I WENT TO KAZAKHSTAN BY ACCIDENT – AND STAYED!

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Well, not really by accident, such as by boarding the wrong airplane; and I didn’t stay forever as I left Almaty when it was time to go home to retire.

But it also would be quite wrong to say that I went to Kazakhstan with the intention to practice law there.

Some background will be useful at this point.

For some years, I was the partner in charge of the London office of Faegre & Benson, a law firm with its head office in Minneapolis.  I had joined the firm when it was in an expansion mode, including on the international side.

During the course of 1992, I was included in a number of exchanges of fax messages and in telephone calls dealing with Kazakhstan, not as an active participant in what was going on but more than just as an auditor.

What was going on was this:  An important individual from Kazakhstan, Bektas Mukhamedzhanov – who spoke little or no English – had come to Minneapolis, 12 time zones away from Almaty, to try to persuade some accounting firms and law firms to set up shop in Almaty.  He knew that the local professionals in Kazakhstan were not at that time up to the task of representing major league global companies, so his objective was clear.

One might think that Minneapolis was not the optimal place to recruit professional firms.  Why not New York City, or Chicago?  Los Angeles?  The reason was that, unlikely as it may have seemed at the time, a Kazakh student was attending the University of Minnesota, and he, unlike Bektas, spoke English as well as Russian and Kazakh.  In short, Bektas had selected Minneapolis because that was a city where he would be able to cope.

That student managed to set up some meetings, including one at Faegre & Benson.  The two Kazakhs caught the firm at the right moment.  Although Almaty – Alma-Ata at that time – could have been seen at that time as a small league player for international legal business, to Faegre’s management there was an important allure attached to being the first international law firm to set up shop there.  It might be debatable, of course, as to whether or not this was sound strategic decision making.

Management endorsed the idea of taking a look and so it happened that visits were made from Minnesota to Almaty to scout out the prospects. Travel then was via Moscow – there were no direct flights from Europe to Almaty.  And all visas were issued by Russian Embassies on behalf of the recently independent Republic of Kazakhstan.

A special constitutional conference was convened in Almaty to take advantage of the presence of the visiting lawyers from Minnesota.  Faegre & Benson laid on their ace constitutional lawyer, John French, who had experience of arguing cases before the U.S. Supreme Court.  Although the travellers were delayed in Moscow due to a snow storm, the constitutional conference was rescheduled in order to accommodate their late arrival in Almaty.

Our delegation included Iliana Haleen, a lawyer in our Frankfurt office who, being Bulgarian and by virtue of her education, spoke excellent Russian.  In Almaty, they met additional influential people, and the omens seemed to be coalescing around a favorable management decision to set up an office in Almaty.

Michael Murphy headed up our International Team, and was point man on this project of possibly opening an office in Almaty.  He enlisted fellow Minneapolis partner Peter Halls as his candidate to be in charge of the proposed Almaty office.  Peter had studied the Russian language in Saint Petersburg, was well known to management, and was willing to take up the challenge.

Peter made his own trips to Almaty to further scout out the situation.  He found a possible office site as well as an apartment that could be used, and he submitted the registration application to Ministry of Foreign Economic Relations, being the office for registering representative offices of foreign companies.  That was in October 1992.

Then things started to unravel.  Upon his return to the United States, Peter encountered compelling family reasons to bow out of the project.  That was accepted by management but it did leave them with a problem on their hands.  They had expended a lot of time and money, as well as ego, in the project; the invitation and welcome were still there in Almaty to be accepted; but the firm didn’t have another suitable candidate in Minneapolis to send to Almaty.

That is when I received the phone call asking if I would be willing to go to Almaty to “give another opinion” about the feasibility of opening an office there.  Mike Murphy would come to London, and the two of us would collect Iliana Hallen in Frankfurt, and then make a new survey of the situation.

Well, this all sounded interesting to me.  I had been working for the past few years on projects in Yugoslavia, Poland, and Czechoslovakia (the spilt-up came later, on January 1, 1993) dealing with Communist regimes (and their successors) in languages that I could not understand and with legal systems that had not yet adapted to the open market economy way of doing business.  Yet somehow the deals were being concluded.  I mean major hotel investments, joint ventures and the like.  Our managers, in thinking about an Almaty office, probably figured that I already had a higher degree in working in impossible situations.

Of course I had been having a good time in the Eastern European countries.  Yugoslavian slivovitz (plum brandy) goes down nicely, particularly when on a riverboat restaurant on the Sava River just before it joins the Danube.  Might be followed by some chorba (fish soup) or some zander fish.  Warsaw too had its delights, with vodka invariably available to guests.  I was surprised to find myself eating lobster there on one occasion.  In Prague, beer was the natural and national choice though svarak (hot wine) was popular in winter.

It hadn’t dawned on me when I took that first trip to Almaty that I was really being invited to take over the formation and management of an office that did not yet exist.

Mike Murphy came to London and we waited for our visas to be issued by the Russian Embassy.  Day after day we waited.  Finally, Mike said he would have to return to Minneapolis on Friday if our visas didn’t arrive on Thursday.  He left early on Friday – unaware that that would also be the day on which our visas were ready to be collected.  Shortly thereafter, Iliana and I were on our way to Almaty. We arrived early one morning late in January 1993.

Of course I have unforgettable memories of arriving there for the first time.  There was an abundance of snow on the ground, reminding me of the Midwest in America where I grew up.  The sky was overcast – wintry, not smoggy at all.  We were escorted to our hotel, the exclusive Residence Number 3 of the Supreme Soviet, a short walk away from the Dostyk Hotel.

We had a number of meetings with government officials and larger business establishments.  I quickly saw that, as in Poland and Yugoslavia, you could assess the importance of the government officials we met by the number of telephones on their desks.  A few even had dedicated direct lines to the president.

I was shown the office premises that Peter had seen, and the apartment.  They could serve our purposes but the office was not very inviting for clients and potential clients due to its inaccessibility.  Another site proved much better, on Seifullin Street close to Abai Avenue.

To get a view on business prospects from a non-Kazakhstani source, I went to the U.S. Embassy to see Craig Karp, the Commercial Attaché.  While waiting to get past the guards at the U.S. Embassy, I overhead an American voice – not so unusual in front of an American Embassy I suppose but it was possible to believe at that time that I was the only American in town.

The speaker turned out to be Karen Wydess, the representative of CEELI (the Central and Eastern European Law Initiative) which was sponsored by the American Bar Association.  I asked Karen if she knew of any local lawyers with commercial law experience who also spoke English. Her prompt answer was that there was a single person with those qualifications, and I soon met her and discussed her possible employment. But that was later that day or the next day.  I did meet Craig Karp and he was, to me, surprisingly pleased to see me because he wanted to refer a legal case to someone – anyone – and I was the only candidate.

A local trading company – Alexei Postovolov JSC – had ordered a supply of the current year’s fashion of clothing and shoes in the normal range of sizes from a firm in the United Kingdom.    What they got instead was a badly packed and wet container of last year’s fashion in all the sizes that had not sold in that year.  You know, enormous blimp things and small petite sizes.

Under the trading conditions at that time, the company had paid in full in advance for the goods because letters of credit were not then issued by local banks.  Thus, there was no way that the importer could stop payment on the basis that the goods did not conform to the contract.  I visited the company and immediately had a client who, in my presence, ordered the transfer of U.S. dollars to our English bank account as a retainer.

Well, management was thrilled to read my report when I arrived back in London.  I had found satisfactory offices that were free of charge for nine months; a local lawyer who spoke English, plus another lawyer who had taught at the law school; and a client with a legal problem and the ability to remit dollars abroad to pay for a solution.  (Up to that point, we had been worried that we could only receive inconvertible Russian rubles which were still being used in Kazakhstan.)

The message from management to me:  “Go for it!”

“Go for it?”  “Me?”  I only went to Almaty in order to give a second opinion about the continuation of the project, not to take charge of it.  But, no, management now looked to me to make something out of their project.

Well, business in London was a bit soft for us at that time, and I had support for my continued management of the London office while also supervising the Almaty office.  Which is another way of saying that no one in management would object if I flew a lot on the airlines. And that I certainly did, at least until we had developed a steady client base.  When that happened, I relinquished my position as head of the London office though I continued to have some UK-based clients.

Over a period of about 13 years of practicing law in Almaty, I made more than 80 round trips from Europe to Kazakhstan.  Let’s see, at about 7 hours of air time per trip that means I spent about 1,120 hours, or nearly 47 full days and nights, on an airplane!  And the distance traveled must have been something like 560,000 miles (895,680 kilometers).  In the call of duty, I also made several trips from London to Minneapolis, a few trips to Washington, D.C., one to Paris, and a few to Moscow.  Phew, I ought to be exhausted.

Near the end of my stint in Almaty, I overheard part of the conversation of two young Kazakh lawyers.  You know, your ears tune in when your name is mentioned by others.  One of the local lawyers had said my name and referred to me as “the grandfather of international law in Kazakhstan.”  I hadn’t really thought of it that way!  However, I undoubtedly had been a trailblazer.

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Book Sales:  Find more information and stories about Kazakhstan and its people from the 1990s and later in my book, West Meets East in Kazakhstan.  It’s available online in softcover or e-book format from AuthorHouse (the publisher), or Amazon or Barnes & Noble.

Website:  My blog posts go out on Facebook and sometimes on LinkedIn.  If you’d like to see them again or check for posts you might have missed, go directly to my website: viewkazakhstan.com

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Consultancy:  Although I currently am trying to ensure that my book gets maximum exposure, the fact is that writing and publishing are sidelines for me.  My main focus is assisting foreign companies to engage in business in Kazakhstan (or elsewhere in Central Asia) and assisting businesses and individuals in Kazakhstan with their projects outside of Kazakhstan.

Based on my long career as a lawyer and my time spent in Kazakhstan, I take on projects in a wide range of industries, certainly in oil & gas, banking & finance, and minerals.  But such a statement insufficiently acknowledges the many spheres in which I have had experience – commercial trading, manufacturing in several areas, transport, directorships of companies listed on the London Stock Excange, shipping, and many more.

For further information, contact me at tom.johnsongx@gmail.com and at +44 1753 885955.

 

 

 

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