Linklaters has selected Shanghai Capital Law & Partners and Shanghai Kai-Rong Law Firm as targets as management works to establish a Chinese law offering. The plans come as the firm’s Asia practice has been rocked by a series of senior exits.
Linklaters wants to become the first Magic Circle firm to practise Chinese law through new Shanghai free-trade zone rules after decades of protectionism in the communist country.
Co-operation agreements are now available to international law firms operating in Hong Kong, Macau or Taiwan, allowing them to practise Chinese law for the first time, rather than relying on a representative office.
Asia managing partner Marc Harvey, who recently lost Linklaters’ managing partner election to former banking chief Gideon Moore, is leading ‘project trident’ and has overseen discussions with ten Chinese firms.
Shanghai Capital Law and Shanghai Kai-Rong, both boutiques, fit with Linklaters’ plan of tying up with a small local firm. Shanghai Capital Law was established in 2004 and has 12 lawyers specialising in initial public offerings, securities and M&A work.
Shanghai Kai-Rong, which specialises in M&A and disputes work, was founded in 1998 by Jin Yu-Lai as one of the first private law firms in Shanghai.
The firm has 15 lawyers, six of whom are partners, and is also known for its finance and shipping work. Major clients include Air China, Singapore Airlines and HSBC Insurance.
If a suitable target cannot be found, the firm will resort to its ‘plan B’, which is to launch a greenfield operation in Shanghai by establishing a new Chinese firm with its own lawyers. It would then tie-up with the firm at a later date.
The push in mainland China comes as Linklaters has been hit by a series of senior exits from its Hong Kong and Singapore practices. Capital markets partners Singapore-based Dean Lockhart and Hong Kong-based Jeremy Webb resigned in January, along with big-billing Hong Kong corporate partner Christopher Kelly. Jon Gray, who went to Davis Polk & Wardwell, David Ludwick, who joined Freshfields Bruckhaus Deringer, and private equity specialist Peggy Wang, who left for White & Case, were also key departures in the region during the last 18 months.
tom.moore@legalease.co.uk