Government LLP plans will hamper UK firms

Many would be forgiven for thinking that the enormous number of large and medium-sized UK firms opening offices, taking over firms and switching partners in major European and Asian cities indicates some kind of global British takeover.

But before we all get carried away with national pride, Denton Hall has brought us back down to earth with a bump.

The firm's decision to pull out of the US after only a year, leaving it without a presence in the US, sends an important reminder to UK firms with over-ambitious expansion strategies that they are merely mortal.

Last August, The Lawyer also revealed that Wilde Sapte had to closed its office in New York.

However, in the same week The Lawyer reveals that Dentons is closing its New York office, it is announced that New York-based firm McDermott Will & Emery is hiring three new UK partners in London and plans to open an office in Germany.

For the time being, the Americans seem to continue to have the upper hand.

UK law firms are a business success story, earning valuable export revenues for the nation. And their success has been applauded by government ministers.

But Labour MPs seem intent on handicapping UK firms in the international market. The House of Commons Trade & Industry Select Committee wants the Limited Liability Partnerships (LLP) Bill to be amended so that individual partners must disclose their earnings and provide financial guarantees to creditors.

City firms are battling against aggressive US firms offering inflated salaries and – for the majority of these firms – the security of a US LLP, without the kind measures called for by the committee.

UK firms must be allowed to compete for the best lawyers in the market. The committee should look at the facts – rather than its own prejudices – and allow them to do so.