Notwithstanding the macro-level impact of Covid-19 globally, independent firms in the Benelux region have adapted to evolving conditions with remarkable fortitude. At Stibbe, for example, there have been tangible reasons for cheer. According to its managing partner, Wouter Ghijsels: ‘The firm is growing, and the lateral hires and promotions of the past year across the Benelux are a testament to that. Overall, we have had an increasingly successful year across all practices,’ he says.
Equally, Loyens & Loeff has been another success story. Says its Netherlands managing partner, Bram Linnartz: ‘Our firm succeeded in adapting to the ever-changing circumstances and continued to grow at a tremendous pace’. This was helped by the firm establishing a dedicated incident and crisis management team to safeguard the workforce and handle the challenges of the coronavirus crisis.
On the corporate front, despite there being a hiatus in dealmaking during the initial onset of Covid-19, independent firms (particularly those in Belgium and the Netherlands) benefited from the M&A market picking up in the third and fourth quarters of 2020. As Marc Vermylen, managing partner of Loyens & Loeff’s Brussels office, observes: ‘The notable movements in the ICT/software sector can be explained by a rush of companies digitalising their business in the face of the pandemic. Private equity houses saw this opportunity and represented more than half of the investment in this sector.’
M&A deal trends aside, what puts independent Benelux firms on a strong footing to win corporate work? As Ghijsels notes: ‘Should an international firm land a cross-border transaction, they could potentially team up with us on the Benelux side, and that has often happened recently.’ In addition to working with US firms, Benelux firms are a first port of call in their own right among international corporates going directly to the region. High-profile local level transactions are also another key pillar of the workload.
Restructuring work has also been a major driver of activity, confirms Luxembourg-based Loyens & Loeff partner Marc Meyers. This work is expected to continue for the foreseeable future, with the impact of Covid-19 being felt for some time to come. In addition, other key talking points include fintech, compliance (including in the context of anti-money laundering, privacy regulations and international cross-border tax treaties) and environmental, social and corporate governance. Also notable is that the newly-formed Belgian government has expressed an intention to embark on a very active investment policy, particularly in areas such as digital and green energy, so the PPP (public-to-private) market is expected to heat up. In addition, the development of logistics and data centres on the border between the Netherlands and Belgium is seen as a key source of work opportunities for firms.
‘The pandemic especially affects young professionals, who would benefit from more direct contact with their seniors.’ David Orobio de Castro, Stibbe
Litigation and arbitration work has also been on the increase in Benelux, with many contentious matters arising from M&A deals that got pulled because of Covid-19, as well as those connected with other previous transactions. As Stibbe’s Amsterdam managing partner David Orobio de Castro reports: ‘We have attracted a number of important disputes, which are still ongoing.’
So, what about the impact of Covid-19 on workplace management? ‘The biggest impact of Covid-19 in the tax and legal sector was undoubtedly the abrupt transition to remote working’, says Linnartz, in a reference to what he describes as ‘the biggest digital experiment ever’.
He adds: ‘Fortunately, our firm had previously invested in sound and robust IT infrastructure with upgraded applications in the cloud and secure remote access to all relevant IT systems, making it possible to work anywhere. This made a significant difference for our lawyers to continue their work remotely without experiencing any disruption in their ability to provide services to our clients.’
This is great from an outward, client-facing perspective, but what about internal issues? Orobio de Castro has detected challenges for more junior lawyers at his firm: ‘We notice that the pandemic especially affects young professionals, who would benefit from more direct contact with their seniors.’
What about longer-term challenges and opportunities for law firms? Vermylen says: ‘We believe that the biggest opportunity for independent firms lies in successfully managing to combine client knowledge through proximity, in-depth expertise of the local regulatory environment and know-how of international best practices, thanks to a solid international network.’
He also points to his firm’s own investment in digitalisation and innovation, with a specialist department having a mission to ‘develop smart solutions that enable us to serve our clients in better, more efficient, and future-proof ways and to continuously look for the best technologies in the market.’
Meanwhile at Stibbe, Orobio de Castro sees the firm’s key relationships with US law firms as a source of opportunities. ‘There are a lot of firms that don’t have a foothold in the Benelux, but their clients do need high-end legal advice there and the relationships with those firms are developing really well, so that is a real plus for independent law firms, especially for us.’ LB