Mozhdeh Pourmand, Andisheh Consultancy

With in-house counsel still a rarity outside of the major state-owned enterprises in Iran, GC talks to Pourmand, whose Andisheh Consultancy business provides external, in-house legal services.

I’m one of the shareholders and partners at Andisheh Consultancy, a consultancy firm giving advice to both Iranian and multinational companies that are working in Iran. I work with companies that usually don’t have an in-house legal function, so we fill the role of in-house but on an external contract, doing the day-to-day business, general legal advisory, contract review, corporate restructuring – everything that an in-house lawyer would do for them.

In Iran, it’s not common for companies to have an in-house legal function – even for the big companies. Contracts are usually handled by the procurement department, so unless they face really big issues, they do not have that intention to go to a lawyer. But, there is an exception: the state-owned companies – they all have an in-house legal function. Because of the size of them, as well as the nature of the business they are handling, they are an exception. They receive the budget from the state to do so, but they also have to deal with internal audits by the government and it is a requirement that they have a legal department to be able to respond and cooperate with this.

When you are in-house, you become an employee, so there are other aspects of an employee-employer relationship – whereas working as I do, in my opinion, has a mutual benefit for both sides. The company does not have to have the financial burden and the overhead for having a full-time employee, so they will not have to deal with the employment contracts, social security obligations and so on, but at the same time, they are receiving an adviser. I think the best terminology for what we are trying to present to the clients, would be like an externalised or a shared service centre.

We are trying to match the culture in our country to the standards that the FCPA or the UK Bribery Act set out. That does tend to require a huge effort and time investment, in terms of training and investigating, to build up that culture.

I think I can say, in a very general way, attitudes do come from the culture of the region rather than the company. So I have experienced the ‘senior’ approach from companies based in Europe towards using in-house counsel, and their approach to any issue in disputes is more or less the same. Compared to our neighbouring countries, you see that the business culture is very much linked to the region they are coming from.

Arbitration is a new concept in Iran. I myself try to advocate that, and I try to promote it in the contracts. Arbitration is especially easier when one of the parties is not Iranian because, for them, it has a very significant privilege: they can choose their own arbitration rules and their own place of sitting, so for them it’s already very much accepted. But, for the local companies, the Iranians, we try to point out different reasons why the arbitration can be a better replacement for litigation.

For litigation, companies really try and see if there is any other settlement option, because it is time consuming, it’s expensive, and you can never predict the results – especially if the case is blurry; you cannot give clear advice on that. So they will try to make a settlement; if there is a debt collection, they will prefer to agree to receive it partially in cash rather than going through court procedure, even if it means they might receive it in four or five years. n