Cultural and legal dynamics of contracting and resolving disputes in the GCC Bertrand Alexis, Senior Director, Legal, Ooredoo 1 2013
Ooredoo at a Glance
Overview Results Strategy Operations Additional Information Ooredoo at a glance (1) Revenue Diversity Solid Revenue Growth (US$bn) Fixed 12% Mobile 88% Integrated telecom group - not a conglomerate Wide range of services, serving both consumer and business markets Growing fixed business 8.7 9.3 6.6 7.5 2009 2010 2011 2012 Oman Tunisia 6% 8% Algeria 10% Iraq 20% Others 3% Kuwait 9% Qatar 18% Indones ia 26% Mix of developed and emerging markets Strong position in all major markets of operations Stable EBITDA Margin (US$bn) 4.1 4.3 3.1 3.4 46% 47% 46% 47% 2009 2010 2011 2012 Customer Diversity Continuous Investment (Capex - US$bn) Tunisia 8% Algeria 10% Kuwait 2% Oman 2% Iraq 11% Others 1% Qatar 3% Indonesi a 63% >92 million customers Premium customers to newly connected 2.3 1.9 1.8 2.0 2009 2010 2011 2012 Note: (1) As of December 31, 2012, 1 USD = 3.64 QAR 3 2013
Fastest growing telco group 2006 2012 (1) Overview Results Strategy Operations Additional Information Tunisia Palestine Iraq Qatar Pakistan Algeria Saudi Arabia Kuwait Laos Oman Cambodia Philippines Maldives Singapore Indonesia 2006 Record Growth 2012 Markets 2 15 CAGR Customers <2mn >92mn 90% Employees 2,200 17,000 41% Revenue US$ 1.2bn US$ 9.3bn 41% EBITDA US$ 726mn US$ 4.3bn 35% Note: (1) Revenue CAGR 4 2013
Overview Driven by a successful track record of execution Results Strategy Operations Additional Information Wataniya Palestine IPO ISE US$3bn Bond Program Wataniya Group stake increased to 92.1% Ooredoo brand launch New mobile license Myanmar US$3.8bn Wataniya Group acquisition Successful US$1.25bn bid for Asiacell Indosat stake increased to 65% Nawras IPO LSE US$5bn Bond Program 2011 2012 2013 Initial Indosat stake increase to 40.8% 2010 Launch of Nawras NavLink partnership 2008 2009 Launch of Wataniya Palestine Asiacell IPO and stake increased to 64.1% Ooredoo established 1987 Listing on Qatar Exchange 1998 2005 2006 Investment in StarHub (AMH) 2007 Obtained investment grade ratings Launch of wi-tribe Pakistan Launch of wi-tribe Philippines Total Group stake now 90% Source: Ooredoo 5 2013
From the GCC In-house Perspective Any key differences? Differences in substantive law civil v. common law Sensitivity to disputes mediation and arbitration in the GCC Legal formalities Similarities? Seeking best practices for a multinational law department Seeking latest Tools and talent to achieve this Balancing the need for outside counsel 6 2013
Choice of Law The law of each of the GCC countries are based on civil law Source of law generally Egyptian law, which is based on the French civil code Company law face a greater number of formalities than under Delaware law (as is the case with company law in civil law countries) Preference for French and English law as an alternative to GCC law, combined with international arbitration clause 7 2013
Differences Common vs Civil Law NDAs both allow for injunctive relief no major substantive difference! Liquidated damages under common law, penalties under civil law English law generally a deference for the intent of the parties, especially if disputes are submitted to arbitration Company law greater number of formalities which need to be respected Publishing agenda in the local gazette Minimum stated capital for companies (together with civil and criminal penalties for failure to meet minimum capital) Publishing agenda for annual shareholders meeting Providing annual results to commercial registrar (available to the public) 8 2013
Key Issues under GCC laws Definition of GCC Bahrain, Kuwait, Oman, Qatar, KSA, UAE Possible Future additions Iraq, Yemen Mandatory local ownership of local Companies (often set at 51% local partner) GCC common market (elimination of tarifs within the GCC) since Jan 2008 Greater formalism generally (need for consular stamps/confirmation of authorized signatures, conformity of documents to originals, etc.) Sukuk Financings Important to look at relatively new legal regimes to promote trade and investment (Dubai International Finance Center, Qatar Financial Center, etc.) Regulations designed to promote investment Special tax rules Separate employment laws and regulations Dedicated arbitral organizations, rules and regulations 9 2013
Arbitration from a GCC perspective Parties to the UN Convention (exception Iraq) Riadh convention DIFC/LCIA joint venture Arbitration in Qatar via QFC Bahrain Center for Dispute Resolution in partnership with the American Arbitration Association (BCDR-AAA) ICC Arbitration also very common The importance of Seat of arbitration- as distinct from the location of arbitral proceedings. 10 2013
Local Arbitral Institutions DIFC LCIA Arbitration Centre strategic partnership Bahrain Chamber for Dispute Resolution Qatar International Court and Dispute Resolution Centre under the auspices of the Qatar Financial Center Gulf Co-operation Council Commercial Arbitration Centre (GCCAC) based also in Bahrain 11 2013
Ethics from a GCC perspective Shariah compliant companies Will question the need to certify compliance with other ethical standards Companies from other jurisdictions must be prepared to respect GCC ethical requirements when doing business in the region 12 2013
Arbitration References www.nipc-gulf.blogspot.com www.iccwbo.org www.difcarbitration.com www.qicdrc.com.qa www.bcdr-aaa.org 13 2013
Thank-you