Middle East Geopolitical Insights | Navigating IT Risks and Business Continuity

Recent geopolitical developments in the Middle East have introduced a complex web of technology-related challenges for organisations operating within the region. To maintain business continuity and secure critical assets, companies must holistically review their operational resilience, cyber defence mechanisms, data governance practices, and third-party contractual agreements.

The following analysis explores some of these vital areas, providing actionable insights for organisations.

1. The evolving cyber-threat landscape

Regional instability has catalysed a highly active and multifaceted cyber threat environment, requiring organisations to defend against both sophisticated state-sponsored attacks and opportunistic cybercrime.

State-linked cyber activity 

There is a significantly increased risk of state-linked cyber activity aimed at creating operational instability, disrupting critical services, and gathering intelligence. These highly capable threat actors typically target critical infrastructure, financial services, energy and logistics companies, cloud and data infrastructure, and government or quasi-governmental entities. 

A prominent example of this is the increased activity against United Arab Emirates (UAE) entities by "Peach Sandstorm," an Advanced Persistent Threat (APT) group with an Iranian nexus.

Opportunistic cybercrime and ‘hacktivism’ 

While organisations may have their attention diverted by immediate physical risks — such as property damage, supply-chain disruptions, and inflation - non-state threat actors are likely to actively exploit this reduced cyber-vigilance. This opportunistic malicious activity manifests in several ways:

• Phishing and fraud: Cybercriminals may exploit crisis communications through government-impersonation, including campaigns mimicking the UAE Ministry of Interior and Dubai Customs etc.
• Targeted malware and social engineering: Threat actors are deploying malware specifically designed to target remote-access systems, alongside social engineering tactics that prey on anxieties surrounding evacuations, travel disruptions, and crisis responses.
• Hacktivist DDoS attacks: There has been a notable surge in Distributed Denial of Service (DDoS) attacks orchestrated by ‘hacktivist’ groups. Organisations must therefore remain highly vigilant to cyber threats that, while potentially unrelated to the geopolitical conflict directly, are enabled by the broader systemic disruption it causes.

Vulnerabilities in operational technology (OT) 

Beyond traditional IT networks, organisations should seek to secure their operational technology. Infrastructure that supports operational monitoring, including industrial monitoring systems and data sensors, represents a critical point of vulnerability. Disruption to these OT systems could lead to severe, real-world operational consequences.

2. Operational resilience of technology infrastructure

Physical risks in the region directly impact digital infrastructure, making operational resilience a paramount concern.

Data centre and cloud infrastructure disruption 

The physical vulnerability of digital assets was recently highlighted when Amazon Web Services (AWS) had to temporarily shut down one of its data centres in the UAE after objects struck the facility. Such disruptions to regional cloud infrastructure can cascade into increased downtime and data latency for hosted databases, interruptions to, of failures of, Software-as-a-Service (SaaS) platforms, and severe knock-on impacts for businesses dependent on these environments.

To mitigate this, organisations must review and update their business continuity planning (BCP) to ensure adequate redundancy of hosting and database arrangements, failover capabilities both within and across geographic regions (as appropriate), and the ability to seamlessly migrate services between cloud regions (all subject to the considerations set out in Section 4 below). Where necessary, load bearing should also be geographically distributed to prevent a single point of failure. 

Recognising these immense pressures, the UAE Cybersecurity Council recently introduced a temporary BCP workaround, permitting local organisations to temporarily store certain datasets offshore.

Concentration and supply-chain risks 

Many businesses rely heavily on a highly concentrated market of global cloud providers. If infrastructure is centralised within a single geographic region or heavily dependent on a single provider's architecture, a localised physical outage could simultaneously cripple multiple organisations. 

Organisations must therefore assess whether their critical workloads can be swiftly migrated to alternative providers or regions (again, subject to the considerations set out in Section 4 below). 

Furthermore, organisations should map their broader technology supply-chain, recognising that instability exposes concentration risks across service providers (MSPs), telecommunications networks, and hardware suppliers.

3. Securing the remote workforce

As crisis response plans are activated, a surge in remote work introduces new security vulnerabilities. Increased exposure stems from employees utilising unsecured home networks or personal devices without a Virtual Private Network (VPN), an over-reliance on remote access systems, and a general reduction in the oversight of user behaviour.

To combat this, organisations should mandate that remote working environments maintain security controls equivalent to corporate office environments, especially concerning access to critical systems. This includes deploying appropriate endpoint security on all devices and ensuring staff are rigorously trained on secure system access protocols.

4. Data governance and regulatory compliance

Relocating infrastructure or shifting hosting services to safeguard operations immediately triggers complex data governance considerations.

Data residency and localisation requirements 

Middle Eastern jurisdictions often enforce strict data localisation requirements. Specific categories of sensitive data - such as health data, information related to critical national infrastructure (CNI), or government data - are legally required to remain within the jurisdiction where they were collected. 

If local data centres face disruption, organisations must conduct rapid legal assessments to determine if their BCP measures allow for data to be transferred offshore, even temporarily.

Personal data transfers 

Moving digital infrastructure inherently involves relocating data. If this data includes personally identifiable information, cross-border data transfer obligations under local data protection laws are triggered. 

Even in the face of rapid operational disruption, companies must determine if such transfers are legally permitted, what of the mandated contractual mechanisms or safeguards would be utilised, and whether any regulatory notifications or approvals are required.
 

5. Navigating contractual and liability challenges

Technology disruptions often lead to contractual disputes and liability assessments.

Reviewing technology contracts 

Disruptions will often trigger clauses across cloud service agreements, SaaS contracts, hosting agreements, and IT services contracts. Companies should urgently review any Service Level Agreements (SLAs), downtime provisions, liability limitations, and the specific disaster recovery commitments made by their vendors. It is also critical to verify, where necessary, whether existing contracts legally permit temporary or permanent migration to alternative providers.

As always, the key to minimising issues is for organisations to ensure they are speaking directly and often to their technology and service providers, as keeping communication lines open will significantly reduce the risk of disputes arising. 

Force majeure and ‘exceptional events’ 

Geopolitical developments may sometimes lead parties to invoke force majeure or "exceptional events" clauses when their contractual performance is prevented by circumstances beyond their control — such as data centre unavailability, damaged infrastructure, or non-delivery of input services. 

Where provided for in the contract, organisations must strictly adhere to contractual notification procedures and mitigation requirements to successfully activate and rely on these clauses. 

Delay provisions and new arrangements 

Even if force majeure is not successfully invoked, supply-chain disruptions may trigger delay provisions where they are included in contracts, impacting implementation timelines and infrastructure deployment. 

Companies should seek counsel on relief entitlements and performance extensions. Furthermore, migrating to new providers necessitates the negotiation of new hosting contracts, where organisations must prioritise cross-border data transfer obligations, stringent SLAs, and robust business continuity and disaster recovery provisions.

6. Managing vendor risk and enhancing business continuity

Ultimately, an organisation's resilience is only as strong as its various third-party dependencies. Organisations should extensively map their exposure to third-party technology vendors, assessing the individual resilience of their cloud and IT security solutions, hosting providers, software vendors, and hardware suppliers.

While proactive inquiries from customers are often limited, it is imperative that organisations interrogate their technology providers' business continuity and disaster recovery plans. Companies should, where possible, secure contractual reassurances and ascertain:

• whether their suppliers have robust contingency plans for regional infrastructure disruption;
• how rapidly services can be restored or transferred post-incident; and
• whether accessible, viable backup infrastructure exists outside the affected region, or with an alternative service provider.

Strategic questions for organisational assessment

Organisational leaders and legal counsel should evaluate their posture against the following critical questions:

1. Where is your core infrastructure hosted, and do you possess sufficient geographical redundancy? 
2. Is your central IT infrastructure spread out enough to survive a localised disaster?
3. Where are your teams located? 
4. Are your teams prepared to transition to secure and legally compliant remote working arrangements?
5. Could operations continue unabated if a primary regional data centre or network went offline?
6. What specific regulatory constraints limit the movement of your data outside its current jurisdiction?
7. Do your current technology contracts grant you flexibility to migrate to alternative locations or vendors?
8. Can your critical suppliers meet their delivery obligations if regional hostilities escalate further?
9. Have you comprehensively stress-tested the resilience of your vital cloud, network, and technology providers?

Periods of regional uncertainty rarely create risk in isolation. We help organisations understand how different risks connect and what that means in practice, so decisions can be made with clarity and confidence. If you have questions about your Middle Eastern operations or would value support navigating the current environment, please reach out to your known Clyde & Co contact or using the button below.

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