Solicitors governing body: Bahrain Bar Society
Competition authority: Ministry of Industry and Commerce
Financial regulator: Central Bank of Bahrain
IFLR1000 ranking categories in this jurisdiction:
Financial and corporate (published October) - Banking, M&A, Project finance
Essentially, Bahrain has two legal markets - the local and the international. Unlike some jurisdictions in the Middle East, the Gulf state has no foreign ownership requirements for law firms so it is not essential for international advisors to assimilate with a local sponsor or employ partners who are Bahraini nationals. This means the two types of firm remain relatively autonomous, working together on transactions but competing for different roles on mandates, one advising on international (usually US or English) law, the other on Bahraini.
Among the international firms present in the country, the most dominant are those with the longest tenures: Baker & McKenzie, Freshfields Bruckhaus Deringer and Trowers & Hamlins. Foreign firms tend to maintain a relatively small permanent presence in Bahrain and often employ fluid teams, where partners are focussed on several jurisdictions in the Gulf or wider region. This structure makes perfect sense for a country like Bahrain where the level of activity does not necessitate having a large dedicated team on the ground at all times. It is also a natural model to use as the vast majority of the significant deals with a Bahrain element are cross-border.
The contingent of domestic firms active on the market’s more significant deals is fairly consistent. Three firms typically compete for the local roles on larger deals: Hassan Radhi & Associates, Haya Rashed Al Khalifa and Zu'bi & Partners. A far smaller firm and younger firm, Jalila Sayed Attorneys & Legal Consultants, is the preferred local counsel of some foreign firms.
A recent new addition to Bahrain’s legal market was regional firm Al Tamimi & Co, which established a branch in Manama in 2014.
Banking and finance is the mainstay for firms focussing on transactional work in Bahrain. Manama has one of the Middle East’s oldest financial centres, established as the country sought to diversify the economy away from a dependence on oil. In part, it was the development of this sector that attracted international firms to Bahrain and, despite the increased competition from other hubs in Dubai and Doha, the local banks remain active. Projects – utilities, natural resources and infrastructure - are other reliable source of instructions for firms. Capital markets work does generate mandates, but is generally limited to sovereign issues or those of financial institutions.
Ben Naylor - Journalist - EMEA
Baker McKenzie is the leading international firm in the market for all types of banking and finance (lending and debt issues) work, both Islamic and conventional. On corporate finance matters the firm generally represents lenders.
During the research period the firm advised on structuring Islamic and conventional loans including advising on murabaha (deferred sale) facilities, bond and letter of credit issuances, term and revolving facilities, and project finance transactions involving sukuk and musharaka (partnership finance). On most of these deals the firm was representing the lenders.
In project development the firm is working for sponsors involved in several large oil and gas and natural resources infrastructure builds in Bahrain.
Banking and finance partner Bilal Kahlon left the firm during the research period.
Recent Data Deal highlights
•Arkad Engineering & Construction $54 million financing
•KGL $166 million syndicated financing
•King Abdulaziz International Airport
“Baker & McKenzie in Bahrain is very well diversified in terms of the specialties. They understand the legal issues at hand very quickly and come up with some options and solutions that would help to make things happen. The availability and readiness of the lawyers at the firm is one their main strengths.” - Banking
“Excellent commitment of the senior team led by Julie Alexander and Basel Barakat. Top professional advice, innovation and dedication.” – Banking
“They are very efficient and responsive.” – Capital markets: Debt
“As usual, B&M were highly responsive, thorough and proactive.” – M&A
“Strengths: methodical, comprehensive, aware of the market. Weaknesses: Not suited for pure project finance transactions.” - Project finance
The Manama office of Charles Russell Speechlys is broadly active in financial and corporate transactional work.
During the research period the firm was more active in banking and finance work than corporate. It advised on debt restructurings for several borrowers (an industrial manufacturing company and a client in the marine sector), worked for a lender providing a term loan facility to an Omani finance company, and advised on a commodity murabaha (deferred sale) and ijarah (capital leasing) facility for a real estate development company.
Recent Data Deal highlights
•Bank of Bahrain and Kuwait $20 million term loan facility
“Their team easily grasps commercial aspects of a transaction and provides pragmatic advice to structure a deal in an efficient and purposeful manner. The team in Bahrain can call upon expertise within their global network, should the need arise, however this is not normally required. CRS regularly provide publications on legal and regulatory changes, but access to the wider coverage of their publications would be of benefit.” – Financial services regulatory
“The firm renders legal services with professional manner. Despite the vast experience in Islamic Finance transactions, an Arabic speaking lawyer would profoundly help in this area of advisory tasks engaged with Islamic Banks.” - Financial services regulatory
The Bahrain branch of Freshfields Bruckhaus Deringer is a leading firm in the market for project work and experienced in power, transportation, utilities, and oil and gas sector, and PPP projects.
During the research period the firm has been most active in social infrastructure project development work including advising on a social housing PPP project.
In M&A work the firm has advised on real estate joint ventures and the sale of majority stakes in power and automotive companies.
Recent Data Deal highlights
Social housing PPP
Zu’bi & Partners is a leading domestic firm that is particularly active in conventional and Islamic banking and finance work.
During the research period the firm was broadly active on lending work (new money and refinancing) and capital markets issues. The firm advised issuers of large sukuk and conventional bonds and acted for consortiums of banks on several large refinancings undertaken by Bahraini borrowers.
Recent deal data highlights
Mumtalakat $600 million 5.625% sukuk issue
Al Ezzel Power Company $243 million refinancing
Al Dur Power & Water Company $1.3 billion refinancing
Nogaholding $500 million 7.625% and $500 million 8.375% bond issues