect against copyright by registering scripts with the relevant authorities. We buy scripts for different TV shows. As a result, we have to register these scripts with the National Library here in Jordan,’ he says.

With Jordan’s location in the heart of the Middle East, Alawamleh says that there are opportunities apparent in utilising the varied talent that ends up residing in Jordan, as well as catering for the tastes of an increasingly diverse population.

‘We have a lot of people who migrate and reside in Jordan, because we are on the border with a lot of countries that have a lot of problems,’ he says.

‘But, that means that different actors, contractors and producers now reside here in Jordan. Because they have been given residence here, they try to protect the way of life they have here and work to improve our industries. For our industry, this will eventually bring us different productions, new TV series, different techniques. The only way is up.’ n

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Joanne Fischlin, Microsoft

I was born and bred in Switzerland. I qualified in Geneva, then spent a couple of years in private practice before finding it wasn’t really my cup of tea. I moved to Ralph Lauren and spent close to four years at their EMEA headquarters.

The plan was to go abroad and work for Bulgari in Rome. That was my dream job. That didn’t happen, because I literally ended up on the road from Ralph Lauren in a fragrance and flavour company. I moved to Dubai with them as their EMEA general counsel, and between 2008 and 2012, the economic turmoil in Europe was terrible. I was spending more time with HR closing down plants than I did with the business. So, at some point, I said to my general counsel, ‘Please allow me to go and sit where business still actually thrives’. That’s what triggered the move to Dubai six years ago. I initially had a three-to-five year assignment, but then after one year, my group general counsel asked me to come back to Switzerland.

My husband and I were happy in Dubai and just one year of expatriation is not something that would have made sense in terms of career development either, so I moved to NASDAQ Dubai, then back to private practice to set up my business – high level in-house secondment. Around this time I also seconded for Microsoft, and then the person I was seconding for resigned and put my name forward, and I ended up getting the job.

I think the challenge in the tech industry is that the technology goes at a way faster pace than the regulation. What we see mostly is that governments are struggling to keep up. Sometimes they come up with what they think is fancy regulation but actually it just doesn’t meet the purpose, or it stifles innovation, or it just misses its target. So I think that the beauty of being in such a large organisation like Microsoft is that you’re actually spending this time on the advisory part, and you’re going to sit with governments to help them understand what type of regulation they should put in place, discussing how they should start thinking about those major disruptions that are going to come with the adoption of technology.

I think that what’s starting now – and will take a couple of years – is ethics in artificial intelligence, particularly responsible adoption of artificial intelligence. Because again, as one of the massive, hyper-scale cloud service providers and obviously key generators of artificial intelligence – powered tools, we have a massive responsibility to make sure that we sell that stuff to the right people, that we understand how the technology can be misused, and how it can put people out of jobs. Because all of those questions are driven out of the legal function at Microsoft, we have a huge role to play in terms of making sure that our customers are looked after, because every business is becoming a digital business.

I think that what one needs to understand is that you can’t be arrogant and think that you’ve figured it out. Nobody has, and it will take the brainpower of a lot of different people in a lot of different areas to actually get that right. So, we do rely on a lot of external resources, but we also, I think, try to put our neck out there and put forward solutions where we think that is the best approach to make sure that the technology doesn’t go south. n

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Abdelrazzaq AI Shurbaji, Citibank

I believe that being an in-house legal counsel here in Jordan and working within the banking and finance sector requires a good understanding of financial technology and electronic banking. Despite its issues, the use of technology within the industry is growing, so it is essential for in-house lawyers working in this field to have a good background in, and a sound understanding of, laws surrounding new technological innovations.

There are a lot of new laws and regulations in Jordan that support the financial industry. But a challenge is that a lot of the people living in Jordan are still not used to the concept of electronic banking. They still need time to understand how it works. For example, the majority of Jordanians still need time to understand how to pay their bills online – many of them still feel like they need to physically go to the bank to pay their bills. This makes the development of financial products here in Jordan particularly challenging.

The laws supporting the integration of Fintech are also growing. The laws surrounding electronic transactions, including the use of e-signatures, are also developing. I believe this is the start of the boom that will transform our industry.

Nevertheless, in-house lawyers are working in areas where there are sometimes a lack of legal regulations. If we look at the introduction of electronic transactions and the use of e-signatures here in Jordan, the laws around that are still developing. I think if laws are implemented in the right way, this will be a great advantage to all parties – including customers, companies and banks – and for all manner of transactions.

In general, some of the new laws implemented in Jordan revolve around income tax law, security rights in moveable property law and insolvency law. For instance, we have recently had new income tax laws introduced, which say that there is a new amount that should be paid to the government as income tax from a range of entities – this includes banking and finance companies. This may impact business here in Jordan because the amount might be considered very high. As a result, I think businesses will think very carefully before investing any money.

Most of the time I work autonomously, but sometimes I like to share experiences with colleagues who are dealing with similar challenges. When new regulations are introduced within the banking and finance sector, I like to share my opinion, as well as learn from the knowledge and experience of other colleagues who are working in the same industry. Sometimes there will be a need to go to external counsel at times when we need to obtain detailed advice on a particular issue.

Despite all of the challenges, one of the biggest advantages of working in Jordan is the security it provides. The business environment in Jordan is safe, stable and secure, especially when compared to some of the countries that surround it. This is a big advantage for Jordan. A lot of countries situated around it are experiencing a lot of challenges. By comparison, Jordan has emerged as an attractive place in the Middle East to work and to invest.

We do not have an abundance of natural resources here in Jordan. I think one of the things that support Jordan’s economy is investment opportunities. We have a lot of projects related to solar and other renewable energy. These projects are supporting the industry here in Jordan. n

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Lebanese Republic

Lebanon in the 21st century represents an evolving nation that has had to overcome major political and commercial challenges. Situated in the Levant on the easternmost part of the Mediterranean Sea, Lebanon serves as a busy economic and cultural centre for the region, but one that is underpinned by a relatively small legal market. But, in-house counsel have been playing an important role behind the scenes in supporting businesses across a variety of industries.

It's a no-brainer

High literacy rates, coupled with low operating costs – at least compared to other Middle Eastern countries – have allowed Lebanon to cultivate a thriving business community of both local and foreign corporations. Capitalising on Lebanon’s potential, consulting giant PwC runs its Middle East legal headquarters from Beirut.

‘It is unusual to have multinational enterprises and multinational companies base their legal teams in Lebanon. That's an unusual thing, even though it has worked really well for PwC,’ says Fayez Khouri, general counsel, Middle East at PwC.

‘The majority of legal work conducted by PwC revolves around countries like the UAE and Saudi Arabia. Lebanon is a very small chunk of the work that is being done.’

Being based in one country while also being asked to serve many others can be challenging. Using Lebanon’s capital as a base, Khouri often spends time travelling between the UAE, Saudi Arabia and the UK, and managing a team of 12 people across the Middle East has given rise to its own set of challenges.

‘The difference working in the Middle East is you are working with so many different types of laws. As a legal team, we operate within 17 different legal jurisdictions. Although we cover 12 territories, some territories, like the UAE, have several different jurisdictions.’

While being located in a hub serving many jurisdictions can be difficult, it also means that the human resource available is high quality and oftentimes abundant.

‘Lebanon is reputed for the quality of its human resources, especially in the banking industry,’ says Maya Abboud, head of legal compliance at Banque Libano-Française.

‘The high level of education plays an important role. We are a multicultural country, we speak three languages and we have a huge amount of diversity. This is why many investors see Lebanon as a hub for their business. The banking and finance industry has always been a reliable partner to these investors.’

Another factor making Lebanon an attractive business centre is location: geographically, Lebanon is very well connected to the rest of the Middle East, sitting along the eastern shore of the Mediterranean Sea.

‘First, Lebanon’s geographical location is considered by many investors as an ideal strategic hub. It is said to be the gate to the Middle East, especially in matters of international trade,’ explains Abboud.

‘The link to other countries, flight-wise, is very good. People can fly back and forth if they need to – from an financial point of view it makes sense, from a talent point of view it makes sense,’ adds Khouri.

A confluence of factors make Lebanon’s prospects as a commercial hotbed for the region – both in the near and further future – promising ones. The port of capital Beirut connects Lebanon, Syria, Jordan, Iraq and Iran to the wider Middle East and the world beyond – an already critical shipping nexus, which will be of increasing importance with the eventual reopening of Syria for business and the flow-on effects of China’s Belt and Road Initiative both adding to the port’s necessity.

Does size matter?

The Lebanese legal market is a smaller market compared to other Middle Eastern countries, and, as a result, the in-house legal sector is also significantly smaller.

‘What is unique is that there are not as many multinational in-house lawyers as there would be if you were in Dubai or Riyadh or other GCC (Gulf Cooperation Council) cities,’ says Khouri.

Being based in Lebanon has not slowed down legal operations. The in-house legal team at PwC has still successfully serviced the Middle East whilst being located in a smaller legal market. Instead, what have been challenging are the differences in laws within Lebanon and the Middle East compared with other legal markets, such as the UK.

‘In the Middle East, you are much more of a generalist. A lot of concepts that exist in England do not actually exist in the Middle East. For example, the concept of indemnity is not as common here. We can argue about having it in, or having it out, and what are the repercussions of having it in, or having it out. But, in the Middle East, the concept of indemnity does not really exist,’ says Khouri.

There are a plethora of legal concepts in English law that are yet to be addressed within the Middle Eastern regulatory framework. From a legal perspective, this presents a barrier for in-house counsel working across several jurisdictions. But those who we spoke to for this report say that the region is moving towards implementing stricter and more thorough rules and regulations for businesses to follow.

The devil is in the detail

Khouri believes the key to managing auditing regulations across different jurisdictions is for in-house counsel to be up to date and at the forefront of any regulatory changes. At PwC, audit work is at the core of the business, making compliance a key consideration – and one which must be done to high international standards.

‘The auditing profession is highly regulated, so we have to always be very mindful of what the regulators are saying, and what they are doing, and how they monitor the work we do. That opens us up to a significant amount of inspection and supervision,’ says Khouri.

‘If something should go wrong with one of our clients where we have done an audit, we need to be at the forefront of trying to supply information to regulators.’

The trend toward higher regulation is seen throughout the Middle East, and Lebanon is no exception. For instance, the global movement surrounding the need for more transparency and compliance within the banking and financial sector has gained significant momentum in Lebanon. Abboud’s role as head of legal compliance at Banque Libano-Française reflects a shift in banking process:

‘The central bank of Lebanon requires banks and financial institutions to have a compliance department, which should include a legal compliance division,’ explains Abboud.

‘This trend is not specific to Lebanon, it is widespread across the world. Whenever you have a sector with growing regulations at a very fast pace, you need to be able to handle them properly. You need specialists with a legal background in order to understand and interpret the laws and regulations and work on their proper implementation. That is why the profession is evolving very, very fast.’

In such an active regulatory environment, process becomes key. As general counsel at PwC, Khouri has the responsibility to implement systems that ensure compliance with regulations and allow for requests from regulators to be met quickly and easily.

‘If you know you are going to be asked to produce documentation by a regulator, you have to be very organised: you need to know where all your documentation is kept; you need to be able to access it; you need to have a set-up where you can review the documentation to ensure you are sending the right documentation to the regulators,’ says Khouri.

‘You need to be very internally aware of where things are and who the right people within the organisation are to assist you with getting that information.’

Insuring the future

The rise of stricter compliance regulations throughout the insurance industry reflects this shift in priorities.

Relative to the size of the country, the insurance and reinsurance industry in Lebanon is surprisingly active.

‘The Lebanese market is ranked as the 70th largest insurance market in the world with a penetration rate of 2.36%, which does constitute a very good performance knowing that Lebanon is only the 112th country in the world in terms of population,’ says Robert Habchi, claims and legal manager at Nasco Re Holding.

Nasco Re Holding is a leading insurance broker in Lebanon and in the Middle East and Northern Africa. Having started his reinsurance career six years ago, Habchi has overseen a surplus of insurance claims.

‘I believe that we have entered into an era in which compliance is starting to dominate our field with strict regulation at all levels, from internal auditors through to the expectations of clients and partners,’ says Habchi.

‘Compliance is becoming further important, particularly in light of the ongoing environment in the Middle East, suffering from regular political crises.’

The Lebanese insurance and reinsurance sector is a very mature industry. There are 51 insurance companies licensed in Lebanon, says Habchi. Therefore, adapting to new industry trends is essential to staying competitive.

‘If you want to survive in such a fierce and competitive environment, you have to question yourself, and adapt to our modern world.’

Team effort

The Middle East as a region does not operate in isolation. As well as grappling with the drivers of regulatory change that come from within the region, in-house counsel based in Lebanon are also required to react to global trends and issues. One of the most significant in recent times has been the introduction of the General Data Protection Regulation (GDPR). Coming into force in 2018, the GDPR is a regulation protecting the privacy of European citizens. It also includes the transfer of personal data outside of the EU.

‘Most recently, the introduction of the GDPR in Europe has been important. Even though it doesn't have a direct effect on the Middle East, there are aspects of it that we need to pay attention to,’ says Khouri.

‘The world is a very small place, it’s not country by country anymore – you are dealing across borders and across jurisdictions. So I think the introduction of the data protection regulations has brought about a lot of changes. We have had to change our standard form contract, we have had to change our policy.’

The effects of the GDPR on Lebanese business practices are a reflection of the rise of digitalisation within the country. In-house counsel in the region are required to adapt to these changes, especially when undertaking cross-jurisdictional activity.

A job to be done

In-house counsel across a variety of industries in Lebanon play an important role in supporting big business. As legal systems evolve, legal advisers remain at the forefront of changing regulations and industry practices. Yet the legal market is still relatively small in Lebanon.

When observing legal practices from a broader view point, Habchi observes key similarities throughout the Middle East.

‘The main difference, I would say, would be on the “emotional side” of Middle Eastern individuals, who have a certain sense of developing personal relationships, with a specific need to meet face to face with their interlocutor.’

The reliance on personal relationships and connections is an important consideration for in-house counsel operating within the Middle East. Yet as the industry continues to change at such a rapid pace, there will always be a place for skilled and talented in-house lawyers within Lebanon. n

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Fayez Khouri, PwC

I am originally from Lebanon – I lived there until I was about nine years old. After that, I moved to the UK and have spent the majority of my life in the UK. I am an English-trained solicitor. I qualified with my solicitors practising certificate in 2000. I did my two years of training in London, where I worked up until 2007. Then I moved to Dubai and lived there for five years, before moving to Beirut. Now in Beirut, I have been living here for the last seven years.

Now I am general counsel of PwC in the Middle East. I run a team of 12 people. We have eight team members based in Beirut, we have four in Dubai and we have one in Saudi Arabia.

I deal with a lot of important matters that concern leadership: regulatory matters, litigation matters and company restructuring matters. I spend a lot of time in between Beirut, Dubai and Saudi Arabia in order to carry out my role, which includes managing my team.

The majority of PwC’s work – like many multinational companies – means that although we are based in Lebanon, we deal with legal matters all across the Middle East. In fact, Lebanon is a very small chunk of the work that is being done by PwC. The majority is in Saudi Arabia, but we oversee these matters from both Beirut and Dubai.

PwC operates within a specific business environment. I would say that we deal with a lot of regulatory issues given PwC is primarily known for its auditing work. The auditing profession is highly regulated, so we have to always be very mindful of what the regulators are saying, and what they are doing, and how they monitor the work we do. That opens us up to a significant amount of inspection and supervision.

If something should go wrong with one of our clients – especially when we have done an audit – we are at the forefront of trying to supply information to the regulators. Sometimes we get brought into litigation when a company is in financial difficulties. So we have to be very careful and mindful of how we deal with inspections, questions and queries.

Another thing which is part of the business environment is the way things are done in the Middle East from a contractual point of view. You end up dealing with a lot of government clients and public sector clients. Therefore, there is usually very little flexibility when it comes to negotiating contracts.

One example is when we provide services to governments – we try to use our standard form. But governments in the region do not accept that, they have their own forms they prefer to use. They are also not very open to negotiating terms on their standard form. So you end up having to accept terms that are not ideal for the company. As a result, you have to manage the risk within the organisation. So instead of being able to be protected from a contractual point of view, you have to be extra careful. You always have to manage risk, but you have to manage it even more carefully when the contractual protections are not sufficient. n

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Maya Hardini Abboud, Banque Libano-Française

I started my career as a lawyer with diversified experience, before moving to Banque Libano-Française (BLF) in 2007 to start my in-house career as a legal consultant. BLF is a top-tier bank that is well reputed for its strict compliance with laws and regulations. It also owns a financial institution, Libano-Française Finance, which operates on the financial markets. In 2013, I was named head of legal compliance division and given a different set of responsibilities and tasks. My role now is to ensure Banque Libano-Française Group’s compliance with all applicable laws and regulations, whether Lebanese, foreign or international. This means, inter alia, making sure all applicable laws and regulations are duly observed, identifying any non-compliance and remediating it, as well as watching out for new laws and regulations, analysing them, interpreting them, disseminating them to all relevant parties and following up on their implementation.

The banking and financial sectors are very heavily regulated. The central bank of Lebanon requires banks and financial institutions to have a compliance department comprising of a legal compliance division – independent from the legal department.

We are continuously witnessing changes at a very fast pace in the legal and regulatory environment. Therefore, the biggest challenge is to keep up to date with all relevant laws and regulations, including any amendments that occur, not only at the local level but also internationally. Our bank has subsidiaries in other countries, so we have to stay abreast of any changes in the legal environment in these other countries as well, including case law, as well as the latest regulatory trends. We need to think ahead of such trends and prepare ourselves for the implementation of new regulations.

Another challenge is interpreting international law or foreign laws and regulations and finding ways to comply therewith where necessary, without breaching local laws.

To overcome those challenges, as a legal compliance division, it is essential to have the broadest possible spectrum of knowledge in laws – not only specifically in our field, but also in those that might have an impact on the general business environment. We also need to raise awareness within all levels of the institution as to the importance of compliance and as to non-compliance risks.

It is also very important, as part of the business practice of any legal compliance specialist, to maintain good communication with regulators, one that is based on trust and on dialogue.

We sometimes resort to external counsellors, especially on special issues or for questions related to foreign laws.

With the continuing evolution of regulatory environments in the last years, and the expected evolution in the coming years, the need for qualified legal compliance professionals who are able to properly interpret laws and regulations and to instruct institutions on how to implement them will continue to grow. n

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Sultanate of Oman

Since the first shipment of oil out of Oman in 1967, the Sultanate’s economy has been largely driven by oil and gas revenue. While that in itself is far from unique to the region, in some respects, Oman does stand alone. It is the largest oil and gas producer in the Middle East that is not a member of the Organization of the Petroleum Exporting Countries (OPEC), and has the longest-serving ruler in the Middle East, Sultan Qaboos bin Said Al Said, who has been in power since 1970.

Strategically located at the mouth of the Persian Gulf, Oman has been labelled as the Switzerland of the Middle East. The country has managed to maintain a peaceful outlook, despite sharing a border with war-torn Yemen, and being situated between powerful rivals, Saudi Arabia and Iran.

Oman also overlooks one of the most important oil and gas shipping lanes in the world, the Strait of Hormuz. In 2018, an average of 21 million barrels of oil were transported through the Strait every day according to the U.S. Energy Information Administration, accounting for a fifth of the world’s oil and linking crude producers in the Middle East with markets across the world.

‘The Middle East is heavily dependent on oil revenue, so whenever oil prices are high then, largely speaking, countries in the Middle East are doing well – although the reverse is true as well,’ explains Richard McLaughlin, general counsel of Oman Oil Company Exploration and Production (OOCEP). OOCEP, a subsidiary of the Oman Oil Company, focuses its activities towards upstream and midstream investments in Oman and abroad.

Growing pains

Oman’s oil and gas exports play a crucial role in driving the country’s economy. In a bid to maintain industry growth, the Omani government is introducing new laws aimed at encouraging private, international companies to continue to invest.

For example, a new law, labelled the Foreign Capital Investment Law, was revealed in July 2019, and will come into force at the start of 2020. It includes a raft of changes, all with the express purpose of making the Sultanate more attractive for foreign investment. The new regulations removed minimum capital restrictions on foreign investment, and allow for overseas investors to retain 100% ownership over their investments.

‘Everybody understands that you cannot rely on oil all the time. It will be depleted, and then the question is how you diversify your business. So Oman is following the UAE and Qatar and other countries who are doing that. So that is interesting in a sense that they are welcoming foreign investment,’ says one in-house counsel working in the oil and gas sector.

‘Foreign entities have limited options at present, for example, they can enter into joint venture agreements with local entities. So we join with foreign companies and enter into joint venture agreements with investors. Currently, in Oman, there's a lot of investment from Korea, China and, to a certain extent, France and other European companies.’

Though it is generally felt by in-house counsel across the region that this is a step in the right direction, if Oman is going to be successful in attracting larger pools of foreign capital, there will be further legislative shifts required.

State owned, state controlled

The oil and gas sector in Oman, as in most regions across the Middle East, is heavily regulated by the government. Unsurprisingly, that influence changes the way in-house counsel across the region must operate.

‘It brings a different dynamic – there is a lot of interaction with government, especially when it comes to oil and gas – and different government agencies have different drivers. Although you are a commercial entity, there are a lot of factors to consider. I think that’s something you need to learn pretty quickly when you are working in a government-dominated sector, because it’s not just the commercial interests that you have to consider all the time,’ says McLaughlin.

‘For example, if a company was thinking about releasing a drilling rig as it no longer needs it, the associated personnel that might have been employed to use it will also be no longer needed. A commercial company would say that it no longer needs that drilling rig anymore and it would terminate the contract and move on. In a government agency, employment is a big factor to consider. They may decide that the best option is actually to keep the drilling rig, and ensure all of those people remain employed.’

Balancing between government objectives and commercial obligations is key to success for in-house counsel working in Oman and across the Middle East.

Crudely opaque

The nature of the industry impacts everything, from the kinds of partnerships being entered into to the minutiae of the legal team’s day to day.

‘Although we are part of a larger group, we have our own autonomous structure. We have numerous joint ventures inside and outside of Oman,’ says McLaughlin.

‘We also have a lot of joint ventures with a lot of the big industry players: Shell, BP, Eni, Total Occidental, etc – so quite a range. In particular, we have acted on many transactions over the past few years, some of which were amongst the biggest in the sector.’

Working for a government authority lends itself to further considerations. When representing Oman, Orpic – a downstream business line for the oil and gas sector – has to ensure it legally complies with laws in other nations.

‘One legal challenge we have is to ensure that we comply with the applicable foreign laws as we extend our footprint abroad. Currently, Orpic has established offices in Turkey, India, Singapore, and China. Therefore, it is more critical for us to understand the laws in each country,’ says Elina Mohamed, general counsel of Orpic.

‘On the commercial law side, there are anti-corruption, antitrust and money laundering, laws for example, which can extend beyond your local jurisdiction. So those are what we call in law, “laws with extraterritorial effect”. This means that these laws can affect you, even though your principal business is based in Oman.’

In a bid to ensure legal obligations remain consistent across the business, Mohamed plays a key role in overseeing compliance protocols across Orpic: ‘As part of our compliance initiative, we make it a practice to have a face-to-face meeting with our advisers and lawyers in foreign countries. We are also trying to improve our compliance function internally, as compliance becomes more important as you start going abroad and expanding your business outside Oman.’

It is imperative that laws focused on preventing bribery and corruption, especially those which extend across jurisdictions, are complied with. Even if a transaction is deemed legal in Oman, it also needs to be deemed legal in the jurisdiction the business is associated with. Understanding these differences is essential for in-house counsel working in the Middle East and can present a steep learning curve for those who trained outside of the region.

Lorenzo Bruttomesso, head of legal at LNG LLC, started his career in his native South Africa, before moving to Oman in 2008 following eight years spent in private practice.

‘The essential difference, from a legal practice perspective, is that South Africa is a common law jurisdiction, whilst Oman is a civil law jurisdiction. In addition, there is no doctrine of judicial precedent in Oman.’

‘Agreements concluded between Omani and international entities are thus governed by predominately English law, with dispute resolution by arbitration, usually to be held in London, Paris or Singapore.’

Another factor is that despite the volume and size of commercial transactions, Oman has a small legal market compared to other countries in the Middle East, so in-house counsel have less choice when seeking the assistance of external legal advisers.

‘There are not that many international law firms here, so that reduces options at a local level, whereas, say, if you were in Dubai, that really would not be an issue. So that is quite different, but not a huge issue. It’s meant that we are not massively reliant on external counsel,’ explains McLaughlin.

Watts next

Fluctuating oil prices have long been a contentious issue across the Middle East. A combination of a prolonged global downturn and steady resource depletion has forced Oman to refocus its economic agenda.

The Oman Power and Water Procurement Co (OPWP) is a governmental body and the sole procurer of electricity and water capacity for the Sultanate, and is expressly aiming for Oman to become a regional leader in sustainable energy. Launching several major projects, OPWP hopes that as much as 30% of the Oman’s energy demands will be filled by renewable energy by 2030.

To meet this target, the OPWP announced in a 2019 press release the launch of its latest solar energy projects: ‘In line with Oman’s vision to diversify fuel sources through the use of clean energy for power generation, Oman Power and Water Procurement Company… is pleased to announce the launch of two solar Independent Power Projects (IPPs) in Oman. This launch follows the successful tendering of OPWP’s first utility scale solar IPP.’

‘With Oman’s continuous growth, implementation of wider scale solar power projects based on the IPP model will allow OPWP to achieve its objectives of sustainably providing power generation capacity.’

The Authority for Electricity Regulation Oman (AER) – Oman’s power sector regulator – has also taken steps towards encouraging homeowners in Oman to install rooftop solar panels. Its 2018 annual report outlines specific subsidies received by homeowners who have installed solar panels:

‘Article (18) of the Sector Law implements a mechanism through which the Ministry of Finance provides electricity Subsidy calculated by the Authority to licensed suppliers on an annual basis.’

In particular, the report highlights the Sahim 1 and Sahim 2 projects, which encourage large households and businesses to install solar panels: ‘During the first phase of the Sahim project customers that installed rooftop PV solar systems, at their own cost, were allowed to be compensated for PV electricity exported to a licensed system at the relevant approved Bulk Supply Tariff.’

Improving on the system, the AER implemented further allowances by enabling the privatisation of the energy sector. Oman’s shift towards renewable energy coincides with a global movement towards green energy, explains Mohamed: ‘Because of various issues worldwide, everybody is conscious of the fact that everybody has to be disciplined in terms of health, safety and environment.’

The road ahead

With a population of only 4.4 million people, Oman has transformed itself into an oil and gas trading hub. Regardless of its geographic location, the country has remained a safe and secure business and commercial centre.

‘As a country, Oman is very safe and secure. In fact, the 2019 Expat Insider survey, which was released by InterNations, ranked Oman at the top on the list of both the safest and the friendliest countries in the world for expatriates to live and work,’ outlines Mohamed.

‘But, at the same time, it also has its own challenges in terms of raising funds and attracting foreign investment.’

Nevertheless, in-house counsel in the region have witnessed continued efforts by the government to diversify Oman’s revenue streams – from law changes, to boosting foreign investment, and to increasing renewable energy initiatives.

‘Working as in-house counsel in Oman, there are both pros and cons. Specifically, some of the legal frameworks and regulations in Oman are still being developed and there are a lot of areas that require clarification,’ summarises Mohamed.

‘The flip side, of course, is that it also gives room for lawyers to argue on the interpretation of the existing law.’

Oman is an emerging market and, as such, provides opportunities to lawyers that would not be available in less developed markets. As Oman develops as a country, in-house counsel across the nation are exposed to unique and varied issues, challenges and opportunities. n

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Lorenzo Bruttomesso, Oman LNG LLC

I am a multi-discipline corporate, commercial, projects (including financing), compliance, and oil and gas lawyer and I strive to be a trusted partner, guardian and team member to the organisation, management team and board of directors for legal and compliance support. My role is head of legal at Oman LNG LLC, thus leading, managing and developing an effective legal team to cater for the needs of the company.

Our challenges are including, but not limited to:

  • the implementation of robust compliance procedures to ensure that we are dealing and transacting with third parties who do not pose risk to Oman LNG and our stakeholders from a sanctions, bribery and corruption perspective;
  • adherence to the latest business practices and ISO standards, including ISO 45001;
  • keeping abreast of and complying with international laws and regulatory frameworks applicable to our international transactions, including retaining international legal counsel who have branches or offices within the jurisdictions where our trading partners conduct business, including anti-competition regulations;
  • the legal department being an integral part of the decision-making process.

Leading, managing and developing a small but effective legal team necessitates interacting and collaborating with external counsel, especially in matters of complex international finance transactions, multi-package plant construction projects, international acquisitions and mergers, and complex litigation and international arbitrations. External counsel also serve as the first port of call in relation to any legal and regulatory changes impacting the industry or jurisdictions where the company’s business is conducted, such counsel being local and international, depending on the needs.

Having been a practising attorney, notary and conveyancer for two decades prior to moving in-house has been very beneficial in my in-house roles, and is reflected in my relationship with and how I interact with various external legal counsel.

Having worked in South Africa previously, the essential difference, from a legal practice perspective, is that South Africa is a common law jurisdiction whilst Oman is a civil law jurisdiction. In addition, there is no doctrine of judicial precedent in Oman. Agreements concluded between Omani and international entities are thus governed by, predominantly, English law with dispute resolution by arbitration, usually to be held in London, Paris or Singapore.

Situated outside the Persian Gulf, Muscat is a business- and family-oriented city, with associated amenities. The Sultanate is home to diverse environments and topography, namely mountains, valleys, deserts and coasts, and flora and fauna unique to the Arabian Peninsula. The diversity and uniqueness of these environments are important with respect to sustainable growth and development, and they attract visitors, tourists, working professionals and families alike. Oman is often referred to as the Switzerland of the Middle East due to the fostering of neighbourly and peaceful relations. n

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Richard McLaughlin, Oman Oil Company Exploration and Production

Oman, like many countries in this region, is highly dependent on oil revenues. Oman produces about a million barrels of oil per day, and about 80% of it is exported, mainly to China. The rest is exported into the local market to make petrol and aviation fuel.

Oman Oil Company Exploration and Production is only about 10 years old. It acts as both operator and non-operator in Oman and overseas. When the government issues exploration and production blocks here in Oman, the government often reserves for itself the ability to ‘back in’ to the development later. So they allow the foreign entity, usually, to invest and look for oil or gas and then if there is a successful development, the government can ‘back in’ at that point. We have been the de-facto recipient of those back- in rights, so we work very closely with the Ministry of Oil and Gas, either as a partner to incoming investors or as a party to these agreements.

My role is broad and covers the spectrum of general counsel, work and this includes significant commercial activities and transactions. A key challenge with large transactions is timing and resourcing them properly, because at times we have had numerous transactions happening simultaneously – so that can be a stretch, resource wise.

In Oman and the Middle East more widely, government entities are very influential. So if you look at Saudi Arabia, the United Arab Emirates, Kuwait and Oman as examples, government-owned entities are highly visible. That is different from other places I have worked and brings with it a different dynamic.

There is a lot of interaction with the government and numerous other agencies as a result. Different government agencies have different drivers which have to be taken into account. Although you are a commercial entity, there are a lot of factors to consider. I think something you have to learn pretty quickly when you’re working in a government-dominated sector is that it is not always solely about commercial interests – and that’s quite different for many counsel.

Most of what we do is done in-house because we are specialist oil and gas lawyers. But we do seek external help from time to time. The usual things we seek external assistance on are either large transactions where we are looking for additional resource or large disputes.

Most oil and gas transactions, financings and partner agreements are governed by English law, but we often need a combination of English law and local law advice. The local law elements tend to be less significant in the overall context, but nevertheless they need to be checked. n