The Middle East and North Africa (MENA) region in general, and Tunisia in particular, is open for business. The economic and legal environment is coping well following the Arab Spring, which has heralded a new era and UK investors and their lawyers are encouraged to cooperate, but not colonise. Those were the clear messages coming out at an event – ‘North Africa in Focus: The View from Tunis’ on the region last week.
Featuring a galaxy of local business and political stars, companies and law firms were given a high-flying perspective on the area.  The British Ambassador to Tunisia, Christopher O’Connor emphasised how important it was to rebuild trust in the region. Mr O Connor said that that not only must foreign investors rebuild their trust in the people and institutions, but the domestic business communities must also work towards restored trust and confidence in their own national governments, a point echoed by the Governor of the Central Bank of Tunisia.
One of the key complaints about Tunisa was the Government’s lack of transparency since the fall of the Ben Ali regime.  At a session moderated by Nicholas Tse of Brown Rudnick, high profile speakers debated this issue with Ahmad Al Karam, director-general of Amen Bank, Jaafar Khatteche, Chairman of  Tunisia’s Banque National Agricole and Maher Kallel of the Poulina Group amongst the panel.  The government’s failure to prepare a draft constitution and to agree on a road map for elections despite having continually promised to do so over the last months received particular criticism.

Circling vultures

Vulture funds , which see private companies trying to profiteer from the debts of some of the world’s poorest countries by buying up debts from poor companies and then trying to recover the full amount through litigation,  came under the spotlight at the event.  The African Legal Support Facility which provides assistance to Highly Indebted Poor Countries (HIPCs) faced claims from vulture funds, is seeking to build up know-how and expertise within reputable law firms in the region.
There are good investors and, as we know from the vulture fund cases, there are bad investors. The task for those of us interested in the development of the region is to attract the good investors with the right economic and legal conditions, but to deter the bad investors by educating local governments on how to avoid these funds in the first place, and to work with them on defending against the vultures  who do attack.  
Dispute resolution is another area which is growing in the region.  Hicham Zegrary of the Moroccan Financial Board described the creation of Casablanca Finance City (CFC), which aims to make Casablanca a business hub for the region and leading financial centre  in North and West Africa. Like the the Dubai International Financial Centre (DIFC), it will have a standing arbitral body - able to resolve disputes according to international standards and principles.   
An oft-cited complaint of international arbitration is the domination of most tribunals by western European and North American arbitrators, often to the exclusion of arbitrators from other parts of the world, particularly Africa. This point was addressed by Sami Hourebi of the ICC, who provided an overview of the ICC’s statistics relevant to the continent. It was agreed by all that more needs to be done to develop and encourage a larger pool of talented and experienced African arbitrators.  

Arbitration and assets

Another complaint of international arbitration is that it has become too slow and too expensive. Early adoption of mediation and other forms of ADR, which have risen to prominence in Europe only relatively recently must undoubtedly be considered.
Expropriation and other risks to investments was  actively debated with a number of animated questions from the floor about new laws introduced to cancel investments supported by members of the Ben Ali government.  Perhaps unsurprisingly, there is a level of confusion about how to treat contracts entered into by a regime that is now considered corrupt.
Asset-tracing and asset-recovery also came under the spotlight with  one of the core themes coming out of the discussions from participants including Paul-Gully-Hart of Schellenberg Wittmer in Geneva and Andrew Durrant of FTI in London, was the need for pragmatism is finding and recovering assets dissipated by corrupt regimes. One of the examples given was the need to provide amnesties to certain former members of those regimes in return for information on the whereabout of assets.

Local firms

The prospects for business in the MENA region, and indeed across African, are obvious. There is much good work that international law firms can do on the continent. What comes across loud and clear from events like this is that we will be greeted with a warm welcome if we come in a spirit of cooperation, but not if we seek to colonise. Relationships with good local firms are key.   
Steven Friel is a partner in Litigation and Arbitration at international law firm Brown Rudnick. The event was organised by Brown Rudnick in association with the International Chamber of Commerce, the Tunisian Bar Association and the Law Firm Network, in Tunis on  4th and 5th October. Attendees included the African Development Bank, Petrofac,  Africinvest  and several oil, banking and public sector organisations from Morocco, Libya and UAE.