IFLR 1000
The Guide to the World's Leading Financial Law Firms

The key development in the legal market is the decision by Clyde & Co to establish an office in Dar-es-Salaam. The firm used to work through its association office Ako Law, but it has now set up a team on the ground with UK and Tanzanian lawyers....

The key development in the legal market is the decision by Clyde & Co to establish an office in Dar-es-Salaam. The firm used to work through its association office Ako Law, but it has now set up a team on the ground with UK and Tanzanian lawyers. This marks the first opening of a foreign firm in the country

Other major developments, which change the landscape somewhat are the departures of Lucy Sondo and Pauline Kasonda to Abenry & Company, which brings Abenry into the fold of the leading corporate finance firms in the country, and the maturing presence of East Africa Law Chambers (EALC) under Stella Ndikimi. In September 2011 EALC took the step to join the Bowman Gilfillan Group.

Mkono & Co continues to hold its position as the longest running large corporate finance firm in the country, although competitors are keen to note that the gap has very much been closed and that Mkono is now just "part of the pack".

"There is a lot of competition," says one partner of the Tanzanian market, "there are more than seven or so law firms that can give you good services and the good clients are concentrated in the foreign investors". According to another: "The amount of money per deal is increasingly; ten years ago if there was a $17 million project everyone was talking about it in town, but now a $1 billion project might not get talked about."

CONTEXT AND TRENDS Activity in Tanzania is being largely driven by oil and gas exploration on the southern coast of the country. It is reputed that one of the largest gas fields is being explored about 80 km off the coast and which will come close to rivalling the natural gas reserves of Qatar, according to a local partner....

Activity in Tanzania is being largely driven by oil and gas exploration on the southern coast of the country. It is reputed that one of the largest gas fields is being explored about 80 km off the coast and which will come close to rivalling the natural gas reserves of Qatar, according to a local partner.

The size of the reserves and timeline for commercial exports have not yet been announced or confirmed, but the prospects are already attracting enquiries from big players inside and outside Tanzania.

"Business is growing exceptionally," says one lawyer, explaining that there are two prongs to the activity, one being oil & gas and the other being agriculture. The market saw a number of financings and M&A related to milling, dairy farms and sugar plantations. "Tanzania is a big bread basket but we don't have developed commercial farming, so we have seen quite a lot of entities setting up big farms," says a lawyer. In oil & gas, firms are seeing players such as British Gas and ExxonMobil coming in, along with service providers like Halliburton and Schlumberger. The government is currently discussing the legal framework for oil & gas.

Aside from this, infrastructure in general is an increasing source of enquiries and transactions. Two significant infrastructure projects are the Tazara rail line linking Tanzania to Zambia and a proposed rail network connecting Tanzania to Rwanda. However, one partner points out that there is no existing public-private partnership (PPP) framework in the country and therefore nothing "underpinning infrastructure projects".

There has been increased investment in the form of private equity and in terms of Chinese and Indian companies and financial institutions. For example, Chinese finance is involved in the construction of an underwater pipeline as well as on road construction and universities.

Tanzania's banking sector has also grown considerably, with the establishment of the Bank of India, United Bank of Africa and Kenya Commercial Bank. Meanwhile the capital markets are still very limited, with little activity on the stock exchange. Partners say the Capital Markets Authority (CMSA) has been looking at reviewing and introducing new laws and regulations to accommodate capital market activities, such as private placements (which are not as yet regulated by legal frameworks).

All in all law firms are optimistic verging on excited and all have noted an increasing call for information from investors including private equity funds from Europe.

MAJOR LATERAL HIRES

George Fernandes
From: Zanzibar Telecom
To: East African Law Chambers (EALC)

Pauline Kasonda
From: Adept Chambers
To: Abenry & Company

Adam Lovett
From: CRB Africa Legal
To: Norton Rose Africa

Lucy Sondo
From: Adept Chambers
To: Abenry & Company

Nicholas Zervos
From: CRB Africa Legal
To: Velma Law Chambers

MAJOR LEGISLATION CHANGES

Mortgage Financing Act
The Act was passed in 2009/10 but the regulations are only being published in their final versions in Spring 2012.

RISING STARS

Adept Chambers
Shamiza Ratansi
Amish Shah