Expansion in the Asia-Pacific region continues to sit high on the agenda for many international law firms and Singapore has emerged as a key commercial hub in Southeast Asia.
Historically, foreign firms were permitted to operate in Singapore only via Foreign Law Practice (FLP) licenses. Firms wishing to provide local Singapore law capabilities were required to form a Joint Law Venture (or less formal alliance) with a local law practice. However, as we’ve discussed in previous posts, the legal market in Singapore has undergone considerable deregulation and the advent of Qualified Foreign Law Practice (QFLP) licenses has meant that firms holding such a license can now practice both foreign and local Singapore law (in certain areas, mainly corporate and commercial work-types), without the need for a joint venture arrangement.
Currently QFLP licenses are held by only six firms – Allen & Overy, Clifford Chance, Latham & Watkins, White & Case, Norton Rose, and Herbert Smith – with a number of other international firms, such as Baker & McKenzie and Hogan Lovells, choosing instead to continue with their Joint Venture arrangements.
Following favorable reviews and performance results of the initial tranche of licenses, the Ministry of Law announced plans to expand the scheme earlier this year and invited foreign firms to submit applications for a second round of licenses between July 1st and August 31st of this year.
As of August 31st, Legal Week (subscription required) reported that 23 law firms had submitted applications. Firms understood to have bid for a license include global giant, DLA Piper, U.S. firms Shearman & Sterling, Jones Day and K&L Gates, as well as UK firms Ashurst, Watson Farley Williams, Olswang and Stephenson Harwood.
The number of licenses to be awarded has not yet been determined, although successful firms should receive their license before the end of the year. However, the Ministry of Law has indicated that priority will be given to firms that demonstrate an ability to help the Ministry achieve the overall goals of the expansion scheme. These are thought to include supporting the growth of Singapore’s key economic areas, such as the financial services, the value of foreign work that a local office would attract, the extent to which the office would act as a regional headquarters, and the size of the office overall.
Rob Bratby, Asia Managing Partner for Olswang outlined his firm’s thinking in terms of bidding for a QFLP license in Legal Week:
“…our technology, telecoms and media industry sector focus complements the Singapore Government’s initiatives to make Singapore a regional hub for IP-rich businesses…a licence to practise Singaporean law will give us additional flexibility for regional transactions”.
New Market Entries
In addition to QFLP license applications (these have mainly been firms already active in the market looking to add a local law capability), a number of other foreign firms have looked to establish new Singapore offices for the first time in recent months. These include a number of offshore and private wealth-focused practices such as Bedell Cristin and Withers, as well as more mainstream firms including the UK’s Addleshaw Goddard and the U.S.’s Squire Sanders.
However, the most prominent has been the announcement by Freshfields Bruckhaus Deringer to re-launch in Singapore, six years after it announced the closure of its office during 2006. The firm decided to shutter the office as part of a wider restructuring of its Southeast Asia business, which also saw the Bangkok office close in 2004, and the focus shift towards Hong Kong and China.
The Lawyer reported that the firm re-opened in Singapore last week. Two partners (capital markets co-head Stephen Revell and co-head of the international arbitration practice, Lucy Reed) have relocated from Hong Kong to Singapore and the firm has also added an energy & natural resources capability via the hire of Gavin MacLaren from leading Australian firm, Allens.
Posted by Tricia Pelton