Kenyan-based law firms are turning to alliances with their international counterparts, raising their profile and capabilities of handling the growing cross-border clients.
The arrangement helps local lawyers to easily connect their long-standing clients seeking legal services in far-off jurisdictions with oversees lawyers within the formed alliance. This saves them from the risk of losing their clients into the arms of competitors.
In reverse, the oversees firms with clients seeking legal services in Kenya refer them to lawyers within the alliance, beating challenges such as language barrier or local bar rules and engagement letters.
This is increasingly becoming fashionable in Kenya as law firms target to retain client goodwill by offering oversees legal services through a seamless network of lawyers.
In mid-November, Kenya’s commercial law firm MMC Africa Law teamed up with Africa’s international counterpart Asafo & Co to form MMC Asafo. This will strengthen their presence in Nairobi, Abidjan, Casablanca and Johannesburg.
“There is an increasing interest and opportunities in Africa, and this strategic direction is meant to provide clients in Africa with a competitive advantage through our combined experience and resources,’’ said MMC ASAFO East Africa team leader Edward Muriu on the deal.
“This allows us to handle major, complex transactions and to be in a position to offer clients a rapid, integrated, value-added service.’’
Many firms striking cross-border deals are more comfortable working with lawyers serving within a single network than having to source legal services from different firms.
Fanisi Capital Chairman and Managing Partner Ayisi Makatiani reckons that working with a single network of lawyers helps firms such as those in private equity space to save on time and cost as well as be assured of good service.
“If we hire one law firm in Nairobi, for example, we want them to coordinate all other deals in the region. It is too much of time and resources if we were to keep coordinating with various law firms,” says Mr Makatiani whose firm has struck various deals in East Africa.
“You can agree one rate (fees) and use it across the board. You can also be assured the standards will be the same. It is more assuring if you work with a law firm that is part of a network which subscribes to given standards.”
Kenya attracted private equity investments worth Sh120 billion in the two years ended December, taking the lion’s share of the total Sh140 billion capital that was committed to East Africa. This is according to a report by KPMG and East Africa Private Equity and Venture Capital Association.
The use of a network of lawyers has been seen in many transactions that cut across different countries, with a similar scenario also playing out beyond investment deals.
When the family of the late Tamarind Group CEO Jonathan Seex wanted to sue Boeing following his death in the Ethiopian Airline’s crash, it took an alliance of local and international law firm.
Nairobi-based law firms, Lesinko Njoroge & Gathogo Advocates and Kabau & Associates Advocates teamed up with US-based aviation law and personal injury firm, Husain Law & Associates to file the in the US.
While the Kenyan firms had strong local standing and near Ethiopia where the crash happened, the US firm had a team of attorneys and experts who know the commercial aviation industry.
The US firm has previously represented family members in more than 10 aviation accidents, including the Kenya Airways Flight 507 crash in Douala Cameroon in May 2007.
This association of the two Kenyan law firms with one in the US allows them to forge links with the world and project an international image.
Another Kenyan law firm Ong’anya Ombo Advocates in October entered into co-operation with Harvey Law Group LLP, a Hong Kong-headquartered immigration and business law firm that offers immigration investment services.
Immigration investment is when a person or company from one country decides to move to another country for purposes of investing based on higher returns or generally business-friendly environment.
A partner at Ong’anya Ombo Advocates, Ombo Malumbe, says its clients in Kenya are increasingly seeking such investment opportunities, making such alliance fashionable.
The firm inked a similar deal with C Savva & Associates Limited, a firm located in Cyprus, to help its clients easily interact with Cyprus jurisdiction on investment and tax planning matters.
“We hope that the benefits coming along with the friendly investment and tax laws in Cyprus will be of interest to you,” the firm told its clients.
Such an arrangement will allow the Kenyan law firm to respond to its clients’ cross-border needs without having to lose independence through merging.
“Our collaboration is more of an arm’s length relationship, which in turn means that there is no control on our model of operation by the other collaborating law firm and vice versa,” said Mr Ombo on the model.
“This will then be reciprocated to the local firm in case oversees client is seeking local legal services through a law firm within the alliance.”
In October, another arrangement involving a Kenyan, South African and UK firm happened.
Kenya’s Daly and Inamdar together with South Africa’s RM Partners tied up with London-headquartered law firm, CMS, for increased business.
They now trade as CMS Daly Inamdar Advocates and CMS RM Partners offering an increased reach to their local, regional, and international clients through CMS.
“This will only deepen as Kenya becomes increasingly attractive as a destination for foreign investment,” said Hamish Keith, managing partner at CMS on the deal.
CMS, one of the oldest and largest multinational law firm will now have 75 offices in 43 countries and more than 4,800 lawyers worldwide.
The addition of the two firms will see the CMS network expand its tax, legal and transaction advisory services in Africa. Before this deal, it had offices in Mombasa, Algiers, and Luanda.
Kenya’s Daly Inamdar Advocates was itself formed via the merger of Daly and Figgis and Inamdar and Inamdar and has at least 35 lawyers.
Executive Partner at CMS Duncan Weston said the global firm sees Africa as a major growth opportunity and want to expand into key markets on the continent riding on the local market knowledge of the two new firms.
“South Africa and Kenya are both sizeable economies, but they’re also gateways into other sub-Saharan markets,” said Mr Weston.
African economies are among the fastest-growing in the world today. The African Continental Free Trade Area, which congregates over 1.2 billion people, is taking shape, pointing to more cross-border activities.
Investments banking and finance, oil and gas, energy and power, infrastructure, transportation and logistics as well as innovation have tipped to increase going forward.