Conducting business with companies in Arab countries

2 min.

Trading with Arab countries has become quite common these days. When conducting business with foreign companies, there is always a chance that your customer does not pay. All is well, until it becomes apparent that your business partner has flown the coop. He cannot be located or it becomes evident that he is unable to pay your invoices. What might you consider when doing business with an Arab country?

As is usual in the Western business world, it is sensible to gather as much information on the person or company you are going to do business with before you enter into a commercial agreement. Approaching the local Chamber of Commerce* is a good first step. This allows you to check whether all information is correct, and you can enquire whether your business partner has been liquidated or not. If you do not speak French or Arabic, using a certified interpreter and/or translator is advisable. This would prevent lack of clarity due to a language barrier.

Drafting an agreement

A second step would be entering into a written agreement with your business partner at a local civil-law notary. This allows you to safeguard your interests. It may also have a psychological impact on your business partner. After all, this puts him under an obligation to pay the due amounts on time and to act in good faith. If things go wrong after all later on, your partner will know that he will be tackled rigorously with all the associated consequences. For bailiffs in the Arab countries are not congenial people. Such an agreement is very common in Algeria, for instance. The costs and who will be paying these costs is decided in joint consultation.

When there is no payment

What happens in the unlikely event that something goes wrong after all because your business partner refuses to pay or cannot be located? If payment is not forthcoming, you cannot just engage the services of a bailiff in the Arab countries. A judgment from a Court is a requirement. Such proceedings are always conducted by a specialized attorney-at-law. Your chances of success are high if this attorney speaks the language of the debtor. An attorney who speaks Arabic is familiar with the procedure and knows the laws, language, and mentality of the country. This way, you ensure that collecting the amount outstanding does not become one thousand and one nightmares.

It does not usually get that far

In actual practice, however, it turns out that business partners feel obliged to pay their debt. Fear of a bad reputation plays a role, for example. In addition, it is common that debtors are supported by their community. Family and friends collect money or act as an intermediary between the debtor and the creditor. People try to avoid legal action and attempt to reach an agreement. A debt recovery attorney is viewed as a last resort.

At Bierens, you can count on optimum worldwide support by the best national and international attorneys and paralegals. Me Ibtissem Garram has specialized in French, Algerian, and Arab law. She handles debt recovery in French and Arabic speaking countries.

Arab countries: Algeria, Bahrain, Egypt, Iraq, Yemen, Jordan, Kuwait, Lebanon, Libya, Morocco, Mauritania, Oman, Palestinian Territories, Qatar, Saudi Arabia, Sudan, Syria, Tunisia and the United Arab Emirates.

*Google for instance on التجاريّة الغرفة (Arabic), Chambre de Commerce (French), or Chamber of Commerce (English) in combination with the name of the country.