Economic growth in Africa remains strong with growth of 5% in 2013. At least a third of countries in the region are growing at 6% and more, and African countries are now routinely among the fastest-growing countries in the world. Yet for businesses seeking to expand into or operate on the Continent and their legal advisers, there remain serious challenges to success. So how can we all make the most of this continent of opportunity and challenges? Focussing particularly on recent developments, legal harmonization, opportunities and day to day issues in the legal world in Africa, the session will provide an insight into the potential challenges that lawyers may find when working with clients or on transactions or litigations in Africa and suggest some ways to mitigate the risks. Covering a range of topics such political risk, corruption, the importance of trust and relationship-building and the different pace of working, the webinar will provide a unique insight into working in Africa and present our unique offering on the continent.

1. Eversheds SHINE WEBINAR
Doing Business in Africa
Strategies for Success
Boris Martor Partner, Head of Africa Group
Eversheds LLP
borismartor@eversheds.com

2. 1. Presentation of Eversheds in Africa
2. Doing business in Africa : opportunities
3. Doing business in Africa : challenges
Contents

3. • Eversheds LLP advising in Africa for over 25 years
• 2007: Formal creation of Eversheds Africa Group
• 7 Offices in Africa – South Africa, Mauritius, Morocco and Tunisia
• Have advised in ALL 54 African countries
• Specialized team with 33 EALI firms across the continent
• Publication of several best selling books on Business Law in Africa
• A unique client mix of Banks/Governments/Corporations
1. Eversheds in Africa

4. • Hubs (Paris, London, North Africa, South Africa)
• Full service with international transactions-investments and Contentious-
arbitration support teams
• High quality, proactive, consistent “day-to-day” advice coupled with global
project management
• Multilingual services across countries & sectors
• Many financial institutions, governments and
multinationals use us on a daily basis in Africa
• Unique African Network of Eversheds
and EALI firms
1. Our approach to working in Africa

5. Eversheds Africa Law Institute – 33 firms
Angola
AG Advogados
Benin
Cabinet Djogbenou
Cabinet HK
Cameroon
SCP Ngassam Njike & Associés
Cape Verde
Eva Marques Legal
Chad
Cabinet Thomas Dingamgoto
Comoros
Avocat Comores
Ghana
JLDMB
Guinea
Cabinet Sylla & Associés
Ivory Coast
Cabinet Bilé-Aka, Brisoua-Bi
& Associés
Liberia
Liberian Legal Service Intl.
Libya
Al-Kilani & Gheblawi Law Firm
Mozambique
AG Advogados/
F Castelo Branco &
Associados (FCB&A)
Niger
Souleymane Yankori
Nigeria
Perchstone & Graeys
Rwanda
K-Solutions & Partners
Senegal
Cabinet 2S
Ba & Tandian
Seychelles
Pardiwalla Twomey Lablache
Sierra Leone
Basma & Macaulay
Sudan
El Hussein Ahmed Salih Law Firm
Togo
SCP Akakpo
Zimbabe
Dube, Maikai & Hwacha
Legal Practitioners
+7 EVERSHEDS Offices
Mauritius, Morocco,
South Africa & Tunisia
Malawi
Mbendera & Nkhono
Associates
Mauritania
Cabinet El Yezid
Namibia
KOEP & Partners

6. An African network based on knowledge
Africa E-Briefings
• Provides monthly updates on legal reform efforts in African
countries
• Practical information for specific Regions and Industries
EALI
• Publication of annual reports aimed at exploring up and coming
issues and challenges facing the legal profession
• Annual summits aimed sharing and formulating Best Practices for
members and clients
• Secondments and trainings
• Focus on Corporate Social Responsibility (CSR) and Diversity
• A Student Prize on Infrastructure case studies

7. Our approach to working in Africa
Eversheds offices
Africa Business Group
EALI firm EALI firm
Core team
Project managementInstructions
Opportunities
& outputs
Reports &
local inputs
Single point of contact ensuring scope of work
Centralized budget and billing
Cost predictability
Reactivity and quality advice
EALI firm EALI firm
CLIENTS

8. 2. Doing Business in Africa: opportunities
• Growing Economy: 6% average continent growth per year on the
continent over the last 5 years
• Increase of investments & GDP
• An attractive challenge for operators and bankers
• A crucial need of infrastructure and investments
• Securing of investments through legal frameworks
• A growing middle class

9. 2. Doing business in Africa: opportunities
“Economic growth in Africa remains strong with growth of 5% in 2013.
At least a third of countries in the region are growing at 6% and more, and
African countries are now routinely among the fastest-growing countries “

10. • Population growth in particular in cities
• Macroeconomic stability even if reliant on
raw materials and natural resources
• Diversification of trade partners (new foreign
direct investments : China, India, Brazil,
Malaysia)
• New sectors emerge : pharmaceutical and
information technology products; agribusiness,
telecommunication; mobile banking and credit
products
• Opportunity to bridge infrastructure gap
2. Doing business in Africa: opportunities

11. 3. Opportunities and/or Challenges?
Africa is full of opportunities but in order to succeed,
investors must have to manage several pitfalls :
• policy clarity
• policy stability
• policy consistency

12. Trends of improvement
at different levels:
• National
• Regional
• International
Reconciliation of pitfalls
and Improvements
Pitfalls common to all
countries:
• Multiple legal systems
• Corruption or “Transparency”
• Protection of investments
• Identification of laws
• Protection of IP rights
• Dispute resolution issues
• Tax burden
3. Challenges in Africa

13. 3. Challenges in Africa
3.1. Multiple Legal Systems

14. 3. Doing business in Africa: challenges
3.2. Number of economic and legal harmonisations

15. 3. Doing business in Africa: challenges
3.3. Mastering harmonized systems such as OHADA
• Synergies with Economic Unions
• OHADA main objective
– Improving legal security and
predictability in order to foster
investment and trade
– Promote economic growth
in Africa
• OHADA challenges
– Regional integration through
legal harmonisation
– Common integration within world commerce thanks to
African unity establishing trust towards economies and
creating development dynamics in Africa

16. 3. OHADA innovative legal framework:
3.3 Benefits of the harmonisation
• Modernize business laws and
Provide identifiable uniform
modern rules on:
– commercial law
– corporate law
– securities
– simplified recovery procedures
and insolvency proceedings
– arbitration
– accounting law
– transportation law
• Create a more stable legal and
judicial environment for
companies wishing to invest
in the OHADA 17 countries
• Other attempts like EAC etc
Dedicated Regional courts: CCJA
• Consultative attributions
• Both a judicial court and an
arbitration institution :
– Supreme court attribution
• matter which involve uniform
acts
• decision without appeal
– Arbitration attributions
• International arbitration
institution
• Arbitration rule: 11 March 1999
• Grants exequatur to CCJA
arbitral awards

17. •Need to examine and take into account Harmonized
regional rules and not only national regulations for the activities
•Harmonized regulations can be of benefit to identify rules &
standardize project or investment documentation/structure
•Need to establish how overall transactions will be
governed and which risks might arise from local regulations
remaining in place vs regional ones
•Need to arbitrate between countries to determine
advantageous and disadvantageous existing legal frameworks
and investments incentives
3.5 What harmonization means
practically for lawyers in Africa?

18. 3.6 Transparency: still a main challenge
The high-level of corruption:
– Bribery of foreign public officials
– Lack of control, supervising
– Inappropriate tax audits
0 : highly corrupt
100 : clean
Anti-corruption legal frameworks Initiatives:
• Regional
– ECOWAS, Protocol on the fight against
Corruption, 21 December 2001
– Directive n°04/2005/CM/WAEMU of
December, 2005 on awarding, executing and
regulating public procurement in WAEMU
• International
– UN Convention against Corruption, dated
14 December 2005
– OECD Anti-Bribery Convention in 2009 :
establishes legally binding standards that
criminalize the bribery of foreign public
officials in international business transactions
• Local : states have their own regulation
– i.e: Congo : law n°5-2009 dated 22
September 2009 concerning corruption,
misappropriation of public funds, fraud and
related infringements in the Republic of Congo

19. 3.6 Transparency: What to do in practice?
Clients in Africa can greatly benefit from the following:
• Develop, implement and train on adequate internal controls
• Create Compliance programs and promote awareness of existing rules
• Develop due diligence :
– on counterparts and business partners
– in case of acquisitions or investments
• Conduct an annual review of effectiveness of policies/procedures
• Avoid cash payments and limit the use of cash in African operations
• Obtain receipts for all expenses, and check published rates/tariffs
• Making sure records and data is safe

20. 3.7 Challenges of Protection of investments for
lawyers : a few examples
Limits encountered (Political)
• Expropriation or nationalization
of the investments without
preliminary and appropriate
compensation
• Risks of Treatment less favorable
than domestic investors (“Most
Favored Nation Status”)
• Difficulty concerning repatriation
of income from investments
(recent event in Mauritania)
• Transitional laws (OHADA in
DRC)
Specific ownership rules/
a few examples
•Libya: concerning the need to
associate local management and
have local shareholdings
•Algeria: the rules 51 /49
generalized to all sectors
– 51% of the company’s share
capital shall be owned by a
national resident or entity
– Need to structure and apply
for repatriation of funds

21. 3.7 Protection of investments: What to do ?
• Determine existing host state investment legislation
• Take benefit of regional investment protection mechanisms
such as UEMOA or CEMAC or other regional investment treaties
• Examine possibility to negotiate investment convention to be
ratified by the State
• Structure investments taking into account existing bilateral
investment treaties (BITs) ≈ 400 in Africa or Multilateral investments
treaties between the government of more than two states
• Choose adequate arbitration settlements
• Identify one stop shop entities to facilitate
registrations
(CI/Rwanda for instance)

22. 3.8 Protection of IP and data privacy rights
As a lawyer, you must ensure that you and
your client does the following:
• Have knowledge of regional rules
• Register IP rights locally
• Protect the use of IP
• Protect sensitive information
• Ensure non-disclosure and
confidentiality when engaging
and working with third-parties

23. 3.8 Challenges with IP: Regional
organizations
• African Intellectual Property
Organization (AIPO)
– 16 member States
– Mission: ensuring the protection and
the publication of patent rights titles;
making the legal framework
attractive to private investment;
encouraging creativity and transfer
of technology.
• African Regional Intellectual
Property Organization (ARIPO)
– 17 member states/13 candidates
states
– Mission: promote the harmonisation
and development of the intellectual
property laws, and matters related
thereto, appropriate to the needs of
its members and of the region as a
whole
AIPO
ARIPO
ARIPO

24. 3.9 Challenges with Dispute resolution
• Avoid Litigation: Weak/variable national interpretations
– Nigeria : rules governing civil proceedings are not uniform
across Nigeria
– Algeria: limited access to Judicial decisions
– Partiality of Judges (number issues day to day)
• Prefer Arbitration:
– Commercial confidential settlement
– Development of arbitration is a trend
– Choice of appropriate clauses
– Check how to ensure enforcement in practice

25. 3.9 Dispute resolution : what to do?
• Check if Local courts are supervised by Regional Court; ex: CCJA (OHADA)
• UNCITRAL Model Law on Commercial Arbitration influence (Burkina Faso etc)
• Arbitration possibilities
– International level: ICSID; ICC etc
– Regional level: ex: OHADA : Common Court of Justice and arbitration
– National level (i.e: Benin: Centre d’arbitrage et de médiation et de
conciliation of the Chamber of Commerce and Industry; Ivory Coast; etc.)
• Recognition of :
– Foreign judgments (under specific conditions – DRC, Egypt, etc)
– Foreign arbitral awards:
» generally, appeal of foreign arbitral awards expressly prohibited by some
countries
» check ratification of New York Convention on the Recognition and
Enforcement of Foreign Arbitral Awards

26. 3.10 African tax burden: rates (2013)
Area State Taxes/
benefits
Dividends Interests charges/
services
Central
Africa
Gabon 30% 15% 10% 10%
Congo 33% 20% 20% 20%
DRC 35% 20% 20% 20%
Cameroon 38,5% 16,5% 16,5% 15%
Southern
Africa and
East Africa
South
Africa
28% 15% 10% 12%
Kenya 30% 10% 15% 20%
North
Africa
Morocco 8,75%/10%
/
17,5%/30%
10% 20% 10%
Algeria 25% 15% 10% 24%
West Africa Ghana 25% 8% 8% ≈ 10%
Ivory Coast 25% 12% 18% 20%
Senegal 30% 10% 16% 20%

27. 3.10 African Tax Burden: How to avoid it?
• Relatively high rates and unpredictable
implementation
• Think about financial flows upfront – global tax
structure
• Need to check existing tax treaties when
structuring investments
– ex: France : 30 tax treaties with African States.
– Mauritius is n°1
• Regional regulations from various regions or
States limit double taxation

28. 3.11 Other day to day challenges
• Real Estate and Property Rights
– Community and Land rights
– Land Reform Efforts
• Requirements for legalization
– local bank accounts account set up
– depositing legal instruments with the notary for number of legal docs
– approval from local government ministries/licensing
– recognition of agency agreements and requirements for agency licenses
• Regulations Governing Bankruptcy and Insolvency
– OHADA procedures and creditors’ rights
– Restrictions on recovery and transfer of debts
• Human resources:
– Difficulty to find and manage resources locally or employ locally
– Development of Local Contents legislations / interpretations
– Limitations on the employment of foreigners

29. 3.12 Other Considerations for Lawyers:
Local Content Policies
“Local Content”
• the share of materials, parts, etc. for the production
of a given product that has been produced locally
• Promote domestic economies by increasing manufacturing,
commerce, services and trade
• Policies needed govern business activities, particularly
in mining and drilling, and attract investment so smaller,
local enterprises can grow
• Poses a challenge between stimulating local economy and
generating more revenue from exporting through
established external channels and facilities.

30. • Contextual Dynamics
– Historical/situational awareness of country
– Pace of Working
– Power and Cultural Dynamics
• Relationship-Building
– Balance between being both a Practitioner and Advisor
– Find the best way to become a trusted resource
– Foster the development of legal and non-legal activities
– Create an enabling environment for communication
– Build and leverage contracts of a local network
3.12 Other considerations for lawyers

31. QUESTIONS?