Clifford Chance has broken off its best friend relationship with India’s AZB & Partners after both firms saw fewer referrals than expected and Indian market liberalisation failed to materialise.
AZB Mumbai-based co-founding partner Bahram Vakil and two Clifford Chance sources confirmed that the firms would continue as “good friends” rather than best friends.
A Clifford Chance partner said one trigger for the break-up was that when the firms entered into their tie-up Indian legal market liberalisation was expected to happen in the near future.
This momentum has been lost, said the partner, although Clifford Chance is still keen to open an office in India when regulations permit.
It is understood that another reason was the relative scarcity of joint mandates on larger deals, with it often being hard to convince Indian clients to instruct firms other than their established overseas advisers.
In addition, the slump in the global economy and the banking sector meant inbound referrals into India from the magic circle firm were fewer than expected.
“I don’t think there’s a single [international] firm out there that has the ability to sustain a firm like ours [in terms of referrals],” commented one AZB lawyer.
AZB co-founding partners Ajay Bahl, Zia Mody and Vakil visited the London office of Clifford Chance last Tuesday (11 January) for a scheduled and regular six-monthly relationship evaluation meeting.
At the meeting the two firms agreed to wind up their official relationship by the end of February, but plans were accelerated as market rumours and speculation continued to mount, with both firms terminating all their previous contractual best friend arrangements.