The Italian law firm BonelliErede recently began operating in Egypt. Its local partner for Egypt is Francesca Secondari, who joined the firm in 2003 and whose expertise is in mergers and acquisitions, banking, corporations, commercial agreements, and real estate transactions. She is in charge of leading BonelliErede’s Cairo office and coordinating its work with the firm’s other offices, as well as with its Egyptian partner Kosheri Rashed & Riad. She sat down with Daily News Egypt to discuss and review the legislative changes that have opened up more space for international law firms to operate in the Egyptian market.
What changes happened recently that made Italian law firms more interested in being here in Egypt?
First of all, I wish to specify that our firm is Italian, but we are an international law firm with an international client base. Needless to say, Italian clients are easier for us as well as our firm is easier for them: not only we share the same language, but they are also able to easily pop up in one of our three offices in Italy as well as in Cairo. Egypt is an interesting country per se, not only for Italians.
Do you have other branches in other countries? Is it a part of the firm’s strategy to be present in emerging markets?
Yes, we already have offices in Addis Ababa, Ethiopia and another one in Dubai. We’d love to expand in other African countries. However, for the time being, we’re working on these three offices which are very important for our strategy. We consider Dubai our hub in the Middle East, while Cairo is more functional both for North Africa and for interactions between the Middle East and Africa. Ethiopia is our hub for the East Africa and sub-Saharan Africa.
How do you evaluate legislative changes in Egypt during the past two years?
Very very well; we witnessed a very interesting evolution in the country in the last two years. Starting from the financial measures, like the liberalisation of the exchange rate and flotation of the Egyptian pound. That was maybe the beginning of the last year, and then we witnessed a very interesting evolution in the legal environment. To this regard I can pinpoint the Investment Law and the Industrial Licensing Law.
Do you think that the legislative reforms provided new investment opportunities in the private sector? Did it increase the attractiveness of the private sector to foreigners?
I would say yes. Although, financial measures have a more immediate impact, legislative changes need to time to develop their effects. Several new laws have very recently been issued (consider the Companies Law on top of those already mentioned) and we, as lawyers, value them very much.
Does that mean that there are opportunities in which the office is currently engaged in deals or are there expectations of deals that are based on these legislative changes?
One of the key topic for us here is how to structure an investment in Egypt (e.g. whether to set up a branch, a company, which kind of company and the like). With respect to these topics the new laws immediately come into play.
What sectors attract investors the most?
Infrastructure and energy are classical [investment attractions] in Egypt but we’ve seen a growing interest in renewable energy.
Does that mean that some of your clients are currently engaged in something?
Yes, but we cannot disclose the names.
Does Egypt’s capacity to attract international law firms indicate that clients want top legal service providers?
I’d say yes, the presence of international law firms is definitely an indicator, but more of how the market is appealing. I have a great respect for Egyptian law firms, many of them have a long-standing tradition and very high reputation. [This is the case of KRR, the firm with whom BonelliErede cooperates in Egypt.
Is having an Italian law firm in Egypt is because the presence of Italian investors?
There are Italian clients interested in here and others are actually investing here, but as I said at the beginning, we are not only aiming for Italian clients; we are an international law firm like any other firm and we can serve, among others, all international clients including Chinese clients as many years ago we set up a China Desk which include Chinese speaking lawyers].
Do you have an office in London?
We have an office in London, one in Brussels, and three offices in Italy, and as mentioned earlier, in Ethiopia, the UAE, and Egypt.
How do we evaluate the quality of service of other law firms, especially that there are other international law firms here in Egypt? What makes you special?
We believe in accuracy and excellence. We wanted to bring our brand, which is synonym of excellent quality, because we believe that being present with a team of our professionals based in Egypt will make the difference for our clients.
What are the main engagements of the firm here in Egypt? What were the main activities you had since your establishment?
Well as I said, from a how to structure a presence in Egypt, matters relating the construction law, dispute resolutions and structuring of project financing.
Are you interested to participate in the public company IPOs and providing them legal advice?
Of course, we are open to that.
What are the things that you found different in the Egyptian market than any other market and the see that it needs improvement?
The concept of the “one stop shop” is a very good one. I think that more than changing the laws, everybody is waiting to see how the laws that are being issued will be implemented.
The latest legislative changes such as the latest investment laws granted investors 30% tax deduction and 50% in free zones; how do you see these changes?
Very well, I think that these are very interesting changes: free zones are a good tool to attract investments, especially in the manufacturing sector. Especially when I look at the private free zones, what investors can do is to develop a free zone as a whole and then lease out the individual spaces. We know that the Chinese are very active in this kind of initiatives in other countries. I think that private free zones will definitely encourage investments in the manufacturing sector.
The whole world deals with single persons companies, does the new companies law face difficulties to follow international standards in this regard?
As the executive regulations are yet to be issued, we’ll keep our impressions for a later stage.
Are there any other sectors here in Egypt that you don’t cover, or you are willing to expand to cover this year or in the following years?
We are willing to focus on corporate governance, project financing, and international taxation issues.
Were inflation levels a reason for not attracting investors last year? Will decreasing inflation levels attract investors this year?
Maybe more than the inflation level itself, the lack of hard currency was badly affecting investors it made very difficult for them to import and perform payments and get payments (with hard currency).