Asian Legal Business February 2015 by Asian Legal Business

DACHENG-DENTONS: WILL MORE CHINESE FIRMS FOLLOW SUIT?

FEBRUARY 2015 ASIA EDITION

MCI (P) 178/01/2015 issn 0219 – 6875 KDN PPS 1793/07/2013(025520)

ASEAN POTENTIAL

Offshore law firms await the arrival of AEC

CORRUPTION FIGHT How FCPA is affecting companies in Asia

MILBANK Q&A

Asia MP David Zemans on regional plans

INSIDE n BIG STORY

n LEAGUE TABLES

n DEALS

PAGE 24

PAGE 34

PAGE 38

n APPOINTMENTS

6 14

ASEAN INTEGRATION SUMMIT

DATE: MARCH 26, 2015 LOCATION: SINGAPORE

THE ROAD TOWARDS

A GLOBALLY COMPETITIVE

REGION MARCH 26, 2015 - SINGAPORE

ASEAN Integration is set to transform the ASEAN region, by creating a trading bloc designed to help Asia compete across all global markets. The ASEAN Economic Community (AEC) blueprint will establish a single market designed to accelerate the region’s global trade competitiveness, ease free movement of human capital, enhance involvement of private sectors in the region’s economic growth and increase connectivity and develop infrastructure. However, with opportunity also come significant challenges, and companies across the region will have to adapt to the new system – with new local and regional legislation to take into account, and changes required across all aspects of doing business in the region. ALB’s inaugural ASEAN Integration Summit 2015 will bring together the region’s key government and private sector leaders to forge partnerships and devise solutions on the legal, regulatory, and business challenges of the AEC.

REGION’S EXPERT SPEAKERS INCLUDE:

ALAN BOLLARD Executive Director Asia Pacific Economic Cooperation Secretariat

CHRISTOPHER STEPHENS General Counsel Asian Development Bank

FRASER THOMPSON Senior Fellow McKinsey Global Institute

PUSHPANATHAN SUNDRAM Executive Chairman China ASEAN Business Association

SIMON TAY Chairman Singapore Institute of International Affairs

CHRIS HUMPHREY Executive Director EU-ASEAN Business Council

JAYANT MENON Lead Economist, Trade and Regional Cooperation Asian Development Bank

IAN MCEWIN Director Singapore Global Economics Group

EFREN LEANO Executive Director Philippine Board of Investments

EDMUND SIM Professor, Law and Policy of the AEC National University of Singapore

WHY YOU SHOULD ATTEND • Enjoy unmatched access to colleagues and leaders from every facet of the ASEAN Economic Community • Explore new partnership opportunities with institutional decision makers in the region’s private and government institutions • Discover best practices, data-driven insights and trends in cross-border opportunities and investments in business, trade, and infrastructure • Gain key knowledge on seizing vast opportunities in a regional economy growing as fast as China and as big as Germany’s by 2018 • Benefit from the expertise of some of the region’s leading authorities in mitigating the legal risks of protectionism • Discover key concepts, innovations, and solutions vital to coping with the key challenges of integration and seizing opportunities to this regional milestone KEY TOPIC HIGHLIGHTS • Receive a critical analysis of the ASEAN Governance and comparative analysis of international and regional organizations • Get updated on recent legal and regulatory developments in the region • Understand the impact on business operations across ASEAN • Negate the risk from changing regulations in taxation, trade, intellectual property, and e-commerce. • Learn about optimal dispute settlement options in an integrated ASEAN • Prevailing over public-private partnership challenges: How to accelerate the necessary private investment in the region

To book please visit www.regonline.com/ASEAN2015 Book 5 delegates and save an additional 20%. For further information on delegate places, please contact Sheila at sheila.lum@thomsonreuters.com or call (65) 6870 3252 For sponsorship or speaking enquiries, please contact Amantha at amantha.chia@thomsonreuters.com or call (65) 6870 3917 www.legalbusinessonline.com/ASEAN-Integration-Summit WORKSHOP SPONSOR

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CONTENTS

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REUTERS/Mark Blinch

COVER STORY

Firms to Watch 2015

Asia today is seeing the growth of smaller, nimbler outfits that are able to compete with their larger peers in both clients and talent through a mixture of quality work and business savvy. ALB’s Firms To Watch 2015 list celebrates 10 of these law firms that may be small in size but are certainly big in ambition

“FROM AN INVESTIGATION PERSPECTIVE, MULTINATIONALS WITH SUBSIDIARIES IN ASIA NEED TO THINK ON MULTIPLE LEVELS. IT’S LIKE PLAYING MULTIDIMENSIONAL CHESS, BECAUSE YOU HAVE TO THINK ABOUT THE LOCAL AUTHORITIES AND THEIR FOCUS, BUT ALSO ABOUT THE IMPLICATIONS IN YOUR HOME JURISDICTION AND LISTING JURISDICTIONS. IF YOU ARE A GLOBAL MNC, A LOCAL MATTER CAN BLOSSOM INTO SOMETHING THAT POTENTIALLY COVERS A HOST OF JURISDICTIONS.” Kelly Austin, Gibson, Dunn & Crutcher

FE AT URES ASEAN potential

2015 is slated to be the year when the ASEAN Economic Community (AEC) kicks off, and the Southeast Asian economic bloc looks all set to drive offshore growth, finds Chris Horton

Clamping down on corruption

Corruption has been a deep-rooted problem in Asia for many years. Local governments have tackled this issue with renewed vigour in recent years, and are fast developing, reinforcing and enforcing existing anti-corruption laws. Meanwhile, extraterritorial regulations from Europe and the U.S. are increasingly affecting how businesses operate in Asia. The U.S. Foreign Corrupt Practices Act (FCPA) is one such law. The FCPA has been in place since 1977, but actions under it have been prolific over the past few years as foreign investment and businesses flow into Asia at lightning pace. Kanishk Verghese reports

‘Having the right team is crucial’

David Zemans, Asia managing partner at Milbank, Tweed, Hadley & McCloy LLP, speaks to Ranajit Dam about the firm’s strategy for growth in the region, how it is adapting to the needs of an evolving Asian market, and the importance of attracting and retaining the best talent

IP dispute resolution: an evolving field

ALB Japan Anti-Corruption Forum

IP dispute resolution in particular is an increasingly hot topic, especially now that more companies are introducing their brands into multiple international markets, and this was discussed in depth at the ALB Singapore IP Conference recently

Nearly 100 in-house counsel, private practitioners and compliance and ethics officers attended ALB’s inaugural Japan Anti-Corruption Forum, held at the Okura Hotel in Tokyo, to hear from a range of distinguished speakers on the latest anti-corruption developments and issues affecting both local and international businesses in Japan

The legal industry embraces innovation

Businesses world-wide are evolving in an effort to maintain market position and stave off the competition, all while working within the confines of tighter budgets. The legal industry is no exception. The ALB Innovation & Leadership: Turning 2020 Vision into Action luncheon in Hong Kong focused on innovation among law firms

34 NEWS 46

BRIEFS — — — — — —

The Big Story League Tables Deals Spotlight: North Asia Southeast Asia News Regional Updates Appointments

3 4 6 7 8 10 14

EDITORIAL

ASIAN LEGAL BUSINESS FEBRUARY 2015

IN PRAISE OF THE

MANAGING DIRECTOR Klaus Pfeifer klaus.pfeifer@thomsonreuters.com PUBLISHER Amantha Chia amantha.chia@thomsonreuters.com MANAGING EDITOR Ranajit Dam ranajit.dam@thomsonreuters.com DEPUTY EDITOR Kanishk Verghese kanishk.verghese@thomsonreuters.com JOURNALIST Shangjing Li shangjing.li@thomsonreuters.com CONTRIBUTORS Chris Horton Tara Shah SENIOR DESIGNER John Agra john.agra@thomsonreuters.com TRAFFIC / CIRCULATION MANAGER Rozidah Jambari rozidah.jambari@thomsonreuters.com ACCOUNT MANAGERS Yvonne Cheung Account Director (China) (852) 2847 2003 yvonne.cheung@thomsonreuters.com

LITTLE GUYS M

uch of the news around Asia’s legal industry has a bit of a big bias. The headlines tend to (not surprisingly) espouse the virtues of size, be it the biggest deals, the biggest disputes, the biggest firms (something we celebrate annually in our Top 50), the biggest networks, and so on. Amid this focus on gigantism, we tend to forget that there are smaller firms doing pretty remarkable work as well. Some are just starting out; some have been around for a bit, but are just hitting their stride, having found the right mix of clients and talent; others choose to remain small, a la Slaughter and May, valuing quality over quantity. The ALB Firms to Watch list makes an attempt to unearth some of these firms and give them the place in the spotlight that they so rightfully deserve. Given that ASEAN is where a lot of the business (and legal) action is set to take place, the vast majority of the 10 are firms with offices in Southeast Asia as opposed to their northern neighbours. And while it wasn’t intended that way, every one of the ASEAN’s larger economies provides at least one firm, and thus a fairly even spread. Keep an eye out for these firms as they continue their upward march.

Shyanne Chen Advertising Sales Manager (Indonesia and Malaysia) (65) 6870 3253 shyanne.chen@thomsonreuters.com Sardor Yangibayev Sales Executive (Philippines, Thailand, Vietnam) (65) 6870 3190 sardor.yangibayev@thomsonreuters.com Henry Cheng Account Manager (Hong Kong) (852) 2847 2016 henry.cheng@thomsonreuters.com

RANAJIT DAM Managing Editor Asian Legal Business Thomson Reuters ranajit.dam@thomsonreuters.com

DIRECTOR, EVENTS Colin Carter colin.carter@thomsonreuters.com CONFERENCE AND MARKETING MANAGER Trang Chu Minh chuminh.trang@thomsonreuters.com

ASIAN LEGAL BUSINESS is available by subscription. Please visit WWW.LEGALBUSINESSONLINE.COM for details. Copyright is reserved throughout. No part of this publication can be reproduced in whole or part without the express permission of the editor. Contributions are invited, but copies of work should be kept, as ALB can accept no responsibility for loss. MCI (P) 178/01/2015 issn 0219 – 6875 KDN PPS 1793/07/2013(025520) THOMSON REUTERS 18 Science Park Drive Singapore 118229 / T (65) 6775 5088 / F (65) 6333 0900 10/F, Cityplaza 3, Taikoo Shing, Hong Kong / T (852) 3762 3269 / F (852) 2154 6425 www.thomsonreuters.com

BRIEFS

02.2015

INSIDE LEAGUE TABLES 4 / DEALS 6 / NEWS 8 / REGIONAL UPDATES 10 / APPOINTMENTS 14

the big story

To merge, or not to merge FIRST KING & WOOD MALLESONS, NOW DACHENG-DENTONS. WILL MORE CHINESE LAW FIRMS CLAMBER ABOARD THE INTERNATIONALMERGER BANDWAGON? By SHANGJING LI

he novelty of the King & WoodMallesons merger is finally starting to wear thin: 大成Dentons is now a reality. That is the stylized name of the new entity that is now the largest law firm in the world – with more than 6500 lawyers in 50 countries – after Dentons and China’s Dacheng Law Offices decided to join forces. The merger comes at a time when Chinese law firms are rapidly boosting headcount and adding overseas offices to cater to the boom in outbound work. “I think it is quite possible that we will see further combinations of this sort,” said Tony Williams, the principal at Jomati Consultants, a Londonbased legal consultancy. However, he added that other Chinese law firms could be reluctant to follow that approach partly because they already work with a large number of foreign law firms, and linking with any single one may close off referrals from others. Additionally, a merger between law firms requires extra effort to combat geographical, cultural, economic and language barriers, according to Williams, since clients of both sides would be interested in nothing but a

joint team providing first-rate services. “I always advise clients contemplating mergers that when they finalise the merger they have only done about 20 to 25 percent of the work required to make the combination a success,” he said. The Dacheng-Dentons merger, which followed six months of negotiations, uses a Swiss verein structure, allowing for separate regional profit pools and accounting while sharing strategy, branding, and other core functions. The 2012 merger between China’s King & Wood and Australia’s Mallesons Stephen Jaques also followed the verein structure, a legally necessary combination, as China forbids foreign law firms and lawyers from practicing Chinese law, relegating them to advisory roles. The surface benefits are obvious: the merger with Dacheng allows Dentons deeper access to the Chinese market. For Dacheng, the merger gives the firm a stronger presence overseas that is quite appealing to Chinese clients. But the wisdom of the merger is under a lot of debate. On the positive side, a merger like Dacheng-Dentons means more influence

in the market and an enhanced reputation. “Dacheng and Dentons’ merger give clients a new option,” said Xiao Wei, the founding partner of Jun He Law Offices, a Chinese law firm with numerous overseas branches. For Jun He, though, merging with a foreign law firm is not the most preferred option when it comes to growing its overseas profile.“You need to consider the downside of the merger,” Xiao said. “The merger could potentially cut the ties between your firm and other foreign partners, which are the competitors of the foreign firm you merge with.“ What makes the issue more complicated is that most lawyers in China work quite independently. Even within a law firm, there is hardly cooperation between teams. “Honestly if you can’t even merge with yourself, how can you properly merge with a foreign law firm?” said Hua Xiaojun, another partner at Jun He. The firm says it is currently weighing up the pros and cons. “We are still observing,” Xiao said. “And we don’t have the plan to merge yet.” The March issue of ALB will feature an exclusive in-depth interview with Dacheng’s Peng Xuefeng.

briefs

ASIAN LEGAL BUSINESS FEBRUARY 2015

MERGERS & ACQUISITIONS SNAPSHOT LEAGUE TABLES

NORTH ASIA LEAGUE TABLES

I. LEAGUE TABLE - NORTH ASIA LEGAL AND FINANCIAL RANKINGS NORTH ASIA Announced M&A Legal Rankings - Based on Value CHINA Announced M&A Legal Rankings Value No. of Market Legal Advisor Rank (US$mln) Deals Share 1 Morrison & Foerster 15,651.1 3 9.9 Skadden 2 7,120.1 8 4.5 Fangda Partners 3 6,154.2 11 3.9 Haiwen & Partners 4 5,184.2 1 3.3 Freshfields Bruckhaus Deringer 5 4,234.9 6 VALUE 2.7 Kim & Chang 6 4,171.0 8 ($mln) 2.6 Bae Kim & Lee 7 4,121.4 4 2.6 19.1 Lee & Ko DEALS: 1 MARKET SHARE: 8 3,669.2 17 2.3 Gibson Dunn & Crutcher 9* 3,597.9 1 2.3 VALUE MARKET 9* Weil Gotshal Manges 3,597.9 1 2.3 RANK LEGAL&ADVISOR DEALS SHARE (*tie) Based on Rank Value incl. Net Debt of announced($MLN) M&A deals (excluding withdrawn M&A)

NORTH ASIA Announced M&A Financial Rankings - Based on Value HONG KONG Announced M&AValue Legal Rankings No. of Market Financial Advisor Rank (US$mln) Deals Share 1 Bank of America Merrill Lynch 65,774.5 8 41.7 Somerley 2 64,201.7 10 40.7 Goldman Sachs & Co 3 54,206.0 10 34.4 Anglo Chinese Corp Finance 4 50,246.1 6 31.9 HSBC Holdings PLC 5 47,686.2 3 VALUE 30.2 China International Capital Co 6 24,705.9 10($mln) 15.7 UBS 7 21,455.9 7 13.6 Morgan Stanley 8 18,124.6 16 11.5 DEALS: 3 MARKET SHARE: 2.8 Great Wall Securities Co Ltd 9 16,368.2 2 10.4 10 Rothschild 6,034.9 7 3.8 (*tie) Based on Rank Value incl. Net Debt of announced M&A deals (excluding withdrawn M&A) VALUE MARKET RANK LEGAL ADVISOR DEALS ($MLN) SHARE

MORRISON & FOERSTER

2 Fangda Partners II.3LEAGUE TABLE - LEGAL Haiwen & Partners CHINA Announced M&A Legal Rankings 4 Freshfields Bruckhaus Deringer

6,154.2

7.5

5,184.2

6.3

5 No. of 2 Deals

4.9 Market 3.1 Share

4,049.4 Value 2,540.5 (US$mln)

CLIFFORD CHANCE

2 Freshfields Bruckhaus Deringer 1,258.7 HONG KONG Announced M&A Legal Rankings 3 Herbert Smith Freehills 1,005.5 Value Legal Advisor 4 Allens 950.1 Rank (US$mln)

Legal Advisor 5 Rank Sullivan & Cromwell Morrison Foerster 15,651.1 19.1 6 1 Davis Polk &&Wardwell 2,236.6 41 2.7 Fangda Partners 2 6,154.2 11 7.5 7 Tian Yuan Law Firm 1,755.6 4 2.1 Haiwen & Partners 3 5,184.2 1 6.3 8 4 Clifford ChanceBruckhaus Deringer 1,737.2 35 2.1 Freshfields 4,049.4 4.9 Sullivan & & Myers Cromwell 2,540.5 3.1 9 5 O’Melveny 1,301.8 32 1.6 Davis Polk & Wardwell 2,236.6 2.7 10* 6 Debevoise & Plimpton 1,201.8 14 1.5 Tian Yuan Law Firm 7 1,755.6 4 2.1 10* 8 Paul Hastings 1,201.8 13 1.5 Clifford Chance 1,737.2 2.1 O'Melveny & Myers 9 1,301.8 3 1.6 (*tie) 10* Based onDebevoise Rank Value including Net Debt of announced M&A deals (excluding withdrawn M&A) & Plimpton 1,201.8 1 1.5 Paul Hastings 10* 1,201.8 1 1.5 (*tie)

Based on Rank Value incl. Net Debt of announced M&A deals (excluding withdrawn M&A)

2 (*tie)

Value (US$mln) Skadden 3,169.6 Latham & Watkins 3,154.5 Allen & Overy 981.0 Mori Hamada & Matsumoto 839.8 Nagashima Ohno & Tsunematsu 480.2 Herbert Smith Freehills 435.5 23.5 Linklaters DEALS: 3 MARKET SHARE:418.8 Kim & Chang 318.4 Jones Day 217.7 VALUE Freshfields Bruckhaus Deringer 185.5 LEGAL ADVISOR ($MLN)

Legal Advisor

SKADDEN

(*tie)

981.0

No. of Market Deals Share 3 23.5 1 23.4 2 7.3 VALUE 10 6.2 ($mln) 5 3.6 2 3.2 2 3.1 1 2.4 3 1.6 MARKET 1 1.4 DEALS SHARE

839.8 Value 480.2 (US$mln)

7.3

10 No. of 5 Deals

6.2 Market 3.6 Share

Rank 1 2 3 4* 4* 4* 7* 7* 7* 10 RANK

2 (*tie)

Based on Rank Value incl. Net Debt of announced M&A deals (excluding withdrawn M&A)

Value No. of Market (US$mln) Deals Share Kim & Chang 4,171.0 8 45.3 Bae Kim & Lee 4,121.4 4 44.8 Lee & Ko 3,669.2 17 39.9 VALUE Skadden 3,597.9 1 39.1 ($mln) Gibson Dunn & Crutcher 3,597.9 1 39.1 Weil Gotshal & Manges 3,597.9 1 39.1 DEALS: 8 MARKET SHARE: 45.3 Debevoise & Plimpton 1,201.8 1 13.1 Paul Hastings 1,201.8 1 13.1 O'Melveny & Myers 1,201.8 1 13.1 VALUE MARKET Shin & Kim 645.9 6 7.0 LEGAL ADVISOR DEALS ($MLN) SHARE

Legal Advisor

KIM & CHANG

Bae Kim LeeValue incl. Net Debt of announced M&A 4,121.4 4 withdrawn 44.8 Based on & Rank deals (excluding M&A)

3 Lee & Ko 3,669.2 HONG Announced M&A Financial Rankings 4* KONG Skadden 3,597.9 Value Financial Advisor 4* Gibson Dunn & Crutcher 3,597.9 Rank (US$mln)

Financial Advisor 5 Rank Nagashima Ohno & Tsunematsu 6 1 Herbert Smith FreehillsCapital Co 435.5 2 3.2 China International 24,705.9 10 30.1 Morgan Stanley 17,872.9 11 21.8 7 2 Linklaters 418.8 2 3.1 Bank of America Merrill Lynch 3 17,307.2 3 21.1 8 Kim & Chang 318.4 1 2.4 UBS 4 17,053.3 5 20.8 9 5 Jones DayWall Securities Co Ltd 217.7 32 1.6 Great 16,368.2 20.0 SomerleyBruckhaus Deringer 16,272.1 19.8 10 6 Freshfields 185.5 16 1.4 Southwest Securities Co Ltd 7 5,699.0 6 7.0 Suisse 8 3,301.4 7 withdrawn4.0 (*tie) Based onCredit Rank Value including Net Debt of announced M&A deals (excluding M&A) Gram Capital 9 2,841.7 5 3.5 Anglo Chinese Corp Finance 10 2,560.0 3 3.1 (*tie)

1.6 Market 1.5 Share

SOUTH KOREA ANNOUNCED M&A LEGAL RANKINGS SOUTH KOREA Announced M&A Legal Rankings

Latham & Watkins 1 withdrawn 23.4M&A) Based on Rank Value incl. Net Debt of announced3,154.5 M&A deals (excluding

AllenTABLE & Overy - FINANCIAL II.3LEAGUE CHINA Announced Financial Rankings 4 Mori Hamada M&A & Matsumoto

1.9

2 No. of 1 Deals

Clifford Chance 1,839.0 32 2.8 51 Shearman & Sterling LLP 713.2 1.1 Freshfields Bruckhaus Deringer 2 1,258.7 4 1.9 6 WongPartnership LLP 697.0 1 1.1 Herbert Smith Freehills 3 1,005.5 2 1.6 7*4 Reed Smith LLP 104.6 0.2 Allens 950.1 11 1.5 Shearman & Sterling LLP 713.2 21 1.1 7*5 Skadden 104.6 0.2 WongPartnership 697.0 11 1.1 96 Akin, Gump, Strauss,LLP Hauer & Feld 45.5 0.1 Reed Smith LLP 7* 104.6 1 0.2 10 Anderson Mori & Tomotsune 36.2 1 0.1 Skadden 7* 104.6 1 0.2 Akin, Gump, Strauss, Hauer & Feld 9 45.5 1 0.1 (*tie)10 BasedAnderson on Rank Value including Net Debt of announced M&A deals (excluding withdrawn Mori & Tomotsune 36.2 1 0.1M&A)

JAPAN ANNOUNCED M&A LEGAL RANKINGS JAPAN Announced M&A Legal Rankings Rank 1 2 3 4 5 6 7 8 9 10 RANK

39.9

1 No. of 1 Deals

39.1 Market 39.1 Share

4*1 Weil Gotshal & Manges 3,597.9 39.1 Goldman Sachs & Co 51,051.5 91 78.7 Anglo Chinese Corp Finance 50,246.1 61 77.5 7*2 Debevoise & Plimpton 1,201.8 13.1 Bank of America Merrill Lynch 3 48,882.9 6 75.4 7* Paul Hastings 1,201.8 1 13.1 Somerley 4 48,550.6 9 74.8 7*5 O’Melveny & MyersPLC 1,201.8 13.1 HSBC Holdings 47,686.2 31 73.5 Gram Capital 2,559.3 56 4.0 106 Shin & Kim 645.9 7.0 Rothschild 7 1,052.3 1 1.6 Capital Ltd 1,039.2 6 withdrawn 1.6M&A) (*tie)8BasedOctal on Rank Value including Net Debt of announced M&A deals (excluding Morgan Stanley 9 1,016.3 4 1.6 Macquarie Group 10 950.1 1 1.5

Based on Rank Value incl. Net Debt of announced M&A deals (excluding withdrawn M&A) (*tie) on Rank Value incl. Net Debt of announced M&A deals (excluding withdrawn M&A) ANY NORTH ASIA INVOLVEMENT ANNOUNCED M&ABased ACTIVITY - QUARTERLY TREND

220 200 180 160 140 120 100 80 60 40

Series1

127.2 103.6

135.8

Series2

110.8 114.6

202.8 146.8

126.2 125.2 95.4

83.2

114.4

134.0

117.7

128.3

148.7 142.5

3,000 162.1 162.1

2,500 2,000 1,500

93.7

1,000 500

1Q 10

3Q 10

1Q 11

3Q 11

1Q 12

3Q 12

1Q 13

3Q 13

1Q 14

3Q 14

No. of Transactions

Rank Value US$ Billion

ANY NORTH ASIA INVOLVEMENT ANNOUNCED M&A ACTIVITY - QUARTERLY TREND

Notes:League tables, quarterly trend, and deal list are based on the nation of either the target, acquiror, target ultimate parent, or acquiror ultimate parent at the time of the transaction. Announced M&A transactions excludes withdrawn NOTES: League tables, quarterly trend, and deal basedbut onwith theno nation of eitherRank the target, acquiror, target ultimate parent, or acquiror ultimate parent at the time of at the transaction. Announced deals. Deals with undisclosed dollar values are list rankare eligible corresponding Value. Non-US dollar denominated transactions are converted to the US dollar equivalent the time of announcement of M&A terms.transactions North Asia includes China, Hongwithdrawn Kong, Taiwan, SouthDeals Korea,with Japan. Data accurate as of 29-January-2015 excludes deals. undisclosed dollar values are rank eligible but with no corresponding Rank Value. Non-US dollar denominated transactions are converted to the US dollar equivalent at the time of announcement of terms. North Asia includes China, Hong Kong, Taiwan, South Korea, Japan Data accurate as of 29-January-2015

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MERGERS & ACQUISITIONS SNAPSHOT

LEAGUE TABLES I. LEAGUE TABLE - SOUTHEAST ASIA AND MIDDLE EAST SOUTHEAST SOUTHEASTASIA ASIALEAGUE / SOUTHTABLES ASIA Announced M&A Legal Rankings Value No. of Market Legal Advisor (US$mln) Deals Share Rank 1 SINGAPORE Morrison & Foerster 8,100.1 Rankings 2 30.9 Announced M&A Legal Allen & Gledhill 2* 8,100.0 1 30.9 Skadden 2* 8,100.0 2 30.9 Simpson Thacher & Bartlett 2* 8,100.0 2 30.9 Allen & Overy 5 1,589.7 2 6.1 O'Melveny & Myers 6 1,510.0 1 5.8 WongPartnership LLP 7 1,347.4 3 5.1 McDermott Will & Emery 8* 1,300.0 1 5.0 Jenner & Block 8* 1,300.0 1 5.0 Weil Gotshal & Manges 10 1,193.2 1 4.6

MIDDLE EAST Announced M&A Legal Rankings Value No. of Market Legal Advisor (US$mln) Deals Share Rank SOUTHEAST ASIA/ SOUTH ASIA 1 Linklaters 2,379.8 2 35.6 Announced M&A Legal Rankings Shearman & Sterling LLP 2 1,800.0 1 26.9 Clifford Chance 3 830.3 4 12.4 Fangda Partners 4* 265.0 1 4.0 Simpson Thacher & Bartlett 4* 265.0 1 4.0 Latham & Watkins 6 250.0 2 3.7 Cliffe Dekker 7 16.4 1 0.3 VALUE Khaitan & Co 8 15.3 1 0.2 ($mln) Accura Advokataktieselskab 9* 10.0 1 0.2 Yigal Arnon & Co 9* 10.0 1 0.2

MORRISON & FOERSTER

ALLEN & GLEDHILL*; SKADDEN*; MORRISON & FOERSTER* SIMPSON THACHER & BARTLETT*

DEALS: 2 MARKET SHARE: 30.9

Based on Rank Value incl. Net Debt of announced M&A deals (excluding VALUE withdrawn M&A)

(*tie)

($mln)

II. LEAGUE TABLE - LEGAL DEALS: MARKET SHARE: 46.4 SINGAPORE Announced M&A1Legal Rankings Value Legal Advisor (US$mln) Rank VALUE 1* Allen & Gledhill 8,100.0 RANK LEGAL ADVISOR ($MLN) Skadden 1* 8,100.0 51* WongPartnership LLP 1,347.4 Morrison & Foerster 8,100.0 Simpson Thacher & Bartlett 8,100.0 6*1* McDermott Will & Emery 1,300.0 WongPartnership LLP 5 1,347.4 6* Jenner & Block 1,300.0 McDermott Will & Emery 6* 1,300.0 8*6* Fangda Partners 700.0 Jenner & Block 1,300.0 Fangda 700.0 8*8* Davis PolkPartners & Wardwell 700.0 Davis Polk & Wardwell 8* 700.0 10 Herbert Smith Freehills 329.7 Herbert Smith Freehills 10 329.7

No. of Deals 1 DEALS 2 13 21 3 1 1 11 11 1 2 2

VALUE RANK LEGAL ADVISOR ($MLN) MALAYSIA Announced M&A Legal Rankings 2* Allen & Gledhill 8,100.0 Value Legal Advisor (US$mln) Rank 2* Skadden 8,100.0 1 J Sagar Associates 123.7 2* Simpson Thacher & Bartlett 8,100.0 Jones Day 2 0.0 50 Allen & Overy 1,589.7 0 0.0 Subtotal with Legal Advisor 123.7 6Oâ&#x20AC;&#x2122;Melveny & Myers 1,510.0 Subtotal without Legal Advisor 2,013.6 7 WongPartnership LLP 1,347.4 0 0 0.0 8*McDermott Will & Emery 1,300.0 Industry Total 2,137.2 0 0 0.0 8* Jenner & Block 1,300.0 (*):tie 0 0.0 10 Weil Gotshal & Manges 1,193.2 0 0 0.0

Market Share MARKET 46.4 SHARE 46.4 7.7 46.4 46.4 7.5 7.7 7.5 7.5 4.0 7.5 4.0 4.0 4.0 1.9 1.9

(*tie) Based on Rank Value including Net Debt of announced M&A deals (excluding withdrawn M&A) (*tie) Based on Rank Value incl. Net Debt of announced M&A deals (excluding withdrawn M&A)

INDIA Announced M&A Legal Rankings Rank 1 2 3 4 5 6 7 8* 8* 8* (*tie)

RANK

Value

No. of

Legal Advisor M&A LEGAL RANKINGS INDIA ANNOUNCED (US$mln) Deals

Weil Gotshal & Manges 1,193.2 Amarchand Mangaldas 846.6 J Sagar Associates 267.3 Majmudar & Partners 110.8 CMS 44.9 Economic Laws Practice 42.3 Khaitan & Co 15.3 AZB & Partners 0.1 Krishnamurthy & Co 1 MARKET SHARE: 31.3 0.1 DEALS: Morrison & Foerster 0.1

1 1 5 3 1 2 VALUE 3 ($mln) 4 1 1

DEALS

No. 1of Deals 2 1 2 1 02 21 119 3 0 1211 01 0 1 0

MARKET SHARE 30.9 Market Share 30.9 5.8 30.9 0.0 6.1 0.0 5.8 5.8 94.2 5.1 0.0 5.0 100.0 0.0 5.0 0.0 4.6 0.0

INDONESIA Announced M&A Legal Rankings

Market Share 31.3 22.2 7.0 2.9 1.2 1.1 0.4 0.0 0.0 0.0

Value No. of Market Legal Advisor MIDDLE EAST Announced M&A Legal Rankings (US$mln) Deals Share Rank 0 0 0.0 0 0.0 Subtotal with Legal Advisor 0.0 0 0.0 Subtotal without Legal Advisor 485.8 26 100.0 0 0 0.0 0 0.0 Industry Total 485.8 26 VALUE 100.0 0 0 0.0 0 ($mln) 0.0 (*):tie 0 0.0 0 0.0 0 0.0 0 0.0 DEALS: 2 MARKET 0SHARE: 35.6 0 0 0.0 0 0.0

LINKLATERS

Based on Rank Value incl. Net Debt of announced M&A deals (excluding withdrawn M&A) VALUE MARKET

($MLN)

DEALS

(*tie) Based on Rank Value including Net Debt of announced M&A deals (excluding withdrawn M&A) (*tie) Based on Rank Value incl. Net Debt of announced M&A deals (excluding withdrawn M&A)

WEIL GOTSHAL & MANGES

LEGAL ADVISOR

Based on Rank Value incl. Net Debt of announced M&A deals (excluding withdrawn M&A)

(*tie)

RANK

Based on Rank Value incl. Net Debt of announced M&A deals (excluding withdrawn M&A) VALUE MARKET

LEGAL ADVISOR

($MLN)

DEALS

II. 2 LEAGUE TABLE Mangaldas - FINANCIAL Amarchand 846.6 1 22.2 SOUTHEAST ASIA / SOUTH ASIA Announced M&A Financial Rankings 3 J Sagar Associates 267.3 5 7.0 Value No. of Market 4 Majmudar Financial & Partners Advisor 110.8 3 2.9 (US$mln) Deals Share Rank

2 Shearman & Sterling LLP 1,800.0 1 26.9 MIDDLE EAST Announced M&A Financial Rankings 3 Clifford Chance 830.3 4 12.4 Value No. of Market Financial Advisor 4* Fangda Partners 265.0 1 4.0 (US$mln) Deals Share Rank 1 HSBC Holdings 749.5 21 11.2 4* Simpson ThacherPLC & Bartlett 265.0 4.0 China International Capital Co 2 265.0 1 4.0 6 Latham & Watkins 250.0 2 3.7 Ernst & Young LLP 3* 250.0 2 3.7 7 Cliffe Dekker 16.4 0.3 Rothschild 3* 250.0 21 3.7 Goldman Sachs & Co 200.0 11 3.0 85 Khaitan & Co 15.3 0.2 DRT Kurumsal Finansman 6 157.1 1 2.4 9* Accura Advokataktieselskab 10.0 1 0.2 Maceen Capital 7 48.0 1 0.7 Yigal Arnon & Co 9* 10.0 0.2 Network Corporate Finance 8* 20.9 11 0.3 Blackstone Group LP 8* 20.9 1 0.3 (*tie) on Rank Value (Proprietary) including Net Debt Capital Ltd of announced M&A deals 10BasedJava 16.4 (excluding 1 withdrawn 0.3 M&A)

(*tie)

Citi 9,293.2 21 35.4 5 1 CMS 44.9 1.2 Wells Fargo & Co 2* 8,100.0 1 30.9 6 Economic Laws Practice 42.3 2 1.1 Barclays 2* 8,100.0 1 30.9 72* Khaitan & Co Markets 15.3 0.4 RBC Capital 8,100.0 13 30.9 Morgan Stanley 2,963.2 4 11.3 8*5 AZB & Partners 0.1 4 0.0 Credit Suisse 6 2,788.2 3 10.6 8* Krishnamurthy & Co 0.1 1 0.0 DBS Group Holdings 7 2,712.3 2 10.3 8*8 Morrison 0.1 0.0 UBS & Foerster 2,314.7 21 8.8 Rothschild 9 1,510.0 2 5.8 (*tie)10* Based on RankofValue including Net Lynch Debt of announced M&A deals (excluding Bank America Merrill 1,300.0 1 withdrawn 5.0M&A) Based on Rank Value incl. Net Debt of announced M&A deals (excluding withdrawn M&A)

Based on Rank Value incl. Net Debt of announced M&A deals (excluding withdrawn M&A)

Series1

80 70 60

Series2 71.8

57.3 45.5

64.8 53.8

47.6

47.4 36.8

65.4

63.0

34.1

42.1

53.1

49.0

45.4 35.8

44.7

42.5

1Q 14

3Q 14

25.3

30 20 10

1Q 10

3Q 10

1Q 11

3Q 11

1Q 12

3Q 12

1Q 13

3Q 13

1,600 1,400 1,200 1,000 800 600 400 200 0

No. of Transactions

Rank Value US$ Billion

ANY SOUTHEASTASIA ASIA/ /SOUTH SOUTHASIA ASIA&&MIDDLE MIDDLEEAST EAST INVOLVEMENT - QUARTERLY TREND ANY SOUTHEAST INVOLVEMENTANNOUNCED ANNOUNCEDM&A M&AACTIVITY ACTIVITY - QUARTERLY TREND

Notes: NOTES: League tables, quarterly trend, and deal list are based on the nation of either the target, acquiror, target ultimate parent, or acquiror ultimate parent at the time of the transaction. Announced M&A transactions excludes withdrawn deals. Deals with undisclosed dollar and values arelist rank eligible no corresponding Rank Value.acquiror, Non-US dollar transactions are converted the USat dollar equivalent the time of announcement of terms. Geographic League tables, quarterly trend, deal are basedbut on with the nation of either the target, targetdenominated ultimate parent, or acquiror ultimatetoparent the time of theattransaction. Announced M&A transactions excludes coverage includes SOUTH EAST ASIA: Singapore, Malaysia, Philippines, Thailand, Vietnam, Cambodia,Rank Indonesia, Myanmar, SOUTH ASIA: India, Bangladesh, Bhutan, Maldives, Pakistan, Sri Lanka; withdrawn deals. Deals with undisclosed dollar values are rank eligible but with noBrunei, corresponding Value.Laos, Non-US dollar Timor-Leste; denominated transactions are Afganistan, converted to the US dollar equivalent atNepal, the time of MIDDLE EAST: United Arab Emirates, Saudi Arabia, Qatar, Jordan, Palestine, Bahrain, Iran, Iraq, Israel, Kuwait, Lebanon, Oman, Syria, Yemen. Data accurate as of 29-January-2015 announcement of terms. Geographic coverage includes SOUTH EAST ASIA: Singapore, Malaysia, Philippines, Thailand, Vietnam, Brunei, Cambodia, Indonesia, Laos, Myanmar, Timor-Leste; SOUTH ASIA: India, Afganistan, Bangladesh, Bhutan, Maldives, Nepal, Pakistan, Sri Lanka; MIDDLE EAST: United Arab Emirates, Saudi Arabia, Qatar, Jordan, Palestine, Bahrain, Iran, Iraq, Israel, Kuwait, Lebanon, Oman, Syria, Yemen

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ASIAN LEGAL BUSINESS FEBRUARY 2015

NORTH ASIA DEALS: YOUR MONTH AT A GLANCE DEAL NAME

$1.6 BILLION M&A JD.COM AND TENCENT HOLDINGS’ INVESTMENT IN BITAUTO HOLDINGS • JD.com will invest $400 million in cash and about $750 million in resources in Bitauto, while Tencent will pay $150 million for its shares. • JD.com and Tencent will hold 25 percent and 3.3 percent of Bitauto’s outstanding shares, respectively, after the deal closes in the first half of 2015. JD.com will also get one seat on Bitauto’s board.

$3.8 BILLION

JD.com and Tencent Holdings’ investment in Bitauto Holdings

Restructuring of Li Ka-shing’s Cheung Kong Group

Cheung Kong Investment’s agreement to acquire Britain’s Eversholt Rail

M&A CHEUNG KONG INVESTMENT’S AGREEMENT TO ACQUIRE BRITAIN’S EVERSHOLT RAIL • UK private equity fund 3i Infrastructure and Eversholt’s other investors have sold their entire holding to Hong Kong billionaire Li Ka-shing’s Cheung Kong Investments. • 3i, Morgan Stanley Infrastructure Partners, and STAR Capital Partners with its co-investor PGGM, acquired the business for 2.1 billion pounds from HSBC in 2010. • Eversholt owns around 28 percent of the UK’s passenger trains, with 19 fleets. It is one of the UK’s three leading rail rolling stock companies.

All-Stars Investment-led consortium’s investment in Xiaomi

Haitong Securities’ placement of H shares

$26 BILLION M&A CSR CORP AND CHINA CNR CORP’S MERGER • State-owned CSR Corp and China CNR Corp, China’s two biggest train makers, will merge to form a new $26 billion company. • The merger is expected to solidify China’s campaign to sell its highspeed technology abroad. • Under the terms of the deal, CSR will issue shares to CNR’s shareholders with a swap ratio of one CNR share for 1.1 CSR shares.

CSR Corp and China CNR Corp’s merger

Itochu Corp and Charoen Pokphand Group’s joint investment in Citic

VALUE (US$ MLN)

DEAL TYPE

China

1,600

M&A

Paul, Weiss, Rifkind, Wharton & Garrison

China

1,600

M&A

Skadden, Arps, Slate, Meagher & Flom

China

1,600

M&A

Sullivan & Cromwell

China

1,600

M&A

Freshfields Bruckhaus Deringer

Hong Kong

N/A

M&A, Restructuring

Linklaters

Hong Kong

N/A

M&A, Restructuring

Woo Kwan Lee & Lo

Hong Kong

N/A

M&A, Restructuring

Allen & Overy

Hong Kong, UK

3,800

M&A

Freshfields Bruckhaus Deringer

Hong Kong, UK

3,800

M&A

Cadwalader, Wickersham & Taft

China, Singapore

1,100

M&A

Goodwin Procter

China, Singapore

1,100

M&A

Skadden, Arps, Slate, Meagher & Flom

China, Singapore

1,100

M&A

Beijing Sunland Law Firm

China, Singapore

1,100

M&A

Ogier

China, Singapore

1,100

M&A

Travers, Thorp & Alberga

China, Singapore

1,100

M&A

Clifford Chance

Hong Kong, China

3,850

Equity

Davis Polk & Wardwell

Hong Kong, China

3,850

Equity

Grandall Law Firm

Hong Kong, China

3,850

Equity

Baker & McKenzie

China

26,000

M&A

Kirkland & Ellis

China

26,000

M&A

Linklaters

China

26,000

M&A

Morrison & Foerster

China

26,000

M&A

Ashurst

China, Japan, Thailand

10,000

M&A

Freshfields Bruckhaus Deringer

China, Japan, Thailand

10,000

M&A

Sidley Austin

China, Japan, Thailand

10,000

M&A

FIRM

JURISDICTION

Orrick, Herrington & Sutcliffe

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SOUTHEAST ASIA DEALS: YOUR MONTH AT A GLANCE

$1.1 BILLION

DEAL NAME

M&A ALL-STARS INVESTMENT-LED CONSORTIUM’S INVESTMENT IN XIAOMI • The investment was led by All-Stars Investment Ltd, a fund run by a Morgan Stanley analyst-turnedinvestor Richard Ji. The investors also included the prominent Singapore sovereign wealth fund GIC Pte and Russian tech fund DST Global. • This round of fund raising would value the Smartphone maker at over $45 billion, Reuters reported.

Ayala Land’s top-up placement

All-Stars Investmentled consortium’s investment in Xiaomi

$1.3 BILLION M&A OLAM INTERNATIONAL’S ACQUISITION OF ARCHER DANIELS MIDLAND COMPANY’S GLOBAL COCOA BUSINESS • Buying one of the world’s largest processors and suppliers of cocoa liquor, powder and butter, Olam will secure eight factories stretching from the Ivory Coast to Singapore with total capacity of 600,000 tonnes per year. • Olam will finance the purchase, which it expects to close in the second quarter next year, through a combination of cash and existing debt facilities.

$10 BILLION M&A ITOCHU CORP AND CHAROEN POKPHAND GROUP’S JOINT INVESTMENT IN CITIC • Itochu and CP Group plan to take a joint stake of 20 percent in Citic. The deal will take place in two stages. Itochu and CP Group will buy nearly 2.5 billion shares in Citic for HK$34.4 billion in April this year, and a further 3.3 billion shares for HK$45.9 billion in October. • The investment is the biggest ever by Itochu, and the largest ever made by a Japanese company into China.

Financing of a hydroelectric power plant in the Eastern Development Region in Nepal

Olam International’s acquisition of Archer Daniels Midland Company’s global cocoa business

Joint venture between Kerry Logistics Network and Puninar Logistics

Itochu Corp and Charoen Pokphand Group’s joint investment in Citic

Largest ever energy portfolio financing transaction in Thailand

FIRM

JURISDICTION

VALUE (US$ MLN)

DEAL TYPE

Paul Hastings

Philippines

356

Equity

Angara Abello Concepcion Regala & Cruz Law Offices

Philippines

356

Equity

Cadwalader, Wickersham & Taft

China, Singapore

1,100

M&A

Goodwin Procter

China, Singapore

1,100

M&A

Skadden, Arps, Slate, Meagher & Flom

China, Singapore

1,100

M&A

Beijing Sunland Law Firm

China, Singapore

1,100

M&A

Ogier

China, Singapore

1,100

M&A

Travers, Thorp & Alberga

China, Singapore

1,100

M&A

Clifford Chance

Nepal

142.5

Project Finance

Shearman & Sterling

Nepal

142.5

Project Finance

Jenner & Block

US, Singapore

1,300

M&A

McDermott Will & Emery

US, Singapore

1,300

M&A

Sidley Austin

US, Singapore

1,300

M&A

WongPartnership

US, Singapore

1,300

M&A

Clifford Chance

Singapore, Indonesia

N/A

Winston & Strawn

Singapore, Indonesia

N/A

AKSET

Singapore, Indonesia

N/A

Ivan Almaida Baely & Firmansyah

Singapore, Indonesia

N/A

Ashurst

China, Japan, Thailand

10,000

M&A

Freshfields Bruckhaus Deringer

China, Japan, Thailand

10,000

M&A

Sidley Austin

China, Japan, Thailand

10,000

M&A

Norton Rose Fulbright

Thailand

2,400

Project Finance

Baker & McKenzie

Thailand

2,400

Project Finance

briefs

ASIAN LEGAL BUSINESS FEBRUARY 2015

NEWS

Amarchand ‘to split into two firms’

he 98year-old Indian law firm Amarchand Mangaldas will be split into two firms, with the two new firms each getting the legacy firm’s Mumbai and Delhi regions, according to a report in Indian newsCYRIL SHROFF paper Economic Times. The split is expected to come into effect on April 1. The paper said that brothers Cyril and Shardul Shroff, managing partners of the respective offices, decided to split after months of legal wrangling and third-party mediation failed to settle a dispute arising from the will of their mother, who died last year. The will

handed her share in the firm entirely to Shardul Shroff, thus giving him a bigger share of Amarchand compared to Cyril. According to the terms of the split, the firm will be split equally between the two, and the new firms SHARDUL SHROFF will get the right to operate on each other’s territory in Mumbai, ET said. The elder brother Shardul, who controls the Delhi office, currently runs the firm’s offices in Gurgaon, Kolkata and Ahmedabad, while Cyril oversees the Mumbai office that also controls Bengaluru, Hyderabad and Chennai.

Fried Frank to exit Asia

ried, Frank, Harris, Shriver & Jacobson is closing its Hong Kong and Shanghai offices, effectively pulling the firm out of Asia. A source at Fried Frank told ALB that partners were informed last week of the decision, and that the offices will be closed by the end of June. Media reports indicate that the firm’s Asian offices were operating at a loss, and an internal memo had been sent out saying that the governance committee had decided against increasing its investment in Asia and would instead “downsize our presence.” Fried Frank’s four partners, 10 lawyers and 18 support staff in Asia are currently discussing their potential relocation options within the firm’s network, but most are expected to leave the firm. The firm is still committed to servicing clients in the region, and is likely to retain its

Chinese practice license and operate service offices in both Hong Kong and Shanghai. After the winding down of Fried Frank’s Hong Kong and Shanghai offices, the firm will have effectively exited Asia. The firm has five other offices in New York, Washington DC, London, Paris and Frankfurt. Fried Frank opened its doors in Hong Kong in 2006, nabbing nine partners from UK firm Simmons & Simmons, before establishing its Shanghai office in 2007.

Indian minister seeks probe into A&O ‘link’ to arbitrator

n Indian cabinet minister has asked the country’s primary foreign intelligence agency to investigate a “link” between Allen & Overy, which is representing Reliance Industries Limited (RIL) and British Gas (BG) before an arbitration tribunal, and the presiding arbitrator of that tribunal, the Indian Express reported. Dharmendra Pradhan, India’s petroleum minister, wants RAW to probe the “connection” between Singapore lawyer Christopher Lau SC, the presiding arbitrator of the tribunal that has been adjudicating since 2011 in a dispute over costs related to Panna, Mukta and Tapti (PMT) oil and gas fields, and the Magic Circle firm, which is representing BG and RIL against the government. The newspaper added that the two companies hold 30 per cent each of the PMT fields, with the state-run Oil & Natural Gas Corp (ONGC) holding 40 per cent interest. The government maintains that RIL and BG are claiming a higher income tax deduction than what they pay. In 2011, before the arbitration started, Lau, a respected veteran arbitrator, had declared to both sides that his daughter had worked for Allen & Overy, the Indian Express said. He was then selected as the presiding arbitrator by the two sides. The paper said that the decision on the RAW probe was taken at a meeting in November between Pradhan and a government lawyer named Indu Malhotra.

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AZMI & ASSOCIATES

DEVELOPMENTS IN SHIPPING LAW IN MALAYSIA. By Philip Teoh1

Philip Teoh Head of Shipping, Insurance and International Trade Department Azmi & Associates (603) 2118 5000 Ext. 5010 philip.teoh@azmilaw.com

Shipping and International Trade is an integral part of the Malaysian economy2 . The growth of shipping in Malaysia is supported by parallel development in dispute resolution facilities such as the establishment of the Admiralty Court3 and the revival of the Kuala Lumpur Regional Centre for Arbitration (“KLRCA”).

provisions of the Civil Law Act. The statutory basis of UK Marine Insurance Law is the Marine Insurance Act 1906 which sought to codify the pre-existing common law of marine insurance. Over the years the courts have through decided cases amassed a body of case law on marine insurance.

1976 LIMITATION CONVENTION. There has been an important development in the area of tonnage limitation. With the Merchant Shipping (Amendment and Extension) Act 2011, the applicable limitation regime is no longer the ‘fault or privity’ regime under the 1957 Limitation Convention but the 1976 Limitation Convention4 . This brings the Malaysian regime in line with major jurisdictions such as England and Singapore.

The Kuala Lumpur High Court had occasion to determine the scope of the duty of assured provision in a total loss only policy in the case of Saz Maritime Services Sdn Bhd v. MUI Continental Insurance Bhd6. The assured’s offshore vessel which was moored was collided into by a runaway barge. The Plaintiff brought a claim under the marine hull insurance policy which was a total loss only policy. The Plaintiff failed to take action and preserve its claim against the owners. The Plaintiff’s claim was dismissed by the trial judge on the ground that it had failed to prove a claim for total loss and also for breaching the duty of assured duties to preserve the claim. The trial judge held that the duty of assured was a mandatory duty under the marine hull policy. The judgment was upheld on appeal. This case raises the important question – If I have insurance, do I need to do anything? The Court of Appeal decision is not the last word on the topic. The case is now pending before the Federal Court which will decide this question in the context of a marine hull insurance case.

CARRIAGE OF GOODS BY SEA The Admiralty Court had occasion on 30 January 2013 to decide on the scope of the shipper / exporter’s duty of care in the shipment of dangerous goods in the case of Ing Hua Fu Marine Line Sdn Bhd v Vitachem (M) Sdn Bhd5. The Admiralty Court held the Defendant shipper liable for the damages to the vessel where the shipper and his forwarding agent did not properly declare the dangerous chemicals under the IMDG Code. This decision was reversed on appeal. The Plaintiff obtained leave to appeal to the Federal Court. The issues raised in the pending appeal before the Federal Court will address the important duties of the shipper of dangerous goods. MARITIME ARBITRATION Under the vibrant leadership of its Director Datuk Professor Sundra Rajoo, the Kuala Lumpur Regional Centre had revised its existing rules to better adapt its rules to industry needs. The revamp of the KLRCA Fast Track Arbitration Rules took into account the requirements of the maritime industry.The availability of arbitration provides a real option to parties to maritime transactions. The most common type of disputes in maritime arbitration are charterparty disputes especially demurrage claims. The Arbitration Act 2005 provides for registration of awards from state signatories to the New York Convention 1958 (“NYC”). The NYC facilitates enforcement of arbitral awards within the framework of the convention. This framework is wider than the reciprocal enforcement laws for the registration of foreign judgment.

A: 14th Floor, Menara Keck Seng 203 Jalan Bukit Bintang 55100 Kuala Lumpur, Malaysia W: www.azmilaw.com

MARINE INSURANCE The Malaysian Insurance market uses the forms / clauses approved by the Institute of London Underwriters. UK Marine Insurance Law is applied vide the application of English law provisions found in the Clauses as well as the reception of English law

The author is the Head of the Shipping, Insurance and International Trade Department at Azmi & Associates. He has over 25 years’ experience in the specialist area and handles both contentious and non-contentious matters. He is an accredited arbitrator with the Kuala Lumpur Regional Centre for Arbitration and has appeared at all levels of Malaysian Courts up to the apex Federal Court. He is also the author of Malaysian Forms and Precedents on Shipping, Insurance Claims, Wills and Trusts, Annotated Statutes on Sale of Goods Act, Merchant Shipping Ordinance, Merchant Shipping (Oil Pollution) Act, Collision Regulations, Halsbury’s Laws of Malaysia on Shipping, Carriers ( Land, Air and Sea), Conflict of Laws, Equity, Bailment and Liens. He has previously practised in Singapore and has spoken at Industry conferences in Malaysia and abroad. 2 In 2014, Malaysia ranked No. 25 in exports and 24 in imports in terms of trade volume and growth in trade average 5 % year to year from 2005 to 2013. Source: WTO website. 3 Set up in October 2010, the jurisdiction of the Court is wider than the traditional Admiralty jurisdiction: Practice Directions of 2012. The author acted for the Plaintiff cargo owner in the case of the Istana VI [2011] 7 MLJ 145 the inaugural reported decision of the Admiralty Court, a claim against a shipowner for delivering cargo without presentation of original bills of lading. 4 The Convention on Limitation of Liability for Maritime Claims 1976 as amended by the Protocol of 1996. 5 [2013] 9 MLJ 825.The author acted for the Plaintiff shipowner at the Admiralty Court and at the Court of Appeal and will continue to act in the appeal to the Federal Court scheduled for March 2015. 6 The author acted for the Defendant insurer in the case at the High Court and Court of Appeal. After a full hearing involving 7 witnesses for the Plaintiff and 2 for the Defendant, the trial judge dismissed the Plaintiff/ assured’s claim in the Kuala Lumpur Civil Suit No.: D-22-1194-2009. The dismissal of the claim was affirmed by the Court of Appeal in Civil Appeal No: W-02-2685-10/2011. The Plaintiff obtained leave to appeal to the Federal Court and the appeal to the Federal Court is due to be heard in April 2015. 1

COVER STORY

ASIAN LEGAL BUSINESS FEBRUARY 2015

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COVER STORY

While much of the major headlines are often dominated by larger law firms – Wall Street and Magic Circle among the international players, and the top-tier Asian ones – the region is seeing the growth of smaller, nimbler outfits that are able to compete with their larger peers in both clients and talent through a mixture of quality work and business savvy. ALB’s Firms To Watch 2015 list celebrates 10 of these law firms that may be small in size but are certainly big in potential. The list has been compiled taking into account submissions from the firms themselves, along with market feedback and ALB’s own insight into Asia’s legal industry. The following list is in alphabetical order.

Location: Jakarta Established: 2010 Riding the wave of the newfound optimism in Indonesia’s business climate is AKSET, which has evolved from being a firm focused primarily on natural resources, when it was established in 2010, to a full-service outfit today. Growth has been both organic (six new lawyers since the end of 2013 taking the total number of fee-earners to close to 30), and inorganic, including the setting up of a Japan desk that stems from a strong relationship with a Japanese law firm. AKSET also plans to establish special desks to provide services to other foreign clients, especially Korea and the ASEAN region, in preparation for the ASEAN Economic Community (AEC) this year. The firm also has two licensed New York attorneys. Notable work by the firm in the past year including acting for the transaction in joint venture between Kulim Malaysia Berhad, a Johor State Corporation, and Indonesian partner Graha Group in managing and developing three oil palm plantation companies in Central Kalimantan. As part of a larger cooperation on plantation, oil and gas, and coal mining interests valued at over $400 million, Kulim acquired 74 percent of shares in the plantations’ parent holding company. AKSET also represented plantation group PT Triputra Agro Persada, along with 11 subsidiaries as borrower, in a $470 million syndicated loan facility arrangement from 15 banks, with PT Bank Permata as facility agent and PT Bank DBS Indonesia as security agent. The firm additionally represented media company MNC Group in acquiring a 25 percent stake in PT Bank ICB Bumiputera, from ICB Financial Group Holdings.

COVER STORY

ASIAN LEGAL BUSINESS FEBRUARY 2015

Location: Singapore Established: 1883 The oldest of the law firms in ALB’s Firms to Watch list, Braddell Brothers was founded in 1883 by the sons of Sir Thomas Braddell, the first Attorney-General of Singapore, making it the third-oldest law practice in the country. A “reboot,” in the words of the firm, took place in 2009, courtesy of former Drew & Napier lawyers Edmund Kronenburg and Tan Kok Peng. Since then, the firm has been building a strong reputation as a specialist litigation, arbitration and dispute resolution boutique. Braddell Brothers represents local and international clients in the Singapore High Court and Court of Appeal, and in international arbitrations seated both in Singapore and abroad, predominantly under the SIAC, ICC and UNCITRAL Rules. Among its notable work, Braddell Brothers represented Indonesian firm PT First Media, a Lippo Group company, in the Astro-Lippo case, helping its client resisting the enforcement of 99 percent of a SIAC award in the total amount of S$352 million ($250 million) in favour of various Astro entities. As a result, it also obtained the discharge of a worldwide Mareva injunction against PT First Media in one of SIAC’s landmark cases. Since 2013, when the firm had around 7 lawyers, it has almost doubled its headcount and now has five dedicated dispute resolution partners and one corporate partner. “Size per se is not important to us. To us, there is no attraction in being the largest firm in a jurisdiction; we want simply to be the best at what we do,” the firm says.

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COVER STORY

Asia Locations: Singapore, Kuala Lumpur, Yangon and Tokyo Established: 2003 in Paris; in Asia since 2006 For a law firm that was founded in Paris a little over a decade ago, CVML has not been shy about opening offices Asia. Tokyo in 2006 was followed by Singapore in 2007, and in 2013, the firm opened an office in Yangon, becoming, in its own words, “the first European independent firm in Myanmar.” A few months later, in May 2014, CVML entered Malaysia after forming an alliance with local firm Abdullah Chan & Co. In Singapore too, the firm is in an alliance – its Formal Law Alliance (FLA) with local outfit Advocatus Law enables it to practice foreign and Singapore laws, including representation before Singapore courts. Additionally, CVML has a Dubai office that is the headquarters of its Middle East practice. The last year or so has seen the firm doing a wide range of work across its four Asian offices. In Yangon, for example, CVML’s clients have included a Singaporean hospitality group restructuring its investments in Myanmar, a real estate private equity fund developing luxury hotels, a Singapore-based company developing mobile payment solutions in Myanmar, and an air company acquiring land development rights in Yangon. As a result, headcount has risen; CVML reinforced its Asia offices with three new partners in 2014, while Abdullah Chan & Co welcomed 2 new partners in 2014. The total number of lawyers now stands at 30.

Location: Hong Kong Established: 2010 In the short four or five years since its founding, Gall has already emerged as one of Hong Kong’s well-recognized independent dispute resolution firms. Led by senior partner and head of litigation Nick Gall, the firm’s client base comprises financial institutions, listed companies, hedge funds, high net worth individuals, entrepreneurs, liquidators and receivers. And the firm is attracting the talent to match: recent hires have included partners Michael Withington from Herbert Smith and Jennifer Van Dale from Baker & McKenzie. “Much of the firm’s reputation has been gained through an ability to accept and succeed in high profile matters, including by referral, and this in turn helps us to develop and expand our practice in new areas and win new clients,” the firm says. In 2014, Gall advised on “leading cases in nearly all key dispute resolution sectors.” These included advising a PRC oil and gas enterprise in a cross-border dispute valued in excess of $350 million; advising the majority shareholder of a property developer in the PRC in relation to its $550 million debt obligations under various debt/equity-linked security documents; representing a Big Four accountancy firm as court-appointed receiver of a Hong Kong company in respect of a number of complex international litigations; and representing the chairman of a solar company listed on the NYSE in relation to debt obligations exceeding $2 billion.

COVER STORY

Location: Manila Established: 2003 Javier Santiago Torres & Gorriceta (JSTG) was founded in 2003, but it is only in the past couple of years that they began appearing on the radar. The firm recently advised on the initial public offering of the Philippine tech company Xurpas, which was touted as the first mobile technology IPO to come out of an emerging Southeast Asian market, as well as the public bidding on behalf of Pilipinas Teleserv Inc. With decades of combined experience among its partners, the firm focuses on corporate law, including banking and finance, investment and trade, and securities regulations; immigration; intellectual property; labor and dispute resolution; cutsourcing and IT; litigation, inclusive of family law and criminal law; and taxation and estate planning. The growth during this time – comprising an increase in the number of clients as well as projects – has been driven by managing partner Joshua Santiago along with partner Mark Gorriceta. Gorriceta describes the firm’s strategy for growth as a focus on people. “We always hire only the top students from the best law schools,” he says. “They are eager and hungry to work.” But business conditions have also come to the firm’s advantage, including a general lift in the overall economic mood in the Philippines. “The Philippine Stock Index is at an all-time high,” he says. “Equally importantly, the country’s credit rating has improved, paving the way for more work.” Plans for the future, include “more lawyers, a bigger office, and the creation of new departments, such as energy and banking,” according to Gorriceta.

ASIAN LEGAL BUSINESS FEBRUARY 2015

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Locations: Kuala Lumpur, Sarawak, Yangon, plus affiliate offices in Vietnam and Indonesia Established: 1999 Malaysia’s JLPW clearly has regional ambitions. Today it is able to call upon the services of 75 fee-earners across ASEAN countries, after entering into an affiliation in Vietnam in 2014, which increased its strength from 45 lawyers a year or so earlier. This adds to its reach within its home market of Malaysia (through offices in Kuala Lumpur and Sarawak), Myanmar (through an office in Yangon), and Indonesia (through another affiliate office). Plus, it is a member firm of international network Interlex Group, as well as the Global Legal Service Network of Chinese firm Dacheng Law Offices. But JLPW isn’t stopping there. “We are looking to establish affiliates in Mongolia, the Philippines and other ASEAN countries within the next few years,” the firm says. The firm started life with just its three founder partners in the depths of the ASEAN financial crisis of 1999. The firm today is known for its expertise in cross-border investments, joint ventures, mergers and acquisitions and capital markets; some of the recent deals it has advised on include JobStreet.com’s disposal of its online business, and the listing of gym, F&B and spa operator Only World Group Berhad. Aside from ASEAN, the firm is also looking at markets in Russia and Kazakhstan for growth in the immediate future .

Asia Location: Hong Kong Established: 2010 in Asia For U.S.-headquartered litigation boutique Kobre & Kim, the year 2014 marked a period of expansion for its Hong Kong office, including welcoming commercial litigator Randall Arthur, an expert on contentious insolvency and bankruptcy, from Gall. Aside from being able to represent clients in the Hong Kong courts in a wide variety of legal proceedings and disputes, the firm can now claim to be one of the few international litigation firms practicing across Hong Kong, the U.S., the U.K, and many of the Caribbean jurisdictions, including Cayman Islands, British Virgin Islands, and Bermuda. In addition, the firm’s Government Enforcement Defense team in Hong Kong now also handles investigations involving the Hong Kong Independent Commission Against Corruption (HKIAC) and the Hong Kong Securities and Futures Commission (SFC). The strategy for growth, the firm says, is “to be the firm of choice for other law firms and clients that are in need of a conflict-free litigation team to handle crossborder disputes.” In addition, the firm follows a conflict-free model – “We don’t have transactional clients and do not ordinarily maintain clients of our own,” says Kobre & Kim. “By avoiding repeat client relationships and the conflicts of interest that come with them, we maintain our independence as advocates ready to litigate against virtually any institution.” Additionally, there is the focus on cross-border matters, and “aggressive, goal-oriented advocacy.” In 2015, the firm is also exploring opportunities in outside areas of its current specialties, including intellectual property disputes. “The firm also has plans to expand its geographical reach in 2015,” it says.

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ASIAN LEGAL BUSINESS FEBRUARY 2015

Locations: Ho Chi Minh City, Hanoi, affiliate office in Hong Kong Established: 2013 The law firm LNT & Partners might have existed in its current avatar only since 2013, but its lawyers have a greater pedigree than that, having been a part of some of Vietnam’s largest law firms in the near past, and the exceptional transactional work that the firm has done since won it the Vietnam Deal Firm of the Year at the ALB Southeast Asia Law Awards 2014. This has included advising Samsung Group in establishment of an R&D center and a factory worth $1.4 billion, representing the Management Authority for Urban Railways in construction of an ODA-financed rapidtransit network worth $7 billion in Ho Chi Minh City, and counseling a joint venture between ISC and Tuan Chau for a property development project worth $7.5 billion. Among the drivers behind its growth, says LNT & Partners, is that its partners have received overseas training and education, and as a result, the firm is able to understand international business practices and thus offer practical and “businessappropriate” solutions. “The firm acts in many ways for clients that involve liaising with authority,” it says. “Often times businesses encounter red-tape stemming from complex interactions with various laws, such as when one governing law conflicts with another. As a result, understanding the law as well as difficulties from businesses is one of LNT’s strong suits.” As for its future expansion, the firm says it all comes down to retaining trust: “As the firm’s slogan states, LNT considers trust from clients as the most important factor.”

Location: Singapore Established: 2007 Set up less than a decade ago in Singapore, and already boasting clients in its home country, Indonesia, Malaysia, Hong Kong and China, Premier Law has two partners, with Siraj Omar leading the litigation, arbitration and dispute resolution practice, and Tandip Singh heading the corporate and restructuring practices. Notable transactions that the firm has been involved in include the restructuring of a $325 million guaranteed senior secured note due 2012 issued by Blue Ocean Resources, the establishment a coal logistics network by PT Atlas Resources for providing access for coal mined in South Sumatra, and the sale of a stake in the IDX-listed PT Asuransi Bina Dana Artha to Spanish insurer Mapfre Internacional. The main drivers behind the firm’s recent growth have been two-fold. “For the disputes team, the main growth area has been acting for bankers, traders and other financial sector employees in relation to investigations carried out by banks and other financial institutions into allegations of rigging of foreign exchange and LIBOR rates,” the firm says. “For the transactions team, the main growth area has been the increase in infrastructure projects in Indonesia, especially in power projects, roads and ports.” And Indonesia will continue to be a key source of legal work going forward. “We expect that infrastructure projects in Indonesia will continue to grow,” says Premier Law. “We also expect the low coal prices to result in defaults and potential debt restructurings amongst coal mining firms.”

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Locations: Bangkok, Hua Hin, Vientiane, Yangon Established: 2005 The sole Thai firm on this list, Siam City Law Offices (SCL) has a presence in three countries already, to go with access to other countries in the ASEAN and beyond through RHTLaw Taylor Wessing’s ASEAN Plus network. “Since we have a good understanding of clients in Asia, we set up firms in Myanmar and Laos to further expand our horizon and to be one of the leading full-service commercial law firms of choice for local, regional, national and international clients.. in the Southeast Asia region,” the firm says. Recent notable work has included representing a Thai company’s disposal of land, brewery and machinery to a multinational brewer in a 4 billion baht deal, and representing Minor Corporation in a dispute of over 135 million baht concerning Thailand’s 2011 flooding claims. The coming AEC is set to offer more opportunities for SCL. “The AEC has created certain advantages for us since Thailand is the base for foreign investment upon entering into the ASEAN market,” the firm says. “Since we have strong practices in litigation and taxation – among others – which are highly sought after by the clients, we feel that more clients now approach us to assist them with foreign investment in Thailand. As for AEC in terms of international level, Myanmar and Lao are considered new markets that most investors would like to invest in. That is beneficial to us since we have a presence in those countries as well.”

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ASEAN POTENTIAL 2015 IS SLATED TO BE THE YEAR WHEN THE ASEAN ECONOMIC COMMUNITY (AEC) KICKS OFF, AND THE SOUTHEAST ASIAN ECONOMIC BLOC LOOKS ALL SET TO DRIVE OFFSHORE GROWTH, FINDS CHRIS HORTON

he acronym AEC may not yet mean much to many people outside of Asia, but for those doing business here, they hail the exciting prospect of a new market that, if realised, will dramatically alter the business landscape in the Asia Pacific region. Scheduled for launch at the end of this year, the AEC – or the ASEAN Economic Community – will liberalise regional trade by removing barriers to the movement of people, goods and services among the 10 member states of the Association of Southeast Asian Nations (ASEAN). The AEC will come at an interesting time. Singapore is beginning to outshine long-time rival Hong Kong as a regional finance hub and source of capital. Indonesia, Malaysia, Vietnam and the Philippines are posting strong growth figures. Even “frontier states”

including Myanmar, Cambodia and Laos are coming in from the cold and becoming increasingly connected with their wealthier neighbours. The ramifications of the formation of a Southeast Asian economic bloc that can compete with its giant neighbours China and India, as well as the US and EU, will take years to become apparent. But the impact of the coming launch of the AEC is already being felt in boardrooms around the world. It is also being felt in ASEAN itself, of course, where more companies, be they local or foreign, are looking at the opportunities that lie in neighbouring markets. Plans are already underway to create new trade corridors, for example, building up transport infrastructure and manufacturing capacity in Cambodia to link existing industrial nodes in Thailand and Vietnam. REUTERS/Nayef Hashlamoun

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As connectivity improves, supply chains won’t be the only areas of the regional economy to benefit, as new sectors such as e-commerce will receive helpful boosts as well. Such developments will unlock new opportunities in a region that has only recently entered a new period of peace and stability. By upgrading both ASEAN’s internal and external profile, the AEC will require a growing number of sophisticated offshore vehicles to compete at a global level. The services of offshore legal counsel will be crucial to the realisation of this goal, providing established offshore legal firms with what should be fertile ground for growth beyond the short term. HIDDEN GIANT More and more companies are adjusting their plans for ASEAN away from a stateby-state approach to a more holistic strategy that views the AEC as one market. And when viewed in those terms, what a market it is. Almost one in 10 people in the world live in ASEAN, which collectively is growing only slightly slower than China and India, while leaving the rest of the BRICS countries in the dust. It’s not growth from a low base-point, either. At present, the upcoming AEC would rank as the world’s fifth-largest economy. This has set the stage for a boom in financial and legal services that will piggyback on increasing M&A activity and economic expansion. Many firms are already busy serving this up-and-coming region.

“Offshore firms generally provide legal services to the region via a Singapore or Hong Kong office presence with client and marketing trips being made to the individual ASEAN countries during the course of the year,” says Michael Gagie, managing partner of Maple and Calder’s Singapore office. “There is increasing demand within the region for offshore legal services and healthy competition amongst the offshore law firms to provide it.” “We are delighted with the way in which the opening of our Singapore office in 2012 has enabled us to further our client relationships with the ASEAN countries and to increase the level of our understanding of the region,” Gagie adds. Other firms also see a region brimming with opportunity. “ASEAN continues to be an important region for offshore legal counsel and we have historically played a role in foreign inward investment as well as trade and access to capital markets, using offshore vehicles,” says Frances Woo, group chairman at Appleby. “As ASEAN has grown in importance so too has ASEAN as a target market for our clients and as a source of work for us,” Woo adds. “The larger offshore firms generally see the ASEAN region as one that is easily serviced from a hub office in Hong Kong and possibly complemented by a presence in Singapore or in Mainland China. We have very successfully serviced the ASEAN

“AS ASEAN HAS GROWN IN IMPORTANCE SO TOO HAS ASEAN AS A TARGET MARKET FOR OUR CLIENTS AND AS A SOURCE OF WORK FOR US. THE LARGER OFFSHORE FIRMS GENERALLY SEE THE ASEAN REGION AS ONE THAT IS EASILY SERVICED FROM A HUB OFFICE IN HONG KONG AND POSSIBLY COMPLEMENTED BY A PRESENCE IN SINGAPORE OR IN MAINLAND CHINA.” Frances Woo, Appleby

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market for over 25 years now, largely from Hong Kong.” Alan Dickson, director and head of the Singapore office of Conyers Dill & Pearman described ASEAN as an important market for offshore legal counsel and a market that is already familiar with the benefits of offshore vehicles. “The demand for offshore legal services in ASEAN remains strong,” Dickson says. “We continue to see offshore structures used routinely when ASEAN companies seek to access international capital and when crossborder investments are made within ASEAN. Business families operating in Asia who hold assets overseas are also very familiar with the advantages to be gained through use of offshore holding structures for such assets.” “As complex transactions with offshore connections continue in ASEAN, we continue to see room for growth in demand for offshore legal services in the region,” he adds.

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“WE HAVE SEEN AN UPTICK IN M&A WORK IN THE LAST SIX MONTHS WITH MUCH OF THIS WORK INVOLVING BVI OR CAYMAN ENTITIES. WE HAVE ALSO BEEN ADVISING ON A LARGE NUMBER OF BOND ISSUES WITH BVI OR CAYMAN BEING VERY POPULAR CHOICES OF JURISDICTION FOR THE ISSUER” Anthony Oakes, Ogier

COUNTING DOWN The run-up to the launch of the AEC at the end of this year will be a busy one for the 10 national governments involved, as well as the ASEAN secretariat. Few expect all of the launch targets to be met when the time arrives. Regardless, much progress has been made by member states in eliminating most tariffs, yet much remains to be done in terms of non-tariff barriers. Nonetheless, it seems the pump is being primed for an initial period of dealmaking and consolidation that should increase regional efficiencies and competitiveness. “The AEC is an historic event for the ASEAN region, offering an opportunity for ASEAN economies to evolve together into a significant global economic power,” says Dickson. “Cross-border investments and transactions are bound to increase with the knitting together of the ASEAN economies,” he adds. “Based upon our knowledge of the existing offshore structures that have been used in the ASEAN region when economic borders have been more closed, we expect an increase in demand for those structures as those borders become more hospitable to inter-region transactions.” That demand will be partially fuelled by the strong growth ASEAN is currently experiencing, in spite of the lacklustre showing in 2014 by Thailand, one of the region’s largest economies. “ASEAN saw its GDP growth for 2014 finish at 4.9 per cent outpacing the world’s GDP growth of 3 per cent,” says Appleby’s Woo.

“We expect to see this trend continue given its large labour force and growing middle class. We also expect to see deeper collaborations with domestic ASEAN and other foreign firms as they develop their presence.” The 10 ASEAN member states are all quite different from one another, with different strengths and weaknesses. Development levels also vary widely. These factors will determine where offshore legal counsel will tend to be in demand when AEC launches. “Some of the ASEAN region is relatively mature – Singapore, for example – but elsewhere – Vietnam and Myanmar, for example – we expect to see more activity as these regions become more robust and confident environments for international investment activity,” Woo notes. “With this comes greater sophistication in the delivery of legal services and an enhanced understanding of complex transactions is expected.” “Certainly our experience is that the market is in growth mode,” Woo adds. “Appleby has historically had strong ties with the foreign firms and equally with the domestic ASEAN firms in tandem with their growth trajectory. As both sides develop in greater alignment, this will further add to our growing and strengthening relationships.” Of course, the regional sea change promised by AEC will not be realised this year, but notions of ASEAN’s short-term potential are gradually coming in line with the fact that on the ground, things will continue to change as 31 December approaches. “As you would expect, in order for us to see increased activity in terms of demand for our services, there needs to be an increase of economic activity necessitating the use of structures involving offshore entities, for instance, for borrowing or for investment purposes, which then require offshore advice,” says Gagie. “I don’t think we expect the launch of the AEC itself to affect deal flow but we do hope that its launch will result in increased economic activity for the region.” ALREADY DEMAND As things stand now, there is already demand among all ASEAN members for offshore legal services. “Offshore structures remain very widely used in the region, particularly BVI and Cayman structures,” says Nathan Powell, a partner at Ogier’s Hong Kong office. “These tax neutral jurisdictions are have highly regarded courts and legal system, flexible and pragmatic regulatory regime and are known for their high-quality lawyers, accountants, advisors, and other service

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providers in both the BVI and Cayman Islands themselves as well as here in Asia,” Powell says. “We see Cayman used very heavily for funds as well as IPO’s and pre-IPO investments in the region. BVI tends to be used a lot for bonds and financing work generally.”’ Powell’s colleague and head of finance at Ogier’s Hong Kong office, Anthony Oakes, says: “We have seen an uptick in M&A work in the last six months with much of this work involving BVI or Cayman entities. We have also been advising on a large number of bond issues with BVI or Cayman being very popular choices of jurisdiction for the issuer. Naturally, some countries and sectors are displaying more robust demand than others. “All ASEAN countries have provided transactions requiring offshore advice,” Gagie says. “Historically, Singapore, Indonesia and Malaysia have provided a lot of deal-related activity, but other countries in the region are also active. Over the past 18 months, the most active sectors for us have been finance and private equity.” Given the region’s dynamism and considering that several of its economies have only recently come online with regard to global markets, some of these newer players offer the possibility of long-term sustained growth, which should drive demand for offshore legal counsel. “Countries such as Vietnam and Myanmar present opportunities in addition to the more familiar and larger markets in Indonesia, Malaysia and Thailand,” says Woo. “There is definitely an uptick on the horizon and offshore structures via Mauritius, BVI, Bermuda, Cayman and Seychelles are popular. The activity crosses all sectors, but as you would expect there is a larger percentage of financial services activity than many other sectors and maritime/transport/infrastructure is particularly strong in this region.” One positive aspect of ASEAN in general is that because it is already familiar with the benefits of offshore finance, it does not require much in terms of educating the market, as was the case in nearby China not long ago. “We see offshore structures used in a broad range of industries in ASEAN coun-

ASIAN LEGAL BUSINESS FEBRUARY 2015

A general view the Bukit Bintang shopping district in the Malaysia’s capital Kuala Lumpur. REUTERS/Bazuki Muhammad

tries, with such diverse industries as financial services, commercial property investment, health care, shipping and resource industries all making use of offshore structures to access international pools of capital and to hold cross-border assets,” says Dickson. “Businesses in Indonesia, Singapore and Malaysia are particularly active,” Dickson adds. “We do not see any particular industry as the front runner in this activity and believe that such a broad based use of offshore structures indicates the main stream acceptance of the advantages of offshore structures among diverse industries.” CHINA FACTOR China’s runaway growth has slowed down significantly, but owing to its size and its growing business and investment presence across ASEAN, it is still a major source of demand for offshore services in the region. As ASEAN’s biggest trading partner, it shouldn’t be surprising that many offshore

firms use their Hong Kong and mainland China offices to serve ASEAN at the moment. This approach should be less common after demand for offshore legal counsel reaches a tipping point, pushing firms to open new offices in Singapore or elsewhere in the region. “Our role on transactions involving ASEAN countries tends to be very similar to our role on Chinese or other international deals,” says Maples & Calder’s Gagie. “We work with onshore lawyers and other advisers of the client to achieve the client’s objectives in terms of structuring and execution of a transaction. We are very much part of a larger deal team.” Given that ASEAN is a collection of wildly different regulatory regimes as well as languages, customs and cultural norms, it contrasts with China’s highly centralised system. “ASEAN, although established since 1967, still consists of 10 member countries that have varying requirements and different regimes, from a legal, regulatory, financial,

“ALL ASEAN COUNTRIES HAVE PROVIDED TRANSACTIONS REQUIRING OFFSHORE ADVICE. HISTORICALLY, SINGAPORE, INDONESIA AND MALAYSIA HAVE PROVIDED A LOT OF DEAL-RELATED ACTIVITY, BUT OTHER COUNTRIES IN THE REGION ARE ALSO ACTIVE. OVER THE PAST 18 MONTHS, THE MOST ACTIVE SECTORS FOR US HAVE BEEN FINANCE AND PRIVATE EQUITY.” Michael Gagie, Maples and Calder

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“OVER THE MEDIUM TO LONG TERM, IF THE ECONOMIES IN ASEAN INTEGRATE MORE FULLY, WE DO EXPECT TO SEE MORE CROSS-BORDER INVESTMENT AND TRADE. TO THE EXTENT THIS OCCURS, WE WOULD EXPECT THAT AEC’S IMPACT, IN THE MEDIUM TO LONGER TERM, WILL RESULT IN AN INCREASE IN THE DEMAND FOR OFFSHORE LEGAL SERVICES IN THE REGION.” Alan Dickson, Conyers Dill & Pearman

political perspective and otherwise,” says Woo of Appleby. “There are also significant cultural and language differences as well and all of these factors taken together mean that ASEAN requirements differ greatly from China. The levels of understanding of the role of offshore in international and regional transactions can differ greatly requiring offshore legal counsel to have a strong appreciation of the local background and dynamics at play.” Woo notes that while Singapore is very accustomed to offshore and understands the sophistication and complexity, there are other ASEAN member countries such as Myanmar and Laos that may not have similar levels of understanding or exposure. That said, China is not as homogenous a market as some outsiders might tend to think. “China is a much larger market and has grown significantly in its use and appreciation of offshore particularly given the size and volume of outbound deals over the years,” Woo says. “However, China can equally be diverse particularly in the noncoastal and less developed regions.” China has also kept a relatively open attitude to offshore vehicles, an attitude that is not mirrored by all of its neighbours to the south. As China and ASEAN business ties continue to deepen, Chinese influence could be one factor pushing governments toward a greater understanding of the advantages offered by offshore. “Chinese policy to date has not discouraged the use of offshore structures,” says Dickson of Conyers, Dill & Pearman. “Chinese businesses have embraced the neutrality, flexibility, certainty and efficiency that offshore holding company structures offer to them in accessing international capital and in financing and trading transactions,” Dickson adds.

“Certain ASEAN countries restrict their citizens and businesses from investing externally, whether for reason of exchange control or simply out of central policies to control business activity and investment flows. To this extent, some ASEAN countries do have institutional impediments to efficient capital flows, and these do represent a significant difference from Chinese economic policy. BEYOND 2015 The AEC is intended to create a legal regime to unify ASEAN into a single market, economy and production base leading to a freer flow of goods, services, investment and skilled labour across the region. Woo notes that, should this vision be achieved more or less on schedule, some forecasts see the AEC as generating 14 million jobs by 2025 and improving the livelihood of 600 million people across the 10 ASEAN member countries and the GDP growth of the region as a whole rising to 7.1 per cent, contrasted to ASEAN GDP of 4.9 per cent in 2013. “This development could lead to greater opportunities for growth and prosperity in ASEAN with growth in trade, transportation and construction being the major sector beneficiaries,” Woo says. “If trade and services are to liberalised, then we see offshore activity as adding significantly to the economic performance of the ASEAN region and enhancing its attractiveness and competitiveness. Offshore stands to gain much from an AEC that can punch its weight on the world stage alongside similar-sized markets in the East and West. It should also see an uptick in business on the back of growing intra-ASEAN M&A activity as well as trade. “The US commits one third of its investments in Asia to ASEAN, which is significant,

and through the AEC, we see this as being further enhanced,” Woo notes. “If the AEC promotes its member states according to its blueprint, investment, business and crossborder trade will increase and become more confident, bringing economic prosperity to the region and the consequential transactions and management of private wealth that surround this. Offshore will play an important role in this development and assist in intermediating financial transactions both within the region and between the region and the US, EU and China.” Although there is much reason for optimism for the AEC in general, offshore firms are generally taking a somewhat long view of the prospects in general, while making sure they seize the opportunity today to lay down a foundation for future demand growth across ASEAN. “In the short term, we don’t expect any significant impact from AEC on demand for services from offshore legal counsel,” says Dickson. “However, over the medium to long term, if the economies in ASEAN integrate more fully, we do expect to see more cross-border investment and trade. To the extent this occurs, we would expect that AEC’s impact, in the medium to longer term, will result in an increase in the demand for offshore legal services in the region.” There is little doubt that the AEC will experience growing pains in its early years as an economic bloc, but this is only natural with 10 very different stakeholders that each have their own particular domestic concerns to address. But it is early days and progress has been substantial. As the saying goes, Rome wasn’t built in a day. Neither was the European Economic Community, but its existence today after decades of wrangling, disagreement and compromise, points a way forward for Southeast Asia.

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CLAMPING DOWN ON

CORRUPTION CORRUPTION HAS BEEN A DEEP-ROOTED PROBLEM IN ASIA FOR MANY YEARS. LOCAL GOVERNMENTS HAVE TACKLED THIS ISSUE WITH RENEWED VIGOUR IN RECENT YEARS, AND ARE FAST DEVELOPING AND ENFORCING EXISTING ANTI-CORRUPTION LAWS. MEANWHILE, EXTRATERRITORIAL REGULATIONS FROM EUROPE AND THE U.S. ARE INCREASINGLY AFFECTING HOW BUSINESSES OPERATE IN ASIA. THE U.S. FOREIGN CORRUPT PRACTICES ACT (FCPA) IS ONE SUCH LAW. THE FCPA HAS BEEN IN PLACE SINCE 1977, BUT ACTIONS UNDER IT HAVE BEEN PROLIFIC OVER THE PAST FEW YEARS AS FOREIGN INVESTMENT AND BUSINESSES FLOW INTO ASIA AT LIGHTNING PACE. KANISHK VERGHESE REPORTS

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n today’s fast-paced and interconnected world, global corporations without a presence in Asia – particularly in China – are few and far between. As the geographical scope of businesses widens and the volume of transactions increases, companies are under more pressure than ever to navigate increasingly complicated and fast-evolving local regulatory environments, and to ensure compliance with the extraterritorial arms of global legislation. The U.S. Foreign Corrupt Practices Act (FCPA) is one such piece of legislation that has been flexing its muscles in Asia in recent years. The FCPA, which has been in existence since 1977, prohibits the bribery of non-U.S. public officials and sets requirements for record-keeping and internal accounting controls at companies that are publicly traded on U.S. securities exchanges. A BIG YEAR FOR FCPA ENFORCEMENT Both the U.S. Securities and Exchange Commission (SEC) and the Department of

tigations and the increase in the average corporate fine and settlement figures in recent years suggest that companies need to be taking FCPA compliance more seriously. According to the FCPA Blog, an online source for white-collar crime enforcement and compliance news, ten companies paid $1.56 billion to resolve FCPA cases in 2014. Comparatively, companies paid $731.1 million in 2013 and $259.4 million in 2012. Last year also saw sizeable fines and penalties levied. In January, aluminium producer Alcoa World Alumina agreed to pay $384 million to settle charges under the FCPA, in what is the fifth largest FCPA penalty of all time. The year ended with French multinational Alstom pleading guilty in December to bribing officials in Indonesia, Saudi Arabia, Egypt and the Bahamas, resulting in $772 million in penalties – the second biggest FCPA enforcement action ever. Also in December, cosmetics company Avon paid $135 million to resolve FCPA viola-

ANTI-CORRUPTION

MULTI-DIMENSIONAL CHESS For her part, Austin says that while companies are concerned about FCPA risk, some are not as focused as they should be on local risk and enforcement action in Asia. From an investigation perspective, multinationals with subsidiaries in Asia need to think on multiple levels, she says. “It’s like playing multi-dimensional chess, because you have to think about the local authorities and their focus, but also about the implications in your home jurisdiction and listing jurisdictions. If you are a global MNC, a local matter can blossom into something that potentially covers a host of jurisdictions,” says Austin. The investigation of multinational GlaxoSmithKline (GSK) last year serves as a fitting example of a local issue turned global. The pharmaceutical company first came under investigation by local authorities for alleged bribery in the southern Chinese city of Changsha, which was then expanded to include investigations by the UK authorities under the UK Bribery Act,

“THE CASES WE ARE INVOLVED IN DEMONSTRATE THAT THE RISKS NEED TO BE OWNED BY THE COMMERCIAL FOLK WITHIN A BUSINESS. THIS NEEDS TO BE UNDERSTOOD, APPRECIATED, MANAGED AND MITIGATED BY THE PEOPLE WHO ARE DOING THE DEALS, RUNNING THE RELATIONSHIPS AND RESPONSIBLE FOR REVENUE GROWTH AND EXPANSION.” Mini vandePol, Baker & McKenzie

Justice (DOJ) are clamping down on FCPA violations in Asia, with China the primary source of investigations. According to a Herbert Smith Freehills Asia-Pacific Anti-Corruption Report, which was released in September 2014, one in four FCPA enforcement actions between May 2013 and April 2014 were generated in the Asia Pacific region. Allegations relating to China, India and Indonesia amounted to nearly 90 percent of these actions. “The trajectory of effort on the part of the U.S. regulators is continuing without any kind of slowdown,” says Mini vandePol, a partner at Baker & McKenzie in Hong Kong, and the global head of the firm’s compliance group. “If companies were taking the FCPA more seriously, we would be seeing a correlation in the extent of enforcement by the U.S. regulators. We are not really seeing that correlation, and that’s likely because many companies have not made FCPA compliance a priority,” says vandePol. Indeed, the rise in the number of inves-

tions in China. However, the size of the penalty Avon had to pay pales in comparison to the cost of the investigation, which stood at more than $340 million, says Kelly Austin, partner and head of Gibson, Dunn & Crutcher’s Hong Kong office. This is the case not only in the big-ticket cases like Avon, but also in smaller investigations. For example, scientific instrument maker Bruker Corporation paid $2.4 million last December to settle FCPA violations, but the company disclosed that its investigation costs were more than $24 million, says Austin. In addition to increasing enforcement efforts by regulators worldwide, lawyers and compliance professionals have observed a greater level of cooperation between Asian and U.S. regulators in recent years. “The DOJ and SEC are far more active in communicating and collaborating with regulators in the Asian region, which enhances their ability to follow the money trail and find individuals who are caught up in allegations,” says vandePol.

and by the DOJ and SEC under the FCPA. In September 2014, GSK was fined a record 3 billion yuan ($489 million) for paying bribes to doctors to use its drugs, and former GSK China chief Mark Reilly and four other executives were handed jail sentences. According to Reuters reports, the company’s overseas practices in Poland, Syria, Iraq, Jordan, Lebanon and the UAE, are also being investigated by the U.S. and UK authorities. The GSK scandal in China underscores the need for businesses to spend more time on due diligence and ensuring that their compliance policies are up and running. However, regulators nowadays expect companies of all sizes to have a compliance programme in place, and corporations venturing into Asia need to do more to avoid regulatory scrutiny, lawyers say. The question being asked in many enforcement actions is whether the company is living and breathing its compliance programme, and how well the programme is understood by the commercial

ANTI-CORRUPTION

ASIAN LEGAL BUSINESS FEBRUARY 2015

Anti-corruption efforts in China and India As U.S. authorities ramp up FCPA enforcement activity, two of Asia’s major players – China and India – are also upping their anticorruption efforts. “China’s anti-corruption campaign for the last 12 to 18 months has been very much front and centre for President Xi Jinping,” says Gibson, Dunn & Crutcher’s Austin. President Xi has vowed to target high-flying “tigers” as well as lowly “flies” in an anti-corruption drive that has ensnared many high-ranking officials, including Zhou Yongkang, the former domestic security chief, and Jiang Jiemin, once the top regulator of state-owned enterprises. However, the lack of transparency in China makes things more difficult for both multinationals and local businesses, lawyers say. “Companies don’t know where the Chinese authorities’ next move is coming from and which industries they will focus on, and it is hard to gain a good understanding of what would work in China to avoid the type of fine that GSK had levied against them,” says Baker & McKenzie’s vandePol. The heightened levels of enforcement in China is unlikely to show any sign of abatement in the coming years, as China seeks to clamp down on its endemic corruption problem – a move that is vital in order to be recognised as a world leader.

side of the company when they conduct business in high risk jurisdictions. EMPOWERING EMPLOYEES One of the greatest risks associated with conducting business in Asia’s emerging markets is the use of third parties. A report on foreign bribery published in December 2014 by the Organisation for Economic Co-operation and Development (OECD), which analysed 427 foreign bribery corruption cases brought by OECD Member States between February 1999 and June 2014, found that almost three out of every four foreign bribery cases arose from third party conduct. Companies should spend more time on conducting thorough due diligence on their third parties to ensure they pick the right partners, says Austin. The OECD reiterated in its report that company executives should lead by example in fighting foreign bribery. However, the report also found that 53 percent of the bribery cases

India stands as an interesting comparison. The country has struggled to tackle its deep-rooted corruption problems, and its democratic system means that it is often not able to enact legislative changes and establish stronger enforcement bodies as swiftly as China, says vandePol. However, a new government was elected in May 2014 under Prime Minister Narendra Modi, who has vowed to initiate sweeping anti-corruption measures and make India more attractive for investment. “Modi is very focused on trying to eliminate the bureaucracy involved in conducting business in India. It is a focus on making it easier to do business, but that is also going to have the benefit of addressing corruption,” says Austin. For example, Modi has put a broom through the processes, and is trying to enhance e-governance and online approvals wherever possible, says vandePol. “It seems relatively minor, but it makes a huge difference. Processes are faster, more transparent, can be tracked, and don’t have hands reaching out for money in the way of bribes,” says vandePol. However, she adds, people will need to see large enforcement matters in India in coming years to drive that message home.

analysed involved corporate management or CEOs – an unnervingly high figure for upper management, who are tasked with setting the right tone from the top. However, vandePol argues that for multinationals in Asia – where the CEO and board are often based in the head office outside the region – the tone from middle management is of more importance. Local middle management is often the key as they are the ones with their fingers on the pulse of their daily operations in the region, says vandePol. In terms of how foreign bribery cases are detected, the OECD found that self-reporting was the most common (31 percent) method. In comparison, only two percent of the surveyed cases were alerted to enforcement authorities through whistleblowers. As a result, the OECD reinforced the protection of whistleblowers as part of greater efforts to tackle bribery and corruption. Although debate is ongoing at a government level,

with countries like India considering introducing legislation to incentivise and protect whistleblowers, some lawyers believe that the issue can, and should, be tackled at a corporate level. “Most whistleblowers come forward for the right reasons. At a corporate level, if you can create an environment that enables people to improve the way business is done in a legitimate way, and where genuine whistleblowers can come forth and have their matters properly investigated internally, you will find that people will be willing to step forward. One of the ways to value that is to put compliance as a key performance indicator in your employment contracts and measure the way people are trying to promote ethical practices,” suggests vandePol. ADVISOR OR GATEKEEPER? With the DOJ and SEC indicating that FCPA enforcement efforts are likely to get more aggressive, lawyers expect to see more investigations in Asia in the coming years, including in jurisdictions like Indonesia, Malaysia and Singapore. Navigating local laws and mitigating local risks while ensuring compliance with extraterritorial legislation will certainly pose a challenge for businesses as they continue to look towards Asia for growth. And with both the size of FCPA monetary settlements and the costs of conducting investigations expected to surge, corporations cannot afford to take the extraterritorial reach of the FCPA lightly. It is important for businesses to bear in mind that when it comes to implementing a thorough compliance programme, one size does not fit all. “The challenge is actually making that compliance programme work day in, day out in a host of different markets, and ensuring that the employees understand the way in which local cultural practices and local risk feature in the context of how they are going to market in a particular jurisdiction,” says Austin. For her part, vandePol believes that inhouse compliance and legal teams should be advisors and guides, rather than the gatekeepers for the company. “The cases we are involved in demonstrate that the risks need to be owned by the commercial folk within a business. This needs to be understood, appreciated, managed and mitigated by the people who are doing the deals, running the relationships and responsible for revenue growth and expansion,” says vandePol. This is especially the case in Asia, she says, where inorganic growth is the norm and where regular acquisitions of local businesses can unearth non-compliant, unethical or criminal dangers.

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Q&A

ASIAN LEGAL BUSINESS FEBRUARY 2015

‘HAVING THE RIGHT TEAM IS CRUCIAL’ DAVID ZEMANS, ASIA MANAGING PARTNER AT MILBANK, TWEED, HADLEY & MCCLOY LLP, SPEAKS TO RANAJIT DAM ABOUT THE FIRM’S STRATEGY FOR GROWTH IN THE REGION, HOW IT IS ADAPTING TO THE NEEDS OF AN EVOLVING ASIAN MARKET, AND THE IMPORTANCE OF ATTRACTING AND RETAINING THE BEST TALENT

ALB: How would you describe the firm’s Asia strategy during your stint as Asia managing partner? And what kind of role does the region play in the firm’s overall global growth plans? Zemans: Our strategy is to maintain our position as a leading, top-tier provider of legal services across Asia. We strive to be the “best in practice” in every market in which we operate while recognizing the need to customize our approach to suit the language, cultural, legislative and regulatory variances in each country we work in. In order to achieve these goals, we believe that it is essential to attract and retain the very best lawyers. Asia has been and continues to be a very important part of Milbank’s global strategy. Our Hong Kong and Tokyo offices have been open for more than 35 years each, followed closely by our Singapore office which is 30 years old this year. ALB: Earlier, this month, Milbank opened its office in Seoul. What do you think your approach to the Korea market will be, and are there lessons to be learnt from the firms that are already there? Zemans: Milbank already has a very significant South Korea practice and we believe that given the importance of our clients in South Korea, it makes sense to have an office there. Senior Partner, Young Joon (YJ) Kim, relocated to Seoul to head-up the new office. YJ is very wellknown and highly regarded in the Korean market. He has advised on a number of

the largest deals to have taken place there and has represented many of the most reputable South Korean corporations and government agencies. We have a very

know and love the region and understand what it takes to successfully close complex deals in Asia. I joined the Singapore office as a young associate in 1997, just before

“THERE IS A MISCONCEPTION THAT SOUTHEAST ASIA IS AN EASY MARKET TO ENTER AND SUCCEED IN. IT IS SURPRISING HOW MANY FIRMS HAVE COME AND GONE OVER THE YEARS HAVING FOUND THINGS MUCH MORE DIFFICULT AND COMPETITIVE TO NAVIGATE THAN THEY EXPECTED.” positive view of the market in South Korea and believe that its potential in the longer term is also very strong. ALB: You have been in Singapore for nearly two full decades now. How have you seen the Asian (and particularly, Southeast Asian) market for legal services develop during that time? Zemans: Milbank opened its Singapore office in 1985 and our commitment to Singapore and the region spans nearly three decades. Our partners in Singapore have spent the majority of their careers in Southeast Asia and because of that each of them - in addition to being great lawyers - has extensive regional experience and invaluable local knowledge. We believe that it is our team that sets Milbank apart from its peers. Clients really appreciate the fact, that in addition to engaging a great firm, they are hiring individuals who really

the financial crisis. I came to Asia thinking I was going to work on large complicated financings and M&A transactions, but quickly found myself working on many of the largest and most complicated restructurings in the region. These deals provided me with first-hand experience and insight into what can go wrong. This is a very valuable lesson for a young lawyer to learn. When a client trusts you with their most complicated and challenging work, you are very motivated to deliver the highest quality product and service. The legal services market in Asia today is growing and is much more sophisticated than it used to be with public and private sector clients demanding a broader range of specialized products and services. The number of foreign law firms active in Southeast Asia has increased rapidly in the last few years. There is a

Q&A

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misconception that Southeast Asia is an easy market to enter and succeed in. It is surprising how many firms have come and gone over the years having found things much more difficult and competitive to navigate than they expected. ALB: Milbank has been particularly active in the growth markets on Southeast Asia, such as Indonesia, the Philippines and Vietnam. What are some of the things that you think that the firm is doing right compared to its peers? Zemans: Having the right team is crucial. We spend an enormous amount of time considering candidates. When we hire someone, whether it is a partner or associate, we do so with the hope that they will quickly become part of the team and be with us for a long time. We invest an enormous amount of time and money in training and want people to thrive here. In addition to being smart, motivated and excited about their work, good judgment is also critical. Asian deals are complex and full of tricky issues. This makes working here challenging but also very exciting and rewarding.

CV 1997

Joins Milbank as an associate in New York and moves to Singapore

2001

Becomes a partner

2012

Named Asia Managing Partner

“CLIENTS REALLY APPRECIATE THE FACT THAT IN ADDITION TO ENGAGING A GREAT FIRM, THEY ARE HIRING INDIVIDUALS WHO REALLY KNOW AND LOVE THE REGION AND UNDERSTAND WHAT IT TAKES TO SUCCESSFULLY CLOSE COMPLEX DEALS IN ASIA.”

ALB: With the recent election of India’s new government, work coming out of the country has increased dramatically. How is the firm poised to take advantage of this? Zemans: We are optimistic about the opportunities in India. The election of India’s new government has led to an increase in activity for us and we anticipate this will continue. There is much greater appreciation now for top quality legal work and we will benefit from this. Milbank has been fortunate to have been involved in a number of large and high profile transactions in India over the last several years. We have a large team in Asia that works on India related matters, in addition to partners throughout the firm’s global network, including partners in London, New York and Washington DC. ALB: What do the next year or two look like for Milbank in Asia? Zemans: Our Asia practice has undergone some very exciting developments, including the addition of five partners to our Asia team in the last 18 month. I believe with this great team in Asia, we are poised for even greater success in the future.

EVENT

ASIAN LEGAL BUSINESS FEBRUARY 2015

IP DISPUTE RESOLUTION: AN EVOLVING FIELD By TARA SHAH

“The internationalization of intellectual property/technology transactions may implicate a growing exposure to potential cross-border disputes, leading to an increasing demand for efficient dispute resolution mechanisms in terms of time and cost, which were the top two considerations when negotiating dispute resolution clauses according to a survey by the World Intellectual Property Organization (WIPO) conducted to capture trends in the resolution of technology-related disputes,” says Jessica Park, legal officer and representative of the WIPO Arbitration and Mediation Center office in Singapore. Park and Stanley Lai SC, partner at Allen & Gledhill, and chairman of the Intellectual Property Office of Singapore, were among the speakers at the ALB Singapore IP Conference that took place on Dec. 9, 2014, wherein numerous topics, such as Singapore’s emergence as an IP hub in Asia, ICANN’s gTLD program, and IP dispute resolution, were discussed. IP dispute resolution in particular is an increasingly hot topic, especially now that more companies are introducing their brands into multiple international markets. IP HUBS There has been a drive by many Asian countries, such as Hong Kong and China, to innovate their IP laws to better protect international rights holders, and to position themselves to be IP hubs within Asia, such as with Singapore. “Singapore is uniquely placed as a hub for dispute resolution, and a notable feature is the sheer array of dispute resolution options that are available to disputants. The Courts continue to develop a specialist bench for IP disputes, and an IP Court guide has been implemented to further manage the procedural nuances and ancillary applications that are applicable to IP litigation. Other options include arbitration, mediation and most recently, the Singapore International Commercial Court (SICC), that was launched earlier this year. The SICC will blaze a new pathway for litigants to try complex multijurisdictional IP disputes in one forum. The SICC presents the assurance of certainty of resolution, and speed, allowing disputants to dispatch a difficult case without undue delay, before returning to commercial priorities. It will be a game changer,” says Lai

IP AGREEMENTS AND ADR Also trending is an increase in international IP/ technology-related agreements, more crossborder disputes and demand for efficient dispute resolution mechanisms, such as arbitration, expedited arbitration, mediation, expert determination and a combination thereof. According to Park, “the scope of IP/ technology-related agreements has been increasingly international: 90 percent of the WIPO Survey respondents indicated that they concluded agreements with parties from other jurisdictions. This trend is also reflected in WIPO case experience where 92 percent of patent-related arbitrations and mediations administered by the WIPO Center have been international in scope.” She explains: “The WIPO Survey further confirmed international enforceability and forum neutrality make arbitration more attractive than court litigation in a foreign jurisdiction to resolve contractual disputes. Mediation and arbitration are particularly advantageous to resolving cross-border disputes in a single procedure as opposed to multiple court litigations in a variety of jurisdictions with different IP legal systems”. To the same effect, Lai notes: “Increasingly we also see interest in mediation and arbitration. In the case of mediation, disputants are increasingly prepared to factor this process into the litigation timeline, and are showing greater willingness to step in and out of mediation at different stages of a dispute.” As to other reasons to why ADR is a popular option, Park states: “ADR is beneficial in IP disputes since they often concern timesensitive technologies. Prolonged IP litigation should be avoided especially when disputes involve technologies with short market cycles; otherwise valuable IP assets can be wasted.” “Another important aspect is the confidential nature of IP disputes. Mediation and arbitration are private procedures where third parties have no access. Recognizing the importance of confidentiality in IP disputes, the WIPO Rules include detailed confidentiality obligations,” she adds. Lai says that “Mediation is a useful means of resolving disputes because the parties avail themselves of an opportunity to resolve matters before a further investment of time and other resources are put into a litigation matter that will increase up to and until hearing. Mediation allows a third party to bring a

perspective and reality check to bear upon the kind of case you think you have going into Court against a backdrop of confidentiality. In my experience I have also found that if mediation is not successful in the first instance, the parties still leave the process knowing the parameters of a prospective settlement that separate them in the dispute.” In sum, with the growing sophistication of the nature of IP disputes, a one-size-fits-all method of dispute resolution is no longer as effective. While traditional court room litigation continues to exist, the trends in IP dispute resolution demand a superfluity of options and forums to accommodate the internationalization of IP rights.

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ASIAN LEGAL BUSINESS FEBRUARY 2015

ALB JAPAN ANTI-CORRUPTION FORUM 2014 Nearly 100 in-house counsel, private practitioners and compliance and ethics officers attended ALB’s inaugural Japan AntiCorruption Forum, held at the Okura Hotel in Tokyo on Nov. 19, to hear from a range of distinguished speakers on the latest anticorruption developments and issues affecting both local and international businesses in Japan. The summit kicked off with welcoming remarks from the conference chair Kanishk Verghese, Deputy Editor of ALB. The first panel of the day discussed how to manage corruption issues across multiple jurisdictions, and how to successfully overcome objections by subsidiaries and contractors without U.S. compliance obligations. The session was moderated by Satoshi Sato, director and general counsel of the legal & IPR department at Sony Mobile Communications Inc, and included speakers Timothy Hewitt, senior international legal counsel at KVH Co, and Kim Stollar, regional counsel for China, Japan and Korea at The Boeing Company. Hewitt recommended that in-house counsel review their company’s compliance policies, and think about how the UK Bribery Act and the Foreign Corrupt Practices Act (FCPA) are being enforced within the organisation and to be aware of how far these laws can reach. “In recent cases, the nexus between the corrupt activity and the territory where it takes place is becoming increasingly minimal and insignificant. This is what tripped Marubeni up earlier in 2014, in what was its second FCPA violation, in connection with a bribery scheme involving Indonesian officials. It is easy to get caught in the web, no matter how tenuous your connection to it may be,” said Hewitt. The next session was chaired by Herbert Smith Freehills Tokyo partners David Gilmore and Dominic Roughton, and senior associate Elaine Wong. Wong highlighted three key trends in the enforcement of anti-corruption regulations across Asian jurisdictions. Firstly, local anti-bribery authorities are becoming more active. Secondly, the number of parallel investigations is rising, with multiple investigations increasingly becoming the norm. Lastly, several jurisdictions in Asia are cracking down on corruption and have recently adopted, or intend to implement, enhanced anti-corruption legislation. Gilmore then took the stage to discuss the challenges of multi-jurisdiction investigations and enforcement actions. “It is

(Above) Panellists discuss the pros and cons of separating the legal and compliance functions within a company (Left) Panellists took questions from the floor throughout the day

increasingly common that in any serious problem you are going to need to deal with regulators from more than one country,” said Gilmore. In-house counsel need to evaluate their company’s position under more than one system of the law, said Gilmore, adding that the legal systems in Asia are in different stages of development, and sometimes have profound differences. Roughton concluded the panel by discussing the effects of bribery and corruption on an arbitration clause, challenges related to the enforcement of arbitral awards, and best practices for managing the consequences of allegations of bribery and corruption in an arbitration. The following panel featured Takamiki

Nishikawa, senior legal counsel at Fox International, Mitsuru Claire Chino, executive officer and general counsel at Itochu Corporation, Kaye Naoko Yoshino, partner at Paul, Weiss, Rifkind, Wharton & Garrison, and Shin Honma, from the forensic services division of PricewaterhouseCoopers. The panellists walked the audience through two scenarios involving the acquisition of a company and a joint venture between two companies, and discussed the key issues to focus on during the pre- and post-acquisition stages, as well as the anti-corruption due diligence measures that companies should adopt. The session after lunch shifted the focus on to reducing risks and protecting the reputation of the organisation, and featured

March 26 –March 27, 2015

Don’t miss INTA’s 2015 regional conference in Japan! Leading the world in technological innovation and high quality consumer exports, Japan is home to many of the world’s largest automobile and electronic products and natural resource manufacturers. In line with the recent changes to the trademark law and Japan’s increased emphasis on trademarks and brands to support its economic growth, this unique conference is the perfect platform to learn about: • Strategies for nontraditional trademarks. • The latest developments and trends in the ASEAN Community. • Geographical indications. • Online counterfeiting. • What in-house counsel expect from outside counsel. • Maximizing the value of your brand. Conducted both in the Japanese and English languages, this event is ideal for trademark owners, attorneys, marketing professionals and government officials wanting to learn more and network with each other.

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ASIAN LEGAL BUSINESS FEBRUARY 2015

(Above) From left to right: Royanne Doi (Moderator), Prudential Financial; Hiromi Furushima, Novartis Pharma; Andrew Savage, Accenture; Lee Augsburger, Prudential Financial (Left) David Gilmore, Herbert Smith Freehills Tokyo, speaking on the challenges of multi-jurisdiction investigatons (Below) Networking refreshment break

Shin Honma from PwC returned to the stage for the final session of the forum to speak about effectively managing bribery and corruption risks. Honma discussed the different steps in-house counsel can take to conduct an effective anti-corruption risk assessment, identify mitigating controls and develop a response plan, and walked through a framework for managing risks presented by third party business partners. “The best compliance programmes I have seen over the years have been the ones where there is true collaboration between compliance, legal, and other functional groups such as sales and marketing. One company in particular refers to this effective collaboration and sharing of information as ‘compliance as a competitive advantage’,” said Honma. Following on from the well-attended ALB Japan Anti-Corruption Forum, ALB is expanding its Anti-Corruption Forum series in 2015 to include events in Hong Kong, China and Singapore.

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moderator Royanne Doi, vice president and corporate chief ethics officer, global business ethics & integrity at Prudential Financial, and panellists Lee Augsburger, chief compliance and ethics officer of Prudential Financial and chairman of the US Ethics Compliance Officers Association, Andrew Savage, senior manager and geographic support legal head for Japan and South Korea at Accenture, and Hiromi Furushima, head of the pharma legal department at Novartis Pharma. The interactive discussion covered a number of topics around ethics and compliance, ranging from best practices for in-house counsel in developing an effective compliance programme, to managing reputational risk and the challenges involved in communicating the culture of ethics to a global workforce.

Following on from the theme of the previous panel, the penultimate session of the day featured an engaging discussion on the pros and cons of separating the legal and compliance functions within a company. Vicki Beyer, labour and employment counsel and senior manager at Accenture, moderated the panel, which also included Yasushi Murofushi, general counsel and head of legal and compliance at Credit Suisse, Chieko Eda, head of Johnson & Johnson’s legal department in Japan, and Edmond Courtroul, general counsel and chief compliance officer at Galileo Japan. The panellists shared their insights on the challenges in-house counsel handling compliance matters face, and their evolving responsibilities in a changing regulatory environment.

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P R O U D LY P R E S E N T E D B Y

DATE: 26 MARCH 2015 LOCATION: THE EXCELSIOR HOTEL HONG KONG

With an increasingly complex regulatory and enforcement environment impacting corporations worldwide, Asian Legal Business is pleased to present “ALB Hong Kong Anti-Corruption Forum 2015” on 26th March in Hong Kong. Continuous assessment and disciplined improvements are the lifeblood of an effective anti-corruption compliance program, and counter the risk associated with corruption and bribery. We invite you to join senior in-house legal counsel, compliance professionals and directors who will gather for a candid discussion on: • How to integrate compliance with business strategy • Developing the role of in-house counsel in decreasing the vulnerability to fraud and corruption • Implementing and reviewing internal efficiencies to avoid high-risk actions that could jeopardize your business • Raising awareness of activities that may have legal implications - how to deal with rogue operators within the company • Negating reputational risks associated with corruption investigations • Establishing core values & ethics and driving the compliance process • Corruption Crackdown - managing bribery investigations for businesses and subsidiaries working across multiple jurisdictions

EXPERT SPEAKERS INCLUDE

STANLEY W.H. LUI General Counsel APAC, Nobel Biocare Asia LTD

CHHOA PECK LIM BELLA Company Secretary, General Counsel, Assistant Director – Corporate Affairs, Hang Lung Properties Limited

SUSANNAH LINDENFIELD Managing Director - Legal & Compliance, The Blackstone Group Ltd

DEBORAH KAPLAN Anti-Corruption Counsel, Morgan Stanley

LORA YIP Head of Legal & Compliance, Asia, Vanguard Investments Hong Kong Limited

JAMES BIDLAKE Executive Director - Legal and Compliance Division, Morgan Stanley

Detailed case studies to be explored at the event include: • Creating, implementing and driving a watertight anti-corruption strategy • Legal, ethical and business challenges for local and global operations • How due diligence can be enhanced with third party contracts, M&A and joint venture activities, and the hiring of new staff • Understanding the steps to take when an investigation occurs; what information you need to provide and the practical steps to do so

SAVE US$100

Event Sponsor

YONG KAI WONG Managing Director - Head of Legal & Compliance, CITIC Capital

DAVID L BISHOP Principal Lecturer, School of Business – Faculty of Business and Economics, The University of Hong Kong

***Register before 21st February to save US$100 with the early bird rates*** ***Special rates apply for in-house legal and compliance teams!*** • In-House legal & Compliance, Academics, Government and Not-For-Profit = US$390 / US$490 • Law Firms, Consultants, Service Providers = US$590 / US$690 ***Group discounts also apply - book 5 passes and receive a 20% discount*** To book your place, please visit www.legalbusinessonline.com/conferences/HKAntiCorruption, or contact Sheila Lum on sheila.lum@thomsonreuters.com or call +65 6870 3252 Speaking and sponsorship opportunities are still available at this conference – for more information, please contact Amantha Chia on amantha.chia@thomsonreuters.com or call +65 6870 3917

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ASIAN LEGAL BUSINESS FEBRUARY 2015

THE LEGAL INDUSTRY EMBRACES INNOVATION By TARA SHAH

“Things are moving quickly in Asia, trying to keep up with the pace and finding time to innovate at the same time is difficult, and thus many law firms and in-house counsel are looking to third party vendors to supply technological innovations that can help with efficiency in both a lawyer’s daily practice and their back office,” says Cary Burch, SVP of Innovation at Thomson Reuters. Burch and David Ellis, partner at Mayer Brown JSM, were among the speakers at the ALB Innovation & Leadership: Turning 2020 Vision into Action luncheon that took place on Dec. 10, 2014 in Hong Kong, where approximately eighty guests listened to a dynamic panel on innovation in the legal industry. Businesses world-wide are evolving in an effort to maintain market position and stave off the competition, all while working within the confines of tighter budgets post the 2007 global financial crisis. In order to maintain this balance, many businesses are looking to innovative products and processes to improve customer satisfaction and increase profitability. The legal industry is no exception, and was equally affected by the global financial crisis. In fact, according to Ellis, “The legal market has stagnated since 2007, and there remains approximately 25-30 large global firms due to the number of law firm consolidations, while other firms remain relatively small in size.” Ellis, who was previously the COO of Johnson Stokes & Master, has an appreciation for what innovation can do to help law firms in today’s market. “Innovation can help with competition, improve efficiencies and increase profitability,” he says. THE LOOK OF INNOVATION Most people tend to think of innovation as something tangible, but according to Burch, “there are many ways a business can innovate, and streamlining operational processes can be just as impactful as investing in new technology.” For the legal industry, operational innovations can take the shape of firm-wide legal practice management training and legal process improvements, with the effect of reduced inefficiencies, strengthened client relations and increased profitability, notes Ellis” In addition to improved operational processes, technology can aid in time management and capture “big data,” which can be

turned into sophisticated “business intelligence” that can provide invaluable statistics and predictive insight that would otherwise take a lot of hours to produce, and skilled professionals to interpret. “The legal industry is being squeezed, and it is difficult to create the platforms required to capture all of this data. That is why law firms and in-house counsels are going to third party vendors to provide a solution,” explains Burch. “There are products now that can help predict how a judge will likely decide a case, and also capture success statistics for individual attorneys,” he adds. Ellis comments: “We use software that allows us to set and better manage case budgets. This in turn produces a body of big data that tracks how much time and money certain things we do requires. With this data, we can adjust our pricing and offer our clients a level of predictability.” Data is great, but “interpreting data is not easy, and software can not only capture it, but can also display it in an easy to read dashboard,” says Burch. A SLOW START Despite the benefits, the legal industry has been slow to embrace innovation. According to Ellis, “the traditional law firm partnership model is not well designed for investing in technology and new processes.” Both Ellis and Burch note that this is due in part to the fact that it is difficult to measure the success of innovation within a law firm when performance is typically based upon billable hours, court room victories and profits per partner. In addition, “the standard law firm size does

not often support rapid innovation. Law firm sizes tend to be small as compared to large corporations. Also, ethical rules prohibiting conflicts of interest make it difficult for individual firms to hold too large of a market share. With size and market share in mind, partners may not see reason to invest in costly innovation,” says Ellis. Partners, as decision makers, will only invest in new ideas if they can appreciate its value. In light of that, Burch notes that, “Currently, more firms are hiring executive level roles such as professional CEOs and COOs outside of the legal industry since these are business minded individuals who can see the value of innovation, and make informed business decisions on it.” THE FUTURE While technology has obvious benefits for the business side of a law firm, Ellis does not feel it will be as big of a trend on the practice side since “not much has really changed in what we do, not out of all recognition, at least.” He pointed out that, “for technology to be worth the investment, it needs to come with change management.” Burch, who describes Thomson Reuters Elite’s products as the “heart and lungs of a law firm” strongly sees the way forward on both the business and practice sides for firms and in-house counsels through both technology and operational improvements. The legal industry may have been slow to embrace innovation, but with fierce competition and leaner budgets, firms and in-house counsel are starting to gain a better appreciation of its potential.

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MICHAEL PAGE LEGAL

Legal Counsel

› Hospitality sector › Well-established global group

› Major shipping company › Work life balance

› Listed multinational › Team based environment

Our Client, a highly well-known multinational in the hospitality industry, is seeking a well-articulated lawyer to join them. Reporting directly to the Senior Legal Counsel, you are responsible to manage the full spectrum of legal and contractual matters impacting the business. This includes drafting, reviewing and negotiating a wide range of agreements and developing strategies to manage risks. With at least 3 years of PQE, you should have a good law degree and experience a reputable law firm or multinational corporation. Experience in hospitality would be ideal, but not necessary. You also possess excellent communication and negotiation skills.

Our client is a global shipping group with strong reputation in Asia. The company is looking for a junior to mid level lawyer to join their team and help support the business in Singapore and India. You will enjoy an excellent company culture and will eventually gain full ownership of certain markets. With at least 3 years of PQE, you should have tracked well in a law firm or multinational corporation dealing with Indian legal matters. You are strong in litigation, work independently and possess excellent communication skills. This role requires frequent travel.

Our Client, a highly reputable and successful conglomerate with multiple business streams, including Energy, is seeking a highly competent legal professional. Reporting to the General Counsel, you will be responsible for providing full legal support and advice to the Group. This includes drafting and reviewing agreements, attending to transactional documentation, providing value added legal advice and ensure compliance with statutory and regulatory requirements. You are Commonwealth qualified, preferably called to the Singapore Bar, with at least 4 years of PQE gained in a reputable multinational and/ or law firm.

Please contact Isis Descormiers (Reg. no: R1440080) quoting ref: 2598740 or visit our website.

Please contact Isis Descormiers (R1440080) quoting ref: 2604060 or visit our website.

Please contact Ng Lay Hoon (R1108753) quoting ref: 2573560 or visit our website.

To apply for any of the above positions, please go to www.michaelpage.com.sg quoting the reference number, or contact the relevant consultant on +65 6533 2777 for further details.

Legal

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Specialists in legal recruitment www.michaelpage.com.sg

28 TH MAY SINGAPORE

NOMINATIONS OPENING 24TH FEBRUARY AWARD PATRON

ALB SUPPORTS

PROUDLY PRESENTED BY

Asian Legal Business is proud to announce that the nominations for the 11th annual SE Asia Law Awards will open on 24th February. This year’s awards will feature a number of new categories, an updated judging panel and a revised judging process for our most transparent celebration of legal expertise in the region yet. Winners will be announced at a gala dinner on 28th May in central Singapore. For more information on the nomination process or to register your firm’s interest in the event, please contact Caryl at mary.aquino@ thomsonreuters.com or call +632 982 5938.

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