The launch of the Qatar Financial Centre (QFC) Civil and Commercial Court has been welcomed by international businesses and law firms keen to advance in the Middle East and benefit from the fast pace the financial centre has developed in recent years.
Earlier this month (14 May) The Lawyer revealed the appointment of former UK Chief Justice Lord Woolf as president and William Blair QC of Three Verulam Buildings as chairman of the regulatory tribunal, which is part of the QFC Civil and Commercial Court.
Woolf tells The Lawyer: “You rarely have the opportunity to watch a legal system being built from scratch. It’s fascinating to see the development first-hand and play a major part in its future.”
There are now more than 50 established international businesses operating in the jurisdiction. Simmons Qatar managing partner Andrew Wingfield says: “I think it will encourage more businesses, such as financial institutions, to come to Qatar. Now that the jurisdiction has a common law framework based on Western laws, businesses will feel more comfortable setting up here.”
Wingfield adds that, as more banks and businesses move into the area, law and accountancy firms will follow.
Until now foreign firms have been required by law to operate in partnership with local firms, with 51 per cent control residing with the local firm. Now, if the firm is registered with the QFC Regulatory Authority (QFCRA) it is not required to have a Qatari affiliate.
Salans, which was previously associated with local firm Ahmed Al Thani & Yousef Al Naama – The International Law Office, has applied for a licence to launch its own offices. Salans Qatar managing partner Patricia Hartsten says: “The court and the regulatory body is fundemental to growth. Commercial activity will definitely increase and we’ll see more law firms setting up here.”
The financial centre has experienced explosive growth in recent years and has become a strong competitor to nearby Dubai and Abu Dhabi, which have both experienced success in the project finance and oil and gas sectors.
But while more foreign firms will begin to set up their own offices and project-based work is expected to flourish further, it is unlikely that dispute resolution will become an important practice area for these firms.
Wingfield says: “International businesses will use their home legal system when disputes arise. I doubt we’ll see a growth in dispute resolution lawyers based in Qatar. The court’s more about providing stability for banks and businesses which want to do business here.”
As newly appointed chairman of the tribunal, Blair highlights the significance of Qatar and the common law it has based the court on.
“It’s a place that I’ve always found interesting because of its fast-paced growth in the international market,” he says. “The court and regulatory framework is necessary as a next step for the region.”
Banks constitute three-quarters of the businesses licensed to set up in Qatar, and with organisations such as Lehman Brothers operating in the area it is easy to see why law firms want to take advantage of the banking opportunities on offer.
QFCRA chief executive Phillip Thorpe says: “After investment banking and asset management, private banking and insurance contribute a large portion to the market.”
The Qatar government has made a concerted effort to attract international investment to the jurisdiction since 2004 and has quickly developed the regulatory framework to suit the new demands.
Thorpe concludes: “The regulatory body was set up in 2005 and it’s not taken long to develop the court and the other necessary elements for Qatar to become even more successful as a financial centre. We can definitely expect to see more businesses applying for licences to set up here.”