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