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ISSUE 6.8

Anti-Monopoly Law

Firms forge ahead with AML one year on 反垄断法实施一年,律所积极发展相关业务

Green energy

Firms play big role in green revolution 商务律师助力绿色经济发展

Managing partner interview

Peter Charlton shares insights into Clifford Chance’s Asia strategy

高伟绅亚洲业务管理合伙人专访

CHINA

In-house

Yao Jun, Ping An

T en le a di ng i n - house departmen ts i n t en le a di ng compa n i es

2009年十佳公司法务部门 n DEALS ROUNDUP n LATERAL MOVES n IN-HOUSE VIEW n Regulatory UPDATES n UK, US REPORTS

www.legalbusinessonline.com


北京总部

北京市朝阳区建国路81号 华贸中心1号写字楼15层 Tel: +8610-6584 6688 Fax: +8610-6584 6677 E-mail: global@globallawoffice.com.cn Web: www.globallawoffice.com.cn

环球律师事务所,

是经中华人民共和国司法部于1984年批准,由中

国国际贸易促进委员会设立的专门从事商事领域法律服务的律师事务所。环 球是中国改革开放后最早成立的律师事务所,2001年初改制为合伙制。 自设立以来,环球为国内外客户提供了一流的法律服务,是中国律师业中最 优秀的大型综合性律师事务所之一。 环球连续多年被 Legal500、Chambers、 Asian Legal Business 和 Asia Law & Practice 等国际知名的法律评论杂志 评选为中国最佳的律师事务所之一。 在国际融资、项目融资、外商直接投资、资 本市场、风险投资和私募融资、并购、资产证券化、不良资产处置、国际海商海 事、反倾销、基础设施建设、建筑、房地产、国际商事仲裁和诉讼等众多领域, 环球均处于国内同行业领先地位。 环球完成了许多在国内外勘称首例并颇具影响的大型项目的法律服务,代 理了一系列著名的国际商务和海商海事的仲裁案和诉讼案。

Global Law Office is a large law firm in the People’s Republic of China (the “PRC”). Founded in 1984 under the auspices of China Council for the Promotion of International Trade, Global was the first law firm established following the PRC’s implementation of reform and opening to the outside world. Global was converted into a private partnership in early 2001. Having committed to providing full range legal services for 30 years, Global has been one of the PRC leading law firms. With a focus on foreign-related legal matters, Global offers efficient, high-quality and extensive legal services to clients at home and abroad. Since its inception, Global has been ranked as one of the top law firms in the PRC by international legal publications such as Legal 500, Chambers, Asian Legal Business, and Asia Law & Practice. Global is ranked as the top of league tables in many areas, including international banking and finance, project finance, corporate and commercial, foreign direct investment, capital markets, venture capital and private equity, M&A, corporate finance, aircraft and vessel finance, competition, structured finance, maritime and shipping, international arbitration and litigation. Since its establishment, Global has provided advice for many precedent-setting projects both at home and abroad.

上海分所

上海市淮海中路138号 上海广场33层200021 Tel: (0086)-21-6375 6722 Fax: (0086)-21-6375 6723 工作语言:中文/英文/法文 律师: 140 合伙人:45 Practice Areas: Corporate and M&A, Capital Markets (IPO & Listing), Banking and Finance, Private Equity & Venture Capital, Construction & Real Estate, Competition/Anti-Trust, Dispute Resolution, Shipping, Maritime & Aviation, Intellectual Property, Taxation, Restructuring, Insolvency & Bankruptcy


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Editorial >>

ISSUE 6.8

Anti-Monopoly Law

Firms forge ahead with AML one year on 反垄断法实施一年,律所积极发展相关业务

Green energy

Firms play big role in green revolution 商务律师助力绿色经济发展

Managing partner interview

Peter Charlton shares insights into Clifford Chance’s Asia strategy

高伟绅亚洲业务管理合伙人专访

CHINA

In-house

In-house revolution

T

he days when an in-house legal departments’ role was regarded mainly as one for housekeeping and litigating is long gone. Many in-house legal departments have thrived and taken on more serious responsibilities in corporate governance, strategic planning and business execution. This has been proven yet again in this year’s In-House 10 feature, which shines the spotlight on top-performing departments in 10 large domestic companies, all of which are either listed companies or parent companies of listed subsidiaries. The global financial crisis hasn’t posted any major impacts on in-house teams’ practice in terms of staff headcount and budget, but it has certainly elevated the importance of risk management. All of the departments interviewed see risk management as one of their key responsibilities in the companies. And as all of the companies are listed on stock exchanges at home or overseas, compliance and disclosure issues also form an important part of their daily work. Of course there are still mergers, joint ventures, IPOs and bond issuances, which are a fact of life for many companies as they grow and become more agile in their response to market opportunities. In-house departments have excelled in providing sound legal solutions and advice to enable their companies to achieve business and strategic objectives, not only in the domestic market but also in key markets right around the globe. For example, China Telecom’s in-house team has played an important role in the company’s US$15.8bn acquisition of China Unicom’s CDMA business; China Construction Bank’s in-house team advised on the company’s US$70m acquisition of AIG Finance in Hong Kong and the issuance of US$2.9bn worth of subordinated bonds; and Sinopec’s recent US$8bn takeover bid for Toronto-listed Addax Petroleum, to name a few. In the course of rapid development of both the country’s legal systems and companies’ global business, every day brings a new challenge for in-house teams. China Telecom, for example, recognises that its main challenge is coming from the company’s business expansion in overseas markets. Increasing exposure to different jurisdictions requires a higher level of expertise and skills. These new challenges and opportunities faced by companies have also resulted in increased cooperation between inhouse teams and external law firms – an encouraging sign of a robust legal industry. The consensus is that the rise of in-house legal departments serves a driving force for the legal industry to improve. Industry observers have noted that, having an in-house legal team in place (in effect formalising the work relationship between clients and external legal advisors) will improve the quality and standards of legal services provided by external counsel, and those companies who will require more specialised legal services in certain practice areas. With expertise and experience accumulating from both the in-house and private practice sides, the legal industry will keep moving onwards and upwards.

2

Yao Jun, Ping An

TEN LE A DI NG I N - HOUSE DEPART MEN TS I N T EN LE A DI NG COMPA N I ES

2009年十佳公司法务部门  DEALS ROUNDUP  LATERAL MOVES  IN-HOUSE VIEW  REGULATORY UPDATES  UK, US REPORTS

www.legalbusinessonline.com

IN THE FIRST PERSON “In-house counsel have to understand the legal environment and regulatory framework of each jurisdiction the bank operates in, and ensure that it complies” Zhang Wei, general manager, legal department, ICBC, on the biggest challenges for in-house teams (p33)

“As for our firm, the biggest

challenge now is how to collect [the] enormous underlying data and evidence ... as clients have limited resources and abilities”

Zhang Xinyang, lawyer, Commerce & Finance, on current challenges for AML practices (p38)

“China has been a main player in international trade and shipping, and will continue to be a dominant player for the next decade” Ik Wei Chong, partner, Clyde & Co, on legal developments in the shipping industry (p43)

CHINA

ISSUE 6.8


e th le r iss ofi ea m -pr e y n’t gh f th i Do st h t o n o m eve al leg

18 September 2009, Conrad Hong Kong

Celebrating The Very Best In The Legal Industry The most high-profile legal event of the year Join the who’s who of in-house counsel, business and law at the 8th annual ALB Hong Kong Law Awards 2009. Secure your place at the industry night of the year where senior in-house counsel, their CEO’s and private practice lawyers come together to enjoy a gourmet dinner, fine wines, world-class entertainment and invaluable networking opportunities as the winners for 2009 are announced.

Secure your table now Don’t miss your chance to attend and network at the most popular night on the legal industry calendar.

Book now! Seats are limited Yes! I want to attend ALB Hong Kong Law Awards 2009 dinner & presentation ceremony Venue: Conrad - Pacific Place, 88 Queensway, Hong Kong | Date: Friday 18 September 2009 | Time: 6:15pm – Cocktails / 7:00pm – Dinner & Award presentations BOOK A TABLE OF TEN AND SAVE OVER US$500 Please reserve

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CONTENTS >>

contents 32

ALB China issue 6.8

46

CHINA

In-house

COVER STORY

32 ALB China In-house 10 We shines the spotlight on this year’s top-performing in-house legal departments, which are now playing an increasingly important role in company developments happening both at home and in the global markets

ANALYSIS 12 Legal practices go green As the country pioneering the way towards a low carbon economy, environmental lawyers and climate change practices are the latest “must have” for self-respecting modern law firms 14 Domestic firms step up to the M&A plate M&A practices in PRC firms are powering up in a big way for predicted expansion in work loads 16 Employment laws Companies are facing increases in employment disputes since China’s new labour laws were introduced in 2008. Law firms are beefing up their employment practices to meet demand

FEATURES 38 AML regime One year after the Anti-Monopoly Law was introduced, much has been accomplished but more remains to be done. ALB China investigates what law firms have achieved 42 Shipping Shipping lawyers are rescuing clients facing litigation as a drastic fall in international trade and ocean freight rates sees disputes multiply

4

50

12

46 ALB special report: Tianjin 09 Forging ahead as a city of importance, Tianjin’s legal firms are making their mark as part of the country’s new economic powerhouse

COMMENTARY

50 Managing partner interview Clifford Chance’s Peter Charlton discusses how the Magic Circle firm’s plans for Asia in alliances and new markets will bring back its sparkle

23 Regulatory Tahota

REGULARS 18 • • • • • • •

NEWS King & Wood completes merger with Arculli Grandall launches IP agency in Beijing Gaopeng Partners joins global network New head of Asia funds at Linklaters Hogan & Hartson reshuffles management First Sino-Singapore joint venture firm established Lexfield revamps brand, adds new IP team

22 Regulatory Paul/Weiss

24 International tax Azure Tax 25 Singapore Loo & Partners

PROFILES 27 Zhonglun W&D 41 Chen & Co 43 Kingfield Law Firm 45 Sloma & Co 49 Winners

11 Mergermarket M&A update 19 UK report 21 US report 31 Thomson Reuters ECM update 52 Sign off ISSUE 6.8


CHINA


NEWS | news >>

| CHINA |

deals in brief

►► China State Construction Engineering Corporation (CSCEC) IPO 中国建筑成功登陆A股市场 US$6.2bn

Firm: Haiwen & Partners Lead lawyer: Liu Su Client: China State Construction Engineering Corporation Firm: Commerce & Finance Law Offices Lead lawyer: Liu Gang Client: China State Construction Engineering Corporation • CSCEC, China’s largest construction company, is the largest A-share IPO since PetroChina raised nearly US$9bn in October 2007 • In December 2008, the group listed its international arm, China Overseas Land & Investment, in Hong Kong, raising US$332m. JSM advised the issuer

HEADLINE DEAL

►► BBMG global offering 金隅登陆香港主板 US$884m

Firm: Paul Hastings Lead lawyers: Raymond Li, Sammy Li Client: BBMG Firm: Haiwen & Partners Client: BBMG Firm: Lovells Lead lawyer: Jamie Barr Client: Underwriters

Firm: Jingtian & Gongcheng Client: Underwriters • First H-share listing on the Hong Jamie Barr Kong Stock Lovells Exchange and the second-largest IPO in Hong Kong so far this year

“The deal highlights the current strength of the local capital markets. It was particularly complex due to the size and scope of the company, comprising more than 100 subsidiaries, multisegmented businesses and operations” Raymond Li, Paul Hastings 6

• Germany’s MAN group is the world’s third-largest heavy truck manufacturer, and Sinotruk is China’s largest manufacturer of heavy trucks • Sidley Austin also represented Sinotruk in its US$1.16bn IPO, around two years ago • This long-term strategic partnership underscores MAN’s continued focus on BRIC countries

►► Export-Import Bank of China / Aerdragon Aviation Partners Loan facility 中国进出口银行为奇龙航空 租赁公司提供2.3亿美元融资 US$230m

Firm: Richards Butler (in association with Reed Smith) Lead lawyer: Emma Casdagli Client: Export-Import Bank of China

►► Everbright Securities IPO 光大证券上海首次公开发行

Firm: Run Ming Lead lawyer: Liu Yi Client: Export-Import Bank of China

Firm: Tian Yuan Lead lawyers: Wang Lihua, Liu Yan, Xu Ping, Wu Guanxiong Client: Everbright Securities

Firm: Clifford Chance Lead lawyer: Simon Briscoe Client: AerDragon

US$1.6bn

| CHINA / HONG KONG |

Firm: Commerce & Finance Law Offices Lead lawyer: He Yinsheng Client: Sinotruk

• Everbright Securities became the second securities company approved for listing following CITIC Securities Co Ltd’s successful listing, around five years ago

►► MAN Group / Sinotruk acquisition 德国MAN入股中国重汽 US$790m

Firm: Freshfields Lead lawyers: Christopher Wong, Antony Dapiran, Rob Ashworth, Connie Carnabuci Client: MAN Firm: Haiwen Lead lawyer: Wang Jianyong Client: MAN

• Clifford Chance was involved in the establishment of the Airbus A320 final assembly line in Tianjin in 2007

►► Sino-Ocean Land Ltd bond issuance 远洋地产境内子公司发行26 亿元公司债券 US$380m

Firm: Kejie Lead lawyer: He Jie Client: Sino-Ocean Land Limited • Sino-Ocean, which focuses on midto high-end residential property development in Beijing, plans to expand in northern China’s Bohai Rim region.

Christopher Wong Freshfields

Firm: Sidley Austin Lead lawyer: Timothy Li Huanting Client: Sinotruk

• This region includes second-tier cities such as Tianjin, Dalian and Shenyang • Kejie lawyers successfully advised Sino-Ocean Land’s restructuring, private equity financing and IPO from 2004–2007

ISSUE 6.8


NEWS | news >>

►► Your-Mart A-share IPO 家润多A股IPO US$142m

Firm: Junzhi Lead lawyers: Liu Xiaoying, Wang Shaoyan Client: Your-Mart Firm: Sincere Partners Client: Your-Mart • Leading retailer based in Hunan has launched its IPO on Shenzhen Stock Exchange, raising US$142m • Lead underwriter was Shenzhen Lianhe Securities

►► Sichuan Expressway Company Ltd IPO 四川成渝高速公路A股上市

►► YOUR MONTH AT A GLANCE Firm

Jurisdiction

Deal name

Allbright

China

China Power Investment Corporation project financing

N/A

Project finance

Atsumi & Partners

Japan / China

Inner Mongolia wind farm financing

48.9

Project finance

Baker & McKenzie

China

Olympus Capital investment in Zhaoheng Hydropower

57.5

PE

China/ Hong Kong

CIC / CITIC capital acquisition

N/A

M&A

Capital Associates

China / Japan

Inner Mongolia wind farm financing

48.9

Project finance

Commerce & Finance Law Offices

China

China State Construction Engineering Corporation (CSCEC) IPO

6,200

Equity Market

China

MAN Group / Sinotruk acquisition

790

Conyers Dill & Pearman

China / Malaysia

Xingquan International Sports IPO

47

Equity Market

China / Malaysia

Multi Sports IPO

16.4

Equity Market

Clifford Chance

China

Export-Import Bank of China / Aerdragon Aviation Partners loan facility

230

Finance

China / Hong Kong

HSBC Bank (China) bond issuance

140

Debt Market

China / Malaysia

Xingquan International Sports IPO

47

Equity Market

2,190

Equity Market

US$264m

Firm: Zhong Yin Lead lawyers: Liu Guangbin, Xiu Rui Client: Sichuan Expressway • Sichuan Expressway, a large-sized enterprise in expressway investment, operation and management in western China, is the first capital construction company from the western region that has been listed on the H-share market • Now runs Chengya Branch and controls four subsidiaries: Chengbei, Shuhai, Shugong and Shuxia

►► Olympus Capital investment / Zhaoheng Hydropower 兆恒水电获5750万美元投资 US$57.5m

Firm: Baker & McKenzie Lead lawyer: Allen Shyu Client: Zhaoheng Hydropower Firm: Zhong Lun Law Firm Lead lawyer: Jack Lai Client: Zhaoheng Hydropower Firm: Purrington Lead lawyer: Moody Weil Client: Olympus Capital • Olympus Capital Holdings Asia has led a US$57.5m investment in Zhaoheng Hydropower Holdings, a hydropower generator and supplier, for an undisclosed-sized stake • Total amount invested includes US$10m from Zhaoheng International

www.legalbusinessonline.com

DLA Piper

Value ($USm)

Deal type

M&A

China / Hong Kong

Amber Energy IPO

Freshfields Bruckhaus Deringer

China

MAN Group / Sinotruk acquisition

790

M&A

Gallant YT Ho & Co

China / Malaysia

Multi Sports IPO

16.4

Equity Market

Grandall Legal Group

China / Malaysia

Multi Sports IPO

16.4

Equity Market

Haiwen & Partners

China

China State Construction Engineering Corporation (CSCEC) IPO

6,200

Equity Market

Hong Kong / China

BBMG global offering

884

Equity Market

China

MAN Group / Sinotruk acquisition

790

M&A

Hong Kong / China

BBMG global offering

884

Equity Market

Jingtian & Gongcheng Jones Day

China/ Hong Kong

Amber Energy Limited IPO

2,190

Equity Market

Junzhi

China

Your-Mart A-share IPO

142

Equity market

JunZeJun

China/ Hong Kong

Bank of East Asia bond issuance

146

Debt Market

Kejie

China

Sino-Ocean bond issuance

380

Debt Market

Latham & Watkins

Hong Kong

Middle Kingdom Alliance / Pypo Digital acquisition

378

PE

Linklaters

China / Hong Kong

HSBC Bank (China) bond issuance

140

Debt Market

China / Hong Kong

CIC / CITIC capital acquisition

N/A

M&A

Lovells

Hong Kong / China

BBMG global offering

884

Equity Market

Milbank, Tweed

China / Japan

Inner Mongolia wind farm financing

48.9

Project finance

Momo-o Matsuo & Namba

Japan / China

Inner Mongolia wind farm financing

48.9

Project finance

Norton Rose

China / Japan

Inner Mongolia wind farm financing

48.9

Project finance

Paul Hastings

Hong Kong / China

BBMG global offering

884

Equity Market

Hong Kong

Poly (Hong Kong) Investments Top-up placement

102

Equity Market

Hong Kong

Xinyu Hengdeli Top-up placement

79

Equity Market

Hong Kong

KWG Property Top-up placement

196

Equity Market

7


NEWS | news >>

• A team from Zhong Lun Law Firm’s Shenzhen office served as PRC counsel for Zhaoheng Hydropower on the equity raising • Baker & McKenzie acted as the company’s international counsel

| CHINA/CANADA | ►► China Investment Corporation / Teck Resources acquisition 中投收购泰克资源公司 US$1.5bn

►► Middle Kingdom Alliance Corporation / Pypo Digital Company Ltd PE 联投基金收购北京派普科 技集团 US$378m

Firm: Latham & Watkins Lead lawyers: David Zhang, Rob O’Shea, Allen Wang Client: Pypo Digital Company Ltd

Firm: Torys Lead lawyers: Philip Brown, Michael Amm, Michael Akkawi Client: China Investment Corporation Firm: Paul Weiss Lead lawyers: Matthew Abbott, Edwin Maynard Client: Teck Resources Firm: Stikeman Elliot Client: Teck Resources

David Zhang

• Middle Kingdom Latham & Watkins Alliance Corp acquired PRC Samsung mobile phone distributor, Pypo Digital Company Ltd • Middle Kingdom relocated to the Cayman Islands and renamed itself Pypo China Holdings Ltd.

►► China Power Investment Corporation Project financing 中国电力 投资集团融资山东核电项目 Firm: Allbright Lead lawyers: Li Xianming, Chen Ke Client: China Power Investment Corporation project financing • Shandong Haiyang Nuclear Power Project is a major energy project within the state plan, following the Liaoning Hongyanhe Nuclear Power Project • Project financing is up to RMB300t. • Finance company China Power Investment Co acted as the financial consultant

►► Join-Cheer Software IPO 久其软件受其公开上市

►► HSBC Bank (China) RMB bond issuance 汇丰中国发行人民币债券

• SOHO China is the biggest property developer in Beijing's CBD • Goldman Sachs, Morgan Stanley and UBS AG acted as joint bookrunners for this listing

US$140m

Firm: Linklaters Client: HSBC Bank Zhang Xuebing Zhong Lun

• Despite having in-house legal counsel, Zhong Lun Law Firm has been SOHO’s long-serving firm. It advised SOHO on its US$1.68bn IPO listing in Hong Kong two years ago

Firm: Clifford Chance Lead lawyer: Connie Heng Client: Joint lead managers

Connie Heng Clifford Chance

• HSBC was one of the first foreign banks to be given permission at the end of May 2009 by State Council to issue RMB bonds in Hong Kong

• Over the past two  years, CIC has invested in financial institutions like Visa, the Blackstone Group and Morgan Stanley with a total value of US$8.1bn • Paul/Weiss acted as United States counsel and Stikeman Elliot acted as Canadian counsel

| CHINA / HONG KONG | ►► Amber Energy IPO 琥珀能源香港上市 US$2.19bn

Firm: Jones Day Lead lawyers: Alex Zhang, Barbara Mok Client: Amber Energy Firm: DLA Piper Lead lawyers: Liu Wei, Esther Leung Client: Piper Jaffray Asia Securities

Alex Zhang Jones Day

• Amber Energy’s HK$166m IPO on HKSE’s Main Board was 1247 times Liu Wei oversubscribed, DLA Piper the fourth most over-subscribed in HKSE’s history

US$31.9m

Firm: V&T Client: Join-Cheer Software • Join-Cheer Software Co, a Beijing-based computer services provider, has received regulatory approval to raise CNY218m (US$31.91m) on the Shenzhen Stock Exchange, via share sale

8

►► SOHO China convertible bonds issuance SOHO中国在香港发行可转债 US$359m

Firm: Zhong Lun Law Firm Lead lawyers: Zhang Xuebing, Hao Han Client: SOHO China

“The success of this IPO is another stride towards a thriving clean energy market in China, a priority sector with vast opportunities for many investors in China today” Liu Wei, DLA Piper ISSUE 6.8


NEWS | news >>

• Bonds were issued through their mainland subsidiaries

►► YOUR MONTH AT A GLANCE (cont)

• Bank of East Asia has also received permission to issue

Firm

Jurisdiction

Deal name

Paul Weiss

China / Canada

CIC / Teck Resources acquisition

►► Bank of East Asia RMB bond issuance 东亚银行发行人民币债券

Purrington Moody Weil

China

Olympus Capital investment in Zhaoheng Hydropower

57.5

PE

Richards Butler

China

Export-Import Bank of China/ Aerdragon Aviation Partners loan facility

230

Finance

China/ Hong Kong

CIC / CITIC capital acquisition

N/A

M&A

China

Export-Import Bank of China/ Aerdragon Aviation Partners loan facility

230

Finance

Japan / China

Inner Mongolia wind farm financing

48.9

Project finance

Shearman & Sterling

China/ Hong Kong

CIC / CITIC capital acquisition

N/A

M&A

Sincere Partners

China

Your-Mart A-share IPO

142

Equity market

Sidley Austin

US/ Hong Kong

Nine Dragons Paper tender offer for Senior Notes due 2013

300

Debt Market

China

MAN Group / Sinotruk acquisition

790

M&A

China / Hong Kong

Bank of East Asia bond issuance

146

Debt Market

China / Japan

Inner Mongolia wind farm financing

48.9

Debt Market

China / Hong Kong

Bank of East Asia bond issuance

146

Debt Market

Stikeman Elliott

Canada

CIC / Teck Resources acquisition

1,500

M&A

Tian Yuan

China

Everbright Securities IPO

1,600

Equity Market

Trend Associates

China / Malaysia

Xingquan International Sports IPO

47

Equity Market

US$146m

Firm: JunZeJun Lead lawyers: Li Yubo, Jiang Deyuan Client: BEA Firm: Sidley Austin Lead lawyer: Timothy Li Huanting Client: BEA

Run Ming

Timothy Li Huanting Sidley Austin

Firm: Simmons and Simmons Lead lawyers: Sau Wing, Kevin Tong Client: Joint bookrunners • Bank of East Asia is one of the PRC’s first foreign-invested banks who has issued RMB bonds to retail investors in Hong Kong

►► China Investment Corporation / CITIC Capital acquisition 中国投资有限责任公司收购 中信资本 Firm: Shearman & Sterling Lead lawyer: Lee Edwards Client: CIC

Simmons & Simmons

Lee Edwards Shearman & Sterling

Firm: Richards Butler Client: CITIC Group • The transaction is subject to the approval of the Hong Kong Securities and Futures Commission.

1,500

M&A

Torys

China / Canada

CIC / Teck Resources acquisition

China

Join-Cheer Software IPO

31.9

Equity Market

White & Case

Hong Kong

SRE Group tender offer and consent solicitation

N/A

Debt Market

Wong Beh & Toh

UK / China / Malaysia

Xingquan International Sports IPO

47

Equity Market

UK / China / Malaysia

Multi Sports IPO

16.4

Equity Market

China

Olympus Capital investment in Zhaoheng Hydropower

57.5

PE

China / Hong Kong

SOHO China bond issuance

359

Debt Market

China

Sichuan Expressway IPO

264

Equity Market

Zhong Lun Law Firm

Zhong Yin

1,500

Deal type

V&T

Firm: Linklaters Client: CIC Firm: Baker & McKenzie Client: CITIC Capital

Value ($USm)

M&A

Does your firm’s deal information appear in this table? Please contact

alb@keymedia.com.au

61 2 8437 4700

• It is expected to close in the fourth quarter of 2009 • CIC was established in September 2007 with US$200bn of assets under management

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9


NEWS | news >>

| CHINA/ JAPAN | ►► Inner Mongolia wind farm financing 内蒙古风力发电场项目获银 团贷款 US$48.9m

Firm: Capital Associates Client: The Asian Development Bank Firm: Norton Rose Client: The Asian Development Bank Firm: Milbank Tweed Lead lawyer: Jeff Layman Client: Japanese sponsors Firm: Run Ming Client: Japanese sponsors Firm: Simmons & Simmons Client: Datang Firm: Momo-o Matsuo & Namba Client: Sumitomo Corporation Firm: Atsumi & Partners Client: Kyushi Electric • The Asian Development Bank (ADB) and the Industrial and Commercial Bank of China (ICBC) will provide a multi-tranche RMB financing, valued at US$48.9m, to a wind farm in Inner Mongolia • The farm will be developed and operated by Datang, Sumitomo and Kyushu consortium • This was a novel deal structured as a local currency financing under parallel facilities provided from ADB and ICBC, supported by limited shareholder guarantees

| CHINA / MALAYSIA / UK | ►► Xingquan International Sports Holdings IPO 星泉鞋材马来西亚上市 US$47m

Firm: Conyers Dill & Pearman Lead lawyers: Janice Oh, Stacie Seetho Client: Xingquan Firm: DLA Piper Lead lawyer: Jeffrey Mak Client: Xingquan Firm: Wong Beh & Toh Lead lawyers: Cynthia Toh, Wong Tat Chung Client: Xingquan Firm: Trend Associates Lead lawyer: Liao Kaizhan Client: Xingquan

10

• Xingquan International Sports Holdings, incorporated in Bermuda, is a sports-shoe manufacturer based in Jinjiang. • It is the first foreign company to be listed on Bursa Malaysia

“Recent changes introduced by Bursa Malaysia have made it easier for foreign companies to list their shares in Malaysia��� Kung Whooi Ping, Conyers Dill & Pearman ►► Multi Sports Holdings IPO 华运控股马来西亚上市

US$16.4m Firm: Conyers Dill & Pearman Lead lawyer: Kung Whooi Phing Client: Multi Sports Holdings Firm: Wong Beh & Toh Lead lawyer: Wong Tat Chung Client: Multi Sports Holdings Firm: Grandall Legal Group Lead lawyer: David Shen Client: Multi Sports Holdings Firm: Gallant YT Ho & Co Lead lawyer: David Shen Client: Multi Sports Holdings

• Multi Sports is a vertically integrated company which is able to process raw materials and manufacture components required in shoe sole production, as well as develop and design in-house shoe soles

| US / HONG KONG | ►► Nine Dragons Paper tender offer for Senior Notes due 2013 玖龙纸业债券回购 US$300m

Firm: Sidley Austin Lead lawyers: Matthew Sheridan, Jason Kuo, Constance Choy Client: Nine Dragons Paper

and land development and building construction. Its real estate business is concentrated in Shanghai

►► Poly (Hong Kong) Investments top-up placement 香港保利投资完成新股配售 US$102m

Matthew Sheridan Sidley Austin

• Jason Kuo and Matthew Sheridan led the team which advised on United States law while partner Constance Choy led the team which advised on Hong Kong law • This was the third time that the Sidley team has represented longstanding client, Nine Dragons, on a significant capital markets matter

| HONG KONG | ►► SRE Group tender offer and consent solicitation 上置集团回购优先票据 Firm: White & Case Lead lawyers: Anna-Marie Slot and Ray Simon Client: Sole dealer and manager • SRE Group is Anna-Marie Slot a real-estate White & Case development company, specialising in property

Firm: Paul Hastings Lead lawyers: Sammy Li, Neil Torpey, David Grimm Client: Poly Investments

Sammy Li Paul Hastings

• Poly (Hong Kong) Investments Limited is a PRC realestate developer • Citigroup Global Markets Asia and BOCI Asia were joint bookrunners

►► Xinyu Hengdeli Holdings Ltd Top-up placement 新宇亨得利完成新股配售 US$79m

Firm: Paul Hastings Lead lawyers: Sammy Li, Neil Torpey, David Grimm Client: Xinyyu Hengdeli

Neil Torpey Paul Hastings

• Xinyu Hendeli is a watch retailer and distributor in the Greater China region

►► KWG Property Holding Ltd top-up placement 合景泰富地产控股完成新 股配售 US$196m

Firm: Paul Hastings Lead lawyers: Sammy Li, Neil Torpey, David Grimm Client: Joint bookrunners

David Grimm Paul Hastings

• Morgan Stanley and Credit Suisse were the joint bookrunners in this transaction • KWG is a second-tier PRC property company focusing on mid-to high end segments of residential markets ISSUE 6.8


NEWS | deals update >>

mergermarket M&A deals update

www.legalbusinessonline.com

11


NEWS | analysis >>

Analysis >>

Recent green deals ►► Amber Energy Hong Kong IPO Value: US$2.19bn

Firm: Jones Day Client: Amber Energy Firm: King & Wood Client: Amber Energy Firm: Conyers Dill & Pearman Client: Amber Energy Firm: DLA Piper Client: Piper Jaffray Firm: Jingtian & Gongcheng Client: Piper Jaffray • The Hong Kong IPO of Amber Energy, a Zhejiang-based clean energy company, was 1247 times oversubscribed, the fourth-most oversubscribed IPO in HKSE’s history

►► GCL-Poly Energy acquisition of Jiangsu Zhongneng Value:US$3.4bn Firm: Freshfields Bruckhaus Deringer Client: GCL-Poly Energy Firm: Hogan & Hartson Client: GCL-Poly Energy Firm: Milbank, Tweed, Hadley & McCloy Client: Jiangsu Zhongneng Firm: Paul Hastings Client: sellers • Hong Kong-listed GCL-Poly Energy, a leading integrated green energy company, acquired Jiangsu Zhongneng Polysilicon Technology Development, a world-leading supplier of polysilicon and wafers to companies operating in the solar industry

►► Olympus Capital investment in Zhaoheng Hydropower Value: US$57.5m Firm: Baker & McKenzie Client: Zhaoheng Hydropower Firm: Zhong Lun Client: Zhaoheng Hydropower Firm: Purrington Client: Olympus Capital • Olympus Capital led the investment in Zhaoheng Hydropower Holdings, a hydropower generator and supplier in China, for an undisclosed-sized stake.

►► Inner Mongolia wind farm financing Value: US$48.9m

Firm: Capital Associates, Norton Rose Client: The Asian Development Bank Firm: Milbank Tweed, Run Ming Client: Japanese sponsors Firm: Simmons & Simmons Client: Datang Firm: Momo-o Matsuo & Namba Client: Sumitomo Corporation Firm: Atsumi & Partners Client: Kyushi Electric • Novel deal structured as a local currency financing under parallel facilities provided from ADB and ICBC.

12

Greener futures now the flavour Pioneering the way forward to a low carbon economy, environmental lawyers and climate change practices are the latest “must have” for any self-respecting modern law firm.

I

n a world that has never been more aware of climate change, law firms are now taking steps to reduce the carbon footprint and minimise environmental impacts, as part of the sector’s input towards corporate social responsibility initiatives. “There has been a sharp increase in public awareness and interest in the green energy sector,” said Baker & McKenzie partner, Beatrice Schaffrath, who is co-head of the firm’s environmental and climate change practice in China. “Law firms are increasingly aware of climate-change issues, from a business perspective as well as a day-to-day operational perspective.” Baker & McKenzie’s offices have put in place a number of environmentallyfocused initiatives, including increased use and collection of recycled materials; an energy efficiency program with a focus on energy conservation and smarter use of electricity and equipment; and participation in environmental conservation activities like tree-planting days. “Another substantive impact that law firms can have is in using their legal skills to assist with the development of best practices globally, in policy formation, in the establishment and framing of regulatory responses, and in establishing market mechanisms,” Schaffrath stated. Driven by government policies to tackle climate change, the green technology industry is burgeoning, attracting billions of dollars of investments. Law firms have been

increasingly busy with projects and transactions in this sector. Firms are becoming part of a driving force making the green energy revolution a business reality. Over the past 18 months, a majority of the leading transactional firms have reported significant increases in instructions relating to green energy, ranging from solar power, wind farm and hydroelectric to clean development mechanism (CDM) projects. “There is definitely an increase in renewable energy investment, mostly driven by the government being very proactive in this area,” said Gide Loyrette Nouel’s Beijing senior associate, Sarah Stokoe. “Part of the US$586bn economic stimulus plan announced last year will be directed at renewable energy projects including wind and solar power, so it’s an exciting time for those involved in the sector.” Baker’s Schaffrath has acted on many green energy sector projects and transactions, and holds a more measured perspective on development of the practices. “Investor interest in the sector has been high, but those investors are often challenged by the ROI aspects of the green energy projects they are considering,” Schaffrath stated. “In the past we have seen a steady and progressive increase in investor interest, driven in large part by the enhanced financial prospects of a project which is, or has the potential to be, a project certified pursuant to the CDM under the Kyoto Protocol. ISSUE 6.8


NEWS | analysis >>

Business goes green

In recent months, mainland-based clean energy companies have been the shining lights in a relatively quiet market, compared to a year ago. A number of companies have raised capital through an IPO or private placement, while some have completed M&A deals. Zhongjiang-based clean energy company, Amber Energy, recently completed its public offering and share placement in Hong Kong. Its IPO was hugely oversubscribed, making it the fourth-most oversubscribed offering in the history of the HKSE. “The success of this IPO is another stride towards a thriving clean energy market, a priority sector with vast opportunities for many investors today,” said DLA Piper’s head of capital markets practice, Liu Wei. Shanghai-based Comtec, a leading solar silicon material manufacturer, is reportedly going to raise US$150m from its IPO, scheduled for the end of 2009. And in July, Hong Kong-listed GCL-Poly Energy, a leading integrated green energy company, acquired Jiangsu Zhongneng Polysilicon Technology Development, which is one of the world’s leading suppliers of polysilicon and wafers to companies operating in the solar industry. Upon completion of the US$3.4bn acquisition GCL-Poly will become the first Hong Kong-listed large-scale polysilicon manufacturer, and one of

the five largest polysilicon suppliers in the world. “There is no question that there will be a consolidation in the solar power industry generally,” said partner and head of Milbank’s global securities group, Douglas Tanner. He led the team that represented the target company. “In addition to mergers and acquisitions, we would expect there will be issues of intellectual property and lots of finance work as the industry expands.” Leading domestic firms have also recognised the opportunities in the green energy market, particularly those firms who have worked closely with investment banks and private equity and venture capital funds. Zhong Lun recently teamed up with Baker & McKenzie and advised Zhaoheng Hydropower in its US$57.5m capital raising, led by Olympus Capital Holdings Asia. The firm has gained tremendous exposure by simply following the footprint of its investment bank and private equity clients. “Affected by the global financial crisis, PE investors are more cautious in doing deals,” said Zhong Lun partner, Gong Lefan. “However, we have seen an increase in investor activities and deal flows in recent months. [The] green energy sector has certainly been gaining lots of attention.” Gong attributes the investment momentum in the sector to recent government policy initiatives

and the stimulus package, as well as the rise of domestic clean energy and technology companies. “Investment in this sector not only makes [a] positive impact on the environment and economy, but also makes perfect business sense. Not surprisingly, PE and venture capitalist investors and investment banks have tremendous interest in it,” Gong said. Global Law Office is another firm that has experienced a sharp increase in the volume of investment in the green energy sector. The firm has represented CDH with its investment in LDK Solar, which completed its IPO on the NYSE. The firm also acted for New Horizon with its investment in Gold Wind Technology, who also completed its public offering on the Shezhen Stock Exchange. The firm is currently involved with ET Solar’s IPO plan. “Green energy projects are very popular in the capital markets, and we expect related work to become a more important part of our firm’s practice,” says Global Law Offices’ partner, George Niu. The central government reaffirmed its commitment to creating a “green energy path to prosperity”. The government announced in May that it will invest more than RMB2tr in renewable energy sources, as part of its new energy industry stimulus plan. So demand for legal expertise in relevant areas will definitely rise.

律所把握绿色机遇

候变化以及绿色能源已成为当前经济发展的热点。诸多律师事务所不仅 在日常运营过程中采取各种各样节能环保措施,同时也逐渐成为推动中 国绿色经济发展的一支重要力量。 贝克•麦坚时合伙人兼中国市场环保与气候变化业务联合主管 Beatrice Schaffrath 表示:“在中国,公众对绿色能源领域的关注度骤增。律师事务所 也越来越多的关注气候变化问题,既有业务角度的考虑,也有日常经营方面 的考虑。” 贝克•麦坚时律师事务所中国办事处采取了多项节能环保措施,其中包括可 回收材料的回收利用和收集措施,注重办公设备的节能和增效,以及参与植 树节等环保活动。

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Schaffrath 认为:“律师事务所可利用法律专业知识,协助制定适用于全球的 最佳实践守则,参与制定监管法规的框架建立,以及协助建立市场机制,从而 在环保领域发挥重要影响力。” 在政府应对气候变化的政策推动下,中国的清洁能源技术行业蓬勃发展。2008 年里针对绿色能源的投资超过156亿美元,比2007年上涨18%,其中投资最活 跃的仍然是风能发电和生物燃料项目。目前,中国已跃居成为世界第二大风能 市场。此外,中国还是世界上最大的太阳能光伏设备制造者。 过去18个月以来,尽管受到全球金融危机影响,律师事务所仍然受到众多客 户委托,协助他们在绿色能源领域里的投资和融资活动。该新兴领域已成为一 批律所业务收入增长的主要动力。”

13


NEWS | analysis >>

基德律师事务所北京办事处高级律师 Sarah Stokoe 表示:“可再生能源领域的投资的确在不断 增加,政府的积极推动和鼓励性政策是最主要的 推动因素。去年宣布的5860亿美元经济刺激计划 中,将有一部分资金投向可再生能源项目,包括风 能和太阳能,因此,该领域的相关企业将迎来难得 的发展机遇。” Beatrice Schaffrath 曾参与中国绿色能源领域的 多个项目和交易,她对该领域的业务发展前景有更 为具体的判断。她表示:“投资者对绿色能源领域 的关注度较高,但绿色能源项目的投资回报率往往 令投资人举棋不定。” “过去几年里,我们发现投资人对绿色能源领域 的关注度稳步提升,其中最主要的推动因素为,如 某一项目通过《京都议定书》的清洁发展机制认证 或有可能通过认证,则该项目将具有良好的投资 回报前景。”

Analysis >>

PRC firms to ride the merger and acquisition surge

绿色交易可令环境和产业同时获益

近几个月以来,大陆的清洁能源公司在资本市场领 域十分活跃,表现引人注目。很多公司通过 IPO 或 私募股权筹集资本,有些则完成了并购交易。 浙江的琥珀能源近期在香港完成上市和股票发 售。其 IPO 的认购量超出发行量数倍,成为香港联 交所历史上超额认购倍数位列第四的股票。欧华中 国资本市场业务负责人刘巍表示:“此次 IPO 的成功 表明,中国的清洁能源市场又向前迈出一大步,这 个市场领域可为中国投资人创造巨大商机。” 总部位于上海的卡姆丹克(Comtec)是领先的太阳 能硅原料生产商,计划于今年年底通过 IPO 融资 1.5亿美元。 今年7月,香港上市的中国领先综合绿色能源公 司保利协鑫能源收购江苏中能硅业科技发展有限公 司,该公司为多晶硅和晶片的全球领先供应商之 一。此次价值34亿美元的收购完成后,保利协鑫能 源将成为首个香港上市的大规模多晶硅生产商和全 球五大多晶硅供应商之一。 美邦律师事务所合伙人兼全球证券业务部主管 Douglas Tanner 带领团队作为江苏中能的法律代 表参与此项交易,他表示:“毫无疑问,无论对全 球太阳能行业还是中国市场而言,企业整合是大势 所趋。我们预计,除并购外,随着行业的发展,还 将催生更多知识产权问题和融资业务。” 中国领先的本土律师事务所亦充分认识到绿色 能源市场的机遇,与投资银行、私募基金和风险 投资基金合作密切的律师事务所对绿色能源市场 尤其关注。 中伦近期与贝克•麦坚时合作,参与泰山投资亚 洲控股有限公司负责的融资项目,为兆恒水电融资 5,750万美元。中伦合伙人龚乐凡表示:“在全球金 融危机的影响下,私募股权投资人在中国参与交易 ���更为谨慎。不过,近几个月来,投资人活动和交 易量均显著增长,绿色能源领域赢得广泛关注。” 龚律师认为,绿色能源领域的投资推动因素包括: 近期政府的政策措施和经济刺激方案,以及国内清 洁能源和技术公司的崛起。 他表示:“对该领域的投资不仅会对环境和经济 带来积极影响,还有助于形成理想的商业氛围。目 前,私募机构、风险投资机构和投资银行均对该领 域表现出巨大投资兴趣,应该在情理之中。” 环球律师事务所在该领域的风险/私募股权投资业 务量亦出现强劲增长。该事务所曾作为鼎晖创业投 资基金的法律代表,协助其投资在纽约证交所上市 的赛维 LDK 太阳能公司,另外还作为新天域资本的 法律代表,协助其投资在深交所上市的金风科技。 环球目前正参与中盛光电的 IPO 计划。 环球律师事务所合伙人牛振宇表示:“绿色能源项 目备受资本市场欢迎,我们预计,与绿色能源相关 的工作将成为事务所业务的重要组成部分。” 中央政府在5月曾宣布,作为“新能源行业刺激计 划”的组成部分,将向可再生能源领域投资2万亿以 上,进一步表明致力于推动新能源行业发展的决 心。相关领域市场对法律服务的需求无疑也将会 继续激增。

14

M&A practices in legal firms are powering up in a big way for the expected increase in work, ALB China reports

S

igns of activity picking up have been apparent for many firms in the past six months, with a number of PRC firms the largest beneficiaries of the market rebound. Beijing-based Commerce & Finance Law Offices and DeHeng Law Offices have climbed to the head of the Asia-Pacific (ex Japan) M&A legal Wang Li advisory league table, DeHeng by value. This is the first time that a PRC firm has topped a league table board. According to research from independent intelligence service Mergermarket, in the first half of 2009 these two firms have advised on US$20bn and US$19bn worth of deals, respectively. The firms have taken the top two spots in the H1 2009 AsiaPacific (ex Japan) M&A league table. Haiwen & Partners, the only other PRC firm in the rankings, is in 19th place by volume, having advised on eight deals worth US$4.6bn. Mergermarket’s league tables show there were 462 deals announced in Q2 2009, which is over 11% more than in the previous quarter. It seems the downward trend in activity seen in the past five quarters in the region may have come to an end. The strong performance of PRC firms owes

much to bustling M&A activity in China. Global share in H1 2009 has increased to 8.3% by value and 7.4% by volume, up from 5.8% and 5.4% respectively, in 2008. Domestic demand is driver The largest 10 deals in the Greater China region announced in the first six months of 2009 involved a local bidder or acquirer. This shows that domestic companies are now the major M&A dealmakers, not only at home but overseas. Shanghai listed China Yangtze Power’s plan to acquire US$15.8bn worth of assets from its parent company, China Three Gorges Project Corporation, is one of the biggest asset restructurings in the local capital market. DeHeng Law Offices is the sole legal advisor to China Yangtze Power. “With China’s economy continuing to grow sturdily and leading the global market recovery, major domestic companies will keep pursuing major deals across a range of sectors, including natural resources, renewable energy and high technology,” chief global partner, Wang Li, said While some foreign-client-oriented law firms have seen a decrease in instructions for M&A transactions over the past year, this firm has enjoyed solid growth. As a well-established and trusted advisor to many large stateowned and private domestic enterprises, M&A practise has become an important part of business, according to Wang. ISSUE 6.8


NEWS | analysis >>

Total revenue proportion for this work increased by 20%, over the same period last year. “The country is undergoing a significant readjustment of its industrial structures, and the large-scale state-owned enterprises are undertaking major restructurings and consolidations. This market evolution has created strong demand for M&A legal services,” Wang said. DeHeng Law Offices has developed a strong M&A practice group, growing in line with the market, having more than 10 partners and over 100 lawyers headed up by Wang. The practice group has been involved in major and complex M&A transactions in recent years. Deal highlights include advising China Resources on its acquisition of China Worldbest Group; Shell China’s acquisition of Tongyi Petroleum Chemical; and FAW Group’s acquisition of Tianjin Automotive Xiali. Recently DeHeng Law Offices assisted the financial services conglomerate Ping An Insurance, in its acquisition of Shenzhen Development Bank. “We believe that PRC firms will become increasingly dominant in Greater China’s M&A market – it is an inevitable trend,” Wang stated. “The global financial crisis sweeping through the world has had a profound impact on many economies. But China’s fast recovery, ahead of [the] global economy has triggered a new, phenomenal M&A wave, led by domestic companies. The emergence of PRC firms is a natural progression, as they actively assist many notable transactions to successful completion.” The US$2.6bn merger between China Eastern Airlines and Shanghai Airlines is the latest manifestation of the current M&A phenomenon. Although China Eastern is listed on the HKSE, the company’s general counsel, Guo Junxiu, sought out leading firm Commerce & Finance Law Offices for the work. Shanghai Airlines turned to its legal advisor Fangda & Partners for advice. “PRC firms have learnt a lot from their international counterparts in past years, and have made impressive progress in handing large, complex M&A transactions,” said Gao Yang, who is a partner with Fangda. “Firms will increasingly play a lead role in transactions that have major PRC elements.” www.legalbusinessonline.com

►► League table - legal advisers to Asia-Pacific (ex Japan) M&A: Value Y/E 2008

H1 2009

Legal firms

Value (US$m)

Deal count

41

1

Commerce and Finance Law Offices

20,248

4

N/A

2

DeHeng Law Offices

19,171

5

16

3

Mallesons Stephen Jaques

17,793

22

1

4

Linklaters

16,540

12

6

5

Allens Arthur Robinson

15,256

8

22

6

Simpson Thacher & Bartlett

13,923

4

17

7

Freshfields Bruckhaus Deringer

13,899

18

13

8

Johnson Winter & Slattery

13,591

3

19

9

Clifford Chance

12,867

13

39

10

Wachtell, Lipton, Rosen & Katz

12,828

2

It’s erroneous to assume that going forward, international firms will have a smaller share of the merger and acquisition transactions involving local businesses and companies.

However, by looking at the league deals table listed above, the rise to power of PRC firms is both exceptional and eye-catching.

中国律所分享并购盛宴 众

多市场研究机构近期发布的统计资料表明, 国内并购市场正在逐步走出低谷开始复苏。虽 然外资并购数量明显减少,但是国内公司之间的大 型并购项目的数量、规模以及复杂程度却在明显增 加。一部分中国律所成为市场回暖的最大受益者。 据Mergermarket统计,在2009年上半年,通商和 德恒分别代理了总价值达200亿美元和190亿美元的 并购交易。两家律所分列Mergermarket 2009上半 年年亚太地区(日本除外)并购排行榜(按金额) 的前两名。排行榜中其他唯一一家中国律所海问律 师事务所,按数量排名第19位。该所代理了八项交 易总价值达46亿美元。 Mergermarket数据还显示,2009年第二季度亚太 地区(日本除外)共宣布462项交易,与前一季度相 比上升11%。过去5个季度该地区所呈现出的下降趋 势似乎已经结束。中国律所的强劲表现在很大程度 上归功于中国地区并购交易的活跃,2009年上半年 其全球所占份额按总额和数量计算,分别从2008年 的5.8%和5.4%增加到了8.3%和7.4%。

国内并购市场复苏,中国律所领跑

过去六个月来,国内律所在并购项目中日益重要的 作用逐步显现。沪市上市的中国长江电力计划从母 公司 – 中国三峡工程开发总公司手中收购价值158 亿美元的资产,成为中国国内资本市场规模最大的 资产重组交易。总部位于北京的德恒律师事务所担 任中国长江电力的唯一法律顾问。 德恒首席全球合伙人/主任王丽博士表示:“我们 确信中国律所在大中华并购业务所占市场份额会持 续增加。冠亚军的出现我们认为有一定的偶然,但 必然是趋势,原因在于过去的一段时期,席卷全球 的金融危机深刻影响了各国的经济,中国经济率先 复苏引领了中国企业大规模并购局面(包括境内企 业间的重组以及跨境收购)的出现,中国律所自然 就表现得相当活跃,并成功协助了一批令人瞩目的 交易顺利完成。” 与上年同期相比,德恒的并购业 务在全所业务中比重提升了近两成。王律师指出造 成这种变化的主要原因在于随着国家进行产业结构 调整和大型国有企业的重组和整合,客观上客户对 并购业务的法律服务需求逐步增加。

德恒的并购律师团队也与并购市场的发展保持同 步。该团队由王律师亲自带领,目前已有十多位合 伙人及近百名专业律师组成。几年来,该团队在众 多大型并购项目中扮演了重要角色,其中包括长江 电力系列并购项目、电监会920项目、华润重组华 源等项目、壳牌收购统一润滑油项目,以及正在进 行的中国平安收购深发展项目。王律师表示:“伴 随中国经济总量的继续上升以及中国在全球经济复 苏过程中的重要作用,国内企业会在很多领域继续 主导一些大型的并购项目,比如资源型、环保型以 及高科技领域。德恒已将并购业务作为未来发展的 重点之一,也将继续扩大该团队的规模。” 王律师还表示,在大型跨境并购交易中,既涉及到 中国法律问题,也涉及到境外的法律问题。由于执业 辖区的不同,中国律师和外国律师在此类交易中既存 在合作也存在一定的竞争。过去跨境并购交易往往由 外方主导,因此外国律师在此类交易中也成为法律 问题解决方案的组织者或者执行者。但是随着中国 经济的发展,国内企业也对跨境业务有了深入的了 解,包括一些大中型企业考虑前往境外进行并购活 动,这样就对境内律师提出了更高的要求。在很多 跨境并购交易中,国内律师在交易结构设计、文件 起草、参与谈判、以及协助交割方面逐渐起到了重 要甚至是主导作用。 中国东方航空与上海航空之间价值26亿美元的重大 重组合并项目是当前中国国内并购市场繁荣的最新印 证。尽管中国东方航空在香港联交所上市,公司总法 律顾问郭俊秀仅委托中国领先的通商律师事务所参与 此项重大交易。上海航空则指定长期法律顾问方达律 师事务所提供顾问服务。 方达律师事务所合伙人高旸表示:“在过去与国际 所合作的过程中,中国律所从国际所学到了很多经 验,处理大规模复杂并购交易的能力和专业水平已 显著提升。在涉及主要中国元素的并购项目,中国 律所将逐渐起到主导作用。” 目前,方达也在中国平 安收购深发展项目中代表新桥资本。 毋庸置疑,外资并购和跨境交易将逐步恢复正常, 国际律师事务所在涉及中国的跨境项目中仍将占有重 要地位。但是,近几个月来中国律师事务所在大型并 购项目中的表现确是格外引人注目。 (Source: Mergermarket)

15


NEWS | analysis >>

Analysis >>

Employment disputes rise while firms profit Companies are facing increases in employment disputes since new labour laws were introduced, so law firms are beefing up their employment practices to meet the expected demand for services

T

he Labour Contract Law introduced on 1 January 2008 affects employers across all industries in the nation, but it is also having a significant impact on law firms’ practices. According to the Supreme People’s Court, 280,000 labour disputes were filed in 2008 – an increase of 93.9% compared to 2007. The surge in the number of law suits means the need for PRC employment law specialists is also on the upswing. Procter & Gamble, a Fortune 500 company operating in China for more than 20 years, is one of many companies that have adjusted to be in line with the new legislation. The company’s in-house department has taken on an increasing amount of employment-related work. P&G’s associate general counsel for Greater China and a specialist in employment law, Benny Chen, said the new law has made the company rethink its policies. The multinational company now exercise even stricter controls over termination decisions. Chen and his in-house team have also completed training to deploy the new legislation to the whole organisation – including manufacturing plants – to ensure compliance. Even with these stringent practices in place, the company has seen a 30% increase in labour disputes. As some cases involve complicated issues that have never been tested in court before, Chen will sometimes engage external legal advisors to assist. Beijing’s Fangda Partners and Guangzhou Guangda, who are both firms with leading employment practices, have represented P&G in labour litigation cases.

16

“As a result of the increase in labour disputes, we have had to outsource some of the work to law firms,” Chen said.

New practices

In response to demand for legal advice, many international and domestic firms are bucking up their PRC employment practices by expanding their teams. “Obviously, the enactment of the new law creates new opportunities for legal

service providers, “ said Zhou Lihui, a PRC employment lawyer who recently joined JSM Mayer Brown. “Before the new law was promulgated, we mostly dealt with documentation and other small aspects of employment law. In late 2007, there was an influx of clients that came in asking us to review their employment contracts before the official enactment of the new law,” Zhou stated. ISSUE 6.8


NEWS | analysis >>

Henry Xiao From: Zhong Lun To: Jade & Fountain Location: Shanghai

Pattie Walsh From: Minter Ellison To: DLA Piper Location: Hong Kong

Alison Smith From: Minter Ellison To: DLA Piper Location: Hong Kong

Zhou Lihui From: Minter Ellison To: JSM Mayer Brown Location: Hong Kong

Winnie Ng From: Baker & McKenzie To: Minter Ellison Location: Hong Kong

A number of lateral hires made by international firms recently show how employment practices are heating up. In the past few months, JSM Mayer Brown hired foreign counsel Zhou Lihui from Minter Ellison; DLA Piper snared former Minter Ellison partner Pattie Walsh and senior associate Alison Smith; and Minters appointed Winnie Ng to fill this vacancy. Chairman and partner of Minter Ellison’s Hong Kong office, Fred Kinmoth, said “given the growing trend of employment disputes, we see the need for talented lawyers, with a strong understanding of the employment landscape in both Hong Kong and PRC, to lead the practice.” Leading domestic firms, such as Jun He Law Offices and Grandall Legal Group, are experiencing more significant increases in work than their international counterparts. “Before the enactment of the new law, we were dealing with a steady flow of employment-related matters, but since the new law we have witnessed a rapid growth in cases, particularly in labour disputes,” said Jun He Law Offices partner, Wang Dongpeng. “The majority of these cases concern wrongful termination and underpaid salaries. More clients need help to accurately understand the law and what they should do in compliance, as it is complex and rather ambiguous. With this trend, there is definitely an ongoing need for more employment specialists.” www.legalbusinessonline.com

Wang added “to effectively handle this demand, our employment team has grown [by] a third of its previous size.” This view has been echoed by Gregory Sy, foreign counsel at Grandall’s, but he said that expansion is also a result of an increased awareness on the part of employers regarding the importance of having proper employment policies.

Legal controversy

The Labour Contract Law continues to generate controversy in the nation, over 18 months after it was enacted. The law has triggered ceaseless debates about its intended target – multinationals or domestic companies – and whether the timing and level of enforcement took into consideration China’s level of “immunity” to the global financial crisis. “I think the law failed to take into consideration the economic downturns, it does not reflect what the current

economic circumstances [are] and it does compromise enterprises, especially at this time,” JSM Mayer Brown’s Zhou stated. P&G’s Chen agreed, saying the law has had unhelpful consequences throughout the financial crisis. As the costs of operating businesses increase, many cannot cope with the lack of funds and are forced to shut down. The labour law, paired with the global downturn, has contributed to the exodus of thousands of factories within the economic regions of the country. The new law also has far-reaching consequences for future transactions, particularly in M&A deals where employment liabilities and continuing obligations become a greater concern for acquirers. As labour laws develop, legal firms will strengthen their employment practice groups to cope with these growing client demands. ALB

劳动雇佣业务随纠纷激增升温

《劳动合同法》的施行,不仅为全国各行业的 雇主带来普遍影响,对律师事务所的业务也有 重要影响。据最高人民法院透露,2008年劳动纠纷 案达280,000宗,较之2007年增加93.9%。法律诉 讼的激增表明,市场对中国劳动雇佣领域法律专业 人士的需求不断增加。 作为全球500强公司,宝洁在中国已有20多年经 营历史,该公司诸多其他公司一样,都依据全新法 律对管理制度进行调整。宝洁中国分公司的内部法 律部门正着手应对不断增加的劳动雇佣相关工作。 宝洁大中华区助理法务总监Benny Chen是劳动雇 佣法律专家,他表示,全新劳动法促使宝洁重新 设计管理制度,目前对裁员决定执行更为严格的 控制。Chen及其内部法律团队还进行大量培训工 作,推动新法律在整个企业内部得到贯彻,确保制 度和运营合规。 不过,尽管采用更为严格的管理制度,自新劳动 法通过以来,宝洁面临的劳动纠纷仍增加30%。由 于部分诉讼案例涉及多方面的复杂问题,无以往庭 审经验可借鉴,Chen有时会聘请外部法律顾问,帮 助公司解决问题。北京方达和广州广大均是劳动雇 佣领域的领先事务所,曾代表宝洁受理诉讼案件。 他表示:“由于宝洁内部劳动纠纷不断增加,我们不 得不将部分诉讼工作外包给律师事务所。” 为应对该领域激增的法律顾问服务需求,诸多跨 国事务所和本土事务所均扩大业务团队,把握中国 劳动雇佣业务的机遇 近期加入孖士打律师行的中国劳动雇佣律师周黎 辉表示:“显然,新法律的施行为法律服务机构带来 全新业务机会。新法律颁布之前,我们的工作主要 是合同编写和以及与劳动雇佣法相关的细枝末节的 工作。2007年末,在新劳动法正式施行之前,开始 有大量客户要求我们协助审查劳动雇佣合约。” 近期,跨国事务所进行诸多横向招聘,充分印证 大中华地区劳动雇佣业务升温。过去数月内,孖士 打吸引铭德的外国顾问律师周黎辉加盟,欧华挖走 铭德合伙人 Pattie Walsh 和高级律师 Alison Smith, 铭德则任命 Winnie Ng 填补职位空缺。 铭德香港办事处合伙人兼主席 Fred Kinmoth 表

示:“鉴于劳动雇佣纠纷不断增加,我们需要在中国 和香港地区的劳动雇佣领域拥有丰富经验的高水平 律师,为雇主提供优质服务,带领业务发展。” 君合和国浩等领先的本土事务所的业务增长势头 更是超出跨国事务所。君合律师事务所合伙人汪东 澎表示:“新劳动法颁布之前,我们的劳动雇佣相 关业务量相对稳定,自新法颁布之后,该领域的诉 讼案件快速增长,其中劳动纠纷领域尤其突出。新 增案件主要涉及不当解聘和拖欠薪金。” 汪东澎补充道:“由于新劳动法内容复杂,很多条 款内容模糊,越来越多的客户需要我们的帮助,从 而准确了解新法律的要求,确保管理制度合规。在 该趋势的影响下,市场对劳动雇佣法律专家的需求 无疑将持续增加。为有效应对市场需求,我们的劳 动雇佣业务团队规模已增加三分之一。” 国浩外国顾问律师 Gregory Sy 对汪东澎的观点 表示赞同,但他同时补充道,新劳动法的颁布并非 导致业务增加的唯一原因,雇主对合法雇佣制度的 重视程度增加亦是业务增长的推动因素。

热度不减的争论

新劳动法颁布20个月后,国内对这部法律的争论依 然热度不减。新法颁布后,引发法律界对其最终目 标的争论,争论内容包括其制约目标为跨国企业还 是国内企业,其时间安排和执行力度是否考虑中国 抵御全球金融危机的能力。 周律师表示:“我认为,该法律没有考虑到经济低 迷的趋势,没有体现中国当前的经济现状。在当前 时期,该法律对企业发展的负面影响尤为突出。” Chen 对 周的观点表示赞同,他认为,在全球金融 危机的背景下,新劳动法对经济的影响毫无裨益。 随着经营成本增加,大量企业无法克服资金缺乏的 难题,被迫关闭。在新劳动法和全球金融危机的共 同影响下,中国经济发达地区出现大量工厂倒闭。 新劳动法对未来行业交易的影响亦十分深远,对 并购交易的影响尤其重大,原因在于,雇佣责任和 持续义务将成为收购方格外慎重考虑的问题。随着 法律的不断完善,律师事务所将继续巩固劳动雇佣 业务团队,以应对持续增长的客户需求。

17


NEWS | news >>

news in brief >>

Hong kong >>

Volunteers aid western region Free legal aid services have been volunteered across the country by 30 lawyers and 70 law school graduates, for the western region where there are few lawyers. The volunteers have signed up to work in these areas for up to three years and are required to handle at least 20 cases annually. Each volunteer will receive approximately US$4,386 as an annual allowance. The campaign is being jointly launched by six organizations, including the Ministry of Justice, the Central Committee of the Chinese Communist Youth League and the China Legal Aid Foundation. The program has received good responses so far: over 500 lawyers applied for 30 spots, with some applicants senior associates or partners of law firms. In the past decade demand for legal services has skyrocketed as more people seek legal relief. Most of these cases relate to work-related injury, child support, disability claims, and welfare claims.

百名志愿者赴西部提供法律援助

来自全国各地的30名律师和70位法律学院毕业生成为 首批“1+1”法律援助志愿者行动的参与者。他们将在 集中培训、学习后,于8月初分别派遣到青海、宁夏、 新疆、四川等13个省、自治区的70个无律师县和 律师资源短缺的西部贫困县,从事基层法律援助和法 律服务工作。 在一到三年的志愿服务期内,每名律师志愿者每年至 少无偿办理法律援助案件20件以上,大学生志愿者从 事与能力相适应的法律援助和法制宣传工作。中国法援 基金会将为每位律师提供一年3万元的生活和办案补贴, 同时配一至两名法学毕业生作为助手。 此次志愿者行动得到了律师和法学院学生们的积极响 应,截止6月20日,律师志愿者报名人数达500余人, 其中包括一些资深律师或事务所合伙人。

New deal spins between firms Jun He Law Offices has paired with United Kingdom firm Martineau in an historic transaction: the buyout of Scotland’s last yarn spinner, Todd & Duncan (T&D) by cashmere supplier Ningxia Zhongyin (Zhongyin). A Martineau team, led by corporate partner Richard Underwood, advised the cashmere supplier on Scottish law, while Jun He Law Offices advised on PRC law. Martineau was introduced to Zhongyin by the local firm through the international legal association Multilaw. Underwood says the deal is evidence that outbound investment is not abating. Empirical data supports the claims: over the last three months outbound investment has exceeded US$10bn, which is the strongest quarterly performance since Q1 2007.

君合代表宁夏中银绒业收购苏格兰纱厂

君合与英国Martineau律师事务所参与了宁夏中银绒业在 苏格兰的收购项目。该公司与道森国际贸易公司签订了 《资产收购协议》,收购其下属邓肯纱厂的业务和资产, 包括固定资产、存货、无形资产以及相关合同等。无形资 产包括品牌 “Todd&Duncan”、“T&D”、“BrownAllan”、“T&D CASHMERE”、“TODD & DUNCANCASHMERE”以及专 有技术、销售渠道、供应渠道和客户关系。交易对价约 为615万英镑,相当于净资产值的54.45%。据悉,中银 绒业为君合的长期客户,Martineau由君合引荐而介入 此次项目。Martineau合伙人Richard Underwood 为中 银提供有关苏格兰法律的服务。Underwood表示:“这 项交易表明,尽管全球经济状况低迷,中国对外投资不 会减弱。欧洲的国际投资仍然十分活跃,因为海外投资 者,如宁夏中银,希望抓住欧洲市场经济好转所带来的 增长机遇。”

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King & Wood has completed merger

K

The merger allows King & Wood to be the first firm to offer clients dual capabilities in Hong Kong and PRC law. It is likely that the merger will pave the way for other PRC firms. The most likely contenders at present are Jun He Law Offices and Duan & Duan. Both of these law practices have been associated with a Hong Kong firm for at least one year. French firm Gide Loyrette Nouel and United States firm Hogan & Hartson are two firms that also recently completed the localisation process, which is required to practice law in Hong Kong. ALB

ing & Wood’s strategy to obtain the right to practice Hong Kong law began in April 2006, when the firm opened an office and established its association with local firm Arculli Fong & Ng. Now, it has executed its strategy and finally announced the completion of the merger, effective from July 2009. As a resuolt of the merger, all of the 13 partners and 45 legal professionals at Arculli Fong & Ng will be fully integrated into King & Wood. Also, a number of corporate, securities and finance partners from the firm’s Beijing and Shanghai offices will become Hong Kong residents. ►► Hong Kong offices of PRC firms Firm

Year opened

Associated firm

Chen & Co

2006

N/A

(C&M) China Law Office

N/A

N/A

Duan & Duan

2006

Chan J & Lai

Grandall

2008

Woo, Kwan, Lee & Lo*

Guangdong Hua Fa

2007

Ng & Shum

Guangdong Xin Yang

2006

N/A

Guantao

2009

Jackson Woo & Associates*

Jun He Law Offices

2006

Wang & Co, XJ

Jin Mao

2007

Wang and Chan

King & Wood

2006

Arculli Fong & Ng *Alliance firms ISSUE 6.8


NEWS | news >>

uk report New Europe/Asia senior partner for DLA Piper Litigator Janet Legrand recently landed the role of senior partner for Europe and Asia at DLA Piper. She will take over from Peter Wayte, who has been in this position since April 2005 and is set to retire from the partnership at the end of the month. Legrand will also continue to carry out client work in the litigation team. An election to select a board member to replace her on the international board will reportedly be held in July.

金杜完成与夏佳理方和吴 正和律师事务所的合并

杜自2006年4月开始执行拓展香港业务的战 略,当时,金杜在香港成立办事处,并与香 港夏佳理方和吴正和律师事务所建立业务合作。 如今,金杜作为中国大陆法律服务行业的龙头, 终于宣布完成与夏佳理方和吴正和律所的合并。 双方合并后,夏佳理方和吴正和律所的13位合伙 人和45位专业律师将整合进入金杜,来自金杜北 京和上海办事处的公司、证券和金融领域合伙人 将常驻香港。 合并完成后,金杜成为首个可为客户提供两地 法律服务(香港/中国法律)的中国事务所。法 国基德律师事务所和美国霍金•豪森律师事务所 近期也完成本地化工作,达到在香港开展业务的 要求。金杜的合并很可能为其它中国事务所跟进 奠定基础。君合和段和段律师事务所跟进的可能 性最高,这两家律所都与香港事务所建立至少一 年的合作关系。

►► King & Wood quick facts

• In June 2009, the firm had 800 lawyers including 190 partners across 16 offices. According to this year’s ALB50, it is the third-largest law firm in Asia by total lawyer numbers • There are four offices in other jurisdictions, including Hong Kong, Tokyo, Silicon Valley and New York, which was established in September 2008 • The firm entered into a strategic alliance with Australian commercial law firm Gilbert + Tobin in November 2007

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Clifford Chance has saved millions from its cost base by outsourcing IT and paralegal work to India. Reports suggest that Simmons & Simmons is also looking to use external lawyers overseas for large pieces of litigation or corporate due diligence.

Linklaters revenue rockets Linklaters recently overtook Freshfields Bruckhaus Deringer to become the largest United Kingdom firm by revenue. It posted a figure of £1.3bn for the 2008/09 financial year, beating Freshfields Bruckhaus Deringer by just £11m. However, Linklater’s average profit per equity partner (PEP) has dropped by approximately 9.6% to £1.3m, compared to Freshfields’ steady figure of £1.44m.

CMS band together for success A year after proposing closer integration, the nine firms that make up the CMS network have announced the alliance is successful. A meeting of partners from these firms in Brussels last month confirmed that pitching for panel places as the CMS network, rather than as individual firms, has proved particularly fruitful, with a place on the ACE European Group panel just one of the many victories the network has achieved. The model allows members to remain as separate entities but share branding, conflict systems and marketing, and pool finances for large projects like creating a single website design across the network.

Pinsents joins offshoring revolution Pinsent Masons is set to cut its costs significantly, following the decision to outsource litigation work, including first reviews of documentation on UK and US-related investigations, to lawyers working for business services company Exigent in South Africa. The saving is around 50% on each role. Ten secretarial staff have been put on paid leave during a trial period and will be made redundant if the pilot proves successful. Although Pinsents has outsourced typing work to Exigent since 2000, it is the first firm so far to offshore the work of qualified lawyers – but other firms are catching on.

Linklaters loses out in Barclays panel shake-up Linklaters recently lost almost half of its panel places on Barclays’ revamped roster of legal advisors, following a three month review by the bank. The 129 places on Barclays’ 11 sub-panels are now finalised, with Linklaters being retained for just four of the categories – a stark contrast from the seven separate panels the firm retained during the bank’s previous major review (in 2007). UK corporate firm Addleshaw Goddard, on the other hand, has increased its presence, gaining spots on four additional panels in addition to retaining positions already held in the HR, private equity and lending and finance categories.

 ROUNDUP

• Spanish firm Rodés & Sala is set to merge with Gómez-Acebo & Pombo and exit its year-old alliance relationship with UK firm Nabarro. The new merger will create a 320-lawyer outfit operating under the Gomez-Acebo & Pombo brand • Clifford Chance will soon leave its Hungary office to its own devices, with Budapest managing partner Péter Lakatos set to form a standalone firm, to be launched in August under the name Lakatos, Köves & Partners. However, the firm will maintain a referral relationship with Clifford Chance • Garrigues still tops the tables as the largest Spanish law firm, both in terms of income and total number of lawyers, ahead of other large firms with Spanish operations, including Cuatrecasas, Gonçalves Pereira(£207.9m), Uria Menéndez (£151m), Clifford Chance (£64.6m) and Gómez-Acebo & Pombo(£52.8m) • Nabarro has launched a second round of redundancy talks with 19 staff following a 10% decrease in turnover for the 2008/09 financial year, down from £140.1m (unadjusted total) to £126.5m

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NEWS | news >>

news in brief >> Tianjin Airbus on runway

Airbus has delivered the first A320 aircraft put together at its final assembly line in Tianjin. The aircraft was among the six Airbus purchases by AerDragon Aviation Partners recently, leased to Sichuan Airlines in June. Richards Butler, Run Ming and Clifford Chance helped complete the landmark transaction. Richards Butler (in association with Reed Smith) and Beijing firm Run Ming advised the Export-Import Bank of China on a US$230m term-loan facility to AerDragon for the purchase. The Richards Butler team was headed by Hong Kong partner Emma Casdagli, and the Run Ming team by executive partner Liu Yi. AerDragon engaged international firm Clifford Chance for advice, with Singapore-based Simon Briscoe acting as the lead partner. The firm was involved in the establishment of the Airbus A320 final assembly line in Tianjin in 2007.

礼德与润明携助首架天津空客A320起飞

中国进出口银行近日为奇龙航空租赁公司购买六架空客 A320飞机提供了2.3亿美元的融资支持。这六架飞机中 包括天津总装线总装的第一架A320飞机。礼德律师事 务所与润明律师事务所携手为中国进出口银行提供了法 律服务。礼德香港合伙人Emma Casdagli与润明合伙人 刘屹是这项交易的牵头律师。 奇龙航空聘请了高伟绅的新加坡合伙人Simon Briscoe 作为法律顾问。高伟绅在两年前参与了设立天津空客车 总装线的合资项目。

Work placement for Pinsent Masons A world-class student from the University of Aberdeen has secured a work placement in Hong Kong with full-service commercial law firm Pinsent Masons, as part of Scotland’s SaltireFoundation business undergraduate program. Christina Johnston was selected from approximately 300 applicants for an eight-week internship at the firm. “The opportunities to experience business in an international culture with a leading law firm are rare and I’m looking forward to the challenge of being an ambassador for Scotland,” she said. The combined support of the program from Pinsent Masons’ offices in Scotland and Hong Kong is backed up by the GlobalScot network and economic development agency Scottish Enterprise.

品诚梅森香港办事处为 SaltireFoundation 优秀学生提供实习机会

作为 SaltireFoundation 本科生计划的组成部分,香港 品诚梅森律师事务所为阿伯丁大学的优秀学生提供实 习机会。 Christina Johnston 在300位申请者中脱颖而出,获得为 期八周的实习机会,他表示:此次机会十分难得,我将 有幸进入领先律师事务所,在国际化文化中获得工作体 验,我由衷期待作为苏格兰的代表,迎接各种挑战。” 品诚梅森的苏格兰和香港办事处联合为该计划提供支 持,“全球苏格兰人”网络(GlobalScot)和苏格兰工商委员 会亦提供协助。

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Beijing >>

Grandall increases IP offerings with launch of IP agency

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t’s not uncommon for law firms to set up a wholly-owned intellectual property subsidiary agency, to become a one-stop shop for offering IP services. Grandall Legal Group recently launched its own agency, which mainly handles the filing, prosecution, licensing, franchising, administration, enforcement and judicial protection of patents, trademarks and copyrights. The new business unit is located in Beijing and operates under the name Chinareals. Headed by partners, Ma Dongxiao and Li Tao, the agency has 11 intellectual property professionals, all of whom are either qualified patent or trademark agents. This is the second major expansion of Grandall’s Beijing practice. Back in 2006, the firm acquired a group of experienced IP lawyers, including Ma Dongxiao, from the Beijing firm Youshilian. As the fourth-largest law firm with more than 420 lawyers

across 10 offices, “Grandall’s existing reputation and clientele will work as Chinareals’ pedestal in Beijing,” said Ma, a veteran lawyer, patent agent and Ma Dongxiao trademark agent. Grandall “Beijing has the most concentrated IP business areas and its location is a great advantage.” Ma is confident that along with the government’s financial policies and strategies, future development of the intellectual property industry will remain positive. The first six months of 2009 have seen a number of other firms beefing up their IP practice capacities. DeHeng Law Offices and Dacheng have hired senior IP partners and lawyers. Rouse & Co has also responded by recruiting three intellectual property specialists. ALB

Beijing >>

Beijing’s Gaopeng Partners joins global network G

aopeng & Partners has increased its international offerings by joining ALFA International, which is a global legal network combining over 130 international law firms. “Joining global legal alliances is an effective way for PRC firms to strengthen their international practice,” partner Wang Jun said. “It provides us [with] a good platform to gain knowledge about the global market and the demand of foreign clients, and also rapidly increases our connections in many overseas markets where there is a member firm of the network.” The firm already has an established international trade and WTO practice,

headed by partner Wang Lei. But Wang Jun expects ALFA membership to beef up the firm’s international business practice capacity. “It is essential to the success of any global business, and to the ALFA International legal network, to have a strong, full-service business-focused law firm as a member,” said ALFA’s chief executive officer, Richard Hetke. As a global legal network, ALFA International has 133 international law firm members across 37 countries (85 members are US-based firms, 48 are non-US based firms). In total, ALFA member firms employ over 8,500 lawyers and 10,000 other legal professionals. ALB ISSUE 6.8


NEWS | news >>

国浩成立知识产权 代理机构,提升知 识产权服务实力 对

律师事务所而言,成立全资持有的知识产 权代理子公司提供一站式知识产权法律服 务并不令人感到意外。国浩律师集团近期成立自 己的知识产权代理机构,主要受理申请、诉讼、 授权、特许、行政管理执行以及专利、商标和版 权的司法保护业务。 国浩的全新业务机构位于北京,名为锐思知识 产权代理有限公司,由合伙人马东晓和李涛担任 负责人。该代理公司现有11位知识产权律师,均 获得专利或商标代理人资格。 新代理公司的成立是国浩北京办事处知识产权 业务的第二次大规模扩张。2006年,国浩曾吸引 多位资深知识产权律师加盟,其中包括来自北京 优仕联律师事务所的马东晓。 马东晓表示:“国浩的业务盛誉和客户资源将 为锐思北京业务提供坚实基础。北京是知识产 权业务最为集中的地区,其地理位置拥有巨大 优势。” 2009年上半年,诸多事务所积极拓展知识产 权业务,其中德衡和大成均聘请高级知识产权合 伙人和律师,罗思亦于今年聘请三位知识产权专 家,应对知识产权市场不断增长的需求。 马晓东补充道,他及其代理公司坚信,在政府 的财政政策和战略的推动下,知识产权法律服务 行业的前景十分光明。 国浩目前是中国第四大律师事务所,10家办事 处遍布全国,律师超过420位。

高朋加入ALFA国际 联盟

us report Dewey on the move Dewey & LeBoeuf chairman, Steve Davis, has worked hard to expand the law firm’s global platform. Following the launch of three offices in the Middle East and another soon to set up in Madrid, the firm seems to have turned its attention to recruiting. The Silicon Valley office recently hired a corporate team from Cooley Godward Kronish, led by partner Richard Climan, and it also snared banking partner Marshall Stoddard from Mayer Brown, to lead its United States banking team.

program to handle tasks that could be billed at low rates. There is speculation that DLA Piper may also be considering alternative staffing models, including more ‘flex-time’ attorneys who can be tapped during busier times and a non-partner-track option for associates. Although the new model at Orrick is only in place for US associates, the firm is believed to be discussing similar talent model initiatives for Europe, with plans to move forward on these initiatives in 2010.

Orrick abandons lockstep remuneration Orrick, Herrington & Sutcliffe recently unveiled its ‘new talent model’, combining a distancing from the traditional lockstep advancement for partnertrack associates and the creation of a variety of new legal roles in the firm. The new model will allow associates to advance at a pace that reflects their developing skill-sets. The model has three ‘tracks’ of lawyers and other professionals and staff: partner-track associates; career attorneys and legal team professionals; and custom track associates. Orrick will also create a non-partner-track option for associates, and wants to reportedly boost the number of staff attorneys doing more routine work, like document reviews. The move to a more merit-based promotion and compensation system has been dubbed ’revolutionary’, with a handful of firms looking to be on the same track. Beginning associates at Howrey will now follow more of an apprenticeship in their first two years, while 18 months ago, McDermott Will & Emery launched a staff attorney

Bingham McCutchen, McKee Nelson merger International firm Bingham McCutchen and specialty practice McKee Nelson are to merge in August, with the combined firm, which will use the Bingham McCutchen name, to take on all of McKee Nelson’s lawyers. Joint revenue for the firms will likely top US$900m (£554.6m), based on 2008 figures, and will include more than 1,100 lawyers, with Bingham McCutchen contributing more than 1,000 lawyers to the new firm, spread among 12 offices. Bingham was also one of the few major firms last year to show growth in both revenue (up 3% to US$767m (£472.5m)) and profits per equity partner ( up 6% to US$1.42m (£874,877)). On the other hand, McKee Nelson had a tougher year, with layoffs and departures bringing the firm’s staff down to just 120 lawyers, with an associated revenue decrease of around 16% to US$160m. However, McKee has a solid reputation for tax planning and tax litigation and also has a strong white-collar practice.

京高朋律师事务所加入 ALFA 国际联盟, 提升跨国法律服务实力,ALFA 国际联盟 是133家跨国律师事务所组成的国际法律合作 网络。 高朋合伙人王军表示:“对中国律师事务所而 言,加入全球法律联盟是提升国际业务实力的有 效方式。该联盟可为我们提供理想平台,深入了 解全球法律市场和境外客户的需求,通过与联盟 的成员事务所合作,可快速增加我们同海外市场 的联系。” 高朋已经拥有较为稳定的国际贸易和 WTO 业 务,由合伙人王磊负责。王军还希望通过加入 ALFA 国际联盟进一步巩固事务所的国际业务服 务实力。 ALFA 国际联盟首席执行官 Richard Hetke 认 为:“无论对跨国企业的成功还是 ALFA 国际联 盟的法律网络而言,拥有实力雄厚且业务全面的 中国会员事务所都十分重要。” ALFA 国际联盟是全球性法律服务网络,会员包 括133家跨国律师事务所(85家美国事务所,48家 非美国事务所),律师超过8,500位,另有10,000 法律专业人士。

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ROUNDUP • US firm Cadwalader, Wickersham & Taft is set to move its London office to new premises in Bank by December 2009. The move will see the firm almost halve its office space in the capital • Shearman & Sterling is expanding its Abu Dhabi operations. The US firm relocated its London partner James Comyn and Paris-based M&A partner Manuel Orillac to Abu Dhabi earlier this year, and has plans to transfer its London-based property partner Ian Nisse to the office in 2010 • UK firm Schillings recently formed a cross-border alliance with US firm Akin Gump Strauss Hauer & Feld to tackle the issue of enforcing United Kingdom court orders in the States

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NEWS | news >>

Update >>

Hong Kong >>

Regulatory

New head of Asia funds

Outbound Lending Further Facilitated By SAFE Regulation

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he recently published Circular on Foreign Exchange Control Issues Relating to Offshore Lending by Enterprises in China (the “Circular”), will create more flexibility for Chinese entities to fund their overseas operations from 1 August 2009. In a media session convened by the State Administration of Foreign Exchange (SAFE), officials explained the main purpose of the Circular is to address issues companies are facing due to the worldwide financial crisis, funding their offshore operations and expansion. Prior to the issuance of the Circular, a non-financial company incorporated in China must qualify as a “multinational company” (as defined under the Circular on Issues Relating to the Administration of Internal Operation of Multinational Companies’ Foreign Exchange Funds issued in 2004, the “2004 Circular”) before the company is permitted to extend loans to their offshore member companies, by using its then-available foreign exchange funds. To qualify as a multinational company, it must have a certain number of subsidiaries or affiliates within its group. In addition, the total amount of outbound lending by a Chinese company is limited to 20% of the company’s equity base. Furthermore, under the 2004 Circular, both the lending Chinese company and the overseas affiliated borrower must meet certain other financial criteria. The Circular now makes it possible for smaller companies to extend financing to their offshore affiliates that are either wholly owned or invested by them. These overseas entities can either be operational entities or pure investment vehicles. Other major changes include: (1) increasing the cap from 20% to 30% and allowing companies to lend up to 30% of its total equity (but subject to the total investment amount the Chinese company has been approved to make in the overseas entity); (2) permitting Chinese companies to use its RMB funds to purchase foreign exchange to fund the overseas financing in addition to using its own foreign exchange reserves; and (3) promising to adopt simpler procedures to further facilitate the loan remittance process. Most of the processing will be handled by the bank without the necessity to go to local branches of SAFE. Chinese companies can directly enter into loan agreements with the overseas affiliates but they can also engage banks and other financial institutions to act as intermediaries to provide entrustment loans. SAFE will still be controlling and overseeing the actual amount of funds being lent to overseas entities. However, the Circular will definitely ease the cash-flow needs of the overseas companies established by non-multinational companies. This ability to finance its overseas affiliates will also increase the appetite for outbound investments by Chinese entities. Written by Jeanette Chan, partner Wei Chen, associate Paul, Weiss, Rifkind, Wharton & Garrison Unit 3601, Fortune Plaza Office Tower A No. 7 Dong Sanhuan Zhonglu Chao Yang District, Beijing 100020 PRC Email: jchan@paulweiss.com Ph: (8610) 5828-6300 or (852) 2846-0300

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Jeanette Chan

igns that the Asia region is emerging from the recent downturn ahead of other areas can be seen by international firm Linklaters deciding to devote additional senior resources to its Asia practice. The firm recently relocated London partner, Edward Smith (pictured), to its Hong Kong office to head up Edward Smith Linklaters the investment management practice. Specialising in private equity funds, infrastructure funds, and closed-ended listed vehicles, Smith’s recent deals include advising on the establishment of the €1bn ABN Amro Global Infrastructure Fund, and the €3bn fund raising for ProLogis European Properties II. He has been involved in many of the sector’s most significant listed funds deals, including advising book runners on the global offering of shares in HarbourVest Global Private Equity and the US$1bn institutional public offering of BH Global Limited. “Despite recent events, the Asia region – China in particular – is expected to become more significant in the context of the global asset-management industry, both as a source of capital and as a location to deploy capital,” Smith said. “It makes sense for us to strengthen our practice in the region, to capitalise on this anticipated growth.” Linklaters has an established funds practice in China with expertise in Hong Kong, Beijing, Shanghai, Tokyo, Bangkok and Singapore (through its joint venture with Singapore firm Allen & Gledhill).

Regional >>

Hogan & Hartson reshuffles

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fter undergoing a localisation process which allows Hogan & Hartson to practice Hong Kong law, the firm has unveiled a new-look management team to oversee its practice. Jun Wei and Steven Robinson have been appointed as joint managing partners of the Jun Wei firm’s Greater China operation. They will Hogan & Hartson be responsible for coordinating direction, strategic planning and practice development. As part of the management reshuffle, the firm has also appointed new office heads. Gordon Ng will become the managing partner of the newly localised Hong Kong office, while Man Chiu Lee is elevated to administrative partner. On the mainland, Roger Peng will lead Steven Robinson Hogan & Hartson the firm’s Beijing office and Arthur Mok its Shanghai office. Earlier this month, Mok and Lee acted for Beijing-based water treatment supplier, Duoyuan Global Water, on its US$88m NYSE listing. ISSUE 6.8


NEWS | news >>

Update >>

at Linklaters Notable instructions include acting for Hopu Capital on establishing the Hopu USD Master Fund I, a US$2bn PE fund geared towards buying stakes in state-owned companies. Also, advising Insurance Corporation of British Columbia (ICBC) on establishing a global resources PE fund worth US$1bn, in its JV with Standard Chartered Bank. Prior to Smith’s relocation, the investment management practice was headed up by Hong Kong counsel, Michael Guilday. He joined Linklaters from Allens Arthur Robinson’s Sydney office in September 2007 to succeed Graham Turl, who left the firm to join the funds management group BlackRock in Hong Kong. ALB

年利达任命新亚洲投资业 务团队负责人

利达近期扩充亚洲业务合伙人团队的举措表明亚洲市场相比欧美市场 有提前复苏的迹象。该所已将伦敦基金投资业务合作伙 Edward Smith 调派到其香港办公室,并称为亚洲基金投资业务团队负责人。 Smith专业特长在于为私募股权投资基金和基础设施基金等提供服务。 曾 在众多大型基金投资交易和基金设立项目中提供法律服务。 他说:“亚洲地区, 尤其是中国的基金资产管理行业将在全球市场上占 有日益重要的地位。这促使我们加强在该地区基金律师团队,充分利用这 一预期增长。 ” 在Smith被调往香港前,亚洲基金投资业务由香港外国法 律顾问Michael Guilday带领

its management This is only the third listing of a PRC company on the exchange this year, after Changyou.com and Chemspec.

霍金•豪森管理层洗牌,力 求进入大中华市场

达到在香港开展业务的法定要求,霍金•豪森律师事务所香港办事处于 本周初开展本地化工作,工作完成后,霍金•豪森任命全新管理团队, 致力于开拓大中华市场业务。 霍金•豪森任命魏军(Jun Wei)和Steven Robinson担任联合主管合伙人,领 导大中华地区的业务经营,并负责业务方向协调、战略规划和业务开拓。作 为管理层洗牌的组成部分,霍金•豪森还新任命两位办事处主管:Gordon Ng 将担任本地化之后的香港新办事处主管合伙人,李文昭(Man Chiu Lee) 晋 升为行政主管合伙人。在大陆业务方面,Roger Peng 将担任北京办事处主 管,Arthur Mok担任上海办事处主管。 本月初,Mok和Lee作为北京水处理企业-多元环球水务的法律代表,参 与价值8,800万美元的纽约证交所上市项目,该公司是今年第三家在纽约证 交所上市的中国公司(前两家公司分别为畅游和精细化工)。

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Regulatory FIMA and Investment Company

I

n the Mainland Chinese merger & acquisition market, M&A transactions of domestic companies by foreign investment firms are considered to be a type of proceedings covered by the Foreign Investors’ Merger & Acquisition Regulation (FIMA). However, the promulgation by the Ministry of Commerce (MOFCOM) of the Provisions for Establishment of Companies with an Investment Nature by Foreign Investment (PECINFI) in November 2004 and the Supplementary Provision on the Establishment of Investment Companies by Foreign Investors (SPPEICFI) in May 2006 has created an important exception to FIMA transactions. The 2004 PECINFI and 2006 SPPEICFI regulations stipulated that foreign investors were entitled to establish a PRC domestically registered investment company, so as to facilitate non-domestic investors’ investments under either Wholly Foreign Owned Enterprise (WOFE) or Joint Venture (JV) forms. Although these newly created companies are considered domestic by regulation, in practice their investments are regarded as foreign direct investments. As such they benefit from the same favorable treatment bestowed to any other foreign investments. Newly created subsidiaries benefit from both domestic registrations as well fas avorable treatments in practice as foreign investments. In August 2006, the Chinese M&A market was further clarified with the promulgation of the Regulations for Merger with and Acquisition of Domestic Enterprises by Foreign Investors (RMADE). The new regulation stated that domestically registered investment firms established by foreign investors, were to enjoy the same treatment as foreign direct investments, when proceeding with domestic M&A transactions. This clarification under RMADE has led to a key question in regards to the treatment of investments made under joint venture projects. Current Chinese legislation permits the establishment of domestic investment companies in a JV form with foreign firms. How to treat the resulting investment transactions of the new JV form is a question that has been left unanswered. The reason for the intentional ambiguity of the drafters of RMADE concerning the treatment of these transactions can be understood practically, in the current market conditions. Few investment firms in China are, or will likely to be, established as joint ventures. For now, there is a lack of urgency to define investments made from JV investment firms. Further, the treatment of JV investment firm transactions is far more complex than simply defining the resulting transaction as either “foreign” or “half–blood” investments. Investments from JV investment firms require two separate systems for anti–trust censoring, as well as touching on issues of commerce authorisation, administrative registration etc. Given the complex range of issues, more time and experience is needed to build up institutional capacity before a concrete and effective definition of JV investment transactions in the M&A market is solidified. The ambiguities of RMADE can be seen as a practical approach by legislators, given current market conditions. Viccine Han, Associate | 韩海威 律师 Sichuan Tahota Law Firm Level 27 Building A, The World Trade Centre Gulou South Street,Chengdu 610015,P. R. China Landline: +86 28 86625656 Mobile: +86 18980086688 Email: vicvvv@msn.com | http://www.tahota-lawyer.com

Viccine Han

23


NEWS | news >>

Update >>

Singapore >>

First Sino-Singapore

International Tax Indian Budget 2009: Tax Proposals

W

hile the US and UK governments have responded to the economic downturn by raising taxes, India has chosen to tread a different path. The budget announced on July 6 by Indian Finance Minister, Pranab Mukherjee, proposed a reduction in the personal Indian tax rates from around 34% to 31%. The basic Indian corporate tax rate has been maintained at 34%. The budget sought to eliminate the surcharge on personal taxes thereby increasing disposable income in the hands of individuals and boosting consumer-spend. In addition, the much criticized fringe benefit tax (especially on ESOPs) and commodities transaction tax have been eliminated. The trend of companies granting ESOPs is expected to bounce back. India recently introduced Limited Liability Partnership (LLP) legislation. Most jurisdictions around the world treat LLPs as tax transparent entities. The budget however, proposes to tax LLPs as separate taxable entities (at the rate of 31%) with profits not being taxable in the hands of individual partners. As a result, losses may not be passed on to the partners for the purpose of set off or carry forward. Further, a number of tax credit issues may arise in a cross-border context. In line with the recent G20 proposals, the budget authorizes the Indian government to enter into tax information exchange agreements with non-sovereign jurisdictions. Many foreign companies have been subjected to oppressive tax collection methods by the Indian tax authorities. Recognizing this fact, the budget proposes to constitute an alternate dispute resolution panel to review the orders of the assessing officer prejudicial to taxpayer, before they are finalized. This is a unique attempt towards providing an efficient dispute resolution mechanism at an early stage. Although the demand for an advance pricing arrangement has not been considered, the budget has authorized the government to formulate safe harbour rules for determination of arm’s length price for transfer pricing purposes. Additionally, the budget has removed certain practical difficulties in computation of arm’s length price where more than one method may be adopted. On the flipside, the budget proposes to increase the minimum alternate tax (MAT) rate from 11% to 17%. MAT is the antithesis of any concession / exemption given. The budget also proposes to bring certain specified noncash gifts within the purview of income tax. Consequently, any gift of immovable property, shares, works of art, jewellery etc., made by a person (except close relatives) would be taxed in the hands of the recipient as income. After much debate and deliberation, the budget has formally announced the introduction of a goods and services tax at both, federal and state levels from April 1, 2010 to replace the existing excise, service and sales / value added taxes. The budget on the whole seems to meet reasonable expectations, especially considering that the new Indian government had assumed office only a month previously. By Debbie Annells, Managing Director, AzureTax Ltd, Chartered Tax Advisers Suite 1010, 10/F Lippo Centre, Tower Two, 89 Queensway, Hong Kong www.azuretax.com, a member of AzureTax Group (Tel) +852 2123 9339 (direct line), (Main Line) +852 2123 9370, (Fax) +852 2122 9209 Registered with the Chartered Institute of Taxation for purposes of anti money laundering legislation.

24

Debbie Annells

S

ingapore's Central Chambers and Dacheng, the largest firm by head count, have formed a joint venture designed to capture clients expanding to India and China. Named Dacheng Central Chambers, the firm is based within Central Chambers' Singapore office. It counts 14 lawyers and seven partners qualified to advise on Singapore, China, India and Thailand laws. This is the first China-Singapore JV firm, and one of the few firms with Indian lawyers. “What we're trying to do is basically capitalise on the shift in focus to this part of the world from [the] US and Europe, especially to the Indian market through trade relations with the ASEAN and China,” said managing partner, Aloysius Wee. “Our strategy right now is to support Indian businesses so we'll have Indian lawyers based in Shanghai taking care of them there. We're looking at an outflow of businesses into south-east Asia and this activity has picked up in the last two or three years. So it's probably more of an opportune time now to set up this joint venture.” The two firms had been working as strategic partners since 2004, with the idea for the JV coming in 2007. “It's taken a good two years to get the documentation and partner Singapore >>

Lexfield revamps brand, adds

J

an Liu & Associates, a Beijing-based IP boutique firm, has been redesigned. The firm has changed its name to Lexfield Law Offices, and boosted its expertise and resources by recruiting a team of experienced IP lawyers. The new additions include renowned intellectual property litigation lawyers Jiang Hongyi, Li Rong, Liu Yongquan, Zuo Yuguo and Jiang Chengguo, and seasoned patent lawyer Yi Yongmei. Most of the lawyers were former partners at Beijing Lifang & Partners. Cheng Yongshun, a respected retired Beijing High Court intellectual property judge, has also joined the new firm as senior counsel. As Jan Liu & Associates, the firm had enjoyed a growing reputation in handling trademark, copyright and anti-unfair competition legal matters. It represented many of the world’s leading corporations, including Google, Sun, BP and Honda, in brand protection and dispute resolution matters. ISSUE 6.8


NEWS | news >>

joint venture firm meetings in place," ►► Singapore jv firms (May 2009) Wee said. In June • Allen & Overy/Shook Lin & Bok the Singapore • Allens Arthur Robinson/TSMP partners met in • Baker & McKenzie/Wong & Leow Nanjing to discuss • Dacheng/Central Chambers the firm's business • Linklaters/Allen & Gledhill model, which will • Lovells/Lee & Lee operate as an overseas model with six partners to contribute equal capital. A development plan for the firm was also realised. “This model, in which the firm would have direct-equity participation rather than a strategic alliance basis, would be the first for Dacheng outside of China and serve as a model for subsequent offices," Wee explained. However, he did not feel that Dacheng would venture further into south-east Asia with new offices; rather, it will take a cautious approach through making associations with local firms. “We're definitely looking … but waiting for the political situations in Thailand and Malaysia to stabilise. Before we venture and set up anywhere we'll have some kind of link or association with a local firm to see if the work is sustainable. Right now we’re doing that out of our Singapore office and working with our associate firms.” ALB

大成在新加坡成立合资律所

与新加坡中央律师事务所合作多年后,大成近日与该所合资成立了其 在新加坡的分所,旨在发展东南亚业务。新成立的合资律师事务所名 为大成中央律师事务所。这是新加坡律所和中国律所首次在新加坡设立合 资律师事务所。 该团队拥有能够提供汉语、印度语、马来语、泰国语数种语种法律服务的14 位律师和7位合伙人。新加坡合伙人Aloysius Wee 表示:“在过去两、三年,中国 企业在东南亚的商业活动有所增加,所以现在是成立合资律所的最好时机。”

new IP team The new team enables Lexfield Law Offices to provide a full spectrum of IP legal services, with particular strengths in patent litigation and intellectual property counselling.

新知识产权律师团队加盟北京联德

京市刘元和君律师事务所已于2009年7月更名为北京 市联德律师事务所。同时,由包括蒋洪义、易咏梅、 李嵘、刘永全、郭金城、左玉国在内的十几位资深知识产 权诉讼律师和专利代理人组成的一支诉讼和专利团队并入 联德律师事务所。已退休的著名前知识产权法官程永顺先 生亦加入该所成为高级顾问。 该所在更名前,专注于商标、版权和反不正当竞争的法 律业务,代表国际上的许多知名企业处理了大量的在华知 识产权案件。随着新诉讼和专利团队的并入,该所旨在成 为一家提供全方位知识产权法律服务的专业所。

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Jiang Hongyi Lexfield

Update >>

Singapore 中国创业板十年磨一剑

2

009年7月20日,中国证监会发布公告,根据《首次公开发 行股票并在创业板上市管理暂行办法》(“《暂行办法》”) 及有关规定,定于2009年7月26日起按照法定要求和程序受 理发行人在创业板上市的申请。这意味着,经过长达10年 酝酿准备的中国创业板正式拉开序幕。 创业板又称二板市场,即第二股票交易市场,如美国的纳斯达克 (NASDAQ),英国的另项投资市场(AIM)等, 是指主板之外的专为 暂时无法上市的中小企业和新兴公司提供融资途径和成长空间的证 券交易市场,其普遍的特点是低门槛准入及严要求运作。全球超过 40家正在运行的创业板,是对主板市场的有效补给,在资本市场中 占据举足轻重的位置。 根据《暂行办法》的规定,在中国创业板申请上市的盈利和发行 股本要求为: 1. 最近两年连续盈利且净利润累计不低于1000万元,且持续增 长; 2. 最近一年盈利,且净利润不少于500万元; 3. 最近一年营业收入不低于5000万元,且最近两年营业收入增长 均不低于30%;且 4. 发行后总股本不低于3000万股。 其中前三项的盈利要求(单位:人民币)为选择性标准,满足其 中任何一项即可。 尽管已较主板上市条件相对宽松,中国创业板的门槛设置同其 他国家相应市场的要求相比还是相对较高的。比如新加坡的凯利板 (Catalist,其前身为新加坡股票交易自动报价市场(SESDAQ)),作 为亚洲第一个为本地和国际成长型公司设立的由保荐人监督的上市 平台,对于公司上市就没有特定的量化盈利要求,而是由受批准的 保荐人判定一个公司是否适合上市。无论是对上市申请的批准和公 开招股之后的公司运作,新加坡证券交易所都不直接参与监督(保 留处罚权),而由保荐人负责监督。这种门槛设立的差别,原因之 一可能是中国中小型上市资源的丰富,出于保证中国创业板高质量 以及能够筛选出满足投资者利益企业的考虑。 创业板的吸引力有目共睹:手续简单灵活,便于实现融资目的。 然而,初期的低门槛准入势必意味着后期的严 格监管要求,以保证市场的有序稳定及投资风 险的控制。比如上市规则的合理统一性,公司 成长性,自主创新性的恰当认定,保荐人的监 管力度,信息披露的准确及时性,公司上市后的 持续监管及风险控制机制,这些必修功课的准备 情况将决定中国创业板是否能在金融危机余波未 尽的大环境下交出令人满意的答卷。

邹阿源 企業事務部法律顧問 Ph: (65) 6322-2235 Fax: (65) 6534-0833 E-mail: zouayuan@loopartners.com.sg

邹阿源

盧寶琪 企業融資部资深專員 Ph: (65) 6322-2231 Fax: (65) 6534-0833 E-mail: kittylo@loopartners.com.sg

俊昭法律事務所 Li Rong Lexfield

88 Amoy Street, Level Three, Singapore 069907

盧寶琪

25


NEWS | news >>

Chongqing >>

First Shanghai firm in Chongqing W

hen it comes to expanding geographical coverage, many Shanghai firms will choose to open in Beijing. However, Haworth & Lexon Chen Jun Haworth & Lexon has taken a different approach by setting up its first branch office in Chongqing – the biggest city in the south-west and the fourth municipality directly under central government administration. As the first Shanghai firm to open an office in Chongqing, partner Chen Jun has relocated from head office to lead the new branch. Shanghai-based partners Chen Jing, Jia Rui and Liang Xiancheng will also join Chen to form the core part of the new legal team. The Chongqing office focuses on practice areas including domestic and international investment, M&A, international trade and maritime affairs, intellectual property, insurance and commercial disputes. “Chongqing is the essential gateway to the west of China. Hence, the city’s rapid economic growth and prime location offers many business opportunities for law firms, especially for M&A, investment, and international business practices,” Jun said.

According to a report by ALB China earlier this year, the western inland region maintains a high-growth market, offering foreign companies a wide range of business and investment opportunities. With more than 3,000 firms generating an annual income of more than US$306m, the western provinces are quickly becoming a force to be reckoned with.

Growth prospects aside, legal firms in Chongqing are also facing increased levels of competition, as large national firms like King & Wood, Dacheng, Zhonglun W&D and Guantao all establish their presence. For example, Haworth & Lexon has 14 partners and 18 lawyers working in two offices, with affiliations to firms in Sydney and Paris. alb

第一家上海律所进驻重庆 上 海和华利盛律师事务所近日迈出了其拓展 国内市场的第一步。该所已在重庆市成立 分所,并成为进驻重庆市场的第一家上海律师事 务所。和华利盛重庆分所由上海总部派驻律师陈 俊担任负责人,由陈静、贾锐、梁先成和沈曦等 合伙人及若干律师组成。涉及的法律服务领域 包括国内与国际投资、并购,国际贸易与海商海 事,知识产权,保险法,商事调解及仲裁、诉

讼等方面。 陈俊表示:“重庆是通往中国西南部的重要的门 户。 重庆经济的快速增长和地理优势可以为和华 利盛的业务拓展带来许多新的机遇,尤其在跨国 并购,内资投资以及涉外业务领域。” 西部市场虽然发展潜力诱人,但律所同时面对 不断加剧的竞争。大型律所,例如大成,中伦文 德和金杜都已在该地区成立了分支机构。

Tianjin >>

Guantao makes local lateral hires R

ecognising Tianjin’s market potential, Beijing-headquartered Guantao has opened its ninth branch office in the city, which is regarded as the growth Ma Kewei Guantao engine for North China. Guantao has recruited seasoned local practitioners Ma Kewei (pictured) and Cong Ying as partners to lead its development. Both Ma and Cong were formerly with local firm Join & High, where Ma served as the co-founder and executive director of the practice. He explained

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“the Tianjin economy is robust and growing rapidly. In view of expanding Guantao’s clientele, Tianjin is perfect.” The new office, currently staffed by six partners and with 11 lawyers, will focus on practice areas including foreign investment, M&A, corporate restructuring, real estate and IP. “I believe that the legal market in Tianjin will continue to flourish, especially for capital markets and M&A practices,” Ma said. Prior to his time at Join & High, Ma was the founding partner of Jun Hui (1994–2006). He specialises in corporate restructuring and

reorganisation, M&A, investment and financing and IP law. ALB

观韬设立天津分所

认识到天津市场的巨大潜力后,北京观韬在 天津成立了其第九家分所,并聘请经验丰富 的本地资深律师马克伟和丛英作为合伙人,领导 观韬在天津的业务发展。天津分所负责人马克伟 表示:“天津经济发展强劲,法律市场增长迅速, 为观韬扩大客户群和业务领域提供良好机遇。” 目前,观韬天津分所有六位合伙人和11位律 师,业务重点包括外商投资,重组并购,房地产 和知识产权。马克伟还表示,天津对资本市场和 并购法律服务需求将进一步加大。 两位律师在加盟观韬之前分别是天津四方君汇 律师事务所的创始人和合作人。 ISSUE 6.8


NEWS | news >>

Malaysia >>

Firms assist company listings in Malaysia

C

onyers Dill & Pearman, DLA Piper and Malaysian firm Wong Beh & Toh all played leading roles in the first listings of Bermuda-incorporated companies on the Bursa Malaysia Stock Exchange. Xingquan International Sports Holdings, a sports-shoe manufacturer based in Jinjiang, raised RMB165m through its offering while Multi Sports Holdings, a JinJiang-based producer of sports shoes, is expected to raise as much as RMB57.6m through its IPO in early August. A Conyers team, led by Singaporebased lawyers Janice Oh and Stacie Seetho, advised Xinquan on Bermuda law; DLA Piper advised on Hong Kong law and Wong Beh & Toh on Malaysian law. Head of Conyers’ Malaysian desk, Kung Whooi Phing, provided Bermuda law guidance on the Multi Sports’ listing while Wong

Beh & Toh acted for the company on Malaysian law. Phing says the regulatory changes making these two listings possible are likely to mean more offshore-incorporated companies would list in Malaysia. “Recent changes introduced by Bursa Malaysia have made it easier for foreign companies to list their shares. Xingquan International Sports Holdings and Multi Sports Holdings are the first two China-based companies to

announce direct listings on the Main Board of Bursa Malaysia ... and we may be seeing the beginning of a trend of increasing foreign listings.” ALB

中国公司首次在马来西亚上市

康德明, 欧华与Wong, Beh & Toh 的协助下, 星泉鞋材成为在马来西亚大马股票交易所 上市的首家中国公司。总部设在晋江,注册于百 慕大的运动鞋制造商星泉鞋材,通过IPO筹得 3.2亿元。据悉,运动鞋鞋底制造商华运控股也 将于8月初在大马股票交易所上市。 康德明新加坡公司合伙人Janice Oh 和律师 Stacie Seetho和为星泉在百慕大的法律方面提

供咨询。欧华为星泉提供香港法律的相关服务, 而Wong, Beh & Toh为发行人在马来西亚的法律 顾问。 康德明和Wong, Beh & Toh同时在为华运控股 的上市项目提供法律服务。康德明合伙人Kung Whooi Phing表示:“马来西亚法律规定的变化使 这两项外国公司的发行上市成为可能,这也代表 以后将会有更多的跨国公司在马来西亚上市。”

‘Walk out’ policy through the international profile of Zhonglun W&D Law Firm

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hina’s economy grows faster than anything we have witnessed so far. In such an environment, law is the one to play the main role, making it essential for the business companies to have a ‘legal shoulder’ to lean on. And this is where the professionalism of Zhonglun W&D Law Firm stands out. Considering the ever growing globalization and the need of cooperation between the states from all over the world, Zhonglun W&D, in addition, attracts new professionals who have an overall view of the global business and economic situation, who are fluent in English, French, Italian, Spanish, German and Japanese, as well as Chinese lawyers who have received their education in famous European universities. Such a person is Mr. Wei Lin, who was recently appointed managing partner in the office in Shanghai. Graduated with a Doctor’s degree from French Université PanthéonAssas (Paris II), fluent in French and English, specialized in the field of overseas M&A and IPO issues and Admiralty Law. Mr. Lin’s background strongly indicates the

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direction the Shanghai branch seeks to head towards. It is the objective of the branch to spearhead the firm’s international legal affairs and operations. The international activities will be approached on two main levels. Firstly, legal advice and services will be provided to foreign companies seeking to set up business in China. Secondly, Chinese companies looking to expand out abroad. In relation to that, Mr. Lin’s European education and working experience together with his Chinese nationality mix together in the perfect blend of understanding Chinese needs and legal system and applying to those needs the European experience and expertise in the area. To meet those needs of the global society, Zhonglun W&D has offices in Paris, Lyon and Riyadh. Moreover, Zhonglun W&D is the first and only Chinese law firm to have set up an office in London. To further strengthen its international positioning, Zhonglun W&D plans to boost its development by opening branches in Hong Kong, Seattle and Washington. Additionally, indulging the needs of the Chinese business, Zhonglun W&D organizes

Firm Profile

Zhonglun W&D

a seminar under the caption “Going global: Laws for Chinese enterprises in M&A overseas”, which will be held in Beijing on September 8th 2009. The program is geared towards creating further awareness of the proper positioning and facilitating of international investment and business activities. After 30 years of fast growth, China’s investment-driven and export-oriented development model, with exports accounting for 40 percent of GDP, had become increasingly difficult to sustain. Thus, China now seeks to transform its growth model in such a way as to revive its economy and to position itself as coming out of this situation as a winner. Posing towards the future, Zhonglun W&D proves to be a law firm ready to support this. Contact details: Address: 19/F Golden Tower, No.1, Xibahe South Road, Chaoyang District, Beijing, 100028, P.R.C Tel: 86-10-6440 2232 Fax: 86-10-6440 2915/6440 2925 Website: www.zhonglunwende.com

Lin Wei

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NEWS | news >>

两位资深合伙人加盟国浩北京和上海

►► LATERAL HIRES Name

Leaving from:

Going to:

Practice areas:

Location

Wu Yiding

Dadi

Grandall Legal Group

insurance

Beijing

Clare Lu

Richard Wang & Co.

Llinks

tax

Shanghai

Chen Xuebin

Great Wall Alliance

Grandall Legal Group

international business, litigation

Shanghai

Ma Jun

MWE China

DeHeng Law Offices

FDI, corporate

Shanghai

Rogers Wu

INVISTA (in-house)

Jin Mao

EHS

Shanghai

Zhuo (Arthur) Chen

Fried Frank

Yingli Green energy

corporate (in-house)

Hong Kong

Steven Sieker

Bennett Jones

Baker & McKenzie

tax

Hong Kong

Vincent Sum

Linklaters

Lovells

finance

Hong Kong

Winnie Ng

Baker & McKenzie

Minter Ellison

PRC employment law

Hong Kong

►► 2009 promotions Name

Firm

Title

Practice

Location

Terence Foo

Clifford Chance

partner

corporate

Beijing

Yang Tiecheng

Clifford Chance

partner

finance

Beijing

Matthias Feldman

Clifford Chance

partner

corporate

Hong Kong

Matthew Truman

Clifford Chance

partner

corporate

Hong Kong

Donna Wacker

Clifford Chance

partner

litigation, dispute resolution

Hong Kong

通过吸引两位资深专业律师加盟,国浩合伙人团队正 在稳步扩大。在过去的一个月内,资深保险业律师吴一 丁加入其北京办公室,原上海亚太长城律师事务所主 任陈学斌加盟其上海办公室。 吴一丁主要从事保险,金融,公司和诉讼业务,她此 前曾在北京大地律师事务所从业13年。而陈学斌则擅 长代理国际业务和商业诉讼事务。陈律师表示: “国 浩律师集团的业务主要集中在公司和商业领域。我认 为,国浩的业务重心更适合我的职业发展,并在将来 能提供更多商机。“ 目前,上海亚太长城律师事务所主 任由徐培华律师担任。

Great Wall Alliance

Jin Mao

EHS specialist for Jin Mao Formerly in-house counsel at multinational manufacturer INVISTA, Rogers Wu has traded in his years of internal legal experience for private practice. Wu has joined the Shanghai office of Jin Mao, leading the environment, health and safety (EHS) practice. During his in-house tenure, Wu developed expertise in manufacturing plant management, project management, labour relationship handling and EHS management. He also worked in-house for three years at a local chemicals company, and spent 10 years with the United States-based Fortune 500 Company, DuPont. EHS is fast becoming an emerging practice in many law firms, as rapid economic development sees environmental protection and occupational health and safety (OH&S) becoming more important.

EHS专业律师加盟金茂 Richard Wang & Co

Llinks

Tax practice launched by Llinks With China’s tax regime becoming increasingly sophisticated, law firms should acquire more tax expertise and skills, to be able to offer value-added corporate legal services to optimise their Clare Lu clients’ success. Shanghai-based commercial law firm Llinks has secured the services of experienced tax partner Clare Lu, who was senior partner with Richard Wang & Co. Qualified as a lawyer, accountant and tax agent, Lu is responsible for leading and building the tax legal service team at Llinks. She has worked with Deloitte’s tax and business advisory group as a senior consultant and tax manager, and serves as vicechairman of the finance and taxation committee of the Shanghai Bar Association.

通力新添税务合伙人,设立税务法律服务团队 近日, 在税务领域具有十多年咨询和法律服务经验的 资深律师陆易作为合伙人加入上海通力律师事务所, 并将领导该所税务法律服务团队的设立和发展。陆易 律师同时具有中国律师、中国注册会计师以及中国注 册税务师资格, 曾在德勤华永会计师事务所税务及商 业咨询部有过多年的工作经验。在加入通力前,陆律 师曾为小耘律师事务所高级合伙人。

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Great Wall Alliance

Grandall

Shanghai business adds senior resource Former director and partner of Shanghai Great Wall Alliance, Chen Xuebin, joins Grandall Legal Group as partner. Chen is based in the Shanghai office and his practice areas include international business and commercial litigation. “I joined Grandall because of its focus on business-related practice areas,” he said. “I believe this focus better suits my expertise and can offer more career opportunities.” However, there are also challenges for Chen to overcome in his new role. “I need to blend into Grandall’s culture and business operations before I can be recognised as an effective team player. It is also very important to develop strategies to expand our legal business practices.” Chen’s spot as director at SGWA, which employs 36 lawyers, has been taken over by partner Xu Peihua. After spending 13 years at Dadi Law, senior partner, Wu Yiding, has joined Grandall Legal Offices’ Beijing branch as a partner. During her years with Dadi, Wu represented major insurance companies and her practice at Grandall focuses on insurance, finance, corporate and litigation matters. On top of her responsibilities in the firm, she also serves as the current vice-chair of Beijing’s Bar Association’s insurance practice committee.

上海金茂律师事务所近日吸引具有多年跨国公司企业 管理经验和公司法律顾问经验的吴荣良律师加盟。吴 律师曾经在上海氯碱化工股份有限公司工作三年,并 在美国杜邦公司位于上海的企业中从事过十多年的企 业管理工作,在企业生产管理、项目管理、劳动关系处 理、环境、健康和安全(EHS)管理等方面积累了丰富 的实践经验。 加入金茂前,吴荣良律师在美国Koch工业集团所属 的英威达公司的法律部门工作。随着吴荣良律师的加 盟,在公司法律服务领域,除了传统的公司业务,金茂 将在EHS这一新的领域为客户提供法律服务,包括公 司并购重组过程中对EHS的尽职调查、工业项目的全 过程EHS法律服务、建设工程中的EHS法律服务、工 厂日常运行过程中的EHS法律服务等。

MWE China

DeHeng

New partner for Shanghai offices One more partner has been added to the Shanghai branch of DeHeng Law Offices. Ma Jun, who was recently promoted to partner at MWE China, has swapped the fast-rising firm for the new position. Ma started practicing in 2003, specialising in corporate businesses, FDI and M&A. He has experience in anti-monopoly and international arbitration practice areas. This new appointment to the Shanghai office comes after the firm appointed three senior IP partners to its Beijing head office a few months ago. ISSUE 6.8


NEWS | news >>

马骏律师加盟德恒上海

在被上海元达律师事务所晋升为合伙人后不久,马骏 律师决定加入德恒上海分所。 马律师2003年开始律师执业,其业务领域涵盖公司 业务和商法、外商直接投资、兼并与收购及离岸反向 收购等领域。此外马律师还拥有反垄断和国际仲裁方 面的经验。在聘请马骏之前,该所在北京总部任命了 三名资深涉外知识产权专家为高级合伙人。

Bennett Jones

Baker & McKenzie

Bakers moves on after layoffs After announcing that it will trim its Greater China offices by 11%, Baker & McKenzie has secured the services of tax partner Steven Sieker for its Hong Kong office. This will be Steven Sieker Sieker’s second stint at the firm, as an associate from 1998–2004 and partner in the tax group from 2004–07. He left for his native Canada in 2007 to take up a partnership at Bennett Jones. Sieker is a past member of the Hong Kong Inland Revenue Board of Review and a part-time lecturer in tax and revenue law at The University of Hong Kong and CityU. He is considered something of an expert in the area of taxation across Asia-Pacific and Canada, where his practice focused on corporate tax advisory work, wealth management and litigation. In addition to the redundancy consultation last month, Bakers also earmarked several new partners across the region. Joseph Deng, Barbara Li and Scott Palmer were elevated to the partnership on the mainland, while Eugene Lim and Jennifer Van Dale were promoted in Hong Kong.

贝克•麦坚时继大中华区裁员后任命税务业 务合伙人

继宣布大中华区办事处将裁员11%后,贝克•麦坚时律 师事务所宣布任命 Steven Sieker 担任香港办事处税 务业务合伙人。 这将是 Sieker 二度进入贝克•麦坚时工 作。1998~2004年间,Sieker 在贝克•麦坚时担任律 师,2004~2007年担任税务业务部合伙人,后于2007 年返回祖国加拿大,进入 Bennett Jones 担任合伙 人。此外,Sieker 还曾是香港税务上诉委员会成员, 还曾在香港大学和香港城市大学担任税务和收入法 客座讲师。 Sieker 是亚太和加拿大地区税务领域的法律专家,其 业务重点包括企业税务顾问、财富管理和税务诉讼。 上月,贝克•麦坚时除宣布裁员计划外,还在该 地区任命多位新合伙人。Joseph Deng、Barbara Li 和 Scott Palmer 被晋升为大陆办事处合伙 人,Eugene Lim 和 Jennifer Van Dale 成为香港办 事处合伙人。

Linklaters

Lovells

Lovells builds up finance practice Lovells has appointed former Linklaters counsel Vincent Sum to its finance practice, citing an upturn in structured products and derivatives activity. www.legalbusinessonline.com

Sum will be a consultant in the firm’s Hong Kong office, where he will service local and international finance clients across Hong Kong, China and Tokyo. Lovells’ head of banking in Hong Kong, Gary Hamp, says Vincent Sum while clients have cited improved sentiment in the market, the appointment is not a knee-jerk response. “We’re not trying to be reactive to a short-term need; rather we’re trying to put in place a very broad and solid foundation so that we’re there for the long term,” he said. “Clients have been telling us that it’s been a difficult market but that sentiment is definitely improving. I think the view is that markets are on the way up, but it’s a long road.”

路伟任命原年利达律师负责金融法律服务

在亚太地区结构性产品和衍生产品交易回暖的背景 下,路伟任命年利达原顾问律师 Vincent Sum 负责金 融领域的法律业务。 Sum 进入路伟后,将担任香港办事处顾问律师,为 香港、中国和东京的本地和跨国金融客户提供服务。 路伟香港办事处金融业务主管 Gary Hamp 表示,尽 管该领域市场出现回暖迹象,此次任命并非单纯的应 需调整。 Hamp 表示:“我们的目的并不在于满足市场的短 期需求,而是着力打造内容宽泛且根基扎实的服务基 础,以满足市场的长期需求。客户一直认为市场环境 较为艰难,但这一状况已大为改观。我认为,市场正在 复苏,但前路漫漫。”

Fried Frank

Yingli

Corporate lawyer goes in-house Yingli Green Energy, listed on the New York Stock Exchange and one of the leading manufacturers of photovoltaic systems, has appointed Zhuo (Arthur) Chen as its legal counsel. Chen joins from the Hong Kong office of US firm Fried Frank, where he was an associate in the firm’s corporate division. In his new role Chen will be responsible for providing advice to the management team and board of directors on various legal issues, and serve as the primary contact point for outside legal counsel. Yingli’s founder, chairman and chief executive officer, Liansheng Miao, said that additionally, Chen will be responsible for assisting the company’s expansion. “Arthur brings his proven legal intellect and valuable experience to innovating and perfecting our products and services,” Miao stated. “We look forward to using his expertise to grow our global business with enhanced precision and speed.” As more PRC companies grow and are publicly listed, competent, internationally-experienced in-house counsel is needed to support operations and strategy execution. Over the past few years, NASDAQ-listed Shanda Interactive Entertainment has appointed US-qualified lawyer Thomas Yih, formerly with Morrison & Foerster in Shanghai, as general counsel. Alibaba Group has hired former Freshfields corporate partner Timothy Steinert as general counsel, shortly after Alibaba.com.’s HK IPO.

英利绿色能源任命新法律顾问

中国领先的一体化光伏产品制造商,美国上市公司英利 绿色能源近日任命Arthur Chen 为公司内部法律顾问。 Chen在加盟英利之前,是Fried Frank香港办公室 的公司法律师。Chen 将在英利为管理层和董事会团 队提供各种法律咨询和支持,并作为法律部门的主要 的联络人。 该公司董事长兼首席执行官苗连生表示:“我们希望 利用他的专业知识,拓展我们的全球业务,增强我们 业务发展的精度和速度。 ” 随着越来越多中国公司不断壮大且在海外上市, 公司对内部法律支持的需求与日俱增。在过去几年 中,NASDAQ上市的盛大互动娱乐已任命原美国美富 律所的Thomas Yih 律师为总法律顾问。阿里巴巴集 团也已聘请了富而德香港合伙人Timothy Steinert为 总法律顾问。

Baker & McKenzie

Minter Ellison

New consultant for Minters After losing its head of PRC employment, Pattie Walsh, to DLA Piper and its foreign counsel, Zhou Lihui, to JSM Mayer Brown, Minter Ellison is bouncing back quickly with a new lateral hire. The firm has announced the appointment of Winnie Ng as consultant to head its PRC employment practice, based in Hong Kong. Swift appointments imply that market demand in China’s employment sector allows no room, even for a temporary vacancy. Ng, who was with Baker & McKenzie as an employment lawyer, commenced in her role in July 2009. “With increasing investor [numbers] entering the markets, there are more companies, particularly multinationals, seeking assistance for complying with labour and contract laws,” said the partner and chairman of Minter Ellison’s Hong Kong office, Fred Kinmoth. “Given this trend, we see the need for a talented employment lawyer with a strong understanding of the PRC and Hong Kong employment landscape.” Minters now employs 10 partners and 21 lawyers in its Hong Kong and Shanghai offices.

Winnie Ng 加盟铭德中国劳动雇佣业务团队

继中国劳动雇佣业务主管 Pattie Walsh 转投欧华 和境外顾问律师周黎辉转投孖士打之后,铭德律师 事务所正通过横向招聘快速恢复实力。铭德近日宣 布,任命 Winnie Ng 担任香港办事处中国劳动雇佣 业务主管。 此次快速任命表明,中国的劳动雇佣市场需求猛 增,甚至不允许出现短暂的职位空缺。Ng 此前曾在 贝克•麦坚时律师事务所担任劳动雇佣律师,将于 2009年7月27日履新。 铭德香港办事处合伙人兼主席 Fred Kinmoth 表 示:“随着越来越多的投资人进入中国市场,更多公 司正寻求律师事务所的协助,以确保符合中国《劳动 合同法》的要求,其中跨国公司的需求尤为迫切。鉴 于该趋势,我们需要在中国和香港地区的劳动雇佣 领域拥有丰富经验的高水平律师,为雇主提供优质 服务。”铭德的香港和上海办事处现有10位合伙人和 21位律师。

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NEWS | news >>

Clifford Chance

Clifford Chance promotes five to partner After losing its spot as the United Kingdom’s largest law firm by revenue to Linklaters, and finalising its partnership restructuring plan, Clifford Chance has moved on with the election of 17 lawyers to partnership. The new partners are based in various locations throughout the global network, including five in the Greater China region. The five new Chinafocused partners include Matthias Feldmann, Matthew Truman and Donna Wacker (located in Hong Kong), Terence Foo and Yang Tiecheng (located in Beijing). Feldmann and Foo are members of the corporate practice group, Truman and Yang focus on finance practice, and Wacker is in the litigation and dispute resolution group. In addition, the firm has promoted two of its mainland-based lawyers to counsel: corporate lawyer Glen Ma in Shanghai and finance lawyer Maggie Lo in Beijing. Promotions were effective from August 2009 and will increase the firm’s global partnership numbers to 587. In February, Clifford Chance revealed its plan to reduce the size and shape of its partnership, with the restructuring reportedly shrinking the firm’s global partnership number by about 15% by early 2010.

高伟绅大中华区晋升五位合伙人

在完成制定其全球合伙人架构改革计划后,高伟绅 于近日在全球范围内晋升了17位合伙人,包括大中华 区的五位律师。 此次在大中华区新提拔的合伙人为香港办公室的 Matthias Feldmann, Matthew Truman and Donna Wacker,以及北京办公室的Terence Foo and Yang Tiecheng。他们的专业领域涵盖公司,金融和诉讼 以及争议解决。其他12位新提拔的合伙人均位于亚 洲以外的办事处。 今年二月,该所宣布将在2010年初前将全球合伙 人团队缩减15%。上月,高伟绅宣布上一财年业务总 收入下滑5%,年利达从而超越其成为业务收入排名 第一的英国律所。

Mapeles shifts two staff to Hong Kong Offshore firm Maples and Calder has moved two finance partners to Hong Kong to meet an expected increase in the number of deals on Asia’s capital markets. Mark Western and Stacey Overholt have been moved from the Cayman Islands and London offices respectively, to lead the firm’s Hong Kong banking and finance practice. Western will focus on aircraft and asset finance, while Overholt will specialise in capital markets and structured finance matters. “From our experience during the past two or

three months things are definitely looking up. We believe we need more firepower so that when things get back to full blast we will be prepared,” said HK managing partner, Christine Chang. This may be sooner rather than later if recent activity is any indicator. Over the past two months several sizeable capital markets deals have successfully closed. Chinese manufacturer Zhongwang launched a US$1.2bn IPO (the largest HK IPO of the past year) while Bawang’s US$215m and 361 Degrees’ US$280m IPOs will raise in excess of HK$4bn.

Maples强化香港团队

离岸律师事务所Maples and Calder 近日将两位 金融合伙人从伦敦和开曼群岛调往香港办公室,以 壮大在当地日益忙碌的业务团队。此次被调往香港 的合伙人为Mark Western 和Stacey Overholt, 他们将领导该所在香港的金融和银行业务的发 展。Western的专业特长在于飞机融资和资产融资, 而Overholt则擅长于处理资本市场和结构性融资类 事务。该所香港管理合伙人Christine Chang 表示:” 从我们在过去两、三个月的业务情况看,香港市场正 在复苏,因此我们需要提前做好准备并壮大在当地 的团队,以满足可能将迅速增长的法律服务需求。 Chang的预测并非没有根据。自今年六月以 来,Maples and Calder 已经参与了一些大型上市 融资项目,包括中旺融资额达12亿美元的IPO, 霸王 以及361度的上市项目等等。

Read the latest issue of ALB online at www.legalbusinessonline.com

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ISSUE 6.8


NEWS | deals updates >>

Equity Capital Markets List China July 16 - August 12, 2009 NB: Does not include transactions valued at less than than US$10m, best efforts transactions and private placements Issuer

Proceeds (USDm)

Currency

Bookrunner(s)

Sector

China State Constr Engineering

7342.7

CNY

China International Capital Co

Industrials

Everbright Securities Co

1604.8

CNY

Orient Securities

Financials

BBMG Corp

883.6

HKD

Macquarie UBS JP Morgan

Materials

Renhe Commercial Holdings Co

720

HKD

UBS

Real Estate

Xinxing Ductile Iron Pipes Co

513.9

CNY

UBS

Materials

Guangdong Midea Elec Appl Co

436.1

CNY

China Intl Trust & Investment

Consumer Staples

China Yurun Food Group Ltd

341.4

HKD

Morgan Stanley Union Bank of Switzerland

Consumer Staples

Sichuan Expressway Co Ltd

263.5

CNY

China Galaxy Securities Co

Industrials

Zhejiang Xinan Chem Indl Grp

196.1

CNY

China Intl Trust & Investment

Materials

Lonking Holdings Ltd

135

USD

Bank of America Merrill Lynch

Industrials

Trina Solar Ltd

129.4

USD

Goldman Sachs Credit Suisse

High Technology

Tianrun Crankshaft Co Ltd

122.9

CNY

Guosen Securities

Industrials

China Dongxiang(Group)Co Ltd

110.1

HKD

Deutsche Bank JP Morgan

Consumer Products and Services

Shanghai SK Petroleum & Chem

107.5

CNY

China Euro Securities

Industrials

Fuqi International Inc

104.4

USD

William Blair & Co

Consumer Products and Services

Harbin Electric Inc

100

USD

Roth Capital Partners Inc

Energy and Power

Accelink Technologies Co Ltd

93.7

CNY

GF Securities

High Technology

Hangzhou New Century Info Tech

45.1

CNY

Guotai Junan Securities

High Technology

China Green Agriculture Inc

28.8

USD

Roth Capital Partners Inc

Consumer Staples

Multi Sports Holdings

24.1

MYR

AmInvestment Bank Group

Consumer Staples

CHINA

Debt Capital Markets Transactions China July 16 - August 12, 2009 NB: Does not include transaction valued at less than USD100m Issuer

Proceeds (USDm)

Currency

Bookrunner(s)

Sector

ICBC

5855.8

CNY

CITIC Securities BOC International China International Capital Co Goldman Sachs Credit Suisse

Financials

China Construction Bank Corp

2927.6

CNY

CITIC Securities

Financials

China Yangtze Power Co Ltd

512.3

CNY

Huatai Securities

Energy and Power

China Shipping Dvlp Co Ltd

439.2

CNY

Bank Communications

Industrials

China Power Finance

439.2

CNY

Bank Communications

Energy and Power

Yangzhou City Constr Invest

292.8

CNY

China Galaxy Securities Co

Industrials

Shanxi Commun Constr Dvlp

292.8

CNY

China Securities Co

Industrials

Inner Mongolian Baotou Steel

146.4

CNY

China Everbright Bank Agricultural Bank of China

Materials

China Development Bank

146.3

CNY

Hongkong & Shanghai Bank Bank of China Standard Chartered Bank

Financials

Zhejiang Commun Invest Grp Co

146.3

CNY

China Everbright Bank

Financials

Shang Yu Water Treatment Dvlp

117.1

CNY

Credit Suisse

Energy and Power

United Rural Cooperative Bank

117.1

CNY

CITIC Securities

Financials

Shanghai Shen Jiang Coast

102.5

CNY

Guotai Junan Securities

Industrials

CHINA

www.legalbusinessonline.com

31


FEATURE | ALB In-House 10 >>

CHINA

In-house This year’s In-House 10 feature shines the spotlight on top-performing departments in large domestic companies – all which are either listed companies or parent companies of listed subsidiaries.

China Telecom Sector: Telecommunications and information services Ranking: 263 in 2009 Fortune Global 500

2009 ALB China Law Awards winner

►► ALB in-house 10

32

Company

Head of legal

China Telecom

Zhang Jianbin

Industrial and Commercial Bank of China

Zhang Wei

China Life Insurance

Zheng Yong

GD Midea Holding

Zhang Chengming

Ping An Insurance (Group)

Yao Jun

Shanda Interactive Entertainment

Thomas Yih

China Construction Bank

Cheng Meifen

China Petroleum & Chemical (Sinopec)

Shao Jingyang

China Southern Airlines

Chen Weihua

Sinochem International

Liu Wenzhao

Department manager: Zhang Jianbin Legal department: Seven in-house lawyers headquartered in Beijing, headed by Zhang Jianbin, with more than 300 in-house lawyers in 31 provincial and municipal branches The department has established unified communications and cooperation, including fixed arrangements such as monthly teleconference, annual research program, annual cross-training program, and a sharing website. Flexible arrangements like temporary transfer of lawyers according to work requirements also exist, ensuring efficient sharing of internal legal resources. Expertise and experience: Covers both traditional legal department duties, such as contract review, litigation, and IP rights, and tailor-made legal services to the telecommunication and information services business.

The team has also been involved in the company’s capital market and M&A activities, centring on compliance and risk management, increasing the team’s experience in corporate legal practice as the company’s business and operations grow in scope and sophistication. Biggest challenge: The main challenge comes from the company’s business expansion in overseas markets. Increasing exposure to different jurisdictions requires a higher level of expertise and skills Recent notable activity: The team has played an important role in China Telecom’s US$15.8bn acquisition of China Unicom’s CDMA business, both as in-house counsel and as the transaction team’s organiser and coordinator. Consisting of a business transfer in relation to CDMA subscribers in 31 provinces in China and related assets transfer relating to a complex CDMA network and share transfers, the transaction involves listed companies China Unicom and China Telecom, which added complexity. With the assistance of external counsel (Linklaters and Jingtian & Gongchen) and leveraging of the legal team’s indepth knowledge of the business and industry, the team not only provided high-quality legal services to internal clients, but ensured the smooth and orderly progression of the transaction. ISSUE 6.8


FEATURE | ALB In-House 10 >>

Industrial and Commercial Bank of China Sector: Banking and Finance Ranking: World’s largest bank by market value, ranked 92  in 2009 Fortune Global 500 2009 ALB China Law Awards winner

Department manager: Zhang Wei Legal department The headquarters’ legal department was established in 1996. It currently employs 38 legal staff in six teams, including four focusing on compliance and contract review, one for dispute resolution and one for general management and coordination. Expertise and experience: The legal department has played an important role in ICBC’s progress on globalisation, assisting the company in listings overseas, opening branches in important markets and acquiring shares in foreign banks. The department has helped the bank keep risks and losses to a minimum during the GFC, and provided strong support to the bank’s innovation and business development areas. In 2008, legal teams from headquarters and branches issued more than 160,000 legal opinions, provided over 240,000 solutions to prevent and control risks, and participated in more than 20,000 negotiations (over 50,000 hours). In terms of dispute resolution, the department handled more than 20,000 litigation and arbitration cases. Based on in-depth research on customer complaints and leveraging the expertise of international banks, the department established its customer complaints management policy. ICBC is the first domestic bank to do this. Top three responsibilities: Compliance, managing and handling litigation cases, internal authorisation and customer complaint management. Top three practice areas: Overseas investment and M&A; crossborder syndicated loans and project finance; and other innovative finance products and services, including online www.legalbusinessonline.com

banking, assets trust and management. Top three outsourced practice areas: Cross-border M&A, cross-border syndicate loans, debt litigation, and arbitration. Most-used domestic/international firms: Linklaters, Davis Polk & Wardwell, Allen & Overy, King & Wood, JunZeJun, Global Law Offices. What are your main criteria when selecting external firms? Professional ethics and conduct, diligent and responsible working attitude, and excellent technical skills combined with great attainments in specialised areas. Biggest challenges: With ICBC becoming an increasingly global bank, the legal departments are facing many new challenges. In-house counsel have to understand the legal environment and regulatory framework of each jurisdiction the bank operates in, and ensure that it complies. Legal departments must assist the bank to manage an increasingly sophisticated array of multi-jurisdictional legal risks and issues, and prevent a legal matter in any jurisdiction from developing into a worldwide public relations crisis. Recent notable activity: Establishing overseas branches and subsidiaries in important global markets, such as New York, Sydney, Moscow, Doha and Dubai. US$5.6bn acquisition of a stake in Standard Bank, the largest bank in South Africa. Takeover of PT Bank Halim Indonesia. US$583m acquisition of Seng Heng Bank in Macau. Restructuring (A-share and H-share IPOs) of ICBC, which is the the largest IPO in the world to date, raising US$21.9bn.

China Life Insurance Sector: Insurance Ranking: 133 in 2009 Fortune Global 500 Department manager: Zheng Yong, general manager, legal and compliance affairs, Department of China Life. He is also arbitrator of the China International Economic and Trade Arbitration Commission.

Legal department: Established in 2003, there are 19 staff: thirteen are qualified Chinese lawyers, however, none have international qualifications and experience. There are five divisions: litigation/ arbitration affairs, corporate affairs, compliance affairs, insurance policy, and connected transactions management. Expertise and experience: Everyone has legal education backgrounds and legal experience. Top three responsibilities: 1. Drafting, reviewing and commenting on legal documentation, participate in business projects and provide quality legal advice on all arrangement entered into by the company. 2. Dealing with litigation and arbitration relating to China Life. 3. Prepare documentation for setting up and implementing the compliance framework platforms, review and update compliance standards, improve the compliance system to ensure its effectiveness and appropriateness to the business needs. Top three practice areas: Corporate, compliance and litigation. Top three outsourced practice areas: Corporate, M&A and litigation. Most-used domestic/international firms: King & Wood, Debevoise & Plimpton and Freshfields, Bruckhaus Deringer. What are your main criteria when selecting which external firms to use? Quality, efficiency and charging standards. Biggest challenges: How to adapt ourselves to new situations, in particular after the amended Insurance Law comes into effect from 1 October 2009. Also, how to provide high-quality and efficient legal services to our company.

“In-house counsel have to understand the legal environment and regulatory framework of each jurisdiction the bank operates in, and ensure that it complies ” Zhang Wei, ICBC 33


FEATURE | ALB In-House 10 >>

GD Midea Holding Sector: Electrical equipment/ appliances Ranking: One of the world’s largest home appliance makers

Department manager: Zhang Chengming Legal department: Midea’s legal centre was set up in December 2005 and initially had less than 10 lawyers. In late 2006 Zhang Chengming was appointed as head, to clarify its duties, strategy and body. Now, the in-house department has 23 lawyers based in three different offices over three departments: Chinese affairs, overseas affairs and IP matters. Expertise and experience: The team recently finalised the “Contract Template Project” to formalise various transactions, reduce transactional risks and increase efficiency. A legal management system (similar to legal ERP) was designed, comprising various sub-systems such as contract management, dispute management, trademark management, and E-Archive. LMS is adaptive to various needs and has greatly improved efficiency of the legal centre. The legal team has compiled a list of leading lawyers and firms who specialise in a wide range of practice areas, enabling lawyers in different places to work as an integrated team. Has the legal department role changed? The legal centre has been expanding its practices from disputes settlement to legal risk management. Our lawyers are trusted partners of business units. Biggest challenges: Helping our colleagues from the business units to understand the legal risks in daily business. In fast-growing companies legal risks are easily neglected. Another major challenge is to keep building the capability of the in-house legal team to support the company, which is one of China’s largest homeappliance conglomerates and has over fifty subsidiaries, some which are listed companies. Also, making sure all inhouse lawyers from different offices work effectively.

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Recent notable activity: Issuance of US$48m worth of new shares. To increase production capacity, acquisition of a stake in Hefei Rongshida Laundering Equipment Manufacturing and Wuxi Filin Electronics Investments in Thailand and Vietnam.

Ping An Insurance (Group) Sector: Insurance and financial services Ranking: 141 in 2009 Forbes Global 2000 Department manager: Yao Jun, chief counsel. Yao’s practice focuses on securities, IPO and corporate restructuring. Legal department: The legal department was established in 2004, as of June 2009 there were over 200 legal professionals now employed in the department. The legal department operates under the directional expertise of Yao. There is a legal office in all sectors to deal with matters, with four legal branches: insurance group, banking and securities, PE investment, IP and labour Expertise and experience: Sixty-seven per cent of in-house lawyers passed the Chinese judicial exam, and 35% have a Masters degree in law. More than 50% of legal staff have over five years experience working within a legal department. Top three responsibilities: 1. Avoiding legal liabilities: risks involving the introduction, sales and maintenance of new insurance products, claims and recoveries. Investments, collaborations, mergers and acquisitions. Handling risks within agent and staff management, disclosure of confidential information, intellectual property rights (IPR) and security breaches. Ensuring that operating procedures and penalties are in line with governing regulations. 2. Protect company interests: protecting Ping An’s IPR and litigation. Reviewing contracts and legal documents to avoid losses, listing, mergers & acquisitions, issuance of shares or debentures,

strategies and asset restructuring. Equity arrangements such as drafting legal provisions protecting corporate interests. 3. Promote management standards: enhancing level of corporate governance. Review and ensure the legitimacy of company’s strategic decisions. Provide legal training and advocacy to increase awareness of aligning with company law. Top three practice areas: Claims (control and prevention of legal risks), legal assessment and support for new practices and products, private equity investment projects (PE). Top three outsourced practice areas: Agent litigation cases, construction, infrastructure and PE investments require specialist legal advice. Wealth management and trust require specialists’ advice to ensure it operates in alignment with the changes within the government treasury. Most-used domestic/international firms: Infrastructure – Jun He Law Offices; Property – Zhong Lun Law Firm; Domestic acquisition – DeHeng Law Offices; Foreign acquisitions – Kaiwen, DLA Piper. Main criteria when selecting which external firms to use? Litigation experience, potential of team, the influence of lawyers and the firm, reasonable charges, and history of dealings with Ping An. Biggest challenge: To be able to choose a dynamic legal team and how to manage them. Recent notable activity: Viewing and adjusting the requirements of systems and operations, processes, documents and terms according to the revised Insurance Law. Claims, the control and prevention of legal risks. The recent acquisition of a stake in Shenzhen Development Bank.

Shanda Interactive Entertainment Sector: Interactive entertainment media Ranking: One of the largest operators of online games in China

ISSUE 6.8


FEATURE | ALB In-House 10 >>

Department manager: Thomas Yih Legal department: Shanda’s legal department has been operating since the company’s inception. At present there are 13 legal staff. Expertise and experience: Each of the senior members of the legal department has over six years experience in practice, including with private firms and in-house. Top three responsibilities: Primarily to advise the company with respect to legal issues surrounding the company’s development. Top three practice areas: Capital markets, M&A, regulatory. Top three outsourced practice areas: Capital markets and intellectual property. Most-used domestic/international firms: Davis Polk & Wardwell, Jade & Fountain. Has the role of the legal service market changed? Due to the high volume of Chinainitiated transactions, competition with firms competing for clients has increased. I think companies are considering law firms based on both the breadth of their practice areas and their expertise. Biggest challenge: Recruitment – we continue to seek high-quality lawyers for our various businesses. Recent notable activity: Tender offer for 51% of the outstanding equity of Hurray. $175m convertible bond and accelerated share re-purchase plan in 2008. Sale of preferred stock to consortium of international investors of a subsidiary of the company.

“Effectively identify business development initiatives and legal risks and the effective solutions for problems Cheng Meifen, CCB www.legalbusinessonline.com

China Construction Bank Sector: Banking and finance Ranking: 125 in 2009 Fortune Global 500

Department manager: Cheng Meifen Legal department: CCB’s legal department was officially established in 1999. In June 2008, the department underwent major restructuring. The department was upgraded to the legal and compliance department and incorporated three more functions, including anti-money laundering, risk management and related-party transactions. There are 48 staff in the headquarters’ legal department, and there are more than 1000 full-time legal staff working in the whole system. Experience and expertise: CCB held second place in the 2009 toplisted company for risk management rankings. These rankings were jointly conducted by Peking University Financial Law Research Centre and China National Radio Station. Top three responsibilities: 1. Management of all legal affairs, such as disputes, intellectual property management and non- contentious work. This includes reviewing and improving internal policies and regulations, drafting legal documents and important contracts, providing legal support to research and development for new products, and advising on major transactions and projects. 2. Ensuring the company is compliant with all relevant law and regulations, which includes supervision of the implementation of internal and external audit, and finding and solving issues that arise from auditing. Manage and coordinate related-party transactions and internal transactions of the whole bank, and lead the anti-moneylaundering programs. 3. Authorisation management – this is the legal staff who are able to take the lead in handling work authorisations.

Most-used domestic/international firms: Jingtian & Gongcheng, King & Wood, Commerce & Finance Law Offices, Beijing Dali, Allen & Overy (UK), Freshfields Bruckhaus Deringer (UK), Sidley Austin (US), Herbert Smith (HK). Has the role of the legal service market changed? The most important criterion of all, I think, is the support and trust you receive from involved parties. The success of the business legal department depends on its ability to risk manage, including the following aspects: 1. Effectively identify business development initiatives and legal risks and the effective solutions for problems related to legal issues, 2. Will the department assist businesses in drafting clear and concise contracts that align with legal rules and regulations, and note the clear rights and obligations of parties that guard interests? Also, can the legal department help reduce potential ambiguities and controversies for future business operations projects, and lay a solid foundation for business product marketing? 3. Whether we can effectively resolve significant legal risks and properly handle major disputes, to ensure the safety of the bank’s assets and maintain a good reputation as a listed company, 4. Can the legal department promote the bank’s involvement in legally compliant activities and operations, and uphold strict compliance with external regulatory requirements, to prevent and reduce the risks of money-laundering and related transactions? Biggest challenges: Since the fourth quarter of 2008, many policies were introduced by the government to accelerate economic growth and expand domestic demand. Commercial banks are encouraged to provide loans to business, but it adds more difficulties for the legal department to control risks and ensure compliance. At the same time, to make sure the business’s growth is sustainable. The current market conditions have put the department’s skills and ability to balance risk management and business development to the test. The GFC has also reminded every financial institution that it’s crucial to prevent and eliminate risks when innovating new products

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FEATURE | ALB In-House 10 >>

and finance structures. This requires the department to be more involved in the process of product innovation, provide stronger support to R&D units, better protect intellectual property rights and work more closely with business units to control risks and avoid any potential disputes and losses. Recent notable activity: US$70m acquisition of AIG Finance, a wholly owned subsidiary of AIG in Hong Kong. Issuance of US$2.9bn worth of subordinated bonds. Bank of America’s sale of US$7.3bn of H-shares in China Construction Bank.

“Another major challenge is to keep building the capability of the in-house legal team to support the company” Zhang Chengming, gd midea holding

China Petroleum & Chemical (Sinopec) Sector: Oil and gas Ranking: 9 in 2009 Fortune 500

Department manager: Shao Jingyang Legal department: The company has established general counsel in both its headquarters and 75 important subsidiaries. It formed a large in-house team with 31 legal counsel located in headquarters, and 1,375 counsel located in subsidiaries. The department has a strict job division for each position, defined in terms of legal coverage, business area, jurisdiction and clients. Each member plays a major role assisting others to build a team matching the status of Sinopec.

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Expertise and experience: In 2008 the legal team assisted by providing more than 104 contract projects for the business, including overseas investment, Chinese/foreign joint ventures, and M&A transactions. More than 100 legal opinion letters were issued and headquarters drew up and implemented the following policies: Objectives of Sinopec Legal: 2008-2010; and Legal Risk Management Report of Sinopec in 2008. The legal team carried out work on risk analysis and evaluation systems, and strengthened legal risk prevention mechanisms. In terms of litigation and enforcement, the team directed and handled 82 law suits at home and abroad, and co-rodinated the solutions of 2,168 trade infringement cases. The department also contributed in shaping new legislation by taking part in 18 national legislation researches in 2008, giving over 60 legal opinions. Top three responsibilities: Analysed and collated 56 domestic joint-venture projects and 12 overseas investment projects, resulting in 12 legal theses and six solutions, respectively. There were 207 forms of standardised contracts in eight categories developed. Actively built up the licenses and certifications management for information technology systems and contract management IT systems. Training scheme: The legal department is very active in sharing its knowledge and experience with peers and colleagues. It has developed 42 special-topic PowerPoints and provides professional training to more than 1,200 people, including the general counsel of subsidiaries, heads of legal affair organisations, in-house counsel, and contract managers. The department also gave lectures to business people to spread legal knowledge and create a legal culture. Most-used domestic/international firms: Guantao, Haiwen & Partners, Grandfield, Jones Day, Herbert Smith. Recent notable activity: US$8bn takeover bid for Addax Petroleum, a publicly traded company on both the Toronto and London stock exchanges. US$1.9bn acquisition of Toronto-listed Tanganyika oil. Sinopec and CNOOC joined forces to buy assets in Trinidad and Tobago from Canada’s Talisman Energy, for around US$315m.

China Southern Airlines Sector: Aviation Ranking: 1084 in 2009 Forbes 2000

Department manager: Chen Weihua Legal department: China Southern Airlines is the world’s seventhlargest airline and the biggest in Asia by fleet size. In the same year when the company was listed in Hong Kong and New York, its in-house legal team was formed. At that time, the team consisted of four members, with Chen as the deputy director. In 2003, in accordance with regulatory requirements, a legal department was established, employing 17 staff. Chen was promoted to general counsel and general manager of the legal department that year. The department currently employs 30 legal staff in four teams, responsible for contract and risk management, litigation and arbitration, and international affairs respectively. Expertise and experience: In 2006, Chen was awarded the “top-ten general counsel of central-level SOEs” by the State-owned Assets Supervision and Administration Commission of the State Council (SASAC). In 2008, the department handled 119 disputes and non-contentious legal matters, avoiding economic losses of about RMB140m. It was also awarded “top-ten legal departments of centrallevel SOEs” by the SASAC. Top three responsibilities: 1. Providing legal advice for major business decisions, and ensuring the legitimacy and compliance of risk control and management 2. Responsible for managing all commercial contracts of the company and reviewing major contracts 3. Management of all litigation and arbitration cases Most-used domestic/international firms: Allen & Overy, Norton Rose, Herbert Smith, DLA Piper, King & Wood, Run Ming, Zhong Lun W&D, Guangdong Z&T. What are your main criteria when selecting external counsel: ISSUE 6.8


FEATURE | ALB In-House 10 >>

“As the company expands scope and enters new markets, we increasingly need advice from external counsel” Liu Wenzhao, Sinochem Costs, qualify of service, professional standards, and communication skills. Has the role of the legal service market changed? The development of the market has been rapid in the past few years, moving towards a more standardised and comprehensive direction. As a result, the market is more competitive and, therefore, the cost of legal services is also becoming more reasonable. In recent years, great changes have been made to the legal systems of the aviation industry. CSA has shifted its functions in three ways: 1. From handling mostly legal disputes to risk management. Work now places an emphasis on prevention-oriented management, 2. The legal department shifted from a passive role to active management. In 2004, an electronic system in contract management was established and used as a company-wide platform, 3. Work within legal risk-prevention extended to a more comprehensive form of risk management. In 2006, CSA began to build a company-wide risk management function for all aspects and standard risk management processes were established to ensure coordination. Biggest challenges: The main challenges for us lie in shifting from traditional legal work to comprehensive risk management, and integrating the in-house legal function into the business. Recent notable activity: Recruitment of new flight attendants and self paying pilot recruitment projects, sales of Airbus A300, MD-82 and MD-90, and introduction of the Boeing 787 and Airbus 380. www.legalbusinessonline.com

Sinochem International Sector: Chemicals Ranking: its parent, Sinochem Group, ranked 170 in 2009 Fortune Global 500 Department manager: Liu Wenzhao Legal department: Officially established as a separate functional department in 2004, inhouse legal counsel was permanently appointed in 2008, based in Singapore. Currently employs 10 staff due to Sinochem’s international business expansion. Expertise and experience: In recent years, the legal department’s role has gone through significant changes. The functions and depth of the department’s involvement in business processes, particularly in business development, investment decision making, strategic planning and risk management, are more prominent. As the company expands scope and enters into new markets, we increasingly need assistance and advice from external counsel who are familiar with overseas jurisdictions, markets and legal environments, and who have extensive expertise in specialised areas. Top three responsibilities: 1. Risk prevention – contract review, control and management of risk, legal training. 2. Legal remedies – default warning, reconciliation, negotiation, arbitration. 3. Managing investment projects – M&A, due diligence, cooperate governance. Most-used domestic/international firms: Jones Day, Baker & McKenzie, Jun He Law Offices, Tianyuan, Zhenghan Law Firm. What are your main criteria when selecting external counsel? Professional ability, language proficiency, cost-effectiveness and reputation. Has the role of the legal service market changed? A good legal department is trusted and respected within the company, and has significant influence on investment decision-making processes.

It is also able to improve the company’s awareness of the rule of law and enhance regulatory compliance. Competition is fierce, but the quality of services provided by different firms varies. Legal professions are increasingly specialised in particular areas and many firms are focusing on development in high-end practice areas. As the legal industry becomes more sophisticated, the importance of using professional tools, such as knowledge management, industry statistics, market intelligence and legal databases is becoming more prominent. Biggest challenges: How to effectively manage an evergrowing IP portfolio and protect the company’s intellectual property rights in domestic and overseas markets remains a challenging task. Another challenge lies in managing risks and protecting the company’s interests and rights in the domestic legal framework. Managing the differences between domestic and international legal practices and help senior management understand the differences is also a challenge for us. Recent notable activity: In 2007, an agreement to acquire a 28% stake in Jiangshan Nantong Pesticide Chemical. In 2008, through a wholly owned subsidiary of Sinochem International (Singapore) Ltd, tendered an offer for a 51% stake of SGX-listed company GMG Global Ltd. Also, winning a four-year crossjurisdiction legal case against Malaysia International Shipping Corporation.

In-house

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FEATURE | Anti-Monopoly >>

Climbing the learning

curve F

At the twelve-month anniversary of the Anti-Monopoly Law’s effective date, ALB China investigates how AML practices have developed during the year.

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or many new practices and businesses, the first year is usually the most difficult one. However, it’s not entirely true when it comes to law firms’ antitrust practices, which have seen demand for services and advice going up ever since the country’s Anti-Monopoly Law (AML) took effect on 1 August 2008. During the first year of the new regime’s existence, much has been accomplished but more remains to be done. In terms of the legal framework, a series of implementing measures and guidelines have been issued. Some landmark decisions have been made under the regime, while many more are yet to be finalised and promulgated. Law firms have been actively advising clients on merger control and compliance with the new law, but haven’t tapped into the practice’s full potential yet. A number of international firms are enjoying a head-start, as they have established an anti-trust/competition practice in major jurisdictions, such as the EU or US. Leading the pack is magic circle firm Freshfields Bruckhaus Deringer. The firm’s China offices started working on merger control provisions for its foreign clients back in 2003. Its China anti-trust, competition and trade (ACT) practice was formally set up when it transported London ACT practice partner, Alex Potter, to Beijing in November 2007, on the back of the introduction of the new law. In March this year, Beijing-based ACT counsel Michael Han was elected to partnership. The firm’s ACT team currently consists of ten members, led by three partners: Connie Carnabuci in Hong Kong and Nicholas French and Michael Han in Beijing. “We saw China as a strategically important part of our global ACT practice, and the new AML regime is developing rapidly, so it’s sufficiently important for us to have partners on the ground and stay at the forefront of the developments,” says Nicholas French, a London-based ACT partner seconded to Beijing recently. He replaces Alex Potter, who headed back to London after 18 months in Beijing. ISSUE 6.8


FEATURE | Anti-Monopoly >>

“Our strategy is to combine our international expertise and experience with local expertise and knowledge … because although the law is very similar to that of Europe, there are some significant differences.” Since Freshfield’s China ACT practice team was set up, it has seen a steady stream of merger control work, including representing the target company in the high-profile US$2.4bn Coca-Cola/Huiyuan deal. This was the first transaction blocked under AML. At the same time, the firm has been instructed by many multinationals to provide compliance services and train legal and business staff. In addition, large PRC companies that are investing overseas also increasingly turn to Freshfields for antitrust and competition advice in other jurisdictions. At the moment, it is advising China Air on its US$825m acquisition of an additional stake in Cathay Pacific, from CITIC Pacific. A team led by partners Alan Ryan and Michael Han is working closely with the corporate team on the deal, handling competition issues. A number of other international firms have also relocated partners and senior associates from Europe or the US to build up their anti-trust/ competition capacity. Linklaters, for example, relocated Swedish partner Erik Söderlind to Hong Kong last September, to become the first head of competition and antitrust in Asia. Last April, Lovells’ competition law specialist and counsel Kirstie Nicholson moved from Brussels to Shanghai in response to an expected influx of competition-related work. For many domestic firms, the AntiMonopoly Law has transformed what was once an ancillary activity into a distinct practice area. Before the AML was introduced, many law firms, particularly those with a strong track record in large cross-border M&A transactions, had already started handling merger control filings for their foreign clients before The Ministry of Commerce (MOFCOM). Now, they are building a stand-alone AML practice on the foundations they have already laid. Domestic M&A www.legalbusinessonline.com

powerhouse legal firm Commerce & Finance Law Offices has set up an AML group consisting of several partners and 10 associates. The group has handled many influential concentration notification filings. Two recent highlights include advising on Chinalco’s US$19.5bn investment into Rio Tinto and China Eastern Airlines’ acquisition of Shanghai Airlines. “We plan to grow our AML group in the earn future as compliance demand is increasing dramatically,” says Zhang Xinyang, an experienced AML lawyer at the firm. “The big challenge for a majority of the domestic firms to develop an AML practice, is that there is a lack of experienced specialists in the market. With more cases handled and [when] more precedents become available, this will change step by step,” says Zhang. “As for our firm, the biggest challenge now is how to collect [the] enormous underlying data and evidence, quickly and economically, as clients always have limited resources and abilities.”

Landmark cases

For firms that are interested in establishing an AML practice, the first 12 months of the regime is an interesting, important and foundationbuilding year. Over the past year, several key implementing rules and guidelines have been issued to provide guidance on how AML will be applied. More importantly, there have been three decisions published by the MOFCOM that will set a certain degree of precedent for future merger control practice. “It’s been interesting in observing a very limited number of decisions that have been published,” says Freshfield’s French.

“The three published decisions illustrate that MOFCOM will enforce vigorously under the AML and show that the enforcement agency has become more sophisticated. There are mixed signs, and certainly include some good signs,” he adds. “Development is all directionally right, giving us an idea of the role that MOFCOM will be playing. It’s clear that MOFCOM requires a lot of information for merger control filings and it takes things very seriously, but it takes a flexible and creative approach to remedies,” he says. Leading domestic firms, such as Jun He Law Offices, share the same perspectives with their international counterparts. Jun He’s lead partner in their AML practice group, Janet Hui, sees the decisions are milestones in the developing history of the AML, with significant impact on foreign companies investing in China as well as M&A law firms. “After the three decisions were announced, AML has quickly become a very critical issue to the completion of major transactions,” says Hui. “If a firm doesn’t have the expertise and skills in handling antitrust and competition issues, it may well face the possibility of losing a client that is looking to do a large M&A transaction, for example.” “The need for a competent domestic firm to handle merger control filings is particularly important, because international firms can’t file notification before MOFCOM.” Jun He Law Offices has advised clients in many merger control filings, however, it has experienced a slight drop in the number of filings handled this year, mostly due to the effect of the

“As for our firm, the biggest challenge now is how to collect [the] enormous underlying data and evidence, quickly and economically, as clients always have limited resources and abilities” Zhang Xinyang, Commerce & Finance 39


FEATURE | Anti-Monopoly >>

The new precedents From 1 August 2008 to the end of June 2009, MOFCOM received more than 100 concentration notification filings, 69% which involved foreign companies. MOFCOM accepted 58 of the filings and 46 reviews have been completed. Under AML, MOFCOM is obliged to publish decisions blocking transactions or imposing conditions, but not other clearance decisions. Only three decisions are available:

InBev and Anheuser-Busch

On 18 November 2008, MOFCOM approved (with conditions) InBev’s US$52bn acquisition of AnheuserBusch (AB). This is the first published decision since the AML became effective, observing that it is a significant consolidation and that the competitiveness of the new enterprise will be increased. The decision notes the transaction will give the parties a large combined market share. In order to reduce possible adverse effects on future competition in the Chinese beer market, MOFCOM required InBev-AB to obtain its consent before implementing certain transactions in China. “The InBev decision provides a valuable

Coca-Cola and Huiyuan

previously in Australia. In 2003, the Australian Competition and Consumer Commission (ACCC) opposed the acquisition of Berri Ltd by Coca-Cola Amatil, the Australian Coca-Cola bottler and partly-owned affiliate of The Coca-Cola Company. In both cases, the regulator’s major concern was that Coca-Cola would gain the ability to leverage a dominant position in the carbonated soft drinks market into the juice market. “This will always be a difficult case and the reasonings adopted by MOFCOM are classic reasonings of [worldwide] competition authorities with similar cases,” Cox states. “It clearly shows that AML and competition law has come of age.”

Mitsubishi and Lucite

MOFCOM accepted the proposal provided by the parties. “The remedies are quite creative,” says Nicholas French, partner of Freshfields. “It provided significantly more details than prior decisions and is considered a more valuable precedent for future acquisitions in China,” says Jun He Law Offices partner, Janet Hui.

On 18 March 2009, MOFCOM blocked Coca-Cola’s proposed US$2.4bn acquisition of Huiyuan in the first prohibition decision adopted under the AML. It was a high-profile case watched closely by the business and legal communities. There are grave concerns about this decision, mainly because the reasonings in it were very general, and the transaction involved a well-known multinational company and a famous national brand. DLA Piper’s Asia head of competition practice, David Cox, points out that the ruling adopted by MOFCOM on Coca-Cola’s acquisition of Huiyuan is similar to a decision made

On 24 April 2009, MOFCOM announced the conditional approval of Mitsubishi Rayon’s US$1.6bn acquisition of Lucite International Group. This is the first decision requiring parties to divest a portion of their production capacity as a condition of approval. 40

insight into how MOFCOM is likely to approach future transactions,” said Mallesons Stephen Jaques partner, Martyn Huckerby, a Shanghai-based competition and antitrust lawyer. “” According to Huckerby, the decision is significant because it further emphasises the importance of parties consulting and negotiating conditions with MOFCOM, before and after the transaction, to obtain clearance. “The InBev clearance came at a similar time to the [conditional] US and UK clearances, which suggests that MOFCOM will consider the approach being adopted in other jurisdictions but will reach its decision in a manner that reflects its understanding of the relevant circumstances in China,” he says.

global financial crisis. However, Hui is positive that when more implemented rules are in place and become effective, and M&A activity picks up again, there will be more business opportunities. In addition, Hui’s team has been busy with instructions from clients to carry out compliance reviews and mitigate the risk of being investigated or sued. Currently, eight partners and eight associates in the firm’s Beijing head office dedicate the majority of their time to AML practice. Jun He Law Offices will adjust the size of the team, however, according to client demand.

Changing work balance

In the first year of the AML regime, legal work has been mainly in the context of M&A transactions and merger control. However, antitrust and competition lawyers are anticipating that issues surrounding cartel and abuse of dominant market position will become the main driver of business. These legal issues will be the next focus of development in coming years. “Law firms have been active in merger control areas for several years, as it is a fully formed process,” says Peter Wang, partner in charge of Jones Day’s Beijing office and co-head of the firm’s China antitrust practice. “But development and enforcement on other aspects of the AML, such as cartel and abuse of dominant market position, reminds slow. In the end, these areas will have more impact on foreign companies investing in China and companies operating in China, as well as drive the practice growth.” As international firms are barred from representing clients before Chinese courts, domestic firms have an advantage in developing business in AML-related private litigation. Managing partner of Grandall’s Beijing office, Zhan Hao, believes that domestic firms will play an increasingly important role advising clients on anti-monopoly law enforcement issues. “Advising on matters related to merger control will be only one part of the antitrust practices at PRC firms, in anticipation of a significant increase in litigation under the AML,” Zhan says. “We are also developing expertise and resources in private antitrust litigation, dominance and abusive ISSUE 6.8


FEATURE | Anti-Monopoly >>

conduct investigations and intellectual property-related unfair competition cases,” he adds. Chinese courts have just begun hearing cases under the AML. Some of the current litigation includes Li Fangping and Beijing Netcom, Renren and Baidu, and Beijing Shusheng and Shanda Interactive. Chen & Co is another forerunner firm in AML practice. The firm has considerable experience in handling merger control filings. One of its deal highlights has been advising Zhejiang Supor, an A-share listed company, in accepting a strategic investment and merger offer by France’s SEB Internationale. This is the first foreign M&A transaction to have undergone the complete anti-monopoly investigation proceedings. In litigation, the firm recently advised a domestic website filing a complaint under the AML against search-engine company Baidu for abuse of monopoly position.Although many in the field believe it may take some time

“After the three decisions were announced, AML has quickly become a very critical issue to the completion of major transactions. If a firm doesn’t have the expertise and skills in handling antitrust and competition issues, it may well face the possibility of losing a client who is looking to do a large M&A transaction” Janet Hui, Jun He Law Offices for antitrust work in China to reach its full potential, few will doubt that one day it will become comparable to other major legal markets. “As enterprises continue to grow and expand, the concentration of undertakings will increase, says Lin Zhong, a key partner in Chen & Co’s AML practice group, and head of the international business department.

“With the legal framework continuing to perfect [itself] and the antimonopoly enforcement authorities becoming more experienced, the amount of AML private litigation, investigation and enforcement activity will increase strongly,” he says. “All of these factors will lead China to become another major anti-monopoly jurisdiction.” ALB

Defining Relevant Market: Enterprise Participation Needed

I

n antimonopoly law, the definition of relevant market is the starting point for analyzing competitive behavior. To provide guidance on defining “related market”, the Antimonopoly Committee of the State Council promulgated the “Antimonopoly Committee of the State Council‘s Guidelines for Defining the Relevant Market” (the “Guidelines”) on July 7, 2009. The Guidelines describe the basis, general methods, and key factors for defining relevant market, as well as the “hypothetical monopolist test”. The Guidelines permit authorities to define relevant market using the relevant commodity or geographic market. For matters involving technology transfer, licensing or other IP rights, the authorities may also be required to define the relevant technology market and consider related factors, such innovation ability. The definition of relevant market is often determinative in antimonopoly cases. As such, an enterprise under investigation should always strive to work with authorities to develop the definition. In particular,

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the enterprise is advised to focus on the following points: First, the rate for small but significant and non-transitory increase in price (SSNIP). Because the SSNIP rate has a significant effect on substitutability analysis for like products, it shapes the range of the relevant market. The Guidelines call for antimonopoly authorities to fix the SSNIP rate at five to 10 per cent when using the “hypothetical monopolist test”. However, as the actual rate may fall between these points and may be capable of being determined fairly accurately based on known industry factors, the enterprise should persuade antimonopoly authorities to determine and adopt the most accurate and favorable rate. Second, the source of statistical data. Authorities use myriad sources of statistical data for substitutability analysis. Because the statistical data chosen will affect the results of substitutability analysis, the involved enterprise must identify the types and sources of statistical date favorable to its position and advocate for its use by the authorities.

Firm Profile

Chen & Co

Third, the relationship between assorted balancing factors. Defining the relevant commodity and geographic market requires balancing numerous factors, such as price, use, and trade barriers, among others. Each can have decisive effect on relevant market definition. Therefore, when arguing for a definition of relevant market, the involved enterprise should be prepared to explain the significance of each factor and relationship, if any, between the different factors. Actively participating in defining the relevant market is the surest means for an involved enterprise to ensure a favorable outcome in an antimonopoly case. Dr. Lin Zhong, Partner Chen & Co. Law Firm (瑛明律师事务所) Suite 1901 North Tower, Shanghai Stock Exchange Building, 528 Pudong Nan Road, Shanghai 200120, P. R. C Tel: (8621) 6881 5499 Fax: (8621) 6881 7393/6069 www.chenandco.com

Dr. Lin Zhong

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FEATURE | Shipping >>

Changing tides A drastic fall in international trade and ocean freight rates sees a significant increase in demand for shipping dispute-resolution services from legal firms and top-notch lawyers

L

ike a violent storm bringing challenges to a ship’s captain and crew, the turbulent shipping market is testing specialist lawyers to their limits. The past 18 months has seen trade volumes experiencing the biggest drop in decades, with the global shipping industry going from boom to bust. However, the changing tide has kept shipping practices afloat. “The shipping industry is one of the industries most hit by the global financial crisis, and there have been many drastic changes,” says DLA Piper’s managing partner of the Shanghai office, Roy Chen. “Many clients had no choice but to involve lawyers to rein in deficits and protect their business interests through litigation and arbitration.” Chen, who has 18 years’ legal experience, notes the industry enjoyed a long prosperous period until the GFC affected business in September 2008.

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The recent market collapse, however, has generated much dispute-resolution work for him and the firm. “A large number of disputes will arise when there is drastic fluctuation in the market or the prices tumble very quickly,” Chen states. “Many long-term shipping contracts entered into at the peak of the boom are now causing huge problems, as they are renegotiated and contentious issues come to light.” Compared to a year ago, DLA Piper’s Shanghai office is handling a larger number of litigation and arbitration cases. It is also representing clients in more complex cases with much bigger claims, and involve large numbers of parties across different jurisdictions. “The claims we have submitted in recent months range from US$30m to US$100m. It is quite common now for a case to have a disputed amount over US$30m, which is much more than before,” Chen says.

Most of the international contracts DLA Piper is involved in refer any disputes for arbitration in London, Hong Kong and Singapore, as these cases are increasingly involving crossjurisdictional issues. Clyde & Co is another international firm that has been busy handling disputes out of its Shanghai office, established in 2006. “For the past 12 months, the volume of corporate and investment work has gone down, but the decline in non-contentious work is clearly offset by the sharp peak in dispute-resolution work,” the firm’s Shanghai partner, Ik Wei Chong, says. “When times are really tough, parties and clients are more interested in getting as much money back as they can, even if it is by way of debt collection or arbitration.” Chong’s practice, which focuses on dispute resolution, estimates that the volume of disputes handled by the ISSUE 6.8


FEATURE | Shipping >>

Shanghai office has increased by 50% year-on-year. Disputes where the firm represented local clients have doubled. Leading domestic shipping firms, like Sloma & Co, the winner of ALB’s 2009 China Shipping Law Firm of the Year award, are representing an increasing number of clients settling international disputes. “The dramatic changes in market conditions from the 2007 peak have caused a significant amount of disputes between foreign parties and Chinese companies,” Sloma’s managing partner, Yu Genrong, says. The firm has a particular strength representing foreign clients in maritime and insurance dispute-resolution. According to Yu, the largest increase in disputes has risen from charter party and shipbuilding contracts. In addition to advising foreign clients, Yu notes that the firm has enjoyed a steady stream of legal work from domestic companies. “Domestic legal work is going as normal, because the domestic companies are less affected by the GFC,” Yu says.

Pick your side

Shipping cases usually involve a long chain of contracts with many parties, including financiers, ship owners and operators, shipyards, charterers, insurers and importer/exporters. Each party will need separate legal representation. For example, seven different parties will be advised by seven different legal advisors. “Because of the nature of shipping business, it has generated significant demand for dispute-resolution legal services,” Chen says. “However, due to conflict of interest issues, often a law firm can only represent certain groups of clients in this industry.”

DLA Piper’s Shanghai shipping team focuses on relationships with large, local shipping companies, like China Shipping, COSCO and Sinotrans. As the shipping market has different specialised segments, lawyers have to be equipped with niche legal skills and knowledge to be competent advisors. This is another reason why it’s essential for shipping lawyers to be specialists. “The business and operations of different parties in the shipping industry vary widely, so only a specialised legal advisor can provide quality services,” says the managing partner of Kingfield Law Firm, Zhang Shuzhen.

“Many long-term shipping contracts entered into at the peak of the boom are now causing huge problems, as contentious issues come to light when they are renegotiated” Roy Chan, DLA Piper

Firm Profile

What can a client expect from his maritime lawyer?

A

s maritime lawyers, what we can do for our clients is far beyond litigations and arbitrations. In fact, we participate in almost every aspect and stage of their business, for instance, the risk evaluation/ procedure design before signing the contract and the crisis management during performance. What we provide to our client is actually integrated legal service with the ultimate aim of promoting safety and success of business. Providing such service requires particularly experience in shipping industry and international trade, including such matters as cargo claims, bunker disputes, laytime and demurrage disputes, hire and off-hire claims, ship repair claims, performance warranties, commodity disputes, CIF and FOB contracts, trade finance and documentary credits, cargo policies, haulage and freight forwarding contracts. Kingfield shipping team’s participation in an importer’s negotiation could be a

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good example for the above point of view: a disponent owner sub-let the vessel to an Indian CFR seller. Undoubtedly, the charterer is under an obligation of making payment for the freight. However, rumor indicates that the disponent owner is sticking in a financial crisis. The charterer refused to make payment for fear that the disponent owner will not pay the hire under the time charter party. They have dispute upon demurrage as well. The vessel therefore stopped in the middle way, with losses accruing everyday. In this case, lawsuit is supposed to be the last choice. According to our suggestion, an escrow agreement was finally signed by the parties concerned wherein the charterer agrees to bunk the vessel and pay part of the demurrage to the disponent owner, while the rest of the freight will be kept by the holder of the B/L (who is trusted by both the charter and the disponent owner) on behalf of the disponent owner, and will be paid on provision of the D/O. In this way, all parties’ interests are well protected while the business goes fluently.

Kingfield Law Firm

Jane Zhang

Perry Cai

By Jane Zhang, Senior Partner, and Perry Cai, associate. Beijing Kingfield Law Firm Email: zhangsz@kingfieldlaw.com; caiyw@kingfieldlaw.com Tel:86-10-58156278 Fax:86-10-58156270/71 406, CYTS Plaza, 5 Dongzhimen South Avenue Dongcheng District, Beijing, China 100007

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FEATURE | Shipping >>

Zhang also heads up the firm’s international trade and shipping team, with 10 lawyers. The team is one of the few practices with extensive expertise representing shippers, having advised many well-known trading and import/ export companies, like Sinochem and China Minmetals. Shanghai-based law firm SG & Co, who traditionally serviced international P&I clubs, is now shifting its emphasis to ship finance, shipbuilding and sale and purchase contractual work. “Many shipyards entered into contracts when the shipping market was booming, without paying attention to details and seeking professional legal advice,” says managing partner of the firm, SG Huang. “They now face major disadvantages in litigation and arbitration against their foreign partners, [and] their unfamiliarity and lack of experience with international arbitration procedures also add to their disadvantages.” Damages and losses from the market’s collapse may, however, serve as an expensive and valuable lesson to domestic shipyards and other shipping companies, who don’t know how to use legal means to protect their interests. “We’ve seen opportunities in helping domestic shipyards and ship-owners prevent and manage legal risks. After experiencing the tough times, riding them out and learning from them, more shipyards and ship-owners will increasingly recognise the importance of legal advice in contract negotiations, and the value good legal advisors can add to the business,” Huang says.

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“China has been a main player in [the] international trade and shipping industry, and will continue to be a dominant player for the next decade” Ik Wei Chong, Clyde & Co Sailing forward

The pie of the global shipping legal market is shrinking gradually, mainly due to contracting “wet” work – collisions and casualty. However, many shipping lawyers are positive about what China will offer in the next decades. “Within shipping litigation practice, the last 10 years have seen less major casualty-and-cargo claims, a result of the stricter regulations and enforcement, improved containerisation and new technologies,” says Sloma & Co’s Yu. “Traditional shipping legal practices in some developed countries have stagnated. The shipping industry in China, on the other hand, is young and emerging rapidly as a potent player in the global market. Shipping legal practices will continue to prosper in the next two to three decades at least.” Riding the wave of a boom in the past five years, several shipping-focused firms have experienced strong growth and developed into large, national firms with a network of offices in important port cities. Sloma & Co, for example, has become a full-service firm through its 2007 merger with Shanghai law firm Siway & Seaway.

The firm now has seven partners and 25 lawyers in the shipping practice group, with branch offices in Suzhou, Shenzhen and Berlin. Shipping powerhouse firm Wang Jing & Co now has a large and competent team of shipping lawyers in its Guangzhou head office and branches in Shanghai, Tianjin, Qingdao, Xiamen and Shenzhen. International firms echo this optimism. “China has been a main player in [the] international trade and shipping industry: going forward, the country will continue to be a dominant player,” says Clyde & Co’s Chong. “Currently, the majority of our work is done for clients who are investing and have financial activity overseas, or running into disputes in foreign countries. As Chinese shipping companies become more active in the international market, their need for legal services from international firms will continue to increase.” Domestic shipping firms are looking to expand once the market recovers. As more shipping activity happens, interesting transactions and disputes will arise. China will be the place to be for those shipping lawyers who are looking for excitement. ALB

ISSUE 6.8


Feature | award winners >>

Winner profile Shipping law Firm of the Year: Sloma & Co

W

hen managing partner Yu Genrong accepted the trophy for Shipping Law Firm of the Year, he knew that he and his firm had no time to rest on their laurels. Genrong founded the business as a Shanghaibased boutique shipping firm in 2001, and has developed it into a full-service law firm with branch offices in Suzhou, Shenzhen and Berlin, following the merger with Siway & Seaway in 2007. “We firmly believe that the effect of the combination of the two firms will be far greater than the sum of the two,” Genrong says. Winning the award is recognition of the positive outcome of the merger on Sloma & Co’s shipping practice. The firm now provides clients with a wide range of corporate and commercial legal services, covering banking and finance, foreign investment, real estate and intellectual property, and offers one of the most reputable and comprehensive legal services for shipping circles among domestic firms. Sloma’s shipping group, led by Yu, has seven partners and 25 lawyers. Among them are former in-house counsel from China Shipping Group and China Merchants Group, and a former partner of United States maritime law firm Healy & Baillie (now merged with Blank Rome). Some of Sloma’s partners are also professors of law in major universities in China – Fudan University and Shanghai Maritime University. They have published books and articles in both Chinese and English on various legal topics. Genrong credits the firm’s technical expertise and capacity to operate collaboratively for clients across a number of practice areas and centres. “The combined resources and expertise enables us to advise clients on complex cases and projects, and handle many different issues in different cities at one time,” he says.

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Sloma & Co’s shipping practice group has been involved in a large number of transactions and disputes in the shipping industry, most with an overseas element. The group has a particular strength in representing foreign clients in maritime and insurance dispute resolution. For example, in 2008 Sloma negotiated and completed several hundred-million dollar new shipbuilding contracts, for United States and Greek shipowners with Chinese shipyards. The firm settled five major collision cases, more than 12 cargo-damage defence cases and three maritime arbitration cases. It also advised on some major ongoing cases, including representing several foreign shipowners before Shanghai Maritime Court to defend against three oil pollution claims, totalling over US$10m. Sloma represented UK P&I Club before Wuhan Maritime Court to defend against a large soybean damage case with a dispute amount of US$7m, and advised Chinese shipowners in Hong Kong arbitration concerning a charter party dispute over US$11m. A major Chinese shipowner was represented in Wuhan Maritime Court, seeking indemnity against a major steel corporation for pre-loading steel product damages, worth over US$10m. In the first six months of 2009, Sloma experienced a reduced demand for corporate and transactional legal services as a result of the global financial crisis, but reported a surge in the number of shipping dispute-resolution instructions. “The international shipping industry has been hard hit by the global financial turmoil, because of waning demand from trade. The dramatic changes in market conditions from its 2007 peak have caused a significant amount of disputes between foreign parties and Chinese companies,” he says. The largest increase in the number of disputes has risen from shipbuilding

Members of Sloma shipping team, Yu Genrong (centre)

contracts and charter party contracts. Yet in addition to helping foreign clients protect their business interests and minimize damages and losses, Yu noted that his firm has enjoyed a steady stream of legal work from domestic companies. “Domestic legal work is going as normal, because the domestic companies are less affected by the GFC,” he said. As Shanghai has set its blueprint to become an international shipping and financial centre, Sloma & Co will continue to reinvent itself to better respond to client needs, increasing its offerings in the full spectrum of corporate and maritime-related matters. “The shipping industry is at a golden period in China. Shipping legal practices will continue to prosper in the next two to three decades at least,” Genrong says. ►► SLOMA QUICK FACTS

• Sloma was formed by the merger of Siway & Seaway and Sloma & Co on 1 September 2007, and has 11 partners and 70 lawyers • Headquartered in Shanghai, with branch offices in Suzhou, Shenzhen and Berlin • The firm’s shipping and maritime team has 7 partners and 25 lawyers

►► SLOMA CLIENTELE HIGHLIGHTS

• Major shipping companies include COSCO Container Lines, China Shipping Container Lines, China Shipping Tanker Co, China Shipping Bulk Carriers, Shinwa Kaiun Kaisha, Mitsui O.S.K. Lines, Oldendorff Carriers GmbH & Co KG, TBS International • Major logistics companies such as Kuehne & Nagel, UPS Worldwide Forwarding, DHL • Major international P&I Clubs such as China P&I Club, Gard, UK P&I Club, West of England, The London P&I Club, the Swedish Club, Japan P&I Club • Major hull underwriters insurance companies include People's Insurance Company of China (中国人保控股公 司), China Pacific Insurance, Mitsui Sumitomo Insurance, Sompo Japan Insurance • Major domestic companies include Baosteel and Sinochem

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special report | Tianjin 09 >>

Tianjin 09: All roads lead to Tianjin Forging ahead as a city of importance, the city’s legal firms are now making their mark, part of the economic powerhouse that is China’s fifth first-tier city

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fter a four-hour flight, the first locally assembled Airbus A320 aircraft landed smoothly at Tianjin Binhai International Airport in May 2009. The successful test flight is an important milestone for Airbus and its final assembly line in Tianjin, which was established in 2006 as a joint venture between Airbus and a Chinese consortium. It also tells the story of Tianjin – after years of preparation and anticipation, the city is taking off and starting to reach its potential. According to official statistics, in the first half of 2009 Tianjin achieved a year-on-year gross domestic product growth rate of 16.2%, more than double the national average. Development of the legal industry is growing at an even faster pace, with a 36% increase in the number of firms and a 14% increase in the number of legal professionals. There are now almost 300 law firms and more than 2,500 practicing lawyers in the city. Beijing-headquartered Guantao is among many national firms that have found this leading industrial centre an attractive place. The firm established its ninth branch office in Tianjin in April

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with six partners and 11 lawyers, and recruited seasoned local practitioners, Ma Kewei and Cong Ying, as partners to lead its future development. Both Ma and Cong were previously with local firm Join & High, where Ma served as the co-founder and executive director. “Tianjin’s economy is robust and is growing rapidly, it is a strategic location for Guantao’s expansion,” says corporate and M&A partner Ma. National firms that entered this market a few years ago are starting to reap the rewards from the city’s rising demand for corporate legal services. “In the past year, we have added two more partners to our team because of the increase in demand for legal services. It has become crucial for us to strengthen our local practice,” said Hua Lei, partner-in-charge at King & Wood’s Tianjin office. The office now has five partners and 14 lawyers. Leading local firms like Winners have also recognised the pressure from increasing competition in the market. Practices have been adjusted and offerings increased to reinforce the local firm’s positions. “It’s only been [in] recent years that firms are realising the business

Law firms with Tianjin branches

►► Beijing firms • • • • • • • • • • • • •

Anli Partners (安理) Dacheng (大成) DeHeng Law Offices (德恒) Gaopeng (高朋) Guantao (观韬) Harden & Wells (万思恒) He Chuan (合川) Huamao & Guigu (华贸硅谷) Kangda (康达) King & Wood (金杜) Zhong Ji (中济) Zhong Lun W&D (中伦文德) Zhong Zhou (中洲)

►► Shanghai firms

• Richard Wang & Co (小耘)

►► Guangdong firms

• Wang Jing & Co (敬海)

opportunities … more law firms are setting up offices in Tianjin,” says managing partner, Li Haibo. “Local firms continuosly need to adopt new approaches and strategies in order to stay on top of growing competition.” He says that “the competition and challenges come from different aspects. International firms and large domestic firms, who are renowned for their brandings, reputations and resources, ISSUE 6.8


special report | Tianjin 09 >>

tend to win larger-scale deals and projects. On the other hand, as a midsize, [we] have to compete with small firms that offer much lower charges.” As part of a development strategy to expand from 32 lawyers and 11 partners, Winners plans to add two new practice areas – taxation and antimonopoly – and hire more specialists. Over the past year, it has already recruited 10 lawyers. “We are confident that as the economy picks up, there will be more M&A deals and these new practice areas will undoubtedly flourish,” Li says. Member of international independent law firms group Lawyers Associated Worldwide (LAW) since 2007, the firm plans to develop a strong international business practice and better service local clients who are increasingly investing overseas.

All systems go

Although new entrants intensify competition, it doesn’t mean that market share is getting smaller. The city’s rapid economic development

owes much to its endeavours to attract foreign and inter-provincial investment. This will create more demand for legal services in new and existing market segments. “Tianjin’s state council tries to attract foreign investments by introducing attractive incentives and financial innovations. Where these privileges [are] there will be investors, and where there are investors, there will be more business opportunities for law firms,” says King & Wood’s Hua. The focus of development lies within the Binhai New Area (BNA), on the eastern coast of Tianjin. Its modern manufacturing and research and development base, plus international shipping and logistics industries, high-tech development and port are important assets for this region. BNA is one of the fastest growing areas in northern China, playing a key role in boosting domestic demand. Six pillar industries have been identified: electronics and IT, automobile manufacturing, biological technology and modern pharmaceutics, metallurgy,

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special report | Tianjin 09 >>

►► Major chinese firms operating in tianjin Firm Grandall Legal Group (国浩)

No of partners/ lawyers 95

Join & High (四方君汇)

50

Mingzhou (明洲)

8

Winners (金诺)

44

Yidao (易道) Zhang Ying (张盈)

52 6

Practice areas Capital markets and securities, construction and real estate, corporate, M&A, aviation, shipping and maritime, arbitration and litigation, PE, intellectual property IT, intellectual property, international business, finance, securities, labour, real estate, litigation, M&A Labour, M&A, PE, litigation, real estate, infrastructure, finance, intellectual property, international trade and maritime Foreign trade and investment, M&A, PE, finance and security, real estate, intellectual property, maritime and litigation Real estate, foreign investment, M&A, PE, foreign direct investment (FDI) and litigation Finance, securities, foreign investment, international business, maritime, real estate, M&A, intellectual property, labour, IT and litigation

petroleum and ocean chemicals, new energy and environmental protection. Winner’s Li pointed out the automobile, aviation and chemical engineering industries as three that have flourished in the past year. “The automobile industry in particular has matured a great deal in Tianjin,” he says. “Automobile traders TJFAW and Changcheng have established offices this year, and the aviation industry also [has the] Tianjing Airbus assembly line, which has built and successfully leased out the first A320.” “In terms of the chemical engineering industry, China Bluestar, a large-scale state-owned enterprise focusing on chemical products and new materials, has also set foot in Tianjin.” King & Wood played a part, representing SFS intec, a global manufacturer and supplier of mechanical

fastening elements, in its 50% acquisition in the Chinese subsidiary of Sunil Dyfas, a Korean parts manufacturer (primarily for Korean automobiles). The new joint venture serves as an important pre-condition for intensifying business relationships in the region, which is also becoming known for having a strong service sector. “The service sector within Tianjin is held as top priority, as part of [its] strategy to attract more foreign investors,” King & Wood’s Hua says. A number of insurance companies are relocating, while many international banks like Deutsche Bank and Mizuho Corporate have opened retail operations in the area. Winners is also busy with corporate deals through development of the BNA. The firm is contracted to provide legal services for transactions relating to the southern development area.

Managing partner Song Ying

Established in Tianjin 2006

Xu Yuping

1994

Qiu Mingzhou

1993

Li Haibo

1995

Liu Qingwen Zhang Ying

1994 1994

It is acting for China Development Bank on its loans to the US, a complex billion-dollar transaction involving Panama, Mexico and Costa Rica. Singapore City Development has also engaged Winners’ for its billion-dollar acquisition of Tianjin real estate. The city’s increase in new operations is the symbol of stronger confidence from both domestic and foreign investors. The causal effect – where increased investment privileges equate to a larger number of foreign investors – is proven. Law firms in Tianjin can continue to reap the fruits of what seems like a winwin state of affairs at present. As the BNA’s fast-growing skyline continues to tell the vivid story of Tianjin’s rise to prominence, the legal profession is working hard to ensure their practices are woven through the fabric of the city’s history. ALB

►► Quick facts Tianjin emerged as China’s third-fastest-growing city this year. According to figures released by the Tianjin Statistics Bureau, the city’s gross domestic product (GDP) was approximately CNY315.5bn, which increased, albeit the drop in foreign trade. The city’s 16.2% year-on-year growth rate is 9.1% higher than China’s national average.

►► Tianjin’s legal industry By July 2009, there were 300 law firms and 2,500 lawyers practicing in the city. Tianjin’s total legal revenues in 2008 were estimated to be RMB6m.

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ISSUE 6.8


Firm Profile NEWS | deals >> Firm ProfileLaw Winners Firm

Winners Law Firm

Specializing in private equity, Tianjin On the Fast Track

banking and foreign direct investment

T

ianjin stands out as the fastestgrowing region with a dazzling 16.2% GDP growth in the first half of 2009 outperforming all other provinces while the national growth rate is only 7.1% which is the lowest in a decade. Tianjin Binhai New Area(TBNA), has turned into a flagship in the city’s strive towards industrial modernisation, marked by both advanced manufacturing industries such as aviation and aerospace industry and traditional steel LIand petrochemical industries. Haibo HAN Liang Peking University

China University of Politics and Law

Twin City & Twin Port TianjinTianjin’s Government Starrecently Rises announced the

GUO Weifeng Nankai University

BAI Xianyue Oxford University

Bohai Industrial Investment Fund, blueprint of “Twin City,in Twin Twin which is the first of its kind in China, After standing thePort”. shadow of City Beijing refers tofor thedecades, Tianjin City Centre TBNA capable of making equity investments Tianjin hasand been getting in burgeoning businesses with highcomfortable the limelight and while Twin Port referswith to the North (Tianjin growth potential. media headlines, since TianjinZone) BinHai Port) and South (Nan Gang Industrial s In advance of the Olympic Games, NewTwin Area was designated bythe the State ports. This City aims to develop a state-of-the-art, high-speed train Cabinet) in 2006 to be the modernCouncil services(China and manufacturing clusters service began runninginvolving between Reform Zone for with financialjoint venture with the Eco-City anBeijing and theComprehensive Twin Port to boost Tianjin’s trade anddevelopment Tianjin, reducing to innovation and administrative reform. integrated projectthe thatjourney will be the the world. only half an hour, making it the world’s Tianjin has been rolling out various largest development to date for the Eco-City. Tianjin Port is the second largest general fastest commercial railway line. initiatives and plans ever The first National Animation & Cartoon Park, port in ambitious China, inferior only to Shanghai port. s In September, the Tianjin Climate since and has set its sights on becoming aspiring to be China’s Disney World, held its The construction of two important docks Exchange was officially launched. The the third economic powerhouse in the groundbreaking ceremony in Eco-city on July 1. in Tianjin Port -Nanjiang Ore Dock and the exchange is a pilot program aimed at country after Shenzhen and Shanghai. The park is a key project co-built by the Tianjin Shenhua Coal Dock Ancillary Project kicked addressing China’s environmental crisis The examples are numerous: Government and the Ministry of Culture. off in July, which has are part of Tianjin’s efforts using market-based mechanism and s Tianjin successfully hosted forto two build TBNA into North China’s shipping center is modeled on the Chicago Climate consecutive years China’s International and Aerospace Industry(AAI) and an international logistic hub.an annual event Aviation Exchange. Private Equity Forum, ,the AAI cluster gradually s Tianjin is now theeffects de facto investment drawing investors and entrepreneurs In TBNA came into shape ever thewith launching of Tianjin Eco-city fund centre ofsince China, more than from all over the globe. Airbus A320 general assembly ,national civil Sino-Singapore Tianjin Eco-city, a 30 sq km 100 funds registered here. s In September 2008, the World industrialization base, the arrival ecologicalEconomic township Forum, in TBNA awill play thegatheringaviation s Tianjin plans to set up aand national overstrategic of aviation enterprises role of a pilot city, serving asrising a sustainable the-counter(OTC) market and thataircraft will allow of influential and leaders poised of a group retail investors to shape in various fields, parts& institutional components and manufacturers in theto trade development modelglobal to be issues replicated of public companies. held in airport unlisted industrialsecurities park. elsewherewas in China .It Tianjin. is aimed to become Tianjin exploring establishment s Bohaienvironmental Bank, the firstprotection, bank in China ThesAAI will is become onethe of Tianjin’s pillar of a city featuring China’s first off-shore financialon center to gain a and national in nearly a industries,with a host of new projects the at resource efficiency sociallicence harmony. the Dongjiang Bonded Zone.drive to decade, started operations in 2006 andpipeline. This also highlights China’s The distinguishing feature of the Eco-city CIETAC opened a Finance is an headquartered in Tianjin. be ansaeronautics powerhouse in Arbitration the future. is to create enviroment where man lives Center in Tianjin in May 2008. And the s Tianjin is now home to Airbus’ A320 The construction of China’s next-generation in harmony with his fellow man, with the goes on. assembly line – a project valued at launch list vehicle-the Long March 5, and the economy final and with the environment. As a While we marvel at the breakneck pace between CNY10–12 billion - and Airbus’ rocket carrier industrialization base is now in result, the Eco-city will give prominence to of development, legal practitioners first foray outside Europe. full swing in Tianjin. It is reported the base renewable engergy, waste management and wonder what might trickle down to them s Construction of a 30-sq km “Eco-city”, will meet the demands of China’s space water treatment, recycling and enviromental from the flurry of activity. Legal service the flagship development of a Sinotechnology development and peaceful use of conservation and ecological preservation providers are pitching for significant and Singaporean cooperation project, spacechallenging for 30 to 50mandates years, in the effort of maintaining with from their clients which will adhereharmony to international Aviation Industry Corp of Chinamarket. (AVIC),In the enviroment. It will also promote high-end in a dynamic and evolving this standards of eco-conservation, country’s largest aircraft manufacturer has service industry ,develop tourism industry exciting legal landscape, no firm is better energy efficiency and environmental jointly set up a helicopter company in Tianjin and encourage green has building and green positioned than WINNERS LAW FIRM to protection, begun. the local government. company transportation. In addition, it of willthe give priority advantage of theThe vastnew opportunities s The establishment CNY20 billion with take focuses on medium and heavy helicopters, to cultural diversity , and industries in respect www.legalbusinessonline.com filling a void in the domestic market. Sales are of life style and recreational amenities. forecast to reach 30 billion to 40 billion RMB China’s largest foreign-invested developer within 10 years. Shimao Property Holdings has entered into a Winners - Profile_v7.indd 33

www.legalbusinessonline.com

NIU Tongxu Nankai University

XU Yanzhao University College London

presented by Tianjin’s growth. WINNERS stands out among competitors for its unrivalled track record in private equity, finance and banking, with a client base including many domestic as well as foreign banks, investment funds and insurance companies that share the view that In April the international aviation and Tianjin will be one of the major future aerospace exhibition, known as Aeromart financial centres in China. WINNERS has Tianjin 2009 co-sponsored by the Tianjin been honored to be selected as legal Government and Business Conventions counsel to more than 30 high-profile International (BCI)and of France witnessed a private equity venture capital funds, record ofother 336 participating enterprises Our clients include Toyota, from Sun China abroad. Samsung, Aeromart was initiated by Life and Everbright, Caterpillar, BCITianjin and was successfully heldLtd., in France FAW Automobile Chinafor 12National years now BCI has designated TBNA as its Development Bank, Standard permanent venue Aeromart. Chartered, DBSfor Bank, BEA Bank, OCBC Bank, among others. TheWINNERS, Dongjiang Port Area(DBPA) inBonded collaboration with the prestigious set up The DBPA will NanKai cover anUniversity, area of 10 has sq km, the Capital MarketinResearch Center in4 making it the largest China. Occupying BinHai office, which is bonded dedicated to sqits km, the first phase of the port research into financial services and area has started operations. It draws oncapital WINNERS, working free closely with themarkets. experiences of international trade the Municipal Government, has been zones, offering international transfer, global actively involved in various financial distribution, international procurement, innovation programs commissioned by international trade transit and export the government, such as the Tianjin processing. Priority will be attached at DBPA Climate Exchange, the new OTC Market, to modern logistics, import-export processing, offshore banking. the manufacturing industry and various WINNERS has joined the Lawyers service industries. Associated Worldwide (LAW), a Itprofessional will be a test-ground for offshore financial association of fine law firms services Chinathan which has been approved acrossinmore 100 jurisdictions which byenables State Council. Moreover, offshore ship it to better serve its clients. registration system willrises, be established As Tianjin’s star WINNERS in is DBPA the forfirm the first China. thattime will in shine.

WINNERS has been proud to be actively Contact Details: involved in many of the Fax: high-profile projects Tel: 86-22-23133590 86-22 23133597 Website: www.winlawfirm.com and will continue to be market leader in TBNA. Contact Details: Tel: 86-22-23133590 Fax: 86-22-23133597 Website: www.winlawfirm.com

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11/24/2008 12:24:02 PM

49


profile | managing partner >>

alb 2009 managing partners series

Peter Charlton - Clifford Chance:

The importance of being local Clifford Chance’s Peter Charlton explains to ALB why being an international law firm means nothing unless you have that local touch

T

he global financial crisis has affected international law firms as much as any other industry. Staff have been laid off, revenues and partner profitability figures are down and even some bigname firms have fallen under the weight of the worst global economic slump since the Great Depression. But one year on from Black September, the ‘green shoots’ of recovery appear to have grown into sturdier seedlings. Stock markets have rebounded, and government stimulus packages have stirred ailing economies to life and mega-deals are starting to re-enter the pipeline and it is Asia, with its dynamism and hunger for continued growth, that seemingly leading global recovery. But as the world’s attention turns more and more towards Asia, Peter Charlton says that the key to emerging stronger from the crisis in Asia isn’t simply about leveraging one’s internationalism, but rather striking the right balance between international excellence and local knowledge. He shares his strategy with ALB.

Following the storm

Appointed to his new role as Asia managing partner only six days before Lehman Brothers filed for bankruptcy, Charlton has been tracking the ensuing storm ever since. After finishing work on Barclays’ postbankruptcy acquisition of Lehman’s US 50

and European operations, he landed in Hong Kong in November 2008. “When I arrived in November, my first task was to look at when the financial crisis would hit Asia and just how large an impact it would have on both the firm and its clients,” he says. “We got a fair idea of how things would unfold by the end of December to January. Oddly, in many ways the waiting for the crisis to reach Asia was actually more difficult to deal with than the crisis itself.” But when the crisis did hit, its impact on all aspects of business was just as profound. “By the new year, deals - even if they were well-advanced – had been put on hold as financing dried up. No law firm escaped the turmoil and all aspects of their operations have been affected: staffing, revenues and profits.”

Staying true to strategy

Trite clichés about the presence of opportunities in crises aside, Charlton believes that the GFC presents firms with a rare opportunity to assess issues like strategic direction but says that the key to success in Asia remains staying true to strategy and resisting the temptation to abandon Asia plans, as many international law firms have sought to do in the past. “The upside is that crises such as these allow one to take stock of the direction in which the business in heading—people may come out a little worse for wear but certainly all the wiser.”

‘Wiser,’ according to Charlton isn’t necessarily about abandoning the strategies that have worked in Asia for Clifford Chance for the best part of 30 years, but rather about ensuring they are malleable enough to adjust to, and succeed in, broader economic trends. “We are not planning strategic u-turns or wholesale changes to our Asia strategies, but instead a recognition that the fundamentals in this part of the world remain strong,” he says. “There is an inherent dynamism in Asia which won’t be shaken by financial crises and at the same time as much as business in Hong Kong, Singapore or Shanghai is becoming more international, it is also locally-based. Strategies need to be built around this fact.” A strategy, it seems, which is at the heart of the firm’s expansion in the Lion city since being one of only six foreign law firms to have been granted a Qualifying Foreign Law Practice (QFLP) license by the Singapore government in December 2008. Partner numbers at the 30-year old office have doubled in just less than 18 months and key lateral hires across all corporate areas have been brought on board, most recently dispute resolution specialist Nish Shetty from the firm’s former joint-law venture partner WongPartnership— growth which Charlton says is by no means complete. “Our Singapore office is classic example of how we like to operate,” says Charlton. “To take international standards and build in local excellence and relevance.” ISSUE 6.8


profile | managing partner >>

The best of friends

If Singapore is a perfect example of this strategy in action, then so too are the firm’s activities in India and parts of South-East Asia, albeit here, owing largely to regulatory restrictions, the format is a little different. Clifford Chance became the first of the magic circle late last year to institute a workable strategy to penetrate legal markets where international firms are currently prohibited from establishing offices—the ‘best friends’ model. “The ‘best-friends’ model is crucial to our expansion in Asia. We have chosen to align ourselves with firms we feel are the best in their respective countries, countries which are of strategic importance to Clifford Chance and where our clients do a lot of business but where we cannot set up due for regulatory reasons,” says Charlton. “We have had longstanding relationships with leading firms in Indonesia (Mochtar Karuwin Komar), Vietnam (VILAF Hong Duc) and most recently have very quickly built an impressive partnership with leading Indian firm, AZB & Partners.” “All of these arrangements involve us sharing referrals and resources with the firms but not necessarily on an exclusive basis, we may have more than one firm with which we do this with in a particular country, it may vary from transaction to transaction.” But what of the long-term prospects for such ententes? Are they mere forerunners to eventual mergers? Should regulatory prohibitions be relaxed are we likely to see Clifford Chance swallow one of its smaller friends or a not so small friends? Charlton deflects the question with a deliberative pause and a rueful smile saying only that the firm has no intention of subsuming any of its current allies. “The relationships we have with our select firms across the region have been successful so far and we expect that to continue so mergers aren’t in our plans at the moment,” he says. “The arrangements are being well-received by our clients and the synergies are simply excellent.”

Asia’s powerhouse economies and protectionism India and China remains at the forefront of most international firms’ expansion plans and Clifford Chance

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is no different and Charlton is only too keen to reveal to ALB where the subcontinent fits into the firm’s plans. “India remains one of the key focuses of our expansion strategy in the region and we remain hopeful that we will be able to practise in India soon if the necessary legislation is passed by the government,” he says. “The recent election results are being seen as a favourable indicator in this regard so it could be sooner rather than later, although international firms have been waiting on this development for many years already.” But the emphasis is changing, says Charlton. Where transactional lawyers once talked of India as a destination for inbound investment from the US, Europe and the UK, now it is talk of Asian interest in the subcontinent and Indian outbound investment that dominate discussion. “A major part of the move East we have seen over the last five or six years is more interest in India as a destination for Asian investment and at the same time as a generator of outbound investment. The country has a number of large conglomerates with extremely strong balance sheets that are capable of making strategic investments or targeting distressed acquisitions in places around the globe.” The same can be said of China according to Charlton, where a marked increase in outbound investment has been a defining feature of the current economic downturn. “China is the bright spot on the horizon for commercial practices in Asia, there is no doubt about that,” he says. “It has the potential to provide the fuel to keep engines running

smoothly—Chinese companies have shown their willingness to provide leverage and strike strategic M&A deals, although the increase in outbound investment we are seeing now will not compensate completely for the global downturn.” The standard measures for measuring global transactional activity, things like market volatility, company balance sheets, acquisition financing and capital markets, aside, Charlton says that the political imperatives weighing on Chinese acquisitions also have the potential to affect deal flow there. “All things being equal, China investments often have political elements which create a different dynamic,” says Charlton. “When economies slow, there is more attention paid to domestic issues, and protectionist sentiments tend to become prevalent as a result.” And while Charlton stops short of predicting any Harley-Smoot type reactions in China he does say that current attitudes are likely to affect fresh investment. “The tensions between protecting domestic industry and encouraging foreign investment are being played out in China now, and for that matter in emerging economies throughout the region,” he says. “Having said this there is a recognition of the need to encourage investment where investment is needed while limiting exposure to the West. The consequence is that we may well see a situation where only low-key investments go through and highprofile investments are put on hold for calmer times… but these calmer times are closer then we may think.” ALB 51


Sign off >> Art case puts online copyright into spotlight Wikipedia may have to learn the hard way that you should always ask before borrowing. The National Portrait Gallery in London is set to sue Wikipedia over claims that 3,000 images from the gallery’s website were uploaded onto the online encyclopedia site, without the gallery’s permission.   The complicated case brings online copyright laws into question. The gallery is claiming that English copyright laws were broken, but as England does not share the same copyright laws as the US – and Wikipedia is based in San Francisco – it is unclear which laws apply. The fact that Wikipedia has only 23 staff, no corporate structure and works on an open source, collaborative approach only makes the case more of a challenge.

White & Case, DLA raided in Moscow The Moscow offices of White & Case and DLA Piper were raided recently by Russian authorities in connection with a fraud investigation, with police reportedly seizing documents in several different business locations, according to The Moscow Post. The searches are believed to have been related to client activities – in connection with an $87.5m (£53.9m) fraud case and a related conflict between owners of the Hotel Moskva – and did not involve the firms themselves.

Rothschild, Freshfields in spotlight over slave claims According to new research, the 19th century founders of British investment bank Rothschild and top law firm Freshfields may have engaged in business linked to the slave trade. The Financial Times reported that documents from Britain’s national archives revealed that Nathan Mayer Rothschild had allowed the use of slaves as collateral in banking dealings with a slave owner, while Freshfields’ founding

partner James William Freshfield acted as a trustee in deals involving Caribbean slave plantations. Academics at University College London are studying the documents, which prove controversial in the US (home to both firms), where numerous banks and other bodies have been pressured to make amends for profiting from slavery. Both organisations have pointed to their anti-slavery credentials.

When the going gets tough... Take a holiday. Or at least that’s what UK firm Cadwalader, Wickersham & Taft are suggesting to their employees. The firm recently initiated an alternative to layoffs, offering 34 lawyers from the capital markets and real estate finance groups a paid “one year, unrestricted sabbatical”. The sabbatical strategy allows Cadwalader lawyers the option of taking one-third of their salary plus medical benefits spread over the next year for an indefinite sabbatical, giving the firm time to try to match lawyers up with clients and not-forprofit organisations. It’s a different story if you’re working at Weil Gotshal & Manges though.

Apparently the firm got the memo that junior lawyers were recently polled (Association of ­Graduate Recruiters Summer Survey, published 6 July) as some of the highest paid graduates, despite the recent pay freezes and cuts plaguing top ­commercial law firms – and has decided to do something about it. The firm recently dropped the starting salary of newly qualified lawyers in its London offices by 5.5% to £85,000, becoming the latest law firm to put such measures in place under pressure from the recession. Addleshaw Goddard, on the other hand, recently rolled out a flexible working scheme, following a 95% vote from fee earners in favour of the plans. The scheme, which began in July, will run for a 12-month period and will see some of the firm’s fee earners switch to a four-day week in return for 85% of pay. The firm has also encouraged sabbaticals and the buying of additional holiday, where fee earners can take additional leave in blocks of four, eight, 12 and 26 weeks and enjoy 30% of salary during the break.

Lawyers get lucky over phone hacking claims A recent wave of tabloid phone hacking allegations are giving litigation lawyers something to smile about. The furore began when The Guardian revealed that Rupert Murdoch’s empire News International 52

had paid out more than £1m to settle legal cases that threatened to reveal phone hacking and other illegal action taken by its journalists. The allegations against News International raise serious questions

about privacy laws and reporting techniques, and the article has led a number of celebrities and politicians to seek advice on potential legal action, with lawyers happily reaping the results. ISSUE 6.8


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Private Practice

Chief Compliance Officer (5-10 yrs pqe) Singapore

Litigation Lawyer (5-10 yrs pqe) Hong Kong A commercial litigator with

Asia-Pacific regional role in this highly regarded US technology multinational. A seniorlevel lawyer with experience gained in the US is needed to advise the business on compliance, litigation and commercial requirements. Prior exposure to international laws and regulations for anti-bribery, trade compliance, unfair competition and corporate governance is ideal. English fluency is required, and those with Mandarin language skills will have preference. Ref: 8153/CB

Compliance Officer (7 yrs exp) Hong Kong Global powerhouse financial institution seeks a compliance professional to cover merchant banking. Knowledge of Asia-Pacific financial services regulations and compliance practices is a must. Ideally, you have private investment fund compliance experience and previously did private equity and real estate fund work. Strong relationship management skills are crucial. Must have excellent English; Mandarin is an asset. Ref: 8268/CB

Legal Counsel (5-7 yrs pqe) Beijing US company seeks a sole legal counsel to cover its businesses in China. The qualified candidate should have 5-7 years solid general corporate/commercial experience to provide legal advice to senior management. Good interpersonal and communication skills are essential. Must be willing to work proactively and independently with minimum supervision. LLB or LLM from a reputable Chinese law school or overseas university is desired. PRC qualification is a must. Ref: 8183/CB

Compliance Professional (5 yrs exp) Hong Kong Regional bank

needs someone to assist the Head of Compliance in advising management on compliance and anti money laundering issues. Must have professional accounting qualification and solid experience from consumer/commercial banking, with a background of compliance or audit. Good communication and interpersonal skills are needed along with fluent English and native Cantonese or Mandarin. Ref: 8245/CB

License & Compliance Manager (5 yrs pqe) Beijing A reputable US IT company seeks a License & Compliance Manager to join its well established legal team in Beijing. The qualified candidate must have solid experience in handling licenses/permits/IP and compliance matters. You will be well connected with government authorities and have strong knowledge of PRC regulations related to the company’s licenses and permits. Must have at least 5 years experience gained at reputable law firms or multinational companies. Native Mandarin and fluent English are required. Ref: 8234/CB

excellent legal drafting and communication skills is sought to join this strong regional firm. Significant experience is needed in litigious court work. Relevant skills required: good technical ability, client handling and presentation skills. Proficiency in both English and Chinese is a prerequisite. Ref: 8289/CB

Senior Finance Lawyer (6-7 yrs pqe) Hong Kong Magic Circle firm has

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Senior Associate (6+ yrs pqe) Beijing Specializing in oil and gas, this position needs someone with M&A expertise to join a well known US law firm. A corporate background is needed, and those who have managed M&A deals in related fields such as natural resources, energy, and/or mining are welcome to apply. Project finance exposure is also a benefit. Native level English is required, and Mandarin is an asset. Ref: 8243/CB

Senior Associate (5 yrs pqe) Hong Kong The international capital

markets group of this famous law firm needs a US securities lawyer. Must have experience with US SEC-registered equity and debt offerings and be able to give ongoing advice and assistance on Exchange Act reports. You should have native Mandarin language skills and be a team leader. Ref: 8286/CB

Capital Markets Lawyer (2-3 yrs pqe) Hong Kong Mid-level lawyer with

capital markets experience from leading international firms is sought by this prestigious firm. Experience in equity capital markets and structured products is essential. Ideally, candidates have UK qualification. Mandarin language skills would be an advantage. Ref: 8259/CB

Associate (3-5 yrs pqe) Beijing Candidates are highly sought to join an international firm. PRC qualification and US bar are mandatory with a JD or LLM from a US school. General corporate commercial experience is desired in practice areas such as, M&A, FDI, banking/finance, project finance and/or oil/gas. For this role, native level Mandarin and good English are paramount. Ref: 8244/CB

HONG KONG Tel: (852) 2520 1168 Fax: (852) 2865 0925 Email: hughes@hughes-castell.com.hk SINGAPORE Tel: (65) 6220 2722 Fax: (65) 6220 7112 Email: hughes@hughes-castell.com.sg

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China Legal Business 6.8