Clifford Chance comes under fire from Singapore government for ‘misleading clients’

Clifford Chance has come under fire in Singapore after the domestic government criticised the firm for misleading clients over its operations in the city-state. 

Singapore law minister K Shanmugam said the magic circle firm had played a “clever word game” in publicising itself as “the first full-service, integrated law practice in Singapore” after the firm entered a formal law alliance (FLA) with local firm Cavenagh Law in December 2012 (11 December 2012).

At the time Clifford Chance had boasted that the FLA would allow it to provide local litigation advice in partnership with Cavenagh Law.

The minister said such a statement “could be read to mean that a foreign law firm can now practice litigation in Singapore. That would not be accurate”.

He added: “We will also not condone arrangements where the SLP [Singapore law practice] is, for all intents and purposes, a proxy of the FLP [foreign law practice]. All collaborations must comply with the spirit as well as the letter of the law.”

The criticisms came in response to a parliamentary question from Singapore MP, Lim Biow Chuan, about foreign firms operating in Singapore.

Shanmugam said the government had contacted the firm to warn it about giving misleading statements.

“My senior officials have called in the partners of Clifford Chance and the local law firm, Cavenagh Law, and told them that their statements conveyed an inaccurate picture and should be stopped,” said K Shanmugam.

After being contacted the firm changed the line to clarify that local litigation advice would be “provided through” Cavenagh Law.

Singapore recently introduced further liberalisation measures to its legal service industry, including allowing wider scope of collaborations between foreign and local law firms and handing out more qualifying foreign law practice licences (7 September 2012).

Under the amended Legal Profession Act SLPs and FLPs based in Singapore may collaborate as two free standing firms under an FLA.

This arrangement enables co-branding and billing, as well as the sharing of office premises, resources and client information. Firms in FLAs can also share up to a third of profits.

However, foreign firms are prohibited from practising domestic litigation in the jurisdiction, even if they have an established FLA there.

A Clifford Chance spokesperson insisted that the FLA “has at all times fully complied with all applicable regulations and will continue to do so”.