International firms looking to enter the competitive Abu Dhabi market may have to rethink their plans, with the emirate considering a moratorium on further launches.
A number of firms, including Berwin Leighton Paisner and Gide Loyrette Nouel, have opened in Abu Dhabi during the past year, while others such as Wragge & Co are eyeing launches, attracted by infrastructure and energy opportunities.
But Abu Dhabi is keen to avoid a repeat of the situation in Dubai, where an influx of lawyers between 2006 and 2008 was followed by widespread job cuts after the local market slumped.
“The government wants to avoid people becoming unemployed in the future - it would be a precautionary method,” a government source said, noting that any decision would need the approval of both the Abu Dhabi Chamber of Commerce & Industry and the Executive Council.
An Abu Dhabi partner at a global firm said: “The authorities don’t want a flood of firms leaving - it doesn’t create a great impression.”
But some argue that existing restrictions, such as a firm needing at least five lawyers on the ground to gain a licence, already regulate the market sufficiently.