Squire Patton Boggs has ended its strategic alliance with Jakarta-based Melli Darsa & Co, just two years into the relationship.

The alliance with the Indonesian firm was first established by legacy firm Squire Sanders in November 2013. The tie-up came a year after Squire Sanders launched an office in Singapore. The relationship was led by Singapore managing partner Ignatius Hwang, who joined the firm in 2012 from Bryan Cave.

Squire Patton Boggs confirmed to The Lawyer the strategic alliance ended last year, but said the firm would continue to work with Melli Darsa & Co on a less formal basis.

It is understood that Melli Darsa & Co suffered from major team exits in 2015. In 2013, the firm had seven partners. Founding partner Melli Darsa is currently the only senior-level partner, supported by three newly promoted junior partners who were made up early last year.

Three corporate and capital markets partners, David Siahaan, Kuntum Apriella Irdam and Laksmita Andarumi, are known to have left Melli Darsa & Co and set up Siahaan Irdamis Andarumi & Rekan at the beginning of 2015.

Squire Patton Boggs said it had no plan to enter into a new formal relationship with another firm.

The Indonesian market has seen a number of changes in international firms’ local association firms. Most recently, Norton Rose Fulbright has formed a new association in Indonesia with TNB & Partners, a firm set up by the majority of the team from its previous ally Susandarini & Partners.

In September 2015, Hogan Lovells terminated its relationship with Indonesian association firm Hermawan Juniarto, three years after the tie-up started. But the firm is seeking another arrangement to support its Indonesian practice.

In May 2015, White & Case changed its association firm for the third time, moving from MD & Partners to Witara Cakra Advocates. The switch came after two partners from MD & Partners left to join Baker & McKenzie and Norton Rose Fulbright.

According to The Lawyer’s latest South East Asia Elite report, Indonesia is seen as prolific in terms of spin-offs from larger firms. It is common for senior or well-known practitioners in law firms to set up their own operations, either as independents or in association with international firms.

For example, Clifford Chance recently formed an alliance with newly established local corporate and banking boutique Linda Widyati & Partners. Its founding partners, Linda Widyati and Dezi Kirana, were previously partners at local firm Soemadipradja & Taher.

“It was a difficult year for firms in Jakarta and put pressure on relationships,” said a partner at one Indonesian firm. “If the two parties have different expectations that could create problems. If they are not fully integrated and the foreign firm treats the local one as an outpost it would be stressful and frustrating for local partners.”

A regional managing partner at an international firm shares this view, saying: “One of the toughest challenges is fulfilling mutual expectations of the co-operation with local alliances.”
Another international firm partner adds that it is a challenge to maintain a relationship when there are management changes or succession issues in either firm.

Find out more about the latest legal market updates and the major firms in the ASEAN region, read the executive summary of The Lawyer South East Asia Elite 2016 report.



Source: The Lawyer South East Asia Elite 2016