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and explanation through the due diligence process,it is still vital to conduct as great a degree ofdue diligence as the transaction timetable provides.Interpreting and clarifying disclosure against thewarranties in the purchase agreement, and the consequencesof that disclosure, are important giventhat local lawyers, local accounting firms and localmanagement typically will be involved in theinitial diligence exercise, and they may not fullyunderstand the absolute requirement for certaintyof expression. Unless the timetable is critical to thetransaction (in which case any curtailment of duediligence must be balanced by enhanced contractualprotections), the benefits to a buyer of a thorough,drawn out due diligence and disclosure processto mitigate diminution of value post-closingcannot be over-emphasised.Corrupt PracticesThe existence of the US Foreign Corrupt PracticesAct and the UK Bribery Act imposes a heightenedrisk on investors. As part of the due diligenceprocess, buyers should determine the risk level ofpotential corruption involved in the transactionand target group and allocate resources accordingly,identify any "red flag" activities that may signalcorrupt practices, record all incidents, considervoluntary self-disclosure (early disclosure can mitigateor eliminate successor liability for violationsuncovered pre-acquisition), seek warranty and indemnityprotection in the purchase agreement, andaudit and strengthen internal controls immediatelyafter closing. Concentrated due diligence, self-reporting,contractual protection and post-closingimplementation of robust controls are key to eliminatingor mitigating liability for pre-closing corruptpractices within the target group.Political Risk/ExpropriationA buyer should check to see whether the countryconcerned is a party to any bilateral investmenttreaty protecting foreign investment. If there is areal risk of expropriation, methods to mitigate therisk include securing co-investment from an internationaldevelopment corporation and/or obtainingpolitical risk insurance.Transaction Governing LawOwing to uncertainty about enforcement of contractsand the reliability of the local courts, transactionsin Africa are typically governed by English orFrench law, depending on the jurisdiction. Occasionallyminority shareholders will seek to challenge theseprovisions, but generally the courts in most Africanjurisdictions recognise offshore governing law anddispute resolution in relation to contracts involvinglocal assets. One form of additional protection is tohave an English law irrevocable power of attorneyfrom the minority shareholders in favour of one controllingshareholder, pursuant to which they expresslywaive their rights to challenge subsequently the purchaseagreement's governing law and jurisdiction.The Authors:Nick Azis is a partner based in the Firm's Londonoffice. He has advised on a broad range of UK domesticand cross-border public and private company52