The Nikčević & Kapor Law Office was founded in 2019 and is today focused on the sectors of construction, energy and real estate, while it also specialises in the use of FIDIC contracts and resolving international disputes
Our interlocutor and his firm place a great emphasis on arbitration as a way of resolving disputes. They are proud of their vast experience of working with large construction projects from more than 20 countries, and particularly proud of the trust and solid reputation that they enjoy among clients.
How specific is the construction sector from a lawyer’s perspective and does our market differ from others in the region?
The construction sector has always been among the biggest challenges for companies – and not just foreign companies, but rather also domestic ones. That is also the case now, because projects are increasingly diverse and specific, especially in the infrastructure and energy fields.
Foreign companies have taught us that legal and administrative risks are just as important as technical, financial and all other risks. That’s why law offices are today increasingly engaged as early as the planning stage, even on smaller projects. On the other hand, legal services have evolved, such that specific advice is increasingly being sought on projects, particularly more complex ones, and that relates not only to knowledge of regulations, but also of international standards like FIDIC contracts, with the daily management and administration of projects, and the resolving of disputes in a faster and more efficient way. The situation is the same or similar around the region, at least from a legal standpoint.
To what extent are FIDIC contracts applied in our country and is our market keeping pace with the world on this issue?
FIDIC contracts are no longer an unknown tool and are applied in almost every project that’s more demanding. This implies the daily administration of copious correspondence regarding various events unfolding both on and off construction sites. Disputes are recognised even in the earliest stages. A legal advisor is expected to react quickly and recognise the risk of a specific situation, which in practice demands an understanding of the construction cycle, commercial and technical aspects, but also the logic of project management. What’s most important is that you are expected to be understand by other members of the team. That’s because a live project ordinarily doesn’t allow a lot of time for considerations, but rather calls for the swift resolving of problems. A decision must be made and responsibility taken.
Students of the University of Belgrade Faculty of Law have been at the top of international arbitration competitions for decades, precisely because they are led by top experts
It is interesting that lawyers are in the minority during project implementation, as they are surrounded by engineers. However, the situation reverses and engineers are in minority at large arbitration hearings, surrounded by lawyers. And it isn’t easy for anyone when witnesses testify and every word of project correspondence is considered.
How common is it for disputes to arise on major construction projects and, in this sense, is Serbia a favourable market for foreign companies?
Disputes arise often, but are resolved in an ad hoc manner, and – at least when it comes to FIDIC projects – there are specific contractual mechanisms that aim to resolve disputes in an efficient way, in parallel with the implementation of the project. The most complicated situations can certainly develop into complex international disputes. Arbitration is recommended for resolving such disputes, which also most commonly occurs in practice, first and foremost because they are organised with the much greater participation of the parties involved than is the case with court processes. The opposing parties can choose their own arbitrators, with whom they are familiar or who they presume are experts in the specific area of dispute.
There are numerous other advantages, the most important of which are perhaps efficacy and the speed at which solutions are reached. It is, however, important where arbitration takes place, because the effectiveness of arbitration also depends on the national market. Our market boasts top arbitration experts who enjoy an excellent international reputation. Also supporting this claim is the fact that students of the University of Belgrade Faculty of Law have been at the top of international arbitration competitions for years, and perhaps even decades, precisely because they are led by top experts. This is a source of pride for all of us. Practice certainly shows that there is room to improve in this field when it comes to the local judiciary, which is compelled to apply foreign arbitration decisions under certain conditions.
You have personally, along with some of your colleagues, amassed a wealth of experience as in-house lawyers on projects from different countries. Is legal advocacy an even greater challenge?
Some domestic construction companies have participated in major projects abroad, and the knowledge and experience of our companies have proved competitive when it comes to global construction brands. You need to see that in practice in order to become aware of it and you need to be comfortable – when confronting strong opponents – with your own stance that you consider correct. Our partner Vlado Kapor, a majority of my colleagues and I have had the good luck of long being part of a team working on projects implemented in a large number of countries, on four different continents. From this point of view, the most useful experience is dealing on a daily basis with “live” problems in real time, as and when the problem arises.
That will prove very useful, because in legal advocacy you often encounter shaped problems. On the other hand, advocacy carries its own multiplicity and diversity of problems, but also different perspectives. You are no longer always on one side.
What types of investment are the most challenging on the domestic market for you and your colleagues from similar offices?
Energy – alongside infrastructure projects and mining – is the sector in which the greatest potential is expected to be realised, not only in terms of construction, but also when it comes to specific knowhow, the harmonising of regulations and the need to monitor and keep pace with international trends. This is also linked closely to environmental concerns. There are challenges in those fields that still lie ahead for us.