Asia Market Update

Attribute to Jacob Hansen, Asia Legal Blog

As the global economy continues to feel the effects of the 2008 recession, it faces both short and long-term challenges. But new and exciting opportunities are being created as the world’s markets walk the road to recovery. Southeast Asia has become an area of growth, attracting many firms and attorneys wishing to expand their portfolios abroad. The legal market in Asia is continuing to grow at record speed, changing the landscape for expatriate lawyers with an increase and broadening of opportunities for associates, partners and firms, a rapid and substantial deal flow.

According to the American Lawyer, Am Law 100 law firms had mild gains in 2012. They reported that gross revenue for Am Law 100 law firms was up 3.4 percent, average revenue per lawyer was up 2.6 percent, and average profits per partner were up 4.2 percent. Notably, this growth was uneven and the more successful firms tended to have a strong international presence, and well as a diverse set of practice areas.

Asia is a strong area of international growth and this extends to the legal sector. The Asian legal market is on pace to double in size by 2017, according to Asia Law Portal. Their analysts project the Asian legal market to grow 6 to 7 percent over the next 8 years, creating a strong incentive for U.S. and U.K. to get on the ground floor for fear of being left out.

Among those countries garnering interest is South Korea, who may be on the path to becoming an important international arbitration hub. Following the enactment of free-trade agreements with the U.S. and EU in 2011, South Korea has opened its legal market to foreign firms [when and please add a hyperlink to the South Korea article]. Dozens of international law firms have already begun to set up shop, such as Baker & McKenzie and Linklaters receiving regulatory approval from South Korea’s Ministry of Law as recently as May of this year. Some analysts are concerned that the market may eventually become overcrowded, but others remain optimistic that there will be plenty of room in South Korea.

Following the trend from last year, Singapore continues to see foreign law offices opening their doors in the Lion City. In May, Simmons & Simmons opened its first Singapore office with a focus on asset management, energy, life sciences, TMT and the financial services sector. Akin Gump opened its first Singapore office in January, while Clyde & Co. formed a joint law venture with Singapore firm Clasis in July. With the continued expansion of Singapore’s legal market, foreign firms are expected to keep establishing a presence and hiring on the partner and associate level in the Lion City.

Firm activity was not limited to expansion, however, and 2013 has been a year of border-crossing mega-mergers. Ashurst has moved up the timetable for its merger with Australian-firm Blake Dawson. A vote is expected to take place this October to confirm the groups’ merger. London-based Norton Rose and U.S.-based Fulbright & Jaworski united to become Norton Rose Fullbright. The merger created one of the largest law firms with a massive footprint in the U.S., Asia, the EU, and beyond. Not to be outdone, SNR Dentons joined together with Paris’ Salans and Canada’s Fraser Milner Casgrain to create a firm that employs close to 2,600 lawyers and professionals. The new firm has been rebranded as simply “Dentons”.

One of the fastest growing industries in the Asian legal market is the energy sector. As more and more Asia countries move toward industrialization, there has been an increased demand for fuel and energy. And, as a result, there has been an increased demand for attorneys to help manage energy transactions and now, more and more, litigate related issues. For example, China has begun to look toward Latin America as its need for energy and resources continues to increase. We at Cypress have noticed an uptick in demand for energy lawyers to work in Asia. While overall energy demand has dipped slightly in recent months, market analysts are confident this is only a temporary blip.

The M&A market in Asia continues to flourish despite a few setbacks. M&A lending of $30.5 billion made up 18.5 percent of the total Asia-Pacific loan volume in the first two quarters of 2013. The amount already exceeds that of 2012 at $28.4 billion, and puts 2013 on track to near the record-setting 2007 ($80 billion). Attorneys of all levels with a strong M&A background remain in vogue for firms expanding throughout Asia.
Asia’s role in capital markets has faced challenges with government cooling having an impact in Singapore and Hong Kong, but there are hopeful signs. Overall growth across the first half of 2013 was greater than in the first half of 2012, indicating a possible upward trend in 2013’s second half. There continues to be demand for capital market attorneys with debt and equity experience and Cypress currently has a record number of positions available for attorneys with or without local language capabilities and either US or HK listing experience. Here at Cypress we typically advise capital markets attorneys practicing in China to try and diversify their practice by working on US, London, HK and mainland China listings.

Cypress Recruiting is well positioned to ensure that your next move is the right one. Cypress is the only legal recruiting firm that has focused on partner and associate recruiting in Asia for over ten years. We have excellent relationships with law firms across the Asian region.

In this regard, it is worth noting that we are representing several law firms that are seeking to bolster their corporate, capital markets, M&A, arbitration, and other practices in Hong Kong, Singapore, Japan, and mainland China. For more information, please visit our job listings on our website.