Dutch dabble in City set-ups
12 March 1996
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Historically, Dutch firms have been reluctant to set up in London. But this view has changed with two firms - Nauta Dutilh and Trenite van Doorne - opening offices in the past six months.
De Brauw Blackstone Westbroek was the first to arrive in the UK when it set up six years ago - and it remained the only Dutch law firm in town until the arrival of Stibbe Simont Monahan & Duhot in late 1994. "There was so much transactional work being done in London. The move brought us closer to sources of business", says Stibbe resident partner Allard Metzelaar.
But not everyone shared this view. Nauta Dutilh partner Diederick van Wassenaer notes that in the past it was difficult to get the 85 per cent partnership vote needed to open the office. "A number of partners thought, in 1991 when we started talking about opening, why have a London office when you can do it in Amsterdam?"
Opinion within the firm shifted as London's importance as Europe's financial centre grew. In particular, Dutch financial institutions, such as ABN-Amro and ING, which bought Barings, were aggressively building their presences in the City.
Even so, opening a London office would not be done at any cost. The main condition, says van Wassenaer, was that the office be profitable. As a result, grandiose plans were rejected in favour of a small office staffed by three lawyers.
Trenite was likewise concerned that its entry into the London market should be cost-effective. Resident partner Pieter Reimer explains that the firm had discussed the idea for some time, but some partners were hesitant as London was so close. But an opportunity too good to miss arose when French firm Salans Hertzfeld & Heilbronn offered Trenite office space in its London premises in Mayfair. In exchange, the two firms would share Trenite's office in Brussels, and the firm jumped at the chance.
Given the importance of English law in international financings, a move into the UK would seem the next logical step for the Netherland's expansionist firms. But this is something that most rule out, with De Brauw's van den Berg quick to scotch rumours that the Alliance of European Lawyers is planning to take on board a UK firm.
Van Wassenaer points out that it would take too long to build up a practice which could take on the top London firms, and few favour the route taken by US firms in London of paying huge salaries to lateral hires.
That road is also seem as problematical. Part of the problem, notes Van Wassenaer, is a risk of losing lucrative referrals from big UK firms if Dutch firms poached their partners and competed with them.
Unlike countries such as France, where UK firms have set up shop, few foreign firms have ventured into the Netherlands. Only Clifford Chance and Baker & Mckenzie (which operates as Caron & Stevens) have done so, though both are successful, in banking and tax respectively. At the same time, van Wassenaer says: "There is much more work from the UK into the Netherlands than the other way around."
This is not to say that firms will not ditch concerns over referrals if the right partner comes along. At Loeff Claeys Verbeke, which linked with Allen & Overy four years ago, there were concerns about losing referrals notably in maritime and intellectual property work, but the feeling was that the benefits of affiliation, especially in the lucrative banking and financial services field where Allen & Overy is a leading City player, outweighed the risks.
For medium-sized firms with fewer worries about referral loss, such as Amsterdam-based Houthoff, which is part of Denton Hall's European network, association with a well-known UK firm was an opportunity to develop an international profile.
Even van den Berg admits that the issue of teaming up with a UK firm is debated within the Alliance more than it was five years ago, although he is emphatic that nothing will happen in the foreseeable future.
Metzelaar adds that much depends on developments in the global market as well as practical considerations. His firm is still digesting its mergers with Belgian and French firms and in terms of priorities other jurisdictions such as Germany and Scandinavia could take preference over the UK.
So will a UK-Dutch merger ever happen? As the canny Dutch like to say: "Never say never".