While more UK firms open offices in The Netherlands, the Belgian market has failed to attract the big City firms looking at further European expansion. The Lawyer reports on how the City is now looking beyond Brussels
There may be Benelux firms, but there is no such thing as a uniform Benelux culture – at least not when it comes to the legal market.
The Netherlands may have experienced an invasion of City firms in the last year, but foreign firms' interest in Belgium has mostly been contained within the strict environs of Brussels. But the dozens of major European and US law firms which have been attracted to Brussels in the past decade are not there because of rich pickings in the Belgian market; they are there to handle competition work coming from the European Commission.
The two spheres are separate and rarely collide. Larger UK and US firms have started to buy up local capability, though the full power of City chequebooks has not yet been unleashed.
That is until recently. With The Netherlands ticked off the list for the larger and more acquisitive UK firms, it is only logical that they look south to Belgium.
For Linklaters & Alliance, the move into Belgium was a fait accompli. By bringing in the alliance to its expansive fold, Linklaters nabbed arguably the premier Belgian firm in one swoop. De Bandt Van Hecke Lagae & Loesch, which had always had a close relationship with Dutch firm De Brauw Blackstone Westbroek, was a prize worth having in the Belgian market – not only for its local corporate and finance capability, but because its competition practice fitted nicely with Linklaters' existing office in Brussels.
Allen & Overy's route to Belgian capability was somewhat less straightforward. It had a small but perfectly formed Brussels office handling EU work. But then last year, the whole Loeff Claeys Verbeke saga began. The majority of the Amsterdam office left for Allen & Overy, while the Rotterdam office joined forces with tax attorneys Loyens & Volkmaars to become Loyens & Loeff. The Belgian part of the firm – itself created by a merger back in the early 1990s – remained nominally independent, and retains the Loeff Claeys Verbeke name, specialising in M&A and capital markets.
Clifford Chance and Freshfields, meanwhile, have resorted to different methods of entering the Belgian market.
Whereas in Germany Clifford Chance and Freshfields have merged and merged again, in Belgium they have had a piecemeal expansion.
For example, Clifford Chance hired corporate partner Axel Miller from blue-chip Belgian firm Stibbe Simont Monahan Duhot last year and the firm has increasingly been involved in large-scale domestic corporate deals such as the privatisation of telecoms company Belgacom. Meanwhile, Freshfields has managed to build up a nifty little domestic Belgian securitisation practice, mostly through partner Ivan Peeters.
The other UK firms with ambitions in The Netherlands tend to mirror their activities in Belgium. DLA, which is due to hook up with Schut & Grosheide in The Netherlands, has formed an association with Belgian firm Price & Partners, while CMS Cameron McKenna is linked to CMS Derks Star Busmann Hanotiau (the Hanotiau part being the Belgian end).
Given the proliferation of US firms in Brussels, it was only a matter of time before the market saw Belgium/US hook-ups. The most prominent firms within the domestic Belgian market are without doubt Cleary Gottlieb Steen & Hamilton – which has one of the most outstanding EU competition practices in Brussels – and Coudert Brothers.
Coudert is also well-established in Brussels – underlining its ambitions earlier this year when it announced a merger with local firm Coppens Van Ommeslaghe & Fauras (the joint firm will trade under the cumbersome moniker of Coudert Brothers – Coppens Van Ommeslaghe & Fauras).
With White & Case recently hiring Guy Schrans from Freshfields, it would appear that US firms with European ambitions are on the move.
If Belgium is a conservative market, then Luxembourg is even more so. Yet just as the laws on banking secrecy are being rejigged, there are equally signs that the local profession is opening up.
Luxembourg's long-established position as a centre for investment trusts means that there is potential for a number of UK firms to set up a nice little business there (although hardly in the same profitability league as City practices).
However, UK firms have only been able to establish offices in the duchy through the back door – that is, through merger. Hence Allen & Overy's sudden presence. It merged with Beghin Feider Loeff Claeys Verbeke to form Beghin & Feider in association with Allen & Overy.
In much the same vein, Loesch & Wolter became part of Linklaters & Alliance when it merged with Belgian member De Bandt Van Hecke & Lagae. The Luxembourg entity is known as De Bandt Van Hecke Lagae & Loesch.
The merger of Clifford Chance and etude Faltz & Kremer was eventually finalised by the Luxembourg Bar Association in January 2000. The new firm, Faltz & Kremer in association with Clifford Chance, has 20 lawyers and will provide Clifford Chance with a significant foothold in the Luxembourg banking market.