A financing involving an African business or project can cross several legal systems before a single document is signed.
The lender may be based in Europe or the Middle East. The borrower may operate in Southern Africa. Assets, guarantors and security may sit across several African jurisdictions. Yet the loan agreement may be governed by English law, without the transaction itself having any other connection with England.
This is not unusual. English law remains deeply embedded in international commerce and financial transactions. The Law Society of England and Wales, in its research on the international legal services sector, estimates that around 40% of global business and financial transactions are governed by English law.
Why English law remains prominent
International financings require a contractual framework capable of dealing with complex rights and obligations between parties that may have little connection with the same domestic legal system.
English law has developed a substantial body of commercial and financial precedent. Its courts have consistently upheld freedom of contract and the enforceability of terms agreed between sophisticated commercial parties, contributing to the predictability sought by lenders, investors and other participants in international transactions.
There is also an established body of standardised market documentation built around English law, including the widely used facility agreement templates published by the Loan Market Association (LMA). For example, in 2024, the LMA published a multi-jurisdictional African facility agreement governed by English law and designed for structures involving borrowers or guarantors in jurisdictions including Ghana, Kenya, Mauritius, Nigeria, Tanzania, Uganda and Zambia.
Relevant transaction types
For institutions operating across multiple countries, that familiarity can be particularly valuable. Lenders may prefer a broadly consistent documentary framework rather than bespoke documentation for every transaction or jurisdiction.
Project finance transactions in energy, infrastructure and mining are a natural fit, particularly where multi-jurisdictional security packages are common.
Trade and commodity finance is another relevant category, given the standard use of English-law documentation and the frequency of African borrowers in these markets.
Syndicated lending also falls squarely within this model, as the LMA framework applies directly and provides a common language for lenders in different jurisdictions.
Development finance is similarly relevant, as development finance institutions often require English-law documentation while financing projects across multiple African countries.
The choice of English law can therefore form part of a wider approach to documentation, risk allocation and transaction management.
English governing law does not remove the local law questions
Choosing English law for the loan agreement does not make the other jurisdictions involved in a transaction disappear.
Consider a financing involving an English law governed loan agreement, a South African borrower, a Namibian subsidiary and security over assets located in another African country.
The contractual obligations under the loan agreement may be governed by English law, while local law applying to the borrower or its assets determines issues such as whether security has been validly created and perfected, whether regulatory approvals are required, whether exchange control requirements apply and what happens if enforcement or insolvency proceedings follow.
Corporate authority, financial assistance rules, taxation and sector-specific regulation may introduce further local considerations.
Cross-border finance therefore requires the governing law analysis and the local law analysis to work together.
The quality of the transaction depends not merely on drafting a sound loan agreement but on ensuring that the various legal components of the structure are compatible.
Coordination becomes part of the legal work
The more jurisdictions involved, the more important coordination becomes.
English law counsel may be responsible for the principal finance documentation while local advisers address security, regulatory requirements and enforceability within their respective jurisdictions.
Someone must then ensure that the conditions precedent, legal opinions, security requirements and closing process operate as a coherent whole.
For African transactions, there is an obvious advantage in English law advisers understanding the environment in which the underlying financing will be implemented.
That includes recognising that the legal analysis cannot stop at the governing law clause.
Exchange control regimes, security registration requirements, public sector rules, financial regulation and differing insolvency systems can all affect the structure and execution of a financing.
The delivery model is changing
Historically, the inclusion of English law documentation in a major African transaction could naturally lead parties towards London-based legal advisers.
However, it is no longer the only model.
English-qualified lawyers increasingly practise outside England and Wales, and sophisticated financial markets such as South Africa provide a base from which English law expertise can be combined with extensive African transactional experience. According to the Law Society’s annual statistics, approximately 11,000 solicitors were recorded as practising outside the United Kingdom in 2024.
For clients, the relevant question becomes one of capability rather than geography.
Does the legal team understand the English law documentation? Does it understand the financing product? Can it identify the issues that arise when that documentation meets different African legal systems? Can it work effectively with local advisers and keep the transaction moving?
These are increasingly the questions that determine how cross-border finance work is resourced.
Building the right legal team around the transaction
For banks, investors, borrowers and project sponsors operating across Africa, the opportunity is to assemble legal teams around the requirements of the financing itself, drawing together English law expertise, local regulatory knowledge and practical experience of executing transactions across the continent.
English-law finance expertise delivered from South Africa, supported by strong African networks, offers clients a cost-effective, capable and practically grounded solution for cross-border African financings.
Pieter van Welzen is a Consultant Attorney in the Banking & Finance practice at Thomson Wilks. An English solicitor and Dutch advocaat, he has more than 35 years of experience advising on banking and finance transactions across African and international markets.
Clients considering a cross-border African financing are invited to discuss how this combination of English-law expertise and African experience may support their transaction.
For further information, please contact Pieter van Welzen at Thomson Wilks.
