Shaistah Akhtar on Navigating Disputes in the Middle East

Shaistah Akhtar is a Partner specialising in commercial litigation, fraud, investigations and regulatory compliance. Her experience spans a number of industry sectors and her practice often has an international focus. She has experience of litigation and investigations in a number of Middle Eastern jurisdictions.

Through her work, Shaistah has established connections with a number of lawyers in the region. In Mishcon de Reya’s series ‘Navigating the Middle East’, Shaistah shares insights from those lawyers working in this interesting and complex part of the world.

Here, she tells of her own experience of getting into law and working with Middle Eastern clients.

When I was at school I would sneak out at lunchtime and go the local Magistrates Court, which was a bit sad for a teenager. I was always fascinated by the legal process and in particular how arguments were successfully presented and disputes were resolved – there was no question in my mind that I wanted to be a litigator from the very beginning.

I’ve been involved in disputes with some sort of Middle East angle for nearly twenty years now. They could be large scale fraud claims, regulatory investigations or corruption investigations. The parties may have chosen English governing law or the jurisdiction of the English Courts, or there may be some other UK connection such as a party being based in the UK or assets being located in the UK. Sometimes the expertise of UK lawyers is simply required in another jurisdiction because skills can be transferred and used there.

For some parties, reaching a quick resolution is not necessarily the priority. The more time that passes, the more positions change, improve or deteriorate. Buying time and gaining leverage can in some cases be an essential part of the strategy.

Although you might not like the outcome, with mediation you are nonetheless in control of it: you are doing a deal. It’s entirely consensual so nobody is forced to agree to anything. With litigation, and even arbitration, you are outsourcing the decision. But if you go into mediation too early, when parties are not quite convinced of its merits, then it can be a waste of time.

Historically mediation was viewed as an acknowledgement of weakness in your case. Now it is part of the architecture of any litigation: at some point somebody will suggest that parties get around the table. Today, deciding to go to mediation is generally seen as a sign of strength because you only propose these things when you are in a strong bargaining position, but in some countries in the Middle East it is still highly unusual in a commercial litigation context and viewed almost as a mark of capitulation.

I advised the senior management of a bank in Bahrain in the Saad Al-Gosaibi case, which was part of a larger dispute worth over US $10 billon. Within 24 hours of being instructed I was on a flight to meet with the senior management of the bank. Within five minutes of meeting them we had the regulator knocking on the door for interviews without any advance notice. With some very limited briefing on the case, we had to respond to that situation and put in place a protocol to protect the client’s position.

Clients come to you when they are in a deep hole. It’s often the case that there is an immediate panic and your job as their representative is to bring some order to the situation. Taking on a problem that is seemingly intractable for a client and sorting it out for them is very rewarding.

Advising clients on the impact of sanctions and following how the international sanctions regime has evolved – particularly in relation to Iran – has been really interesting. You see these stories reported in the news nearly every day. Introducing sanctions is often politically driven and has an economic impact on these countries with the very real knock on effect on clients in their ability to trade with a particular country. How do clients negotiate an agreement with a particular counterparty in a country where sanctions are in place against that country, or where sanctions may be imposed at any time?

There is not much in the way of precedents or case law around sanctions because it is a relatively new area and regulations can come in literally overnight. How do you interpret them?  How are they going to be enforced? Clients rely on your judgment. You’ve got to look at how things have been applied in relation to other jurisdictions, and at the guidance and purpose around the relevant regulations.

There are global tentacles to most commercial activities and that’s reflected in the way that disputes come up and the way that they are litigated. It’s quite rare for there to be a high value dispute with just one jurisdiction involved, which is a product of the way that the global economy and trade has developed in the last two decades in particular.

When dealing with a local law problem local expertise is essential. At Mishcon de Reya we have strong relationships with first rate law firms across the Middle East. We rely on those relationships to get the best input (and output) for our clients. We work with firms that mirror our reputation and our experience so clients receive a consistent service.

The laws in countries across the Middle East are often an amalgamation of different systems. You have to work with each country with that in mind.  It is impossible to make broad generalisations about the region as a whole. That’s why we’re so pleased to be able to offer insights from our contacts on the ground in different jurisdictions through our series: Navigating Disputes in the Middle East.