Firms in the UK have puzzled over a single question for many years: European alliance or own offices?
Few do both. But Field Fisher Waterhouse (FFW) took the plunge last week, as first revealed on www.thelawyer.com (26 March), abandoning its failed European Legal Alliance and opening its own offices in Belgium and Germany.
The move shows FFW’s disenchantment with the network it launched four years ago.
Former alliance chairman Mark Abell says: “We need to be able to offer a full, high-quality service in all European jurisdictions. We just can’t do that piecemeal with a confederation of law firms.
“We need proper management control and clear aims and objectives. It can’t just be a coalition of the willing.”
The firm has burnt its bridges, launching with partners poached from former alliance firms Buse Heberer Fromm in Germany and Verhaegen Walravens in Belgium.
“They’re competitors now,” says Abell.
Beyond that, FFW has plans for a full, Europe-wide expansion. The firm is negotiating a merger deal with former alliance partner Dubarry Le Douarin Veil to launch an office in Paris.
Jimenez de Parga, FFW’s Spanish ally, will market itself in association with FFW. According to Abell, the agreement is “not a merger, but bears all the hallmarks apart from financial integration”.
The firm is discussing a similar arrangement with Italian alliance member La Scala e Associati. But this is what FFW always claimed the alliance to be. So what is the difference?
FFW managing partner Moira Gilmour says: “Jimenez de Parga continues to be an independent firm, but the relationship with us is exclusive. The agreement is that outside of Spain they’ll market themselves as Field Fisher Waterhouse Jimenez de Parga.
“It’s generating business together rather than just referring work. The more we get to know each other’s business, the more we get to know where the opportunities are.
“It’s not the intention to merge today, but if the market conditions change, and both parties agree, it’s something that potentially could happen.”
The alliance ran into problems long before FFW took the decision to go solo.
Relations between FFW and German alliance partner Buse were strained by deep disagreements on how the alliance should progress.
Buse wanted a series of bilateral relationships with network firms, whereas as FFW wanted a unified whole that could be marketed to clients and firms in other regions.
Jacques Verhaegen, name partner at Verhaegan Walravens, saw the deteriorating relationship from inside the alliance.
He tells The Lawyer: “FFW didn’t believe any longer in the alliance. There were difficulties between the German firm and the English firm and it started with those tensions.
“Most of the firms were happy with the alliance. The two extremes were Germany and the UK.”
The divisions were deep. Buse objected to the prioritising of alliance work along FFW’s practice areas, which gave IP and IT the same standing as corporate.
There were also disagreements about marketing the alliance in the US, which was one of the main reasons for FFW to build up the network in the first place.
FFW had been pulling out all the stops to market itself and the alliance as a unit so as to build up referral work from other firms in the US. But when Buse opened its own representative office in New York in 2005 it became clear that the Germans were not going to play ball when it came to the world’s biggest legal market.
Verhaegen says: “[FFW] wanted to show to North America that we could work together in Europe. But in the opinion of FFW it didn’t have the return they expected.
“I suppose it’s good for my firm, because we’re free again.”
Abell’s plan is to double the number of partners in the new offices within a year, giving the firm six in Belgium and eight in Germany. He says the alliance was always meant to be the first step to FFW’s own offices on the Continent.
“It’s all been pretty much what we
decided from day one,” says Abell. “We knew that, in order to have a successful presence in Europe, we couldn’t just go charging in.
“We felt we would come to a natural point when we would make a decision, and that’s what happened.”
The success of the new venture will depend on whether Abell and the London management find the harmony with their new offices that was lacking in the alliance.