The Corona Pandemic and its impact upon the legal sector in the Middle East

Kuwait Towers during sunset

The Covid 19 crisis has led to the greatest economic uncertainty in a generation.

I approached three highly experienced lawyers based in the UAE to ask for their predictions and expectations of how this crisis will affect their very different industries and what impact it will have on the UAE. 

Oliver Hallsworth is the Managing Director of ADS Securities LLC.  A lawyer by profession, he lives in Abu Dhabi and has been based in the Gulf since 2012.  Oliver foresees long lasting changes to the legal industry: 

The practice of law is often seen as the last bastion of resistance to the fast-paced technological change sweeping other industries. Our current routines as lawyers during the Coronavirus pandemic has shown that we are capable, as a profession, of adapting to the “new normal”. Working from home has shown we are all capable of the seismic transformation required to propel the legal profession into a digital age.

Lawyers can have an adaptive mindset across the entire legal spectrum, whether in-house, private practice or members of the judiciary, with the courts effectively going digital. Having said that, not all forms of dispute are amenable to online judging. 

The in-house department will have to move away from the traditional insource/outsource paradigm and focus on how legal advice can be delivered to meet enterprise wide expectations. The in-house department will be driven by the relentless desire to assemble expertise, collaboration, delivery, results and internal client satisfaction: more of a portfolio approach to providing its services as a fully integrated partner of those businesses that it supports.

Russell Woolford is Head of Legal for Intigral, a digital, media and entertainment company.  Based in Dubai, he has lived in the UAE since 2007.  His industry sector is at the forefront of the most obvious changes to our way of working and living:    

The crisis will create two contrasting short-term impacts on the TMT sector that may “cause” the lasting changes. First, a spike in consumption of entertainment video-content and a proliferation of digital interaction in non-entertainment sectors – video-conferencing apps to enable WFH.  With production on lockdown (i.e., no new traditionally-made content), there could be saturation on OTT video platforms – Netflix has decided to publish all its content.  Second, when the lockdown is relaxed, there will be a proportionate (i.e., dramatic) drop in consumption, since people will immediately want what they’ve been denied.  These reactions may lead to lasting changes.  

Theatrical cinema may not survive in its current form; and Studios may decide to release content to OTT-platforms far earlier than current industry standards, or even cut out the theatrical-release window altogether.   Other changes will depend on how creative the TMT industry is in adapting and what measures it takes to be less vulnerable to future pandemics. 

I foresee the harnessing and further practical emergence of AI across the TMT sector.  The video content that can be produced remotely (more cost-effectively and less dependent on human proximity) will be the future: the gaming sector is a clear beneficiary.    

Confidence that communications, and the provision of services, can be delivered through digital means will give rise to more dynamic (remote) working conditions and, perhaps, more cost-effective and increased output.  

There may be a lasting global change to our relationship with privacy of personal data.  Although many measures to curb the spread of Covid-19 are viewed as temporary, the door has been opened to reassess the weight given to personal-data privacy versus the health/security of the community.   Technology has been deployed in new ways, for example to record a person’s health, trace their contacts, and monitor their movements. The demonstrable effectiveness of this use of technology may have far-reaching, unintended, and lasting consequences.

James Donald is Vice President and Deputy General Counsel of Accor Hotels and has lived in Dubai since 2008.  The hotel sector is a sector that has experienced one of the most dramatic downturns: 

Travelling behaviours will change which will affect hotel operators, just as they changed for airline travellers post 9-11. There will be a new focus on operational hygiene protocols to reassure guests that hotels are safe places to visit. 

I think we will see fewer people travelling for routine meetings as a result of the uptake of remote-working technology. Corporate travel will still be very important (particularly for business relationships), but given the impending recession and the fear factor that currently exists, corporate travellers will be more discerning in choosing whether to jump on a plane as readily as they did in the past.

As every industry is discovering, those that have strong balance sheets will survive. There will probably be increased consolidation amongst hotel operators, and those that have scale are going to have an even greater competitive advantage to adapt to some of the changes we will see post-Covid.  

Both Oliver and Russell envisage changes to the UAE.  Oliver regards the UAE as a resilient nation: 

What the Coronavirus pandemic has thrown into sharper relief is the need to accelerate diversification away from over reliance on petrochemicals with the collapse in oil prices bringing a need to focus investment in industries that will be integral to recovery of the global economy: industries such as technology, logistics and healthcare. 

James feels that the decisive action taken by the government of the UAE will help the economy: 

The decision to postpone the Dubai EXPO to 2021 will hopefully support UAE-based hospitality businesses for the remainder of 2020 in anticipation of a rebound in 2021. But the scale of the rebound will depend on how the Covid crisis unfolds in the coming months, and whether vaccines and other ameliorating medications are developed and deployed quickly.

Russell predicts long term changes to the global marketplace:

Because the companies we work for and consume from are networked, many changes will not be unique to the UAE.  I expect there to be a recession into 2021 as many businesses will not have survived and any resurrection of what died will take time. And with quantitative easing a likely measure taken globally, there will be inflation, which will at least indirectly impact the UAE economy, if not directly.    

Until there is a vaccine for Covid-19, people are likely to continue to interact remotely and be reticent about travel; this potential habit will affect the UAE acutely given its economy relies on crowds:  hospitality, tourism, and events are key.

A direct and lasting change brought about by people’s new habits could be to the price of commercial property (with the demand for traditional office space being proportionate to the propensity to permit people to work outside); and, perhaps, the decline in the use of cash and the proportionate rise in the use of contact-less payment methods.   Positively, this could be the stimulus for disruptive entrepreneurial activity, with the market becoming accustomed to receive services without direct human contact.

It is clear that there will be long term/permanent changes to the markets and the way we work but it is also clear that the legal industry is well placed to adapt to these changes.  It is also clear that the Middle East will adapt and continue to be one of the most active and interesting regions to work and live as a lawyer.

For more information on legal vacancies in the Middle East, contact Iain Rainey