US law firm Shearman & Sterling is preparing to open an office in Egypt, marking the firm’s first foray into Africa with plans for an international arbitration and projects practice.
Shearman, which has a five-partner office in Abu Dhabi handling project finance and arbitration work, and a satellite operation in Dubai, is hoping to extend its on-the-ground presence in Egypt as investors return to the country after the revolution in 2011.
Preparations are at a late stage, with the firm currently finalising plans for an associated office, with foreign firms banned from practising without a tie-up with a local entity. Local authorities are still to approve the plans, with strict guidelines in place that regulate the percentage of local lawyers making up an office in the country.
Influential founder of the firm’s international arbitration practice and Paris chief, Emmanuel Gaillard, is spearheading the plans and is set to manage the launch. A partnership vote will not be required, with the plans only needing approval from the firm’s executive and policy committees. Yas Banifatemi, who alongside Gaillard secured the record-breaking $50bn Yukos arbitration award against Russia last year, is a member of the policy committee and has worked on cases for the Egyptian state and government-owned companies. Shearman has nine other partners with a substantial practice in Africa.
Gaillard and Banifatemi are currently handling four arbitrations against state-owned oil and gas companies, Egyptian Natural Gas Holding Company and Egyptian General Petroleum Corporation, as well as the Egyptian government, in claims worth over $8bn following the cancellation of a deal to export gas to Israel. Legal Business understands that, should the authorities give approval, Paris-based arbitration counsel on those arbitrations, Mohamed Shelbaya, will relocate to the new office, which will initially focus on the oil and gas sector.
The office will also help service Shearman’s Algerian client base, including state-owned oil company Sonatrach, which Gaillard and Banifatemi successfully defended in 2012 from a $3.6bn claim from Spanish energy majors Repsol and Gas Natural.
There has been a sharp rise in the number of investor-state claims in North Africa following the Arab Spring and power supply issues that have led governments to scrap export deals, following pressure to supply the local market first. Egypt has signed 100 bilateral investment treaties, among the most of any state, protecting investors from expropriation and government action that may impact on profit.