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Global Islamic Capital Markets: CurrentTrends and Future Opportunities

IntroductionGlobal Islamic Capital Markets: Current Trends and Future Opportunities

2014 was an exceptional year for the international Islamic capital markets and will beremembered as the year in which the Islamic capital markets transitioned beyond the traditionalhubs of the Gulf and South East Asia to new markets including Europe and Africa.

In this briefing we bring together for the first time contributions from our lawyers in the London,Dubai and Istanbul offices that were originally published at the end of last year. We hope thatthese articles may be of some interest to you sharing our experience of some recent highprofile transactions.

The first article explores current trends and opportunities in the global Islamic capital markets,offering some insight into how new entrants might approach this market and what the immediatefuture might hold for the global sukuk market. The second article analyses the first UK sovereignsukuk and the possibilities that this ground-breaking issuance may bring.

The third article considers the first ever South African sukuk and whether this could be the catalystfor an African sukuk market to emerge. The final article explores recent Turkish legislation that isgoing to allow new entrants and structures to enter the Turkish shari’a sukuk market.

The motivations for different entrants to the global sukuk race vary widely and the challenges forestablishing a foothold similarly differ for each jurisdiction. However, the immediate future for theshari’a compliant fixed income securities market looks positive with many new sovereigns confirmedor rumoured to be entering the market and with the barriers to corporates issuing sukuk in suchjurisdictions falling away.

The transition beyond the traditional hubs of Islamic finance in South East Asia and the Gulfcould be seen as the point at which the sukuk market begins to mature and establish shari’acompliant fixed income securities as one of the main types of global asset finance.

Building on our experience in Asia, the Middle East and Europe, Clifford Chance has been at theforefront of shaping this transition having recently advised on a number of groundbreakingtransactions, including the first UK sovereign sukuk, the first South African sovereign sukuk and thefirst sovereign sukuk of Senegal. Similarly, Clifford Chance has in recent years been at the cuttingedge of the development of the Turkish shari’a compliant fixed income securities market, includingrecently advising on the Republic of Turkey’s $1 billion sovereign sukuk.

At the back of this briefing we have included details of our global Islamic capital markets teamshould you wish to get in touch with us.

1. Recent trends and new perspectives in global . . . 4Islamic fixed income capital markets

2. Dissecting the UK Government sukuk . . . . . . . . . . . 9

3. Breaking new ground in Africa: South Africa . . . . . . 12joins the global sukuk race

4. The emergence of the Turkish sukuk market . . . . . . 15

5. Contacts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

6. Our presence in the world . . . . . . . . . . . . . . . . . . 21

contents

Introduction

As 2014 draws to a close we are now atthe time of year when looking to thefuture for market trends is almostunavoidable. So, as part of our end ofyear forecast, we would like the reader tojoin us in considering the year’sdevelopments in global cross-bordershari’a compliant capital markets, tryingto draw some lessons from the recentpast while casting our eyes to the future.Certainly, in particular for those moredirectly involved in this part of the globalcapital markets, 2014 has been aremarkable year, with the inauguralissuances of the first sovereign sukuk bythe UK and Senegal in June, by theRepublic of South Africa and the HongKong Special Administrative Region ofthe People’s Republic of China inSeptember, by the Duchy of Luxembourgin October and the return to the marketsof the Republic of Turkey in lateNovember. With these sovereign issuersentering into (or confirming their presencein) the market it is difficult to avoid theimpression of having witnessed in recentmonths a momentous transformation inthe landscape of shari’a compliant globalfixed income capital markets. Not onlyhas the offering of shari’a compliant fixedincome instruments available to investorsin the markets been substantiallydiversified (both in terms of currencydenominations, geographical exposureand credit standing), but the samedynamics that have so far shapedinternational shari’a compliant fixedincome instruments in the global capitalalso markets also appear to havebeen transformed.

Recent trends

Shari’a compliant fixed income securitiesare part of the modern Islamic financewhich has developed in South East Asiaand the Middle East in the second half ofthe 20th century to reflect the localpolitical demands to create financialsystems more aligned with the ethicalvalues of countries with a predominantlyMuslim population. In the last decade,however, as a result of the globalisation ofthe financial markets, a global internationalmarket for this type of securities hasgradually emerged, growing well beyondthe domestic confines of those originalmarkets. In the last few years, Islamicfinance has spread well beyond SouthEast Asia and the Middle East and thetarget of making the domestic financialsystems more “inclusive” in order toimprove the access to funding irrespectiveof religious or ethical beliefs and to createa level playing field between conventionaland Islamic financial institutions hasstarted being pursued also in countrieswith secular or non-Islamic legal systemssuch as Turkey and the UK. This has lednot only to new opportunities for Islamicfinancial institutions emerging but also thecreation of shari’a compliant fixed incomeinstruments as an integral component ofthe domestic capital markets of anincreasing number of countries. SeveralEuropean countries, including the UK,France and Turkey, have explored thisoption and some have already enacted

regulatory and tax legislation to equalisethe treatment of shari’a compliantinstruments with conventional fixedincome. The presence of sizeable Muslimminorities and the current demographictrends are likely to sustain the expansionof these financial products acrossWestern Europe and farther.

“Inclusiveness”, however, has not beenthe only driving factor and, with theincreasing volume of international shari’acompliant fixed income instrumentsissued in the market, several financialcentres have started jostling for positionto claim the title of centre for globalshari’a compliant fixed income capitalmarkets. The interest in attracting thelucrative service industries supporting andoperating around the main financialmarkets and retaining or increasing their

4 Global Islamic Capital Markets: Current Trends and Future Opportunities

Recent trends and newperspectives in global Islamicfixed income capital markets

Key points

n Turkish market developmentsillustrate how policy tools may becreated to support shari’acompliant fixed income securitiesand attract foreign investors fromthe Gulf region.

n Legal techniques fromsecuritisation and asset – backedfinance may help to access shari’acompliant capital markets forfunding infrastructure projects indeveloping countries.

n Recent trends may transformshari’a compliant fixed incomesecurities into a significant sourceof funding for asset finance.

This article tracks the evolution of the global shari’acompliant fixed income capital markets with a particularfocus on Turkish market developments.

“...several financial centres have started jostling forposition to claim the title of centre for global shari’acompliant fixed income capital markets.”

© Clifford Chance, January 2015


5Global Islamic Capital Markets: Current Trends and Future Opportunities

share of these markets has led to activepublic and political support for promotingthe development of the existing global orregional conventional financial centres asnew Islamic financial centres. The recentsovereign issuances of the UK,Hong Kong and Luxembourg (and on aregional level, South Africa and Turkey)are clearly also aiming to promote theinternational standing of London,Hong Kong and Luxembourg, as well asIstanbul and Johannesburg, in anincreasingly competitive environment.However, while pursuing these objectives,the recent issuances are also raising newpolitical aims and concerns. Attractingforeign capital and targeting in particularthe liquidity existing in the Middle East isincreasingly seen as a fundamental publicpolicy aim by many governments acrossthe globe and the availability of tools andstrategies that are suitable to attract suchforeign capital is at the forefront of suchgovernments’ consideration. The recentsovereign issuances of Senegal, SouthAfrica and Turkey, for example, reflectthese political ambitions in different ways.

The concurrence of all of these trends,however, is also having a broader anddeeper impact on global shari’acompliant fixed income capital marketsand seems to be refashioning this type ofdebt securities. To appreciate fully thisevolution, it may be helpful to considerhow the more recent issuances differfrom the traditional shari’a compliantfixed income securities issued in the Gulfregion and, in this respect, the Turkishmarket developments and the relatedlegislative enactments in the last threeyears offer a useful insight. The recentTurkish market developments also helpto illustrate how policy tools may bedeveloped and what issues need to beaddressed as a result.

Developing suitable policy tools: theTurkish example

With a long presence in internationalcapital markets as an issuer ofconventional debt instruments and asecular constitution, the Republic ofTurkey, despite its predominantly Muslimpopulation, did not appear to be themost obvious candidate for issuingshari’a compliant sovereign fixed incomeinstruments in 2012; particularlyconsidering that the yields onconventional Turkish bonds were thenstill pricing inside yields expected from asukuk. Primarily borne out of the politicaldesire to support the opening of thedomestic market to participation banksand to promote Istanbul as a regionalfinancial hub, the approach adopted bythe Republic since 2011 is, therefore, aninteresting case study.

The issuance of shari’a compliantinstruments was first made possible inTurkey by the introduction in 2010 of aform of asset – backed debt instruments(known in the Turkish legislation as leasecertificates) through covered bond stylelegislation which made it possible forparticipation banks to tap the market viaa regulated entity (known as an assetleasing company) which is subject to thesupervision of the Capital Markets Boardof Turkey (“CMB”). This was followed bythe introduction of appropriateamendments to the tax legislationintended to make it more attractive forforeign investors to invest in theseproducts. To begin to win the confidenceof investors in the product, the Republicof Turkey decided to enter the marketand issue lease certificates in 2012.Since 2012, the Republic has repeatedlytapped the market issuing its own leasecertificates both in the domestic and theinternational capital markets and in so

doing has established a clear benchmarkfor foreign investors. These sovereignissuances have helped foreign investorsbecome familiar with this market, haveestablished a yield curve for leasecertificates and have contributed tomake it possible for the participationbanks to access directly the internationalcapital markets themselves.

The success of this policy – clearlyreflected in the ability of all the Turkishparticipation banks to access theinternational (as well as the Turkishdomestic) capital markets in recent years– has led the CMB to attempt to openthese sources of funding well beyond thestill narrow participation banks sector. In2013 the CMB enacted a boldamendment of the regulatory frameworkintended to make the lease certificatesalso available to other institutions,including corporate groups and projectfinancing for local infrastructural projects.Though it is too early to assess theimpact of the new legal framework,which, notwithstanding the interest byseveral Turkish corporates, has not yetbeen tested in the market, it is interestingto note how the new legislation isreshaping the nature of thelease certificates.

Asset-based versusasset – backed instruments

Though a typical international shari’acompliant fixed income instrument issuedin the Gulf region is usually structured asa beneficial interest in an English lawgoverned offshore trust, the incomegenerating asset forming part of the trustproperty (typically located onshore) is notsegregated from other assets (as thetransfer of the asset is typically notrequired to be perfected under the law ofthe relevant jurisdiction). The profit return

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Global Islamic Capital Markets: Current Trends and Future Opportunities

on the certificates is only linked to theperformance by the obligor of itscontractual arrangements entered intowith the trustee, which also forms part ofthe trust property. The return on theinvestment is “based” on the asset –rather than being “backed” (or in otherwords secured) by it – and the value ofthe asset is only intended to provide theparameters for determining the size ofthe capital issue and the financialperformance of the instrument and is notcalculated on the basis of its real marketvalue. As a result, an investor investing insuch an instrument practically invests inthe credit risk of the obligor rather than inthe value of the income generating asset.

Though generally compared in themarket to a similar asset – based sukukal ijara as issued in the Gulf region, theTurkish lease certificates present quitedistinct legal features. The Turkish leasecertificates benefit from statutorysegregation and (after the reformsenacted in 2013) are subject to astatutory debt to asset ratio based onthe real market value of the underlyingassets. As such, the Turkish leasecertificates are much closer to anasset – backed instrument than a typicalsukuk originated in the Gulf region.

These characteristic legal features do notseem to have played a significant role inthe market assessment and pricing ofthese instruments which still seem to beperceived by the market primarily as

asset – based instruments. However, it isdifficult to imagine that this will remainthe case if the aim of the CMB topromote lease certificates as a source offunding for project finance is to succeed.The segregation of the assets for thebenefit of the investor is such animportant credit enhancement factor thatit can hardly be ignored in structuringany such future project finance bond.

Asset finance in sub-Saharan Africa:replicating the Turkish model?

Whether the approach pursued by theRepublic of Turkey may provide aroadmap suitable for other countries isdifficult to say. However, it is alreadypossible to note certain similaritiesbetween the Turkish lease certificates andthe inaugural issuances of internationalshari’a compliant fixed incomeinstruments recently completed by theRepublic of Senegal and the Republic ofSouth Africa.

The Senegalese issuance has beenstructured using securitisation legalprinciples, with a transfer of assets –including a usufruct over governmentalbuilding complexes – to a securitisationfund which then leased back thebuildings to the Senegalese governmentand funded the purchase of the assets byissuing to investors units in thesecuritisation fund. As the securitisationfund is a form of co-ownership of theunderlying assets under Senegalese law,

the units are equivalent to a beneficialinterest in a trust and the structure isconsistent with shari’a. However, the useof securitisation techniques results in aninstrument which structurally is anasset – backed (rather than an asset –based) debt security.

Similarly, in the inaugural South Africanissuance, the certificates representbeneficial interests in an onshore trustcreated over certain assets located inSouth Africa, including a personal usufructright over government – ownedinfrastructure assets. As the trust hasbeen perfected in accordance with SouthAfrican law, notwithstanding the apparentsimilarities with an asset – based sukuk alijara as issued in the Gulf region, theunderlying assets are segregated throughthe trust.

In both the Senegalese and SouthAfrican issuances, due to the sovereignnature of the debt securities, thesestructural legal features may appearrather academic and pale intocommercial insignificance.Notwithstanding the legal segregation ofthe assets, any return for the investorsdepends purely on the timelyperformance of the sovereign rather thanon the real performance of the assets(the local government, in each case, isthe only debtor of the securitisedreceivable or is the only entity entitled toown the relevant assets). Therefore, inthe context of these sovereign issuances,any distinction between asset – backedand asset – based securities is of littlepractical consequence. However, shouldthese legal structures be replicated in thecontext of non-sovereign shari’acompliant fixed income securities, theseaspects would have a much greaterrelevance, as the financial product would

“When used within secular legal systems with apredominantly non-Muslim population, form oversubstance is inevitably likely to be less attractive and agradual shift towards more typical asset finance islikely to occur.”



appear closer to the Turkish leasecertificates than to standard issuancesoriginated in the Gulf region. Thisconclusion is very significant given thedeclared intention of each of thesecountries to use Islamic finance to attractforeign investment in their respectiveeconomies, either to fund publicly byowned businesses or private companiesor to fund infrastructure projects.

This, of course, does not spell theimminent end of the shari’a compliantasset – based fixed income securitieswhich have been issued so successfully inthe Middle East and South East Asia.Sovereign issuers and corporate entities inthese regions having a financial standingsufficiently strong to approach theinternational capital markets are likely tobe able to tap the markets with traditionalinstruments. In many emerging markets,however, the use of asset – backedstructures may be necessary.

The utilisation of legal models based ondomestic legal frameworks forasset – backed products as in Senegal isalso highly significant as it may allowpotential avenues for structuring fixedincome instruments to be identified in linewith the requirements of shari’a law usingwell understood legal concepts in thelocal jurisdiction. Many civil law countriesexploring how to allow domestic issuersto tap the international shari’a compliantcapital markets may prefer using oradapting such existing legal frameworksinstead of using offshore trust structuressuch as those used in the Gulf region. Inparticular, when recognition of foreigntrusts may be an issue, such an approachwould have the benefit of retaining thelegal certainty of well-known domesticlegal principles. Such an outcome wouldseem to be more likely if these countries

were to try to access the internationalshari’a compliant capital markets forfunding infrastructure projects.

When used within secular legal systemswith a predominantly non-Muslimpopulation, form over substance isinevitably likely to be less attractive and agradual shift towards more typical assetfinance is likely to occur.

A new road map

The recent experience of the Turkishmarket confirms that, in order to attractforeign capital by targeting the liquidityexisting in the Middle East, the role playedby the state is likely to be critical. A clearlegal framework is necessary and it mustbe capable of reconciling therequirements of shari’a law, as required byIslamic scholars, with the demand of legalcertainty from investors. This may beachieved using legal principles borrowedfrom securitisation and asset – backedfinance without the need to enact specificlegislation for Islamic finance. This mayallow potential avenues for structuring theinvestment to be identified so as to fitboth the expectations of traditionalinvestors familiar with asset – basedsukuk and the more demandingrequirements of full asset segregation, andtherefore reducing the potential risk oflegal uncertainty inevitably associated withthe adoption of new legal principles.Introducing a favourable tax regime is alsoimportant. However, the significance of

the sovereign issuances in winning theconfidence of the markets cannot beunderestimated, as the support of thegovernment is vital to create anenvironment which may attractforeign capital.

Introducing a legal framework suitable forissuing shari’a compliant fixed incomeinstruments is not going to be thepanacea for all the funding problems ofevery country. Unrealistic expectationsshould be discouraged. The marketdevelopments in Turkey may help tounderstand the potential obstacleslimiting the growth of shari’a compliantfinance. Notwithstanding the recentlegislative development, lease certificatesremain a form of asset finance and theavailability of shari’a compliant assets isa prerequisite for issuing any such leasecertificates. Outside those countrieswhere all the economic activities have tocomply with shari’a, drawing a neat linebetween shari’a compliant and shari’anon-compliant assets within anybusiness organisation may beproblematic. In many countries,therefore, the availability of suitableassets is likely to be a major constraintand it may be difficult to see how Islamicfinance may become a general source offunding for all types of businesses.However, most infrastructure assets arelikely to create no such problems and theuse of shari’a compliant capital marketsto fund (or refund) projects is more

“...the significance of the sovereign issuances inwinning the confidence of the markets cannot beunderestimated, as the support of the government isvital to create an environment which may attractforeign capital.”

promising. International investment isunlikely to be attracted unless sufficientlystrong credit ratings can be achieved.Investor appetite is likely to remainfocused on investment grade securitiesand by itself a shari’a compliant structurewould not be sufficient to mitigateconcerns regarding the low credit ratingof the obligor. The availability of Islamicfinance may therefore be limited as aresult of the low sovereign rating of therelevant jurisdictions. Conversely, in orderto achieve a more attractive rating,structuring the securities as

asset – backed (rather than asset – based)shari’a compliant fixed incomeinstruments – along the lines of the Turkishlease certificates or using securitisationtechniques as in Senegal – may become aprerequisite for accessing these markets.

In any case, the active role played by localgovernments in issuing shari’a compliantfixed income instruments is manifest.


Conclusion

In the years to come it is not unlikelythat 2014 will be seen as a turningpoint in the development of the globalinternational market for shari’acompliant fixed income securities. Withthe issuance of sukuk by the UK,Luxembourg and Hong Kong, some ofthe main global financial centres haveentered the race to positionthemselves as the key markets forthese products. These sovereignissuances are likely to provide usefulbenchmarks for investors interested ininvesting outside the core Islamicmarkets in the Middle East and SouthEast Asia. Developed economies areincreasingly keen to find ways toattract foreign investment. At the sametime, there is an increasing focus onhow to attract investment ininfrastructure projects, particularly inemerging markets where there is ahigher demand for such investmentsand potentially higher long-termreturns. The time seems ripe for anincreased sophistication of thisfinancial product to accomplish theseveral roles it can play. These trendsare likely to transform shari’a compliantfixed income securities into one of themain types of asset finance.

Claudio MedeossiDirector, LondonT: +44 20 7006 2341E: [email protected]

Contributors

Debashis DeyPartner, DubaiT: +971 4 362 0624E: [email protected]




IntroductionThe global Islamic financial servicesmarket is estimated to be worthsomewhere in the region of US$1.14trillion. Its potential for continued growthhas made it attractive to investors whoare looking to take advantage of all theopportunities it presents. As a result,raising finance through Islamic financialinstruments has become increasinglypopular throughout the world.

July 2014 saw the first sovereign sukukissuance in the United Kingdom. The UKgovernment made its inaugural issuancewith a £200 million sukuk due in 2019.The sukuk offer a competitive periodicdistribution amount set at a rate of 2.036per cent per annum. The issuance wasvery well received by investors and washeavily oversubscribed.

The UK has sought to position itself as aninternational hub for Islamic finance andthis issuance embodies that commitment.Being the first of its kind by a Europeansovereign state, the transaction was trulyground-breaking and has laid thefoundation for further Islamic financing inthe UK. The transaction has set aprecedent for entities wanting to draw onthis largely untapped pool of Shari’acompliant investors. It opens up andprovides a guideline for a whole newsource of funding available to issuerswithin Europe.

The transaction documents were held tobe Shari’a compliant by Bait Al-MashuraFinance Consultations Company, ShariahCommittee of CIMB Islamic Bank Berhad,The Executive Shariah Committee ofHSBC Saudi Arabia Limited and

Standard Chartered Bank ShariahSupervisory Committee.

As a Shari’a compliant instrument, theissuance uses an ijara structure. Theproceeds of this specific issue were usedto acquire the lease of certain land andbuildings from The Secretary of State forCommunities and Local Government(DCLG). The properties were then sub-leased back to DCLG in return for DCLGmaking periodic rental payments. Theserental payments are to be used by theissuer to fund its distributions to thesukuk holders.

Dissecting the UK Government sukukThe ground-breaking sukuk issuance by the UK Government last year, the first of its kindby a European sovereign state, seeks to position the UK as an international hub forIslamic finance and tap Shari’a compliant investors.

Summary Of Terms & Conditions

Issuer HM Treasury UK Sovereign Sukuk PLC

Issue Date 2 July 2014

Scheduled Dissolution Date 22 July 2019

Issue Price £200,000,000

Face Amount £100,000 and integral multiples of £1,000 in excess thereof

Rate 2.036%

Currency Pounds Sterling (£)

Form Global Certificate in Registered Form

Principal Paying Agent, Registrar andTransfer Agent

HSBC

Exchange London Stock Exchange

Governing Law English Law

“The issuance wasvery well received byinvestors and was heavilyoversubscribed”

10



The following diagram (simplified for the purposes of this article) illustrates the principal relationships between the parties and the cashflows of the structure.

IIM Treasury UK SovereignSukuk PLC (Issuer/Trustee)

Certificateholders HMT

cash flows

agreement/assettransfer

Subleaseof premises

Head Leaseof Premises

Premium forHead Leaseof Premises

Rent andSupplementary

Rent

Surrenderof unexpired

residue of termof Head Lease

Exercise Price

Appointment asServicing

Agent

Reimbursementof Services

Charge Amount(set-off againstSupplementary

Rent)

Issue ofCertificates

Proceeds ofissue

PeriodicDistributionAmounts

DissolutionDistribution

Amount

ProcurementUndertaking

DCLG(as Tenant)

DCLG(as Obligor pursuant

to the PurchaseUndertaking)

DCLG(as Servicing Agent)

DCLG(as Landlord)

First, the purchasers of the sukuk(Certificateholders) elect to pay the issueprice to HM Treasury UK SovereignSukuk PLC (Issuer/Trustee). TheIssuer/Trustee is a public limited companyincorporated in the United Kingdomspecifically to issue the sukuk andfacilitate this transaction.

The Issuer/Trustee must then use thepooled capital to fund its acquisition of a

99 year lease over plots of land andbuildings “(Sukuk Asset)” used forgovernmental purposes from DCLG.

After the purchase of the Sukuk Asset,the Issuer/Trustee has to hold the title tothe asset on trust for the benefit of theCertificateholders. This ensures that theCertificateholders have an undividedbeneficial ownership interest in the SukukAsset as declared by the Issuer/Trustee

pursuant to a declaration of trust. Thisbeneficial ownership of the Sukuk Assetalong with certain other documentationprovides the Certificateholders with aright to receive payments under it.

Next, the Issuer/Trustee shall sub-leasethe properties back to DCLG. Inconsideration, DCLG is to make rentalspayments to the Issuer/Trustee over thefive year life of the sukuk. These rental



payments are the source from which theIssuer/Trustee will pay theCertificateholders the periodicdistributions owed to them. TheCertificateholders will be owed thesedistributions as profits through theirbeneficial interest in the Sukuk Assetwhich is generating this income.

Finally, on the scheduled dissolution date,the Issuer/Trustee has the right to requireDCLG to purchase back the unexpiredterm that remains on the lease. TheIssuer/Trustee is to use this payment byDCLG to pay back the dissolutiondistribution to the Certificateholders.Again, the Certificateholders will beentitled to this payment as considerationfor the sale of the Sukuk Asset, to whichthey will have an undivided beneficialownership interest.

As this is the first sukuk issuance of itskind in the United Kingdom, it has a fewnotable features:

n The UK has been very active for thelast few years in creating a level playingfield between conventional instrumentsand their Islamic equivalents. A criticalaspect to this is the tax legislation forthe issuance of sukuk-al-ijara which isreflected in Schedule 61 of the Finance

Act 2009. A large amount of time wasspent manoeuvring through theframework and ensuring the structureand documentation complied withthese requirements so that thetransaction benefited from the varioustax reliefs. In effect the sukuk wastherefore treated the same as a UK Giltfor tax purposes.

n Whilst the primary obligor was theDCLG, and DCLG was the entity thatwas responsible for payment of therent under the ijara agreement andthe exercise price under the purchaseundertaking, HM Treasury agreed,through the procurement undertaking,that it would either perform theobligations of DCLG or would ensurethat DCLG was put in sufficient fundsfor DCLG to discharge its obligationsin a timely manner.

n Unlike a typical sukuk issuance, thistransaction utilises a Deed of Covenant.This allows the Certificateholders tohave direct recourse and enforcementrights against the HMT should theIssuer/Trustee fail to make paymentson maturity. A Deed of Covenant wasincluded because HMT wanted toensure that the sukuk holders weretreated the same as its UK Gilt holders,who do have direct recourse to HMT.

n Some governmental real estate issuesneeded to be addressed andtherefore intensive legal analysis wascarried out on whether or not thegovernment had a qualifying interestthat complied with both Shari’a andthe legislation. The Government entityalso had to have the capacity to dealwith its assets in the mannerenvisaged by the transaction.

Qudeer LatifPartner, Global Head of Islamic FinanceT: +971 4 362 0675E: [email protected]

Contributor

Conclusion

The UK Government’s first sukukissuance could be seen as a criticalturning point for Shari’a compliantcapital markets in Europe, extendingsukuk issuances beyond thetraditional hubs of the Middle East andSouth-East Asia. The Gilt structureused in this issuance means that thisissuance can be readily benchmarkedagainst conventional Gilt issuancesthough it will not be easily adaptableto corporate issuances. There isclearly a great demand for Shari’acompliant securities issued in Europeand further efforts from the UKGovernment may allow a UKcorporate sukuk market to developand truly establish the UK as aninternational hub for Islamic finance.

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Introduction

The RSA sukuk No. 1 Trust (the “Trust”)was established in South Africa on18 August 2014 by GMG CorporateFiduciary Services Proprietary Limited asits founder. On 29 August 2014, a Letterof Authority from the Master of the HighCourt in Pretoria, South Africa (Letter ofAuthority) authorised ZAR SovereignCapital Fund Proprietary Limited (the“Trustee”), a special purpose vehicleestablished in South Africa, to act asTrustee of the Trust in accordance withthe South African Trust Property ControlAct 1988. The Trust acts through theTrustee for the purposes of the issuanceof the Certificates and the entry into thetransaction documents.

Structure of the sukuk issuance

This issuance is structured as aparticipation in a sale and leaseback ofgovernment-owned infrastructureassets. The proceeds of the issuance ofthe Certificates were used by theTrustee to purchase from the Republic(acting through the Minister of WaterAffairs) a personal usufruct right incertain infrastructure assets located in

South Africa. These assets were leasedback to the Republic (as lessee) by theTrustee (as lessor) for the term of theCertificates and are to be repurchasedby the Republic upon redemption of theCertificates. The Certificates representan undivided beneficial ownershipinterest in the Trustee’s rights under thetransaction documents, which includesthe right to receive rental paymentsunder the lease and the right to receivethe purchase price for the repurchase ofthe assets upon redemption of theCertificates. Payments of rental underthe lease are intended to fund the profitdue under the Certificates on a bi-annual basis and the final rentalpayments under the lease, together withthe principal amount payable by theRepublic for the repurchase of theassets, are intended to fund theredemption amount payable underthe Certificates.

The Certificates are redeemable onmaturity, or prior to maturity upon theoccurrence of an event of default. Inaddition, should the assets whichunderpin the structure be destroyed in

whole, the Certificates shall beredeemed by the Trustee using theproceeds of insurance payable by theRepublic (as service agent) pursuant tothe terms of a service agencyagreement. While it is arguable from aSouth African law perspective that theTrust may be a collective investmentscheme, on the basis that it holds aninterest in immovable property, theFinancial Services Board of the Republicof South Africa (as the regulator ofcollective investment schemes in SouthAfrica) confirmed that the Trust fallsoutside the regulatory remit of theCollective Investment Schemes ControlAct, No. 45 of 2002 of the Republic ofSouth Africa and, therefore, an

Breaking new ground in Africa: SouthAfrica joins the global sukuk raceOn 24 September 2014, the Republic of South Africa (the “Republic”) issued itsinaugural sukuk – the first ever international sovereign sukuk offering from Africa. TheUS$500 million Trust Certificates (the “Certificates”), due 2020, were issued by ZARSovereign Capital Fund Proprietary Limited as Trustee of the RSA sukuk No. 1 Trust.They have been admitted to listing on the official list and admitted to trading on theregulated market of the Luxembourg Stock Exchange. This article considers thestructure and key features of the issuance and draws a comparison with other recentsovereign issuances of shari’a compliant securities.

Key points

n The Republic of South Africa hasissued its first sukuk in theinternational capital markets.

n The sukuk has been issued inaccordance with the provisions ofSouth African tax law enacted tofacilitate sukuk issuances.

n This issuance could be the catalystfor the development of an Africanasset-based shari’a compliantsecurities market.

“This issuance could be the catalyst to allow anAfrican asset-based securities market to develop.”



exemption from registration under theAct was not required.

Role of thecertificateholders’ Representative

An interesting feature of the structure isthe role undertaken by theRepresentative of the certificateholders(the “Representative”). Clearly intendedto replicate the role of a bond Trustee inEurobond or securitisation transactionsgoverned by English law, or by adelegate in a typical sukuk originated inthe Gulf, the Representative in thistransaction is provided with certain rightsand powers, such as the power to grantwaivers and agree amendments oncertain limited grounds (without theconsent of the certificateholders), thepower to make certain determinationsand to call meetings of certificateholders,and the power to enforce the obligationsof the Republic under the transactiondocuments in the interests of all ofthe certificateholders.

The Representative, however, is not aTrustee; its role is akin to that of aprotector of the certificateholders’ rightsand is appointed to perform certainfunctions for their benefit through certainfiduciary powers vested in it under theTrust deed. The Representative is alsogranted a separate power of attorney bythe Trustee to allow it to step into theshoes of the Trustee to enforce the rightsof the Trustee under the transactiondocuments in a default scenario. Upon adefault, the Republic is required under thepurchase undertaking to repurchase theTrustee’s personal usufruct right in theassets and to pay final rental amountsunder the lease. The role of theRepresentative is similar to the role of theRepresentatives in respect of the leasecertificates issued by Turkish sukuk

issuers under the recent Turkish sukuklegislation. The role of the Representativein the South African sovereign sukukissuance is, however, distinguishable fromthe sukuk recently issued by the Treasuryof the UK which (in line with the giltsissued by the UK Treasury), does notprovide for any collective representationof the interests of the investors.

Governing law of the sukuk issuance

The South African sukuk issuance issimilar to the first sovereign sukuk of theUK, on the basis that both werestructured using an onshore issuingTrust. The Trustee is an orphan specialpurpose vehicle and, like the founder ofthe Trust, is incorporated in South Africawhere the underlying assets are located.

Establishing the Trust in South Africa andobtaining authorisation of the Trusteefrom the Master of the High Court inPretoria, South Africa, meant that theTrust deed which established the Trusthad to be executed before the issuanceof the Certificates and was subject toautomatic termination provisions if theLetter of Authority was not subsequentlygranted. The Trust deed was amendedand restated prior to issuance, to providefor the final pricing information in theterms and conditions of the Certificates.

While the creation of the Trust in SouthAfrica was required to be governed bySouth African law, the governing law ofthe Certificates (in line with internationalstandards and expectations ofinternational sukuk investors) is Englishlaw. Accordingly, there is a splitgoverning law clause in the Trust deed,with the establishment of the Trust beinggoverned exclusively by South Africanlaw, and the Certificates themselves andthe sections establishing the role of the

Representative being governedexclusively by English law.

Interestingly, the establishment of theTrust in full compliance with South Africanlaw also results in the local segregation ofthe assets. However, in the context ofthis issuance, this feature has not beenused as a defining feature intended tostrengthen the credit of the Certificates,as the Certificates are intended toreplicate the classic asset-based (and notasset – backed) sukuk alijara typicallyissued in the Gulf and well familiar toMiddle Eastern investors.

Increasing appetite for shari’acompliant securities

Following in the footsteps of Hong Kongand the UK earlier this year, South Africa isamong the first predominantly non-Muslimcountries to issue shari’a compliantsecurities in the international capitalmarkets. The South African sukuk issuancewas more than four times oversubscribed,mirroring the high investor demand seenearlier this year for the UK Treasury andHong Kong issuances. This is indicative ofthe increasing appetite for both asset-based finance generally and sovereignshari’a compliant securities in particular.The issuance saw a particularly strongdemand from Middle East investors, wherethe demand for shari’a compliant securitiesis currently far outstripping supply.

Like the recent UK sukuk, the SouthAfrican sukuk represents a significantbenchmark for future sovereignissuances of shari’a compliant securitiesin the international market. Whatremains to be seen is what thisissuance will mean for South Africa andthe wider African continent. Unlike thegilt-based structure used in the UKsukuk, the structure of the South African

14



sukuk is readily adaptable for use byother domestic issuers – including bothbanks and corporates – and isrecognisable to foreign investors.Clearly, the continuing interest andsupport of the South Africangovernment will play a crucial role inachieving market growth in Islamicfinancing. It will also be interesting tosee if this issuance will lead to otherdomestic players following thegovernment’s lead in accessingalternative methods of funding.

Conclusion

This issuance could be the catalyst to allow an African asset-based securities marketto develop. Following the local currency issuances by Senegal and Gambia earlier thisyear, and now the South African international sukuk issuance, it is likely that otherAfrican governments may now consider shari’a compliant funding sources, looking inparticular to investment from the Middle East. While the different legal systems acrossAfrica may pose a challenge to achieving market consistency, and in the short termcertain African governments may favour smaller local currency issuances, the SouthAfrican sukuk issuance has gone a long way in demonstrating how flexible a sukukstructure can be in overcoming challenges under domestic law and in offering aplatform for financing that is both competitive and in high demand.

Rhona ByrneSenior Associate, DubaiT: +971 4 362 0734E: [email protected]

Stuart MasonLawyer, LondonT: +44 20 7006 4291E: [email protected]

Contributors

Stuart UrePartner, DubaiT: +971 4 362 0659E: [email protected]



In 2011, the participation bank KuveytTürk (after issuing a pioneering firstTurkish sukuk in 2010) issued the firstsukuk pursuant to newly enactedlegislation entitled the Principles on LeaseCertificates and Asset LeasingCompanies (the “First Legislation”). TheRepublic of Turkey then issued its firstUS$1.5 billion sovereign sukuk inSeptember 2012 which was followed bya US$1.25 billion sovereign sukukissuance in October 2013. The Republicof Turkey also tapped the local sukukmarket by issuing Turkish Liradenominated sukuk in 2012 and 2013,which proved to be another veryimportant milestone in the growth of theTurkish sukuk market. These issuancesmostly followed a traditional sale andleaseback model known as anijara structure.

The First Legislation allowed theformation of asset leasing companieswhich are special purpose vehiclesregulated by the Capital Markets Boardof Turkey (the “CMB”). Under the FirstLegislation the asset leasing companiesissuing certificates under an ijarastructure are incorporated specifically to

be able to issue certificates bought byinvestors (known as “certificateholders”)so as to purchase assets and lease themback to the originator. In essence, theasset leasing company finances theacquisition of such assets using fundsraised by the issue of certificates, andthe lease rental payments from theoriginator mirror the profit distributionsdue under the certificates. The cashflows from the lease rentals are thereforeused to service such profit distributionsto certificateholders.

The framework in which Turkish sukukare issued uses deliberately differentterminology, such as “asset leasingcompanies”, as opposed to “sukuktrustees” used in typical non-Turkishsukuk structures. The asset-based asopposed to asset – backed ijarastructure was originally the only type ofstructure allowed under the FirstLegislation. This opened the way forsukuk issuance in Turkey, and whilehighly useful, the ijara structure is notsuitable for certain types of financings,such as infrastructure projects, as anasset leasing company cannot purchaseand create a lease over an asset before

it is built. The sovereign sukukissuances were sought as thebenchmark by which to establish theTurkish sukuk market as a global hubfor Islamic finance. In addition to KuveytTü�rk, the three other Turkishparticipation banks (AlBaraka Bank,Bank Asya and Tu�rkiye Finans Bank)also issued sukuk both in the domesticand international markets. The globalcapital markets community has followedthe first sovereign and participationbank sukuk issuances with great interest

The emergence of the Turkishsukuk marketAs one of the new MINT economies and the 17th biggest economy in the world, theRepublic of Turkey has in recent years begun utilising shari’a compliant sukuk issuancesas a means of attracting some much sought after capital investment into the country,particularly from the Middle East where the demand for shari’a compliant securities is faroutstripping supply. Recent legislation in the Republic of Turkey has broadened thenumber of sukuk structures that are permitted, to allow the Turkish sukuk market toexpand. For the first time these new structures will permit corporates and othernon-financial institutions to issue sukuk and may attract investment into areas such asinfrastructure projects, which is becoming one of the key areas of focus for the Turkishgovernment. This article considers the new structures and the legislative framework.

Key points

n Recent legislation in the Republicof Turkey has opened up theTurkish sukuk market tonon-financial institutions, includingcorporate, for the first time.

n The recent legislation has alsopaved the way for new types ofsukuk structures to be used, so asto attract new capital investmentinto the country.

n The Turkish government is keen forthe Republic of Turkey to becomea global hub of Islamic finance.

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and the desire to allow non-financialinstitutions to issue their own sukuk wasgiven legislative support, in the recentCommuniqué on Lease Certificates(III-61) issued on 7 June 2013 (the“Second Legislation”) partly thanks tothe CMB’s great effort and willingnessto improve and develop the sukukmarket in Turkey. The Turkishgovernment has also announced that ithopes to grow the participation banks’market share and has announced itsintention to grant a participating banklicence to at least one of thestate – owned banks, whichdemonstrates the growing importanceof Islamic finance in the country’s widerfiscal strategy and the Turkishgovernment’s desire to bring newplayers into the market.

In addition to the by now establishedownership or ijara structures allowedunder the First Legislation, the SecondLegislation also allowed asset leasingcompanies to issue lease certificatesbased on management (mudaraba),purchase and sale (murabaha),partnership (musharaka) and contractoragreement (istisna) structures. While it isexpected that the initial sukuk issuedfollowing the Second Legislation willfollow the ijara model, the SecondLegislation allows the possibility tofinance a much wider range of projectsand businesses.

Under the management, or mudaraba,structure certificates are issued for thepurpose of transferring the incomegenerated from the management of theassets of an originator, including via alease of assets owned by suchoriginator, to certificateholders duringthe term of the sukuk. In this structurean agreement will be executed betweenthe originator and the asset leasing

company to govern the management ofthe assets of the originator withouttransferring the ownership.

The musharaka model is in essence ajoint venture structure between theoriginator and the asset leasing companywhereby the originator retains a role asmanaging agent and shares in the lossand profits of the structure with thecertificateholders. The SecondLegislation regulates the financing of thejoint venture through the issuance ofcertificates whereby the asset leasingcompany exclusively contributes capitaland other parties contribute othertangible capital.

The murabaha model can be used insituations where there are no tangibleassets in the underlying structure andthe proceeds of a certificate issuancecan be used to fund the purchase ofcommodities and the asset leasingcompany can on-sell the commoditiesto the originator to generate revenuefrom the deferred purchase price whichis then distributed periodically to thecertificateholders during the term ofthe sukuk.

Of particular interest is the istisnastructure, which could be used to financeinfrastructure projects such as airports ormotorways. The istisna structure worksby means of a forward lease agreement,whereby capital is provided to purchasethe initial raw materials or land involved ina project and the forward leaseagreement provides that the eventuallycomplete asset is sold and leased backto the originator and such profitdistributions from the asset aredistributed to certificateholders much likein an ijara structure. While there is somedebate among shari’a scholars as towhether certificates can be used before

the project is finalised, it is clear that thisparticular structure has great potential tobe used to finance some of Turkey’sfuture infrastructure projects.

The need for a valuation report undercertain structures is one of the mostimportant aspects that the SecondLegislation has introduced, which isespecially important for originators toconsider, in that it regulates the value ofthe asset portfolio on which theissuance is based. The SecondLegislation provides that the issuanceamount of lease certificates based onownership (ijara), partnership(musharaka) or contractor agreement(istisna) structures may not exceed 90%of the fair value of the underlying assetsdetermined under a valuation reportprepared by a valuation company. Thisensures that such issuances aresufficiently covered by the assets uponwhich they are based, and affords somereassurance for certificateholders shouldsuch a structure go into default.Originators considering entering theTurkish sukuk market will therefore needto ensure that they have sufficientassets on which to base their issuance.Not only will such originators need tosatisfy the requirements of the valuationreport, they will also need to ensure thatthe assets on which the issuance isbased are shari’a compliant.

The asset leasing companies at thecentre of the Turkish sukuk market areunlike special purpose vehicles found intraditional securitisations or in othersukuk markets, in that they can issuemultiple sukuk and can issue certificatesfor companies other than the companywhich was incorporated to issue them.However, the Second Legislation makesit clear that the entities listed in (d), (e),(f) and (g) below can only establish



asset leasing companies if they areactual fund users and cannot establishon behalf of third parties. The SecondLegislation has listed the entities beingallowed to establish an asset leasingcompany as:

(a) banks;

(b) intermediary institutions engaged inone of the following: (i) portfoliointermediation; (ii) general custodianservice; or (iii) underwriting;

(c) mortgage financing institutions;

(d) real estate investment trusts listed onthe stock exchange;

(e) public companies in the first andsecond groups determined inaccordance with corporategovernance regulations of the CMB;

(f) companies issued with a long – terminvestment grade rating; and

(g) companies of which 51% or more isowned by the Undersecretariat ofthe Treasury.

The Second Legislation does not clarify ifthe investment grade referred to in limb (f)above needs to be obtained from aninternational rating agency, although theCMB has approved local Turkish ratingagencies’ ratings on recent sukukissuances, in respect of this requirement.It is also assumed that the rating onlyapplies at the moment of issuance, asthe Second Legislation is silent as towhether such investment grade ratingneeds to be maintained by such assetleasing company.

The asset leasing companies are alsounlike other special purpose vehiclesin that they are heavily regulated bythe CMB.

The Second Legislation principallyrequires the CMB to approve the articlesof association of an asset leasingcompany before it can issue sukuk. Inaddition, the CMB’s approval is requiredin the following circumstances:

n where the asset leasing company isparty to a merger and de-mergertransaction and amends its articlesof association;

n where any acquisition of shares thatresults in the acquisition of shares byone person directly or indirectly,representing 10% or more of thecapital of an asset leasing companyor where by virtue of a shareacquisition the shares held by oneshareholder exceed or fall belowcertain percentages of the assetleasing company’s capital; and

n where there is a transfer of sharesgranting management orvoting privileges.

In addition, pursuant to the SecondLegislation, an asset leasing companymay not:

n engage in any activities other thanthose indicated under its articles ofassociation as approved by the CMB;

n grant any property rights in favour ofthird parties over its assets and rightsother than as permitted under itsarticles of association;

n dispose of such assets and rights inany way which prejudices theinterests of the certificateholders; and

n use any loans, be indebted or useany assets except for such activitiesset out in its articles of association.

The CMB also provides that the assetleasing company is to have at least

three board members, one of whichmust be an independent board memberwho satisfies the CMB’s independencycriteria and certain decisions are subjectto the vote of such board member. Theboard of directors of the asset leasingcompany is required to preparequarterly investor reports which shallinclude revenues and collections madefrom the relevant assets and paymentsmade to the certificateholders.

As asset leasing companies can issuemultiple sukuk, the importance ofsegregating assets to minimise theinsolvency risk and the risks ofcross-default is paramount. The SecondLegislation also sets out that separaterecords are to be kept in respect of theassets which are subject to eachissuance, including the revenuesgenerated, the collections made and theexpenses incurred with respect thereto.The assets, rights and liabilities of eachissuance for each company areseparately monitored in the records ofthe asset leasing company and untilcertificates are redeemed, assets in theportfolio of an asset leasing companymay not be disposed of, collateralised orseized. It is important to bear in mind,however, that unlike special purposevehicles used in non-Turkish sukuk, theasset leasing companies are not entirelyinsolvency remote by virtue of the factthat they hold assets on behalf ofdifferent companies. However, under theSecond Legislation, until the redemptionof the certificates occurs, the assets andrights included in the portfolio of theasset leasing company cannot beincluded in the insolvent company’sestate nor can they be subject to aninjunction order.

Along with the First Legislation,amendments in the tax legislation have also

18



afforded certain tax advantages on sukukwhich means that corporates wishing toraise finance through the sukuk market willbe able to raise finance in a way which iscompetitive with traditional finance raisingand could open them up to a currentlyunavailable investor pool, such as certaininvestors from the Middle East who canonly purchase shari’a compliant securities.Below are some of the key tax advantagesof the sukuk that have been recentlypassed pursuant to Turkish tax legislation:

n Pursuant to the Corporate Tax Law(Law No 5520), any capital gains tobe derived by an originator from thesale of an asset portfolio to an assetleasing company and from an assetleasing company to an originator areexempt from corporate tax on thecondition that such sales are onlymade for the issuance of thecertificates by the asset leasingcompany. In order to benefit fromsuch exemption, the capital gainsderived from such sales must bereserved in equity as a fund which isnot to be distributed for five yearsand the sale proceeds must becollected in cash within atwo-year period.

n Under the VAT Law (Law No 3065),the delivery of certificates is exemptfrom VAT. In addition, the transfer of

assets to an asset leasing companyas well as the lease of assets by anasset leasing company and transferto the originator are exemptfrom VAT.

n Pursuant to the Charges Law (LawNo 492), the sale of the assetportfolio in a sukuk is exempt fromthe Title Deed Registry Fee andother fees.

n The Income Tax Law (Law No 193)requires withholding tax from theinterest income received under thecertificates issued abroad. However,the rate of such withholding tax isreduced to 0% for such certificateswith a maturity of five years, as istypical for a sukuk.

n Pursuant to the Stamp Tax Law(Law No 488), the transfer of assetsto an asset leasing company, thetransfer of such assets by an assetleasing company to the originator,documents issued with respect tothe lease and the certificates are allexempt from Turkish stamp tax. Anon-resident holder will also not beliable for Turkish inheritance,registration or similar tax or dutywith respect to its investment inlease certificates.

Currently, the tax legislation has mainlybeen applied to the ijara structured sukukand it may be that further tax legislationwill need to be enacted to encourage theuse of the other structures that have beenintroduced by the Second Legislation.

The Turkish government is very keen touse Islamic finance as a means ofattracting investment into the country,particularly from the Middle East, and theinitial sovereign issuances were manytimes oversubscribed. There are certaintax advantages of using sukuk to raisefinance and both the First Legislation andthe Second Legislation have beenenacted to create a framework by whichdifferent shari’a compliant structures canbe utilised and are specifically designedto allow new players to enter the market.While it is clear that there are excellentopportunities in the Turkish sukukmarket, there are a few challenges thatnew entrants into the market may face,including understanding the scope andlimitations of Islamic finance and thedifficulties in reconciling the newstructures with existing Turkish capitalmarkets and tax legislation. Once theseobstacles are addressed and the newstructures become tested andestablished, Turkey is perfectly placed tobecome a global hub of Islamic finance.

Müfit ArapoğluCounsel, IstanbulT: +90 212 339 0052E: [email protected]

Contributor



Contacts

Louise KearySenior Associate, LondonT: +44 20 7006 1249F: +44 20 7006 5555E: [email protected]

Elizabeth FortuneSenior Associate, LondonT: +44 20 7006 4837F: +44 20 7006 5555E: [email protected]

Claudio MedeossiDirector, LondonT: +44 20 7006 2341F: +44 20 7006 5555E: [email protected]

Bruce KahlPartner, LondonT: +44 20 7006 2419F: +44 20 7006 5555E: [email protected]

Mustapha MourahibPartner, CasablancaT: +212 52013 2081F: +212 520 132 079E: [email protected]

Debashis DeyPartner, DubaiT: +971 4 362 0624F: +971 4 362 0445E: [email protected]

Stuart UrePartner, DubaiT: +971 4 362 0659F: +971 4 362 0445E: [email protected]

Simon SinclairPartner, LondonT: +44 20 7006 2977F: +44 20 7006 5555E: [email protected]

Habib MotaniPartner, LondonT: +44 20 7006 1718F: +44 20 7006 5555E: [email protected]

Katherine HensbySenior Associate, LondonT: +44 20 7006 8118F: +44 20 7006 5555E: [email protected]

Matthew FaircloughPartner, Hong KongT: +852 2825 8927F: +852 2825 8800E: [email protected]

Adrian CartwrightGlobal Practice Area Leader for CapitalMarkets, LondonT: +44 20 7006 2774F: +44 20 7006 5555E: [email protected]

Kelwin NichollsPartner, LondonT: +44 20 7006 4879F: +44 20 7006 5555E: [email protected]

Qudeer LatifGlobal Head of Islamic Finance,Partner, DubaiT: +971 4 362 0675F: +971 4 362 0445E: [email protected]

Jennifer LovettLawyer, LondonT: +44 20 7006 4110F: +44 20 7006 5555E: [email protected]

Müfit ArapoğluCounsel, IstanbulT: +90 212 339 0052F: +90 212 339 0099E: [email protected]


Claire BarkerSenior Associate, DubaiT: +971 4 362 0732F: +971 4 362 0445E: [email protected]

Rhona ByrneSenior Associate, DubaiT: +971 4 362 0734F: +971 4 362 0445E: [email protected]

Mark DickinsonSenior Associate, DubaiT: +971 4 362 0695F: +971 4 362 0445E: [email protected]


Stuart MasonLawyer, LondonT: +44 20 7006 4291F: +44 20 7006 5555E: [email protected]

Eileen KerrAssociate, DubaiT: +971 4 362 0724F: +971 4 362 0445E: [email protected]

Ian ConveyLawyer, LondonT: +44 20 7006 1809F: +44 20 7006 5555E: [email protected]

Xuan JinSenior Associate, DubaiT: +971 4 362 0696F: +971 4 362 0445E: [email protected]

Brian O’LearyAssociate, DubaiT: +971 4 362 0749F: +971 4 362 0445E: [email protected]

Alekhya PrakashAssociate, DubaiT: +971 4 3620 3688F: +971 4 362 0445E: [email protected]

Nirmalya GangulyLawyer, LondonT: +44 20 7006 3178F: +44 20 7006 5555E: [email protected]

Hajar BarbachSenior Associate, DubaiT: +971 4 362 0750F: +971 4 362 0445E: [email protected]

Shauaib MirzaSenior Associate, DubaiT: +971 4 362 0726 F: +971 4 362 0445E: [email protected]

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Notes


Clifford Chance LLP is a limited liability partnership registered in England andWales under number OC323571.

Clifford Chance LLP is a limited liability partnership registered in England & Walesunder number OC323571. Registered office: 10 Upper Bank Street, London,E14 5JJ. We use the word ‘partner’ to refer to a member of Clifford Chance LLP,or an employee or consultant with equivalent standing and qualifications.

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