When in London...
30 June 1998
Before foreign law firms in can really benefit from their London offices, they must adapt to the idiosyncrasies of practicing law in England.
Welcome to legal life in London. Perhaps there is time for a leisurely two-hour lunch followed by a nap? Time to chat over an espresso? Space to samba on the tube? Forget it. The daily routine of Madrid, Paris or Rio de Janeiro is left on the airport tarmac when you arrive in London.
Most foreign lawyers soon discover that lunch consists of a quick sandwich munched at their desk and, in a typical day, the only moment you get to reflect on life is the few seconds between your computer crashing and the panic setting in.
Since a London office has become top of the "must do" list of foreign law firms who have an eye on cross-border legal advice, the number of foreign lawyers in London has increased.
The invasion of US firms has taken the limelight, but less highlighted is that there are now over 70 non-US foreign law firms with offices in London.
These firms argue that many of their important clients are now based in London and that the ability to both meet clients face-to-face and to organise the deal from the capital can mean the difference between being instructed and not.
Time differences, language barriers and cultural misunderstandings may mean that without a London office, contact between client and lawyer is not established and a relationship does not develop - often weakening a lawyer's ability to pick up important nuances in a client's personality.
But with a foot in the door, foreign lawyers can build these important relationships. Vera Dantas, one of three London resident partners of the five-lawyer London office of Brazilian firm Noronha Advogados, lists this advantage as one of the main reasons her firm set up in London in 1988. "Having a London office facilitates enormously the relationship between lawyer and client," she says.
Juan GonzAlez, resident partner of Spanish firm Ur'a & Menendez, agrees: "The ability to provide face-to-face advice is vital. We are more prone to be called to internal meetings where the client is projecting and voicing concerns over development costs."
But clients can sometimes be unpredictable. Lawyers at firms with attractive home bases can spend more time out of the UK than in it. "I'm loath to say there is a general rule," observes GonzAlez. "But possibly clients like to go to Spain [for negotiations] and so I follow them."
However, instruction can come from UK firms based purely on a London presence. Hans Bagner, resident partner of Sweden's largest law firm Vinge, says of his firm's instruction by a UK plc in its acquisition of a company in Sweden: "They chose us as we had an office in London."
The London office can also act as a conduit for the flow of work to and from the head office. Gibraltar-based firm Marrache & Co has a London office staffed by three English qualified lawyers and they handle the commercial litigation work of the firm's Gibraltan and Spanish clients.
They also co-ordinate the flow of information between UK companies and law firms seeking advice on Gibraltan and Spanish law from their colleagues in Gibraltar.
And as UK and US companies and financial institutions transfer their resources from developed to underdeveloped regions of the world, the London offices of firms such as Indian law firm Singhania & Co or Brazil's Pinheiro Neto-Advogados or Noronha Advogados are set to benefit.
But often clients are unaware that their counsel for a particular jurisdiction has a capability in London.
Diederick van Wassanaer, managing partner of Dutch firm Nauta Dutilh's London office, says that on more than one occasion a client, referred to him by an English law firm, has called to discuss a particular issue and been pleasantly surprised when he suggests "maybe it would be easier for me to just walk across the street".
And as more firms set up in London, the profile of a foreign office can improve. For instance, Benelux firm Loeff Claes Verbeke is the latest with Dutch lawyers to commit to London and van Wassanaer sees this benefiting his own practice.
"Having a critical mass of other [Dutch] law firms in New York meant deals were done there," he says. "Now UK clients find that the lawyers are here and that has a positive affect for all law firms. One thing leads to another - if English clients find they can do a transaction in London rather than in a Netherlands-based office they will."
And as US law firms like Chadbourne & Parke and Coudert Brothers have learned lessons in recruiting and developing practice groups, so too non-US foreign law firms in London have had to adapt their strategies.
Vinge's London office opened in 1979 to serve Scandinavian companies and individuals escaping tax regimes in Sweden that Bagner describes as "quite confiscatory". Vinge decided to establish a network of independent English lawyers to serve the firm and provide its Scandinavian clients with English property, employment, tax and immigration law advice.
But by the beginning of the 1990s the firm saw a resurgence of interest in Sweden by both its own nationals and UK and US-based companies. When Sweden joined up to the European Union, foreign investment in that country soared.
The firm reorganised to deal with this change in flow of demand for services, dropped its English law ties and now concentrates its five-lawyer office on advising UK and US clients investing in Sweden.
The London office also works in connection with its Scandinavian partners Kromann & Munter of Denmark and Thomessen Krefting of Norway, to provide a one-stop-shop service for clients interested in the region.
Another example of such reorganisation is Munich-based Beiten Burkhardt Mittl & Wegener. Set up in 1989, the firm initially focused on enforcing the claims of UK and US clients in Germany.
But in April 1997 the whole firm restructured to take advantage of the increase in cross-border takeovers and disposals in Germany. Now 80 per cent of the London office's work is advising UK companies setting up in Germany.
And the strategy of the foreign firms' London offices is not the only thing mutating to suit the current market for legal advice. Often the lawyers themselves have to alter the way they practice to meet the demands of UK-based clients - demands which can vary significantly from those of clients from their home countries.
One lawyer who has noticed a change in his practice is Uria's GonzAlez. "The way you approach problems and deal with clients - it is closer to the UK way in our home offices," he reflects. "You can't avoid that, or being influenced by the market around you."
Dantas of Noronha adds: "I think being here helps you to understand English law firm culture. After so many years here, I now feel completely at ease in the English legal environment."
But this can also create problems as UK lawyers fail to adapt their own expectations of what they can ask of their foreign counsel.
Marc Forestier, resident lawyer at French firm Azema Sells, says: "Being a French law firm with a presence in the UK, we get calls on lots of areas of law. It is difficult to explain that we can only do certain things - you need to have a certain amount of specialisation."
Dantas also points to the differences in working environment between London and her native Brazil.
She argues that company research in Brazil is not as easy as in the UK. "When I explain to my English colleagues that it will take time to do the due diligence I would expect some flexibility from them," she says.
So working in London as a foreign lawyer is not a smooth ride. But the daily challenges keep life, as one foreign lawyer understated so beautifully, "interesting".
And while their profile in the London market might not be as high as the US firms, they are bullish about the future. As Forestier explains: "We haven't done much marketing - we've been busy."
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