Legal Market Overview
As may be expected of a GCC nation, Bahrain’s economy has historically been dominated by the oil and gas sector. However, Bahrain has significantly smaller oil reserves than many of its neighbours, and although a medium-term solution was presented by the discovery of additional oil reserves in April 2018, economic diversification remains essential to the country’s long-term economic strategy. Policymakers have identified the greatest opportunities for development in the country’s banking sector in particular. Indeed, with looser banking regulations than countries like Saudi Arabia, Bahrain is already home to a highly sophisticated conventional and Islamic banking industry and serves as one of the region’s more significant banking hubs. Moreover, with government initiatives aimed at facilitating financial-sector innovation, the country is increasingly seeing activity in the digital banking and fintech sectors.
The significance of Bahrain’s banking sector is illustrated by the internal focus of many law firms operating in Bahrain. Law firms tend to be highly specialised in banking work, and will often handle other types of instructions in close co-operation with their banking and finance teams. For example, in the projects and energy sectors, a strong construction practice is of course important, and a corporate team with experience of complex project documentation is invaluable, but even here many firms will find the fiercest competition in the project finance space. Further, although increased interest in fintech and innovative banking has opened the door for development in these areas, it has also led to a rise in banking-sector disputes and has highlighted the importance of litigation and ADR, complemented, ideally, by experience in the banking sector. As the kingdom allows only Bahraini nationals to appear before the court, international players seeking to do business in Bahrain should take note of some of the market’s full-service domestic firms, including Zu’bi & Partners, Attorneys & Legal Consultants, Hassan Radhi & Associates and Haya Rashed Al Khalifa Attorneys at Law & Legal Consultants. Several prominent international firms are also active in Bahrain.