The Canadian club
24 June 1997
Canadian law firms form a quiet, but distinctive presence in London. Like their US counterparts, most of their work derives from financial services; unlike the more aggressive US firms, none of the Canadians have seriously attempted to "internationalise" and practise local law in a variety of markets. But this is not to say that they do not offer an international service.
"Canadian firms don't have the same reservoir of clients as US firms," comments David Glennie, managing partner in London at Blake, Cassels & Graydon. "There is usually a Canadian connection. At the same time, it is no longer important to be qualified in the jurisdiction if you have the appropriate skills and support. We do work for US clients in the Euromarkets."
The firm's bread and butter work consists of helping Canadian companies selling into Europe or European companies selling into Canada. Recent deals have included a Eurobond issue for the Royal Imperial Bank of Canada, which marked a return to the market by the bank after an absence of several years, and the establishment of commercial paper programmes in Canada for several UK financial institutions, including the Halifax and the Nationwide Building Society.
One area of native expertise that the Canadians have sold worldwide is natural resources, and several of the London practices have been involved in structuring mining enterprises in Africa, Russia and even Latin America. "Africa is very busy at the moment," says Glennie, who has helped Canadian companies buy into South African diamond mines and Russian oil and gas operations.
McCarthy Tetrault is Canada's largest law firm, with around 580 fee-earners. It aims to be the dominant practice in each of the Canadian markets and can reasonably claim to be a firm of world significance. According to London managing partner Oliver Borgers, the firm has strength in depth in all areas of law, from corporate to environment, but has a particularly good reputation for its litigation work.
Financial services are prevalent in McCarthy Tetrault's operations in London, particularly in the areas of Borgers' own specialisms of mergers and acquisitions, and divestitures. Work in the natural resource sector is also significant, with both African and Eastern European connections.
The firm has also established a reputation for its work in telecoms, having played a primary role in redrafting communications legislation in Indonesia and Jordan. However, McCarthy Tetrault is strict about practising only Canadian law.
"It would require a very significant investment to practice English law, given that the work we do is very high end," explains Borgers. "But we are prepared to compete with anyone internationally."
Stikeman Elliot maintains the largest and longest-established Canadian presence in London, with 11 lawyers, four of whom are partners. There is also an office in Budapest to look after Eastern Europe and an office in Hong Kong which practises local law. In London, core practice areas are mergers and acquisitions, and capital markets, almost always combining cross-border and Canadian elements, while private client tax advice is also significant.
The firm represents media tycoon Conrad Black's UK interests, while recent deals have included finance for APV, the Hungarian electricity company, the (now on-hold) France Telecom privatisation, a Daily Telegraph equity deal, and the purchase of a UK lorry manufacturer by the Canadian Western Star. "Most of our work is generated here," comments managing partner in London Stuart Cobbett. "There is work referred from Canada, but then a lot of what we pick up here is referred home."
Borden DuMoulin Howard Gervais is the London office of four Canadian firms that practise separately in Toronto, Vancouver, Calgary and Montreal. The office's principal areas of specialisation are international business law, particularly capital markets, mergers and acquisitions, and arbitration and insolvency, in which the firm was involved with the liquidation of BCCI. Bordens is unusual for Canadian firms in that it also has a litigation practice.
As to whether the firm will follow in the expansionist footsteps of US firms, litigation partner Norman Letalik says: "Canadian practices are still interested in practising Canadian law only - so far, the only firm interested in expanding into UK expertise is Stikeman Elliott. This policy is dictated by prudence and the assumption that it is not always appropriate for Canadian firms to give legal advice on major projects where the clients will seek UK or US firms at first instance. But if there is a Canadian component, we will be happy to supply it."
Although lacking the ambition and aggression of their US counterparts, it seems that Canadian firms in London are not afraid of competing globally, but, with the possible exception of Stikeman Elliot, they prefer to keep their dealings strictly in Canadian law.
The English shortage of high-calibre business lawyers has become so intense that a new agency, ZMB Canada, has been formed to help ship in recruits.
According to its founder, Christopher Sweeney, top London firms have long recognised the talents of solicitors in New Zealand and Australia, but Canada has been overlooked.
This is strange given that Canada is large, sophisticated, English-speaking and has standards of education equal to anywhere in the world, while most educated citizens are bilingual in French and English.
Being a member of the Commonwealth, makes immigration from Canada slightly easier than from the US, while a qualified Canadian attorney needs only to sit a two-hour exam to register with the Law Society in England.
Although mainly specialising in common law, in line with the UK and the US, Canadian lawyers are also familiar with the continental civil law system, which is practised in Quebec.
"Once people in London saw the quality of Canadian candidates, the momentum began," says Sweeney.
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