IFLR 1000
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From the point of view of projects, last year was characterised by a stall in the legal market because of the international crisis. "The fact that there is not much movement in projects means that the market is not moving so much," one partner says....

From the point of view of projects, last year was characterised by a stall in the legal market because of the international crisis. "The fact that there is not much movement in projects means that the market is not moving so much," one partner says. The players in this small jurisdiction have been keeping themselves busy with long term projects. "I think existing ongoing projects keep law firms well occupied," one partner says.

Furthermore, a recent trend has seen two of the market's leading firms, Boga & Associates and Kalo & Associates, establish operations in Pristina in order seek out and exploit business opportunities present in Kosovo. Furthermore, this year, the Tonucci & Partners spinoff Apicella & Partners closed down and Berardino Apicella moved to Italy while one of his partners moved to Ernst & Young. "Berardino was a good lawyer but his target was a bit ambitious," one peer says. Also last year, CMS's Italian outlet, CMS Adonnino Ascoli & Cavasola Scamoni acquired the entire Tirana office of Eversheds' Italian alliance firm, Eversheds Bianchini. In the coming editions, it will be interesting to see what sort of impact the firm can make in a market that is dominated by strong domestic firms and whether it will be able to integrate and create a solid local client base.

CONTEXT AND TRENDS Presently, Albanian legislation only recognises mergers between companies with their principal place of business in the country itself. Nevertheless, Albania is obligated to align itself with EU law and recently the Ministry of Economy, Trade and Energy introduced a draft law, concerning the relevant EU Directive, for discussion on cross-border mergers....

Presently, Albanian legislation only recognises mergers between companies with their principal place of business in the country itself. Nevertheless, Albania is obligated to align itself with EU law and recently the Ministry of Economy, Trade and Energy introduced a draft law, concerning the relevant EU Directive, for discussion on cross-border mergers. The ongoing political crisis impedes the legislative process but newly elected President, Bujar Nishani, has made EU entry his priority and has pledged to tackle the standstill which threatens the country's integration. "It's a general trend that Albania is trying hard to approximate legislation to the EU," one partner says, adding that, "maybe it's going too fast. It's too complicated for the Albanian reality and misses the background."

Energy is one area that generates interest among the market's participants. "We see Shell here and we're happy to see them here. They came three months ago. The oil sector is promising. Everyone is looking," one commentator says. In fact, on account of Albania's water abundance, hydropower is a healthy source for foreign investment, especially from Austria and Italy. For example, the government recently put four state owned hydropower plants up for sale. "More than 90% of Albania's electric energy comes from hydropower," one partner says.

The banking sector did not suffer too much from the crisis. Nevertheless, the situation worsened as the sovereign debt crisis hurt commercial relations with key trade partners, Greece and Italy. "It's not the best economic time ever. There's a lot of Greek effect and Italy's not in the best shape either. Yet, our exposure to the financial market is somehow limited and we're always above what the IMF says," one partner states. Banks have been carefully revisiting existing loans and distinguish between bad loans that they try to sell and the promising ones that they try to restructure. Real estate was hit badly as many projects stopped in light of the difficulty to get financing. However, a small segment of the market wasn't hit so badly. "Some could afford villas and this became a fashion. That is, the building of villas for a limited number of people who can afford it to create an elite following the trend in other countries," one partner says.

M&A activity continues in Albania but not on a large scale. "A few transactions are happening even though the market is not so active," one partner says. Vienna Insurance Group has been significantly expanding its market position in Albania and hydropower privatisations are moving while there are plans for oil and insurance companies. "Energy has a lot of M&A potential but there are regulatory issues," one commentator states.

MAJOR LATERAL HIRES

Fatos Lazimi
From: Kalo & Associates
To: Optima Legal & Financial