US firms Cleary Gottlieb Steen & Hamilton and Paul Hastings have both confirmed plans to open a Seoul office following the recent ratification of the Korea-US Free Trade agreement by both countries.
The Korea-US Free Trade agreement (FTA) was first ratified by the US Government in October 2011 and by the South Korean Government last Tuesday (22 November) after four years of negotiations. The FTA, widely expected to become effective from January 2012, will allow US law firms to have a physical presence in the country for the first time.
Cleary earlier today announced its plans to open an office in Seoul in the first half of 2012. Partner Yong Guk Lee and counsel Jay Hoon Choi, together with several Korean-speaking associates, will relocate to Seoul from Hong Kong initially.
However, the firm clarified that it is yet to submit an application for the office as the regulatory framework is still being developed. Lee, who has been practising with Cleary since 1992 and in Hong Kong since 2004, noted that the firm has been considering a Korea office since the FTA negotiations started in 2007 and the recent ratification has made its thinking more concrete.
“We’ve been involved in practising law with Korean clients for over 20 years, and we’ve started thinking seriously about having an office in Korea as it looks like it’s more possible to do so,” said Lee.
The firm plans to relocate the current Korean team from Hong Kong to Korea in the next two to four years. It has more than 30 lawyers worldwide who are fluent in Korean, including four partners, two counsel and 11 associates based in Hong Kong.
“The Seoul office will offer our clients the convenience of having our lawyers accessible on the ground and we’re hoping to broaden and deepen our relationship with them,” said Lee. “Currently, capital markets and cross-border M&A are the two core practice areas for the Korea practice. With the new office we’ll have opportunities to handle a wider variety of international matters for our clients, such as antitrust and disputes resolution and restructuring.”
Paul Hastings, meanwhile, has also reaffirmed its commitment to enter the South Korean market by setting up a Seoul office as soon as local regulations change.
“The firm’s management and the partnership have already been fully committed to opening a Seoul office. We’re already planning to submit an application once the FTA becomes effective, presumably in January 2012. It’s just a matter of time and a matter of the process,” said Hong Kong partner Daniel Kim.
Paul Hastings has a 10-lawyer Korea team based in Hong Kong that includes partners Kim and Jong Han Kim, who is head of Korea practice.
“Our plan is to relocate most if not all of the Korea team to Seoul as soon as it’s allowed,” said Kim.
The firm has 25 Korean lawyers worldwide. Samsung and Hanwha are among the firm’s Korean clients. It is also currently working on two Hong Kong IPOs for PRC issuers that are subsidiaries of Korean parent companies.
It is understood that within the first five years of launching in Seoul, foreign firms will not be allowed to practise local Korean law or employee Korea-qualified lawyers. International firms expect that their relationships with local firms will remain largely unchanged. However, competition for US-qualified Korean lawyers with international experience will inevitably increase once the market opens.