In recent years a few international law firms have set up joint operations or alliances with Chinese law firms in the Shanghai Free Trade Zone.  In this article, our consultant Betty Chen highlights some of the reasons why a lawyer might want to consider a move to an alliance firm and also discusses where the demand currently is.

As an international and Chinese law firm alliance, there is a lot of expectation to integrate services between the two firms. This is not always that easy and does take time. The firm can often go through a period of time where things are difficult; however, there are a number of positive reasons why a lawyer might consider a move to one of these firms.

1. Litigation exposure: PRC licensed lawyers have the opportunity to appear in court on behalf of clients in mainland China.
2. Financial reward: Lawyers have more flexibility in tax arrangements compared to the lawyers at international law firms. It is also normal practice that lawyers will receive 3-6 months additional salary as a year end bonus with an alliance Chinese law firm compared to 1-3 months at international law firms.
3. Better career development: PRC lawyers at an alliance Chinese law firm find themselves with an easier path to partnership/counsel.

Where is the demand? 

The alliance Chinese law firms are building a well-rounded legal services capability and as a result there are opportunities across the spectrum. Legal talent is needed in:

1. Dispute resolution: the Chinese alliance law firms want to play a role in dispute resolution practice using the PRC law capability. Dispute resolution lawyers are needed in employment, IP and commercial dispute resolution.
2. General regulatory/compliance: Delivering general regulatory/compliance legal services to multinational corporations can help the alliance Chinese law firms to maintain sustainable and stable client relationships. They are therefore looking for lawyers with specialist compliance knowledge.
3. Financial services regulatory: Mid or senior level lawyers, particularly with financial services regulatory experience, are needed to serve international financial institutions in China.
4. Anti-trust/competition: Lawyers with anti-trust/competition experience are in demand largely for merger filing and relevant investigations work in China.  These lawyers are also expected to build up  direct connections with relevant authorities

Faced with the challenges of peer and PRC law firm alliances, international law firms need to come up with new strategies in order to compete. With this in mind, we expect more and more international law firms to turn to this option in order to succeed. Currently there are three international law firms in alliances approved by the Shanghai Justice Bureau: Baker Fenxun, Holman Fenwick William Wintell & Co and Hogan Lovells Fidelity.  There are still a few international law firms considering setting up as a joint operation in the Shanghai Free Trade Zone, and we expect to see more announced in the future.

For more information on the market or if you are considering a move within China please contact Betty Chen on betty.chen@ssq.com.