While the mood among firms in Ireland on both sides of the border is buoyant, opinion among their clients is mixed. The developments and determined expansion in the level and band of services available have been welcomed, but some believe that these changes have not gone far enough to make the service comparable to that found in City firms, particularly in relation to Northern Ireland firms, which are perceived by some to be too small to deal with major issues or clients.
Raymond McGinley is the head of ICL’s first in-house legal office in Ireland. He joined the global IT services company in September and has spent his first three months assessing the level and type of service necessary for his company. With the boom in e-commerce throughout Ireland, ICL – which has had a base on the island for more than 30 years – was in place to take full advantage of the growth in the industry. It now services clients as diverse as Eircom and the Northern Ireland Housing Executive.
And it was this huge growth in e-business that necessitated the establishment of an in-house legal department. Work would traditionally have been passed on from ICL’s London legal office to firms such as Masons and Linklaters & Alliance. McGinley says: “As an IT-based company, it’s difficult to find a single practice in Northern Ireland that can effectively facilitate ICL’s needs.”
The huge volume of legal work in the company means that a lot of projects are inevitably outsourced from his office in Belfast. Much of this work is not confined to the six counties, as there is a certain amount of cross-border activity which ties in with ICL’s Dublin office, as well as some issues that cross the three jurisdictions of the Republic, Northern Ireland and the UK. McGinley says: “It’s on this basis that we’re trying to build relationships with law firms with a presence in Ireland and which can cater for these cross-border needs.” Through the company’s historical links, Masons, which now has a well-established Dublin office, must feel that it is in the running for any outsourced work, despite the fact that it does not as yet have a Northern Ireland presence. But McGinley is adamant that no decision has been made on future relationships with particular firms.
McGinley, who left big five accounting firm PricewaterhouseCoopers (PwC) to join ICL, is well experienced to comment on the legal market. He was director of corporate legal services in the Belfast PwC office until his move (The Lawyer, 11 September), though much of the work outsourced from PwC in Ireland is passed on to its affiliated legal firm of Evans & Co in Dublin.
His experience, despite doubts about the lack of critical mass in some Northern Ireland firms, has instilled within him a healthy respect for a number of individual lawyers. He says: “On a personal note, within Northern Ireland there are individual lawyers who I rate very highly, particularly on the corporate and commercial side. People like Richard Grey and Paul McBride in L’Estrange & Brett and David Jameson in Carson & McDowell.”
David Jameson, however, disagrees with any suggestion that the Northern Ireland legal market is restricted. Jameson, a partner at Belfast firm Carson & McDowell, sees these perceptions as one of the main problems affecting the legal industry in the six counties. He says: “This is one of our main hobby horses in Northern Ireland. Many large institutions have a somewhat civil service attitude to work, and feel that from a protection point of view, they need to use a large London firm.”
In Jameson’s view, the main problems that the firms in the north are experiencing are in no small way brought about by themselves and their lack of attention to marketing. He says: “Northern Ireland firms historically do not trumpet their expertise. In the main they are not involved in marketing themselves, which is in stark contrast to their UK counterparts. This has led to a perception, particularly among Irish firms, that when UK legal experience is required, work should be passed to City firms in London rather than to Belfast.” This traditional neglect of marketing by the firms in Northern Ireland will have to be tackled if they want to take advantage of the increasing number of new companies setting up and moving to the province. These include Denver IT company Avalanche, which announced just last week that it would be setting up its global headquarters in Northern Ireland.
Iona Technologies is an Irish software company that began as a campus company in Dublin Trinity College, and while it has offices in Ireland, its focus has shifted from an Irish to an international perspective. It now has offices in Japan, Australia, the UK, France, Switzerland, Germany and throughout the US, where it is quoted on the Nasdaq index. The company has had close links with Dublin law firm William Fry since it was first set up by Chris Horn, Annrai O’Toole and Sean Baker in 1983.
Myra Garrett, a partner at Dublin firm William Fry, has worked with Iona on its corporate side throughout these years, through its first-round fundraising in 1993, its opening of a US base in Boston in 1995 and its 1997 IPO on the Nasdaq stock exchange. She says: “We’ve been through the full cycle with them, from fundraising to IPO and numerous acquisitions. The company is listed on the Nasdaq, which means that work these days is necessarily divided between Irish and US law firms.” The company’s main legal function, though, is not based in Dublin. 1997 saw the appointment of Lindsey Kiang as general counsel to Iona, based in the US. Although Kiang is US-based, he is nevertheless directly involved in the legal activities of William Fry’s Irish office, and has noticed an unusual difference in the way the Irish legal industry works compared to the US. He says: “There doesn’t seem to be extensive use of lawyers within Irish companies. It seems that Iona is the exception – we have two in our Dublin office. The trend of in-house lawyers doesn’t seem to have taken hold. And while US companies have traditionally tended to work in association with outside firms, Irish companies seem in general to depend heavily on outside resources.”
Citibank, one of the largest financial institutions in the world, opened its Ireland office in 1965, and was one of the first groups to move into the International Financial Services Centre (IFSC) in Dublin when it opened in 1997. Unlike operations in other Citibank legal offices around the globe, the Irish office works on a panel basis. The Irish panel includes firms such as Matheson Ormsby Prentice, A&L Goodbody, McCann Fitzgerald and Dillon Eustice.
Citibank’s lawyers work mainly in the Republic, where they deal with e-commerce and securities, as well as a range of corporate finance and M&A work. Hedd Vine, senior legal counsel for Citibank in Ireland, says: “I have a good opinion of Irish firms: they have excellent lawyers and compare well to any you will find in the UK. However, they don’t always have the resources that you might see with a City firm, especially with so much work around at the moment. Recruitment can be quite difficult for them – they want to get the right people and so far they’ve taken the right approach by being cautious and selective and not just grabbing anyone.”
Even in her relatively limited two years of experience working on the Irish market, Vine has noticed some major developments in the range of services offered by the firms, and indeed in the way these services are focused. She says: “A huge effort has been made over the past few years to improve services in Ireland with a client-friendly approach.” This can be seen particularly in areas such as IT and e-commerce, which have been at the forefront of the boom in the Irish economy, and which are an essential part of Citibank’s business in the Republic.
Vine is almost unwavering in her praise of Irish firms and outsources almost all the institution’s work to the Irish legal market, with only specialist issues such as global custody being dealt with either in-house or sent to a niche firm in the UK. She does, though, have some concerns about the lack of female partners in the Irish firms. “It’s quite disappointing,” she says. “The [male-female] ratio of partners cannot really be explained away.”
While Irish firms are unable to compete with the top UK practices in terms of resources, their phenomenal growth in line with that of the economy has nevertheless been recognised by most of the clients who use their services on a regular basis. Their future success depends mainly on an ability to keep their growth in line with the work needing to be done. This, though, is a task that grows more difficult every year as they try to compete with the larger City firms and each other to attract new recruits.