By Stephen Karangizi
Director & CEO
African Legal Support Facility
I take this opportunity to thank the East African Law Society for inviting me to speak at this year’s Annual Conference.
The African Legal Support Facility (ALSF) is an organization dedicated solely to providing legal advice and technical assistance to African countries. The Facility has supported over 35 African countries in negotiating major commercial agreements in the areas of natural resources, infrastructure projects and commercial debt issues. In addition, the ALSF has extended capacity building programmes to African lawyers and experts in the same areas. (See examples on our website – www.aflsf.org)
Several East African countries are currently facing pivotal moments in their development paths as a result of the large natural resource discoveries especially in Oil and Gas and large infrastructure projects like airports and roads. We are proud that as the ALSF, we have given technical assistance to the governments of Kenya, Uganda, Rwanda and Tanzania in the above mentioned sectors.
The bulk of our advisory services are provided by international law firms. However every ILF we engage to provide services is required to work with a local partner to pass on the necessary skills and experience. I am glad to say that some East Africa law firms have been able to undertake mandates outside the East African region which is an exhibition of how advanced and global the legal industry is. As the ALSF, that’s the trend we aspire for enhancement of legal skills for African lawyers. This will address the issue of limited engagement of African lawyers in key projects in their home countries and on the continent.
I will share with you my thoughts and views on how to future proof the legal profession in East Africa to fit into an ever changing global environment. Increasingly for African lawyers, the business environment in our countries is continuously growing. According to the 2017 World Bank Doing Business Report, East Africa’s attractiveness is high with Rwanda leading the way. In my opinion there are several challenges and opportunities that we need to take account if we are to enhance the legal profession and its contribution business and investment in East Africa.
My focus will be on enhanced commercial legal practice to support negotiation of complex transactions and how African lawyers can position themselves for the emerging opportunities. The key issues include:
- Globalization of Legal Services
- Embracing Technology; and
- Reform of Legal Education
a) Globalization of legal services
In the last 15 years there has been an increasing change in legal commercial legal practice in Africa. One of the key indicators has been the entrance of foreign law firms in Africa. This phenomenon sometimes called the “globalization of legal services” presents opportunities but also opens our legal practice to new challenges. This has led to increased competitiveness and deepening of the legal practices through introduction of more modern business approaches through cooperation with local firms. The challenges come in the form of “potentially” reducing the business opportunities available to the domestic legal practices.
The state of globalised legal services is also a result of increased demands by clients and the new practices for engagement of legal services across borders both by governments as well as the private sector. The skills and services expected of a law firm has expanded from the traditional roles to increasingly sophisticated areas of law in specialized industries like the extractives industries and large infrastructure projects.
However following the economic reforms that swept the continent in the 1990’s the role of the private sector and foreign investment have been enhanced. Unfortunately, the growth in the private sector and FDI was not matched with enhanced skills for supporting commercial legal services. In addition, the increased discoveries of extractive resources in Africa and increased interest Public Private Partnerships especially in the infrastructure sector meant that commercial legal skills previously not utilized in Africa are now critically required.
The existing networks that have been established across the continent also provide law firms with an opportunity to share experiences on best practices. Those networks come in different forms. Partnering with foreign law firms has several advantages such as attracting multinational investors as the brand name of a foreign associating firm increases visibility and credibility. In addition, foreign law firms introduce more business like practices that have the potential to increase efficiency. However, in my opinion those partnerships should be mutually beneficial and we should avoid situations where those arrangements do not incorporate sufficient skills transfer. I am happy that law firms in East Africa have made significant steps in the globalization of legal services and as the ALSF we constantly seek ways to engage more African law firms in supporting negotiations with African governments.
b) Embracing technology
According to the Financial Times, 2016 “ Over 114,000 jobs in the legal sector in the UK are likely to become automated in the next 20 years as technology transforms the profession.” The projected change is a result on advancements in technology and use of artificial intelligence and the continued mismatch between the skills that are being developed through education and those currently required in the workplace.
Lawyers therefore need a broader skill set so as to adapt to change. Lawyers also need to embrace information technology in their operations to enhance their legal practice and operational efficiency through different initiatives like remote working to reduce overhead costs.
c) Reform of the legal education system
As highlighted above, the changing technological advancements affect the relevant skills today’s lawyers need. African legal education to a large extent has been based on curricula inherited from the colonial times, I am conversant with developments made by the different law schools across East Africa to embrace changes in our environment and it is necessary for us to keep pushing for the changes to meet the required needs of our clients. Despite the progress made already, most of the emerging legal issues are still not taught at the law Schools in Africa. Subjects like project finance, capital markets, competition law, arbitration, extractives industries and infrastructure projects.
Legal education should also enhance business professionalism. One of the major reasons the international legal firms are successful is the way law firms are managed as businesses. The focus of legal education should focus on both technical and non-technical aspects so as to ensure that East African lawyers are able to successfully manage and handle key projects in whatever sectors they are engaged in.
One of the major activities we are involved in on behalf of the governments is inviting law firms to compete for business. As an international institution we are required to use the highest standards of public procurement. Unfortunately many African law firms are usually unable to succeed with their bids for several reasons. First, a competing firm has to show that they have experience in cross border transactions as well as in the relevant area of expertise such as a mining with good knowledge of the international trade issues that relate to that particular sector. Second, the firm requires depth of expertise at various levels as negotiations are held at short notice and at least one expert familiar with the matter has to be available when required. Third, the response to the technical proposal has to be innovative and responsive. In terms of legal education and practice set up, a major challenge we still face is the lack of specialization. I acknowledge that it is difficult to specialize in one area as there is no guarantee of adequate business in that area, however going forward and with increased developments in our markets, it’s a possibility to consider if we are to enhance our practices in the region.
However one of the major challenges we still face is that many aspects of commercial legal practice have limited application in our jurisdictions. These areas to name but a few include:
- The need to advocate for increased use of ADR – especially Arbitration linked to courts. Ever since the Lagos High Court introduced court linked Arbitration there has been a huge boom in the arbitration industry of Nigeria enabling them to enhance skills at international level;
- The need to address the anti-competitive area. The successful operations of the COMESA Competition Agency has shown the opportunities available for growth of this intervention area.
- The need to enhance skills in the PPP area will greatly support the ambitions of our countries to structure and conclude many infrastructure deals along that line. We are currently unable to meet the demand for capacity building in this area from African countries.
- Robust insolvency related modern laws that are consistent with a modern business environment.
Missed opportunities means missed business. Missed business in turn means omitting some key blocks in the “enabling business environment” superstructure.
The institution I lead was established to contribute to addressing these challenges. However at a continental level it’s even more difficult to try and address all the issues. I think it is important for the regional bar societies to start developing a strategy to assess what the long term implications of “globalization of legal services” will mean to their members.
Our experience at the Facility has shown us that enhancing legal capacity can be better attained by national and regional Bar Societies such as yours. It is also important that the continuous legal education the members receive takes a “practical” modular based knowledge transfer approach rather than mere theoretical knowledge transfer. These skills are relevant to all lawyers regardless of whether they work for the government or the private sector.
In addition, clear identification of the skills gap is essential. To this end, the ALSF Academy Project which was launched today will assist in the development of the relevant curricula and rolling out training programmes in key sectors for the members. We hope that the Project will complement the already existing programmes run by the national and regional Law Societies.
I thank you for your attention.