The most notable headlines to emerge from Asia this week include Herbert Smith Freehills (HSF) deciding not to renew its coveted qualifying foreign law practice (QFLP) licence in Singapore, while EY has announced plans to expand throughout the region.
Meanwhile, Clifford Chance‘s private equity practice has demonstrated its ties to key client Carlyle, despite high-profile exits in London, with a sizeable deal in South Korea.
For HSF, the decision not to renew its QFLP came after a series of recent departures from the Singapore office, set against the prescriptive growth targets set by the Singapore ministry of the law that underpin the granting of the QFLP to foreign firms.
HSF has a long history in Singapore, going back 25 years. According to Singapore managing partner Michael Walter, the firm remains committed to the city but he added: ‘To renew our licence we would have had to sign up to specific growth plans. We weren’t prepared to do that so we chose not to pursue the renewal.’
Departures include the head of south-east Asia disputes, Maurice Burke, who left in February for Hogan Lovells. The firm also lost energy lawyer Charles Ball to Reed Smith’s Singapore office last year.
Other departures include Freehills former Singapore managing partner John Dick, who left for EY in November 2013.
With HSF unable to offer domestic law services in the city state, it will now pursue a local alliance. ‘The options we’re looking at include joint law ventures and formal law alliances with domestic Singapore firms,’ said Walter.
‘The Singapore ministry of law has granted us a six month extension to the end of October, after which the firm will have new arrangements in place to support our ambitions and those of our clients in Singapore and the wider region,’ he added.
‘An expiry date of the 31 October gives us a bit more time to get an alternative in place. I’m pretty comfortable with that.’
Firms that have been successful in getting their QFLPs renewed for another five years include Allen & Overy, Clifford Chance, Latham & Watkins and Norton Rose Fulbright. White & Case only secured a one year extension to its licence, which will be extended by another four years if the firm is able to meet targets set by the Singapore ministry of law.
‘Over the last few months we have been actively engaged with the ministry of law, the attorney general’s chambers and the economic development board on matching our business plan with Singapore’s focus on ensuring that Singapore is a centre for international transactional and arbitration work,’ said Stephen McWilliams, managing partner of Lathams’ Singapore office.
Meanwhile, the hire of John Dick by EY last year was clearly the precursor to larger expansion plans, with the Big Four accountancy giant announcing plans last week to expand its legal services business throughout Asia over the coming year. EY has said it is looking to expand its offering across Singapore, Vietnam, Hong Kong, Korea and Indonesia, subject to regulatory requirements.
Earlier this year the firm entered the Chinese market via the acquisition of Shanghai-based law firm Chen & Co. So far the only other major accountancy firm that has a legal presence in Asia is Deloitte, through its tie-up with Chinese law firm Qin Li law firm.
In a statement, EY said: ‘EY Law operates in 40 countries around the world, with more than 1,000 lawyers…and is continuing to grow globally. From 15 January, our Greater China practice has had 50 lawyers operating out of Shanghai, Beijing and Hong Kong (and growing) as part of our multidisciplinary service offering.’
Finally, while Clifford Chance’s global private equity practice has suffered of late after losing its principal Carlyle Group relationship partner David Walker to Latham & Watkins last year, followed by Kem Ihenacho in February, the firm ran a major deal for this key client out of Korea this week. Corporate partner Simon Cooke led, alongside Seoul managing partner Hyun Kim, on a deal that saw Carlyle buy fire protection and security company ADT Korea from Tyco for $1.93bn.
The deal is the largest private equity buyout in Korea since 2008 and although subject to regulatory approval, is expected to close in the second quarter of this year.