JOHANNESBURG - Multinational law firm Baker McKenzie is beefing up its African operations as doing business in the world’s second largest continent has become riskier.
The firm, which is headquartered in the US, has announced a raft of strategic appointments in a bid to enhance its client coverage across Africa, where a number of investors faced increasing regulations in countries in which they did business.
Baker McKenzie, which has announced the appointment the appointment of leading legal eagle Morné van der Merwe as managing partner of its Johannesburg office, was appointed in July by German multinational software giant SAP to investigate alleged fraudulent activities with the controversial Gupta family.
A throve of leaked emails dubbed #GuptaLeaks suggested that SAP paid more than R100m in kickbacks to a Gupta company, CAD House, in order to secure a lucrative contract with state-owned company Transnet.
The Gupta family, who are President Jacob Zuma’s personal friends, are accused of having undue influence in the awarding of state contracts and appointment of key cabinet ministers.
Baker McKenzie’s incoming head of dispute resolution Darryl Bernstein, who is replacing Gerhard Rudolph, and head of competition and antitrust practice Nick Altini, also formed part of the law firm’s key appointments.
Energy industry legal heavyweight Kieran Whyte was recently appointed as head of the energy mining and infrastructure practice. Altini, who would be assisted by newly appointed partner Lerisha Naidu, was expected to focus on growing the practice into Africa. Baker McKenzie is headquartered in the United States.
Delivering his maiden speech at the United Nations General Assembly two weeks ago, US President Donald Trump, told African leaders that the continent has “tremendous business potential” and that “I have so many friends going to your countries to get rich”.
He said Africa represented “huge amounts of different markets for American firms, and it’s really become a place that they have to go, that they want to go”. Bernstein said there were inherent risks in entering into cross-border deals in emerging jurisdictions and as a result, “disputes are increasing in Africa”.
On top of this, he said, “investors in Africa are facing a growing number of laws and regulations in each of the countries in which they do business.” He added that cross-border legal compliance has become so complex, “that multinationals are now citing it as one of their biggest business risks and a brake on profits”.
Whyte said better formulation and implementation of legislation and policies both in the energy sector, as well as other sectors such as mining, industrial and commercial sectors, would help restore confidence in South Africa as an investment destination. “Sub-Saharan Africa is also a key area of interest,” he said.
As managing partner, Van der Merwe, who has been recognised as a leading lawyer in the country by law firm networks Chambers Global, Legal 500 and IFLR1000, said he was looking forward to building on their success of the last five years and taking their South African and African practices to a “new level”.
“Having grown the team from 16 in 2012 to 53 today, we need to make sure our strategy is the right one for a new and highly competitive environment,” he said. They were confident they had the right people in place to help deliver on their clients’ needs.
“We have lawyers who understand our clients’ unique challenges and who can help them to navigate an increasingly uncertain world. In Africa, the combination of our local knowledge and global reach is especially important given the current uncertain deal making and business environment,” said Van der Merwe, who wished Rudolph well in his future endeavours.
“Being able to deal with this uncertainty means having lawyers in the correct practice groups who have relevant industry knowledge, as well as exposure to the international cross-border environment. A robust industry focus is an important part of our strategy as it helps us to better understand the environment in which our clients operate and what keeps them awake at night,” he said.