Nortons HK break-up leaves it in the cold

NORTON Rose is to be booted out of Hong Kong for three years by its long-standing partner Johnson Stokes & Master (JSM) following its decision to to end its 22-year association with the island's largest firm.

The Hong Kong firm is insisting that Norton Rose honours a contractual clause which was triggered when Norton Rose terminated its association on 31 March.

Roger Birkby, Norton Rose managing partner, said the principal reason for the split was that JSM would not allow Norton Rose to develop its project or asset finance practice in Hong Kong.

Norton Rose's team of nine lawyers, which included five partners, will split up and move either to the firm's Singapore office or return to London when the association ends in a year's time.

David Stannard, head of the team, will move his highly successful corporate finance practice to Singapore. But he promised: "One minute past midnight on the day the restraint period ends, I will be up here [in Hong Kong] opening an office."

Under the agreement, Norton Rose faced restrictions on the use of its brand name in Hong Kong and Chinese work done by its lawyers, and also on the number of lawyers it could base at JSM's office.

Sources in Hong Kong said that this severely restricted Norton Rose's profile on the island and mainland China.

Birkby acknowledged that the firm's global practice would suffer as a result of its banishment from the island, but insisted the decision was in the long-term interests of the firm.

Commenting on Norton Rose's decision, John Woodhall, managing partner of Clifford Chance's Hong Kong office, said: "You cannot have a credible Asian practice without a significant Hong Kong presence."

News of the severing of the firm's association in Hong Kong coincides with the impending disbandment of the Norton Rose M5 group.