Shoring up – the Offshore report

Shoring up – the Offshore report

In what will undoubtedly be remembered as an unpredictable year in more ways than one, offshore firms across the globe leveraged their resilience and diverse practice offerings to weather the storm that 2020 brought. The US-China trade wars and the uncertainty around the EU/UK divorce gave way to the devastation of the global coronavirus pandemic, plummeting oil prices and markets in freefall, and the final throes of Brexit negotiations.

However, the offshore legal sector seemingly managed to duck every blow and avoid every collapse, with 2020 and early 2021 proving to be highly successful years across the offshore market. For Edward Mackereth, global managing partner of Ogier, ‘unprecedented was the word of 2020’, while Christian Luthi, chair of Conyers, states: ‘2020/21 has certainly tested the adaptability of the firm, and Conyers has come through extremely well’. Jonathan Green, global managing partner of Maples, adds: ‘2020 and early 2021 have been very active periods for us, setting new high-water marks in many of our practice areas. Our global teams have delivered without missing a beat, pandemic notwithstanding.’ Continue reading “Shoring up – the Offshore report”

Caribbean offshore report: End of the storm?

Caribbean offshore report: End of the storm?

The Caribbean’s offshore financial centres have faced their fair share of challenges in recent years thanks to the increased international scrutiny of the tax haven environments, the impact of falling oil prices and the business interruption caused by the seemingly endless cycle of hurricanes, which sees the region bear the brunt of the ever-pervasive impact of climate change. Add to that a global pandemic, and there’s certainly the potential for a substantial economic disaster.

While the Covid-19 infection numbers for the Caribbean as a whole have remained low thanks to quick action by the local governments to close borders, enact temporary lockdowns and implement testing and contact tracing methods, the primary impact of the coronavirus pandemic on the Caribbean is undoubtedly on tourism. For Bermuda, the British Virgin Islands (BVI) and the Cayman Islands (Cayman), the tourism industry contributes 28%, 52% and 70% of the average GDP respectively and figures suggest that, at worst, 2020 could see a 71% reduction in the number of international visitors. Continue reading “Caribbean offshore report: End of the storm?”

UK offshore report: Staying afloat

UK offshore report: Staying afloat

‘Anyone who says they’re not struggling would be lying,’ says Tim Pearce, global managing partner of Bedell Cristin, referring to the Jersey market. ‘Every sector of the economy and every business has struggled or suffered as a result of Covid, though businesses have struggled in different ways. Some financially, others socially. Others are struggling in terms of pure management. But for us, and indeed for the offshore industry as a whole, we’ve weathered the storm OK so far.’

Pearce’s cautiously optimistic outlook reverberates throughout the discussions with partners across the Bailiwicks of Jersey and Guernsey in the Channel Islands archipelago and the Isle of Man in the Irish Sea to the north – the jurisdictions collectively known as the Crown Dependencies. Unlike the UK, domestic property is booming, buoyed by numerous factors. ‘In times of crisis, people invest in what they know,’ says Pearce. ‘People are looking for safe havens right now and property in all of our offshore jurisdictions is benefiting from that.’ Continue reading “UK offshore report: Staying afloat”

Global offshore – Stick or twist for the sector’s leaders

Global offshore – Stick or twist for the sector’s leaders

On paper at least, history will show that 2019 was a very good year. Encouraged by sustained low interest rates, declining trade policy uncertainty and diminished fears of an economic slowdown, US stock markets led the way: the S&P 500 ended the year up 28% and the Nasdaq 35%. Meanwhile, the Europe-wide STOXX 600 increased by 23% and the FTSE 100 by a more modest 12%.

But on the ground, things seemed a little different for many offshore law firms. ‘Even by recent standards, 2019 was an extraordinary year in geopolitical and macro-economic terms: US-China trade wars, Brexit uncertainty, volatility in the US dollar/GBP exchange rate, tension in Hong Kong and the growing risk of a global economic downturn,’ says Jonathan Rigby, global managing partner of Mourant. Continue reading “Global offshore – Stick or twist for the sector’s leaders”

Offshore: Deal or no deal?

Offshore: Deal or no deal?

Protracted arguments over Brexit have led a divided Britain to the point of exhaustion. In the months leading up to the June 2016 referendum, offshore firms were concerned about the potential impact of a ‘Yes’ vote – although perhaps less so than some of their onshore counterparts. Even before the financial crisis, there had been a continued diversification by larger firms in the major offshore jurisdictions away from a reliance on the UK economy.

Since the referendum, offshore firms in the British Crown Dependencies and Overseas Territories have been dealing with the problems of continued uncertainty that Brexit has created for their clients and advising them in relation to investment opportunities that may arise once it is eventually resolved. Continue reading “Offshore: Deal or no deal?”

Offshore: The unsilent majority

Offshore: The unsilent majority

Among Asia’s competing financial centres, Hong Kong is the essential place to be for leading offshore law firms. Collectively, their local offices have grown significantly over the past few years to around 300 lawyers, making Hong Kong the third most-heavily lawyered jurisdiction by offshore firms after the Cayman Islands and Jersey.

But in early June, the first visible signs emerged of real discontent with Beijing’s increasing threat to Hong Kong’s freedoms: around 3,000 lawyers took part in a silent protest march in opposition to a government bill that would amend the city’s extradition law – the largest-ever protest by lawyers in history. They argued vehemently that the proposed amendment would allow Hong Kong to handle extradition requests from jurisdictions with no prior agreements, most notably China, and would strike a blow to the rule of law. Since that peaceful march, Hong Kong has deteriorated to become a city in crisis. Several months of much larger pro-democracy protests by millions of its citizens have provoked widespread violence and a sustained fall in business activity. Continue reading “Offshore: The unsilent majority”

Offshore leaders’ year in review: Under pressure

Offshore leaders’ year in review: Under pressure

Donald Trump is still in office, Brexit is still about to happen, but the global economy in 2018 provided few of the seismic shocks that have reverberated offshore in recent years. Uncertainty remains a continuous theme, although there were none of the revelations like the Panama Papers of 2016 and the Paradise Papers in 2017, both of which generated big headlines but ultimately little impact.

The media attention has been underpinned by what Ingrid Pierce, global managing partner of Walkers, calls ‘a deliberate unwillingness to understand the benefits of international financial centres to the global economy’. Offshore reputation remains a concern for Michael O’Connell, Appleby’s group managing partner. ‘Considering the escalating media, political and regulatory scrutiny that the industry is under, combined with the pressures of an uncertain economic environment, there is a continued need to focus on perception and reputation,’ he says. ‘Any large mistakes are likely to be blown out of proportion in the current climate.’ Continue reading “Offshore leaders’ year in review: Under pressure”

Offshore disputes: Centre of the cyclone

Offshore disputes: Centre of the cyclone

The inferno of disputes arising from the financial crisis is finally being reduced to embers. Although this may have caused the volume of commercial litigation in London to plateau, disputes in the main Caribbean offshore centres continue to be very buoyant: several firms report significant double-digit revenue growth in their dispute resolution teams over the past 12 months.

Driven by different dynamics, the Cayman Islands, the British Virgin Islands (BVI) and Bermuda have each developed in their own right as sophisticated jurisdictions in which to litigate – supplemented by the expansion of specialist commercial courts, a raft of high-quality judges and a regular flow of top-drawer London silks to argue significant cases. Continue reading “Offshore disputes: Centre of the cyclone”

Offshore disputes: Big fish, small pond

Offshore disputes: Big fish, small pond

Carlyle, Tchenguiz and Crociani are cases repeatedly cited by the leading players in Jersey and Guernsey as shorthand for big disputes and big fees. These cases just keep on giving: all three are now subject to further appeals or related proceedings, prolonging their life in litigation terms. Elsewhere, the mood among local dispute resolution and insolvency lawyers is generally upbeat. Although less high-profile litigation might not deliver the big headlines, there is enough going on below the radar for revenues to remain healthy.

‘Insolvency-related disputes are still a significant source of work globally,’ says Jeremy Wessels, Mourant’s head of litigation and dispute resolution. ‘Other areas where we have seen increased activity include trust-related litigation, regulatory, debt restructuring, cross-border enforcement and go-private transactions.’ Mourant remains the biggest Channel Islands firm for disputes with 25 lawyers in Jersey (five partners and 20 other fee-earners) and 23 (six and 17 respectively) in Guernsey. Continue reading “Offshore disputes: Big fish, small pond”

The offshore elite in review – rolling with the punches

The offshore elite in review – rolling with the punches

Global stock markets rose by 22% in 2017, according to the Morgan Stanley Capital International index of bourses. Meanwhile, the World Bank is forecasting global economic growth to increase to 3.1% this year after a better-than-expected 2017 as investment, trade and M&A continue to rebound while commodity prices recover. Against this favourable economic background, it is no surprise that offshore law firms had another very good year.

But there were some local difficulties. Hurricane Irma and Hurricane Maria created havoc across the Caribbean, not least in the British Virgin Islands (BVI). ‘It had a devastating impact on the lives of our BVI colleagues,’ says Jonathan Rigby, managing partner of Mourant Ozannes. ‘None of us will ever fully understand what they have been through, but their strength of character and resilience has been truly humbling.’ Continue reading “The offshore elite in review – rolling with the punches”