Oct 19th, 2014 by Justin Allen Pifer
In 2011 and 2012, the world’s leading foreign law firms began to create offices in South Korea. This highly tactical move was met with varying levels of intrigue. Some critics said there were concerns that there wasn’t enough work to go around, yet others championed the possibilities of success.
Despite this bifurcated assessment of the legal profit possibilities in South Korea, international firms continue to take an interest in Seoul. Skadden Arps Slate Meagher & Flom is the 19th firm to open in the country, and the most recent. Currently, most firms have been devising plans on how to corner the market pertaining to overseas litigation. Areas of applicable law include outbound M&A, international capital markets, nationalization of transient workers, and Korean corporate compliance. These legal teams usually start with three and ten lawyers and then grow according to need. Pursuant to recent regulations, these foreign firms are also permitted to co-bill and share profit-pools with local firms on a project-by-project basis. The current question in the legal world is whether these mega-firms are turning a profit with their Korean ventures and what challenges persist as competition with other firms continues.
“It is hard to generalize on how firms are doing,” says Yong Guk Lee, the chief representative for Cleary in Seoul. “We had a Korean practice based in Hong Kong for more than 20 years and are continuing in Seoul with what we’ve always done. That’s probably true for a handful of firms - they are carrying on doing what they used to do out of Hong Kong. There are others that have a more niche practice, and those that are either brand new players in the market or trying to expand beyond their traditional practice areas.
For a greater set of firms, the reality seems to be that the Seoul branch is not a solitary profit growth center and serves as more of a networking base for new clients and new business prospects for other connected offices. Another problem these firms are having is finding Koreans, either to run or staff offices. A partner at a firm based in the United Kingdom says the Korean employment issue is unlikely to change: “The difficulty in Korea is that it will be hard to make any inroads into the market unless you’ve got a team of Korean-speaking lawyers. That’s a particular challenge for British firms because not many Koreans want to go and study in the UK. The US firms are almost spoilt for choice and so have a natural advantage.”
Source: The Korea Times
Picture: The Korea Times