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Analysis China’s new Anti-Monopoly law: firms beef up competitive edge

ALB Hong Kong Law Awards 2008 The finalists revealed

ALB Special Report: Malaysia 08 Liberalisation on the cards?

Offshore financial centres Finding differences in similarity

ALB HOT The hottest lawyers of 2008


Country editors The Regional Updates section of ALB is sponsored by the following firms: Philippines

Founded in 1945, SyCip Salazar Hernandez & Gatmaitan is one of the most-established law firms, and the largest, in the Philippines. Principally based in Makati City, the country’s financial and business center, the firm also has offices in Cebu City, Davao City and the Subic Bay Freeport. SyCip’s practice covers all fields of law and the broad range of the firm’s expertise is reflected in its client base, which includes top local and foreign corporations, international organizations and governments. SyCip combines traditions of professional integrity and excellence with a time-tested ability to break new ground. China

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Joshua Scott




Daniela Aroche Loo & Partners was founded in 1985 as a niche practice, handling mainly banking, corporate, securities and commercial work. With the support of a comprehensive network of correspondent law firms, the firm serves its clients in their regional needs. The firm has been regularly noted for its IPO, M&A and general corporate work.




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ATMD is a dynamic and progressive firm with an established IP, corporate & commercial, competition and dispute resolution practice. The firm also has an extensive regional experience advising both domestic and foreign clients on cross-border transactions. ATMD has been voted as Singapore’s Intellectual Property Firm of the Year at the 2005 and 2006 ALB Awards and the 2005 AsiaLaw (IP) Awards. International arbitration

Established in 1889, Drew & Napier is one of Singapore’s leading law firms. Consistently rated top tier in dispute resolution, the firm has 7 senior counsel, the largest number of any Singapore law firm. The firm is headed by CEO, Davinder Singh, SC, one of Singapore’s foremost lawyers. Drew & Napier is also highly rated in Insolvency & Restructuring, IP, Tax, Banking & Corporate, Competition Law, TMT, and Shipping.

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Sweet are the uses of adversity


uke Senior, the protagonist of William Shakespeare’s As You Like It, philosophically stated ‘sweet are the uses of adversity’, in doing so reiterating the viewpoint that everyone from statesmen to scholars, clergy to common men have held dear since time immemorial: that while troubled times and difficulties may test our limits, we will, almost certainly, emerge stronger from them. And while the cynic in us may dismiss Duke Senior’s utterance as overly romantic, too trite to be of use to us today, the reality is that the commercial utility underpinning his statement – that is, that as much as adversity brings challenges, it also brings opportunities for profit – has a special resonance for lawyers throughout the region. Asia is surely in the midst of adversity. Not only are IPO volumes down on the two markets that dominate the entire region – China and Hong Kong (see ‘news in brief’ section on p15) – but also the region’s emerging economies, the likes of Indonesia and Malaysia, are in a state of inertia; stalling despite possessing an embarrassment of natural resources (see the energy & resources feature and Malaysia Special Report p66 and p76 respectively). Yet, all is not lost. In our profile of the ‘hottest’, most dynamic, headline-grabbing lawyers of 2008 (p34), we have identified no fewer than 100 lawyers for whom adversity is not simply a hurdle but, instead, is an opportunity to test their own mettle and broaden their own practices. In our cover story, you will find leaders, technical experts and strategists who, while all possessing different skill sets, are united by one thing: they have found that element which separates them from the rest. For while trials and tribulations may open doors hitherto closed, capitalising on them is not simply a matter of turning up. It is about differentiation in an environment which breeds uniformity. But just what form will this take? While there is no distinct formula which this must follow, this issue indicates that it requires both ingenuity and acumen, and perhaps even a little of Duke Senior’s idealism.

For while trials and tribulations may open doors hitherto closed, capitalising on them is not simply a matter of turning up. It is about differentiation in an environment which breeds uniformity


IN THE FIRST PERSON “Malaysia remains one of the

favourite investment targets in the region, but, with the political situation unclear, people are waiting to see what happens” Raslan Loong, chief executive partner at Caesar Loong, on investment in Malaysia (p66)

“Previously, China obtained access

to a stable supply of materials via long-term contracts. Why not take an interest in the source itself?” Seung Chong, an M&A partner with White & Case in Hong Kong, on China’s strategy for obtaining resources (p76)

“Other jurisdictions like Singapore are promoting themselves as onshore offshore jurisdictions” Frances Woo, partner at Appleby, highlighting the Lion City’s incentivisation schemes (p82)


Asian Legal Business ISSUE 8.9

NEWS | deals>> >> CONTENTS


ALB ISSUE 8.9 66

ALB 34


COVER STORY 34 ALB Hot 100 ALB’s annual look at the biggest, brightest, most awarded and most talked about lawyers in Asia over the past 12 months

ANALYSIS 10 Compliance The combination of complex corporate compliance environments in Hong Kong and Singapore and renewed interest in the region mean lawyers in this sector are in demand 11


China: Anti-trust law The new Anti-Monopoly Law has been launched in China. Firms are reaping the benefits in the form of more work but lawyers remain wary of accompanying problems Korea financial services Korea’s budding financial services sector is set for changes, following further deregulation and developing free trade agreements

FEATURES 50 Higher education Australia’s elite universities are packing them in when it comes to higher education for lawyers 52 ALB HK Law Awards 2008 – the finalists A run-down of what to expect at this year’s ALB Law Awards in Hong Kong and the firms shortlisted to pick up a gong in each of 36 categories 66 ALB Special Report: Malaysia 2008 The Malaysian legal market is gaining momentum, but longer term structural reform is on the cards 74


Property investment The credit crunch has had a global impact on once-flourishing property markets, but Asia remains more resilient and investor interest is high

76 Energy & resources China’s burgeoning economy is bringing gains across Asia for some but frustration for those who are missing out 82 Offshore financial centres As convergence and competition between offshore financial centres increases, offshore firms are busy on ever more complex transactions




Singapore LOO & PARTNERS



REGULARS 6 • • • • •

NEWS CC Asia managing partner relinquishes post Merger flop for Heller Ehrman and Bakers Strong growth for resources and infrastructure project financings Colin Ng & Partners merge with global professional services provider Middle East: more office openings

PROFILES 28 Watson Farley & Williams 30 BT Partnership 48 Loo & Partners 69 Raslan Loong


71 Wong Beh & Toh

16 UK report

73 Tay & Partners

18 US report

78 Hanafiah Ponggawa & Partners


80 Mochtar Karuwin Komar

20 International arbitration DREW & NAPIER

84 Appleby


90 Ogier

81 Mori Hamada & Matsumoto 86 Harney Westwood & Riegels

104 Sign off


Asian Legal Business ISSUE 8.9

NEWS | deals >>

deals in brief | UAE | ► ABU DHABI COMMERCIAL BANK MEDIUM NOTE TERM OFFERING US$7.5bn Firm: Allen & Overy Lead lawyers: Roger Wedderburn-Day, Cieren Leigh Client: HSBC Firm: Clifford Chance Lead lawyers: Debashis Day, Ursula Gil, Bilal Ahmad, Jana Salloum, Catherine Wilson Client: Abu Dhabi Commercial Bank Firm: Walkers • The Abu Dhabi Commercial Bank (ADCB) established a new Londonlisted medium term note program, allowing the notes to be issued by ADCB itself or by its offshore unit in the Cayman Islands, through its subsidiary ADCB Finance (Cayman) Limited

| INDONESIA | ► PT ADARO ENERGY TBK IPO US$1.3bn Firm: Hadiputranto, Hadinoto & Partners Lead lawyers: Rambun Tjajo, Tuti Hadiputranto Client: PT Adaro Energy Tbk

Firms: White & Case; Milbank Tweed Clients: Goldman Sachs, Citigroup & others Firm: Hendra, Soenardi & Rekan Lead lawyer: Eddy Hendra Clients: PT Saratoga Investama Sedaya, PT Persada Capital Investama, PT Triputra Investindo Arya and PT Trinugraha Thohir

► PT ALAM TRI ABADI ACQUISITION US$1.1bn Firm: Lubis Ganie Surowidjojo Lead lawyer: Abdul Haris Muhammad Client: Ariane Investments Mezzanine Pte Ltd Firm: Hendra Soenardi & Rekan Client: PT Alam Tri Abadi Firm: Milbank Tweed Lead lawyer: David Zemans Clients: Shareholders of Ariane Investments Mezzanine Ltd Firm: White & Case Lead lawyer: Joel Hogarth Client: Agalia Capital Ltd • One of Asia’s largest IPOs to date, this US$1.3bn deal allowed PT Adaro Energy Tbk to transfer proceeds from its IPO into a subsidiary, PT Alam Tri Abadi; Alam in turn used the

“HHL has been involved in the formation of Dairy Trust from the outset. The Olam transaction will provide new capital to fund the construction of milk processing plants at various locations in New Zealand and access to global sales and marketing networks” NATHANAEL STARRENBURG HARMOS HORTON LUSK 6

proceeds to acquire 100% interests in Agalia Energy Investments and Arian Investments Mezzanine. The acquisition is one of the largest M&As in Indonesia in recent years


Clients: Management shareholders of Honiton Energy • The management shareholders in Honiton Energy Holdings plc sold their combined 43.6% interest in Honiton Energy Holdings plc to a joint venture vehicle formed by Tanti Group and Arcapita Bank. They receive a 10% equity holding in the JV company in consideration for their shares. The joint venture vehicle acquired a 100% stake in Honiton

Firm: Sullivan & Cromwell Client: Tokio Marine Holdings Firm: Wolf, Block, Schorr and Solis-Cohen Client: Philadelphia Consolidated Holding Corp • Tokio Marine Holdings will acquire all outstanding shares of Philadelphia Consolidated Holding Corporation in a cash merger transaction with a price of US$61.50 per share. The acquisition will be financed through Tokio Marine Group’s cash on hand together with borrowings, including the issuance of non-convertible bonds

| HONG KONG | ► HONITON ENERGY EQUITY SALE TO JV TANTI GROUP AND ARCAPITA BANK US$1bn Firm: Clifford Chance Lead lawyers: Andrew Whan, Sue Wai Yim, Neeraj Budhwani

| NEW ZEALAND/SINGAPORE | ► OLAM–NZ DAIRY TRUST STAKE ACQUISITION US$76.6m NZ$101m Firm: Harmos Horton Lusk Lead lawyers: Andrew Harmos, Nathanael Starrenburg Client: New Zealand Dairy Trust Firm: Buddle Findlay Lead lawyers: Simon Vodanovich, Sacha Judd Client: Olam International • Olam International, the Singapore commodities company, acquired a 24.9% stake in New Zealand Dairy Equity, the Kiwi milk processor. The NZ$101m deal has reportedly made Olam a strategic player in the New Zealand dairy industry • The transaction is subject to the approval of Dairy Trust shareholders, to be sought in early September 2008 • Dairy Trust will bid for the remaining shares in subsidiary Open Country Cheese Limited, and Olam has entered into a pre-bid agreement in this offer • The deal is expected to close in early September 2008

| INDIA | ► QUATRRO ACQUISITION OF BABEL MEDIA Undisclosed, estimated US$100m Firm: Luthra & Luthra Lead lawyers: Anil Rai, Manmeet Singh, Tanmay Amar, Vinay Ahuja , Ashish Porwal Client: Quatrro Firm: AZB Partners Lead lawyer: Vinati Kastia Client: DE Shaw Asian Legal Business ISSUE 8.9

NEWS | deals >>

• Indian outsourcing group Quatrro has acquired a 60% stake in UKbased Babel Media, a provider of specialist services to the gaming industry. Quatrro worked with US hedge fund investor, DE Shaw, which also now holds a minority stake of shares in Babel. The partners funded the acquisition through a combination of debt and equity

► GOLDMAN SACHS BOND SALE AND WARRANT SUBSCRIPTION Firms: Davis Polk & Wardwell/ Trilegal Lead lawyers: Kirtee Kapoor, Zhan Chen, Shaoyun Xu, Alan Fu Client: Goldman Sachs Firm: Linklaters Client: SpiceJet Firms: AZB Partners, Weil, Gotshal & Manges Lead lawyers: Akiko Mikumo, David Meredith, James Cole Client: Wilbur Ross • Goldman Sachs sold its foreigncurrency-denominated bonds in SpiceJet Limited, an Indian airline company listed on the Bombay Stock Exchange, to purchasers affiliated with Wilbur L Ross Jr

| JAPAN | ► SMFG PREFERRED CAPITAL USD 3 SECURITIES OFFERING US$1.35bn Firms: Linklaters; Kozo Sasaki; Simpson Thacher Lead lawyers: Simpson Thacher: Alan Cannon, Robert Laplante, Andrew Hecht, Todd Wolfe, Rob Holo, Mark Lab, Jeanne Annarumma, Ben Applestein Clients: Goldman Sachs International, Merrill Lynch International, Morgan Stanley & Co International plc, Daiwa Securities SMBC Europe Limited Firms: Davis Polk & Wardwell; Nagashima Ohno & Tsunematsu; Maples and Calder Lead lawyers: Theodore A Paradise; Fumihide Sugimoto; Matthew Gardner

► YOUR MONTH AT GLANCE Firm Ali Budiardjo, Nugroho, Reksodiputro Allen & Gledhill Allen & Overy Amarchand & Mangaldas & Suresh A. Shroff & Co AZB & Partners

Jurisdiction Indonesia, Singapore

Deal name Citra Group share purchase and refinancing

Singapore UAE India

Farrer Court Site redevelopment & MSREI Finance Abu Dhabi Commercial Bank Medium note term offering Lehman Brothers Real Estate Partners investment


Goldman Sachs bond sale and warrant subscription


India, UK India, USA China, Singapore

Quatrro acquisition of Babel Media Investment in SOMA Networks Inc. Midsouth Holdings SGX Delisting

Undisc. 100 48

China, Europe Qatar UAE Hong Kong

Labelux Group Acquisition of Bally International AG Commercial Bank of Qatar GDR listing Abu Dhabi Commercial Bank Medium note term offering Honiton Energy equity sale to JV Tanti Group and Arcapita Bank

Undisc. 900 1,100 1,000

Cochrane Lishman Conyers Dill & Pearman

Australia, BVI, UK Australia, BVI, UK Indonesia, Singapore

CopperCo-Mineral Securities acquisition CopperCo-Mineral Securities acquisition Citra Group share purchase and refinancing

Davis, Polk & Wardell


Goldman Sachs bond sale and warrant subscription

Japan/ USA Qatar Dubai Indonesia

SMFG Preferred Capital USD 3 Limited securities offering Commercial Bank of Qatar GDR listing Damas IPO PT Bayan Resources Tbk IPO

Australia, BVI, UK

CopperCo-Mineral Securities acquisition



China, Hong Kong, UK, USA Singapore China, Japan Australia, Indonesia Indonesia Indonesia Indonesia

China Merchant Holdings Senior Note Offering


Debt market, equity Project finance Banking M&A Equity Equity Debt market

Baker & McKenzie ChrisChong & CT Ho Partnership Cleary Gottlieb Clifford Chance

Dewey & LeBoeuf Erry Yunasri & Partners Franklyn Legal Fried Frank Harris Shriver & Jacobson

Hadiputranto, Hadinoto & Partners Hanafiah Ponggawa & Partners Hendra, Soenardi & Rekan Henry Davis York Hogan & Hartson Hunton & Williams

Huen Wong & Co (in association with Fried, Frank, Harris, Shriver & Jacobson) Jingtian & Gongcheng Jones Day Latham & Watkins

Lehman Lee & Xu Linklaters

Client: SMFG Preferred Capital USD 3 Limited • SFMG Preferred Capital USD 3 Limited, a subsidiary of Sumitomo Mitsui Financial Group, sold its US$1.35bn of non-cumulative perpetual preferred securities, now

Lovells Lubis Ganie Surowidjojo Luthra & Luthra

Indonesia Indonesia Australia, India, USA Australia, China China, Hong Kong China, Thailand

Farrer Court Site redevelopment & MSREI Finance Commercial Property Refinancing PT Bumi TBK bid for Herald Resources PT Adaro Energy TBK IPO PT Bayan Resources Tbk IPO PT Citra Sari Makmur syndicated loan facility

US$m 107

1512 1,100 800

400 400 107 Undisc. 1,350 900 270 530

1,512 395 551 1,300 530 111

Japan China

PT Alam Tri Abardi Acquisition PT Adaro Energy TBK IPO SIS Chubb acquisition Autohome & PCPop merger with Norstar Media Asia Cement (China) Holdings IPO BP Overseas Development Co. Ltd Acquisition of AsianAmerican Coal Inc Dai-ichi Mutual Life Insurance Company share purchase Beijing Capital International Airport Co share capital raising

China, Hong Kong Australia, BVI, UK China, Hong Kong

Asia Cement (China) Holdings IPO CopperCo-Mineral Securities acquisition Trina Solar Limited notes and share issue

China, Hong Kong, UK China, Hong Kong, USA China, USA

ReneSola Follow on Offering Canadian Solar NASDAQ Follow on offer China Sunergy convertible notes and share issue

Undisc. 123 55

Indonesia China, Europe India

PT Bayan Resources Tbk IPO Labelux Group Acquisition of Bally International AG Goldman Sachs bond sale and warrant subscription

530 Undisc. Undisc.

Dubai Vietnam

Damas IPO Saigon Premier Container Terminal port development project finance Tamweel PJSC Sukuk issue PT Alam Tri Abardi Acquisition Investment in SOMA Networks Inc. Lehman Brothers Real Estate Partners investment

UAE Indonesia India, USA India

Practice Debt market, Equity Project finance Equity Private equity

Equity, debt market M&A Equity Debt market, Equity M&A Equity Equity Banking, equity Equity Equity Debt market, equity Equity, debt market Banking Equity Equity Equity

1,100 1,300 Undisc. 220 268 420

Equity, M&A Equity M&A M&A Equity M&A

Undisc. 300

Equity, M&A Equity

268 400 138

270 225 300 1,100 100 800

Equity Equity Equity Equity Equity Debt market, Equity Equity M&A Equity, debt market Equity Construction, project finance Debt market Equity, M&A Equity Private equity


NEWS | deals >>

listed on the Singapore Exchange Securities Trading Limited

► RESOLUTION AND COLLECTION CORPORATION OF JAPAN SHARE SALE OF CHUO MITSUI TRUST HOLDINGS, INC US$971m Firm: Simpson Thacher Lead lawyers: David Sneider, Alan Cannon, Robert Laplante, Todd Wolfe, Rob Holo, Amie Broder, Ben Applestein Clients: Resolution and Collection Corporation, Chuo Mitsui Trust Holdings Inc Firm: Nagashima Ohno & Tsunematsu Lead lawyer: Fumihide Sugimoto Client: Resolution and Collection Corporation, Chuo Mitsui Trust Holdings Inc Firms: Davis Polk & Wardwell; Ito & Mitomi Lead lawyers: Theodore A Paradise; Fuyuo Mitomi Client: Daiwa Securities SMBC Co, Ltd, Nikko Citigroup Limited and Goldman Sachs Japan Co, Ltd • Resolution and Collection Corporation of Japan sold 170,000,000 shares of common stock in Chuo Mitsui Trust Holdings Inc (CMTH), which included a public offering in Japan and offerings to institutional investors in Europe and the US under Regulation S and Rule 144A. The RCC converted part of its preferred stock in CMTH into common stock and sold it in the global secondary offering

| CHINA | ► AUTOHOME & PCPOP MERGER WITH NORSTAR MEDIA Firm: Mallesons Stephen Jaques Lead lawyer: Simon Milne Client: Telstra Firm: Hogan & Hartson Lead lawyers: Roger Peng, Amber Tang, Jay Song, Scott McClure Client: Norstar • Telstra recently acquired a 55% shareholding in Chinese media companies Autohome and PCPop, merging them with Norstar Media, another automobile and digital device website acquired by Telstra in the same transaction. The acquired


businesses, worth US$220m, are leaders in the online auto and digital device advertising sectors in China

► LABELUX GROUP ACQUISITION OF BALLY INTERNATIONAL AG Estimated US$600m Firms: Oppenhoff & Partner Rechtsanwälte; Lehman Lee & Xu Client: Labelux Group Inc Firm: Cleary Gottlieb Lead lawyer: Paul Marquardt Client: TPG Capital LP • Deal sees Labelux Group, a subsidiary of Coty Inc, acquire Bally International AG, the fourth-largest luxury goods brand in China, from Texan company TPG Capital LP

► BEIJING CAPITAL INTERNATIONAL AIRPORT CO SHARE CAPITAL RAISING US$300m Firm: Fried Frank Client: Beijing Capital International Airport Company Limited Lead Lawyers: Stephen Mok, Norman Hui, Viola Cheung • Beijing Capital International Airport Company Limited placed 313,214,000 new H shares for approximately HK$2.34bn

• The construction project is Vietnam’s first port built by foreign investment, and is a 20/80 joint venture by the state-owned Tan Thuan Industrial Promotion Company (IPC) and the world’s second-largest port operating group, Dubai Port World (DPW) • Linklaters worked with the local office of international law firm affiliation Russin & Vecchi to advise the JV partners on financing the initial phase of the project

| AUSTRALIA/JAPAN | ► WOODSIDE PLUTO LNG PROJECT FINANCING US$1.5bn Firm: Paul Hastings Lead lawyers: Christian Peterson, Raj Pande, Tomohisa Aiko, Yumiko Abe Client: Japan Bank of International Cooperation and The Bank of Tokyo Mitsubishi UFJ Firm: Morrison & Foerster Lead lawyers: Dale Caldwell, Adam Young Clients: Woodside Energy, Kansai Electric and Tokyo Gas • Japan Bank of International Cooperation (JBIC) and commercial lenders led by The Bank of Tokyo Mitsubishi UFJ (BTMU) financed the Pluto LNG Development Project, an

Australian natural gas exploration and production operation • The banks financed the US$1.5bn project, which includes the production of gas, development of LNG trains, shipping and both onshore and offshore facilities • Paul Hastings acted for JBIC and the commercial lenders, advising on structuring the transaction, and preparing and negotiating financing documents. Morrison & Foster acted for Woodside Energy and Kansai Electric and Tokyo Gas • The deal closed on 7 July 2008

| AUSTRALIA/SINGAPORE | ► CHALLENGER–MITSUI ESTABLISH INVESTMENT MANAGEMENT BUSINESS US$1.2bn Firms: White & Case, Venture Law Lead lawyers: Lock Yin Mei, Thomas LaMacchia Client: Challenger Financial Services Group Firm: Freshfields Bruckhaus Deringer Lead lawyer: Edward Cole Client: Mitsui & Co • Challenger Financial Services is working in a joint venture with Mitsui

• UBS AG was the sole placing agent on this transaction • Beijing Capital International Airport Company Limited engages in the operation and the management of the aeronautical and nonaeronautical businesses at the Beijing Capital Airport

| VIETNAM | ► SAIGON PREMIER CONTAINER TERMINAL PORT DEVELOPMENT PROJECT FINANCE US$225m Firms: Linklaters; Russin & Vecchi Lead lawyer: John Maxwell Clients: DP World, Tan Thuan Industrial Promotion Co Firms: Allen & Overy, Vilaf Clients: ANZ, Calyon, DZ Bank AG, HSBC Asian Legal Business ISSUE 8.9

NEWS | deals >>

& Co to create a Singapore-based investment management business • White & Case and Venture Law acted on behalf of Challenger, advising on fund establishment and sponsorship. Freshfields acted for Mitsui, advising on fund structuring and terms, and joint venture arrangements with Challenger • The joint venture will establish and sponsor the Challenger Mitsui Emerging Markets Infrastructure Fund, with a target size of US$1.2bn

| AUSTRALIA/NEW ZEALAND/SINGAPORE | ► FRASERS–ALLCO COMMERCIAL REIT STAKE ACQUISITION US$132m S$180m Firm: Allens Arthur Robinson Lead lawyer: Robert Speed Client: Allco Commercial REIT Firm: WongPartnership Lead lawyer: Andrew Ang Client: Allco Commercial REIT Firm: Allen & Gledhill Lead lawyer: Prawiro Widjaja Client: Frasers Centrepoint Limited • Frasers Centrepoint Limited has acquired Allco Finance Group’s Singaporean real estate business. The S$180m deal comprises Allco’s 17.7% stake in the Allco Commercial REIT and 100% interest in the Allco (Singapore) Limited. Allco REIT has been listed on the main board of the Singapore Exchange Securities Trading Limited since 2006

| AUSTRALIA/CHINA | ► AVONLEA–SINO GAS MERGER TERMINATION A$100m US$97m Firm: Steinepreis & Paganin Client: Avonlea Minerals

► YOUR MONTH AT GLANCE (CONT) Firm Luthra & Luthra Majmudar & Co

Mallesons Stephen Jaques McGuireWoods Milbank, Tweed, Hadley & McCloy

Morrison & Foerster Norton Rose Oppenhoff & Partners Orrick Paul Hastings Rajah & Tann

Reed Smith Simmons & Simmons Skadden

Jurisdiction India, Russia India, UK India India India, USA Australia, Indonesia Australia, India, USA Australia, China China, Thailand

Deal name Sistema acquisition of Shyam Telelink Limited Quatrro acquisition of Babel Media Gokul Refoils & Solvent Ltd share offer WW Grainger Inc stake acquisition of Asia Pacific Brands India Ltd Lummus Corporation, Patel Brothers Services and Engineering Pvt Ltd and Apex Auto Ltd joint venture PT Bumi TBK bid for Herald Resources SIS Chubb acquisition Autohome & PCPop merger with Norstar Media BP Overseas Development Co. Ltd Acquisition of AsianAmerican Coal Inc AK Khan & Company Ltd share sale


Labelux Group Acquisition of Bally International AG Shandong Chenming Paper Holdings IPO Warburg Pincus Investment in Beijing Tianyu JBIC-Bank of Tokyo Woodside LNG project Midsouth Holdings SGX Delisting

Indonesia, Singapore

Citra Group share purchase and refinancing

Australia, BVI, UK Qatar Japan, USA China, Japan Japan, USA Japan, USA

1100 Undisc.

Qatar Japan, USA Japan, USA

Tay & Partners Trilegal

Malaysia India

Walkers Weil, Gotshal & Manges White & Case

UAE India

Abu Dhabi Commercial Bank Medium note term offering Goldman Sachs bond sale and warrant subscription

Indonesia Indonesia Singapore Indonesia Japan, USA

PT Alam Tri Abardi Acquisition PT Adaro Energy TBK IPO Kravis Kolhlberg Roberts acquisition of Unisteel Technology PT Bayan Resources Tbk IPO Tokio Marine Holdings Inc acquisition of Philadelphia Consolidated Holdings 98 Holdings Pte Ltd share acquisition Farrer Court Site redevelopment & MSREI Finance UOB & PingAn Securities proposed fund-management JV China Southern Fund Management & Oriental Patron Financial Asset Management JV

Yuan Tai PRC Attorneys

551 Undisc. 220 420

Singapore Singapore China, Singapore China, Hong Kong


PT Alam Tri Abardi Acquisition PT Adaro Energy TBK IPO JBIC-Bank of Tokyo Woodside LNG project Asia Cement (China) Holdings IPO AK Khan & Company Ltd share sale

Slaughter & May Sullivan & Cromwell

Wolf, Block, Schorr and Solis-Cohen WongPartnership

Practice M&A M&A Equity M&A JV

Bangladesh, Hong Kong , Japan Indonesia Indonesia Australia, Japan China, Hong Kong Bangladesh, Hong Kong , Japan China, Europe China, Hong Kong China, Hong Kong Australia, Japan China, Singapore

CopperCo-Mineral Securities acquisition Commercial Bank of Qatar GDR listing Bank of Tokyo Mitsubishi UFJ ltd share purchase Commercial Property Refinancing SMFG Preferred Capital USD 3 Limited securities offering Resolution and Collection Corporation of Japan share sale of Chuo Mitsui Trust Holdings, Inc. Commercial Bank of Qatar GDR listing Bank of Tokyo Mitsubishi UFJ ltd share purchase Tokio Marine Holdings Inc acquisition of Philadelphia Consolidated Holdings Port of Tanjung Pelepas-misc joint venture Goldman Sachs bond sale and warrant subscription

Simpson Thacher

US$m 627 Undisc. Undisc. Undisc. n/a


1,100 1,300 1,500 268 350

Equity, M&A Equity Project finance Equity Equity

Undisc. 383 78 1,500 48

400 900 3,000 395 1350 971

M&A Equity Equity Project finance Debt market, Equity Debt market, Equity Equity Equity M&A, Equity Banking Banking Banking

900 3000 4700

Equity M&A, equity M&A

n/a Undisc.

JV Equity, debt market Equity Equity, debt market Equity, M&A Equity M&A Equity M&A


1100 1300 578 530 4700 Undisc. 1,512 Undisc. Undisc.

Equity Project finance JV JV

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

61 2 8437 4700


Firm: Q Legal Lead lawyer: Robyn Ferguson Client: Sino Gas and Energy Limited

On page 49 of the article entitled ‘Building ambition’ published in ALB Issue 8.8, ALB mentioned ‘Steven Chau’ of ‘Hills International’. Both of these references were incorrect and in fact should have read ‘Steven Chan’ of ‘Hill International’. The amended article is available at www. ALB regrets this omission.

• Avonlea Minerals cancelled its proposed merger with Sino Gas and Energy. The deal, worth about A$100m, was expected to involve Avonlea’s 100% acquisition of shares in Sino Gas. The deal was terminated on 14 July 2008

ONC Lawyers (formerly known as Or, Ng & Chan) was omitted from the ‘ALB 50’ table of Hong Kong’s largest law firms, published on page 31 of ALB Issue 8.6. The firm has 23 lawyers in Hong Kong and so should have been ranked seventh. The amended table is available at www. ALB regrets this ommission.

The tax and trusts feature entitled ‘Trust Me’ in ALB Issue 8.8 contained the following errors: Deborah Annells managing director of Azure Tax was quoted as saying “There is no such thing as a tax return in Hong Kong.” That should read: “There is no such thing as a Trust tax return in Hong Kong.” ALB also stated “Indeed, Annells’ consultancy is a stickler for making sure the rules are followed.” That should read: “Azure Tax makes sure the tax rules are followed for their trust cases.” ALB regrets these errors.


NEWS | analysis >>


The rise and rise of compliance in Hong Kong and Singapore As international business interest in Hong Kong and Singapore reaches fever pitch, the region’s law firms are finding that there is a renewed need to focus on compliance and regulatory issues as Hong Kong and Singapore authorities are each tightening their grip to keep up with today’s global market


omplex. That’s the best way to describe the corporate compliance environments in Hong Kong and Singapore. In both countries, there is a wealth of regulatory bodies and legislative instruments dealing with everything from banking ordinances and futures to securities and listing rules. Yet lawyers in both jurisdictions predict that there is plenty more regulatory activity to come, particularly as transactional activity increases in quantum and sophistication.

Hong Kong: further compliance regulation on the horizon ► HONG KONG REGULATORY BODIES AND THEIR FUNCTIONS • Securities and Futures Commission(SFC) Regulates securities and futures markets in Hong Kong • Hong Kong Monetary Authority (HKMA) Regulates banking and business through banking ordinances • Hong Kong Stock Exchanges and Clearing Limited (HKEX) Regulates listing rules • Hong Kong Growth Enterprise Market (GEM) Regulates listing rules of GEM-listed entities and their sponsors

At present, there are four corporate regulatory authorities in Hong Kong: the Securities and Futures Commission (SFC), which regulates the securities and futures markets in Hong Kong; the Hong Kong Monetary Authority (HKMA), which regulates the banking business through the banking ordinances; Hong Kong Stock Exchange (HKEX), which regulates the listing rules; and Hong Kong Growth Enterprise Market (GEM), which regulates the listing rules of GEM-listed entities and their sponsors. “There is constant dialogue between these four authorities but none speaks for the other,” said Richard Mazzochi, partner at Mallesons. The SFC, in particular, has been more proactive in the last couple of 10

years. “It has been monitoring market developments, reviewing relevant laws in other jurisdictions and having discussions with private practitioners,” said Mazzochi, citing as an example the SFC’s proposal to recognise certain registered Australian funds. For Michael Phillips, a partner at Heller Ehrman, increased SFC activity indicates the government’s realisation that it needs to regularly update and adopt corporate governance best practice to maintain its status as an international financial centre. “Hong Kong regulators are now more powerful and proactive than ever before and this trend is, almost certainly, not only to continue but also to proceed at a faster pace,” he said. Corporate and securities partner at Dechert Basil Hwang agrees, pointing to the increasing sophistication in the SFC’s regulatory approach. “The SFC, with a view to maintaining Hong Kong’s competitiveness as a financial centre, appears to have adopted a more risk-based approach to regulation,” he said. Similar changes are believed to be in the pipeline at the HKEX. “Currently, the HKEX employs a pre-vetting Basil Hwang, regime, in which all Dechert relevant documents need to be pre-approved before registration,” explained Robert Ashworth, head of Asia corporate at Freshfields. “However, they are making efforts to move to a postvetting model, for which the focus will be on addressing defective disclosures after filing.” There are also plans for the HKEX Listing Rules to be backed up by statutory legislation. “If such plans come to pass, a breach by a listed company of certain provisions of the Listing Rules will become a great deal more serious than is currently the case,” said Phillips.

The view from the Lion City: Singapore’s compliance landscape The case in Singapore is slightly different from that in Hong Kong. Whereas the flurry of regulatory activity in Hong Kong is geared towards cementing its position as a hub for international business, the stepping up of Singapore’s is about creating an environment conducive to attracting more high-end transactional activity. Yang Eu Jin, partner at KhattarWong, believes that, as more complex corporate vehicles and financial instruments are introduced into Singapore, the need for compliance and regulatory advice is set to explode, with interesting, if unintended, consequences. Yang said that nascent regulatory spaces are the areas where further development is most likely. “Although the Registered Business Trust Act was only introduced in 2004 in Singapore, it, and other areas aligned to it, such as listings, are potential areas poised for growth in Singapore,” he explained. However, Joyce Tan, a partner at WongPartnership, thinks that increased regulatory activity is likely to leave its most indelible mark in other areas. “With more sophisticated institutional investors in the market, there has been an increase in shareholder activism with respect to corporate governance. Numerous highprofile corporate scandals in Singapore in recent years, such as the National Kidney Foundation and the Asia Pacific Brewery cases, have led to a higher level of scrutiny by the courts and the public,” she concludes. One area that has already witnessed substantial change is competition. And although the Competition Act came into effect in January 2006, its full effects are still largely unknown. “Clients still need assistance reviewing and understanding this relatively new law, and also how it is likely to be implemented and enforced,” said Asian Legal Business ISSUE 8.9

NEWS | analysis >>

Stefanie Yuen Thio, a director of TSMP Law Corporation. Chong Kin Lim, head of Drew & Napier LLC’s TMT and Competition Law Practice, agrees: “Given Sandy Foo, the heightened public Drew & Napier awareness surrounding the recent investigations by the competition commission, we expect greater interest by businesses in seeking legal help on competition law compliance.”

Broader issues: the credit crisis When financial trouble strikes, often regulatory and compliance issues occupy the centre stage for both regulators and the regulated. The traditional view has been that it is the ‘micro’ areas such as disclosure which come under the microscope.However, if the Asian financial crisis and more recent Enronrelated mishaps have taught lawyers and business people anything, it is that these micro practices have a far broader significance. “Areas that affect investors’ interests and integrity of the market as a whole are those which will attract the greatest regulatory attention,” said Sara Or, a partner at JSM. “The credit crunch has increased the momentum on regulatory work and we are expecting to see more litigation as

“Hong Kong regulators are now more powerful and proactive than ever before and this trend is, almost certainly, not only to continue but also to proceed at a faster pace” MICHAEL PHILLIPS, HELLER EHRMAN a result,” said John Champion, partner at Clyde & Co. “D&O insurance is being sold into a more receptive market, and claims have occurred and will continue to do so.” This is especially true for antimoney laundering. “A breach of money laundering rules in one country will expose that company to close scrutiny by regulators in other jurisdictions,” said Phillips, who highlighted the creation of a central coordinating committee by the Hong Kong government to deal with money laundering. Singapore authorities are similarly focusing on this issue. “With the revisions in 2007 to Monetary Authority of Singapore notices on money laundering, we expect financial institutions to require more legal assistance on issues pertaining to customer due diligence programs and sanctions screening,” said Sandy Foo, director at Drew & Napier.

Transactional funds compliance: on the up? The consensus among those that ALB spoke to was that, of all the areas expected to take off in the compliance space, work related to funds would likely be the big winner. “Our global investment funds clients generally are highly conscious of and take great pains with local regulatory and compliance issues. Basically, it’s a risk-management issue that investment funds are sensitive to,” said Hwang, noting that regulations governing hedge fund activity in Hong Kong is an area in which further government action is expected. This is also the case for Singapore. “Regulatory work relating to funds management, for example in licensing, will increase with the recent trend in investment funds coming to Singapore,” said Thio. ALB


Anti-Monopoly Law creates a new set of opportunities and challenges The much-anticipated new Anti-Monopoly Law (AML) has come into effect. Lawyers told ALB that it creates more business for their firms as multinationals, and that local companies are scrambling to back their businesses with anti-trust lawyers to secure legal compliance. However, many also expect a bumpy ride ahead as the law undergoes its due process, in the world’s fastest growing economy


he local and international law firms that ALB has spoken to unanimously agreed that the demand that generated by the new Anti-Monopoly Law (AML) will usher in more clients and give them a chance to establish a foothold in this area.

A new frontier for legal practices To this effect, several international companies in China have ramped up their anti-trust practices in the last

year by relocating seasoned anti-trust lawyers from the US and Europe to their Shanghai or Beijing offices. “We’ve had a huge amount of interest from clients who have connections in China,” said Cheng Yuan, Beijing-based anti-trust lawyer at Linklaters. “They’re eager to understand to what extent the law is relevant to how they do business. This is especially the case for those whose businesses have a large market share in China.”

Zhan Hao, executive partner at Grandall Legal Group, revealed that as a result of the new law, the local firm has retained some of its biggest clients – an aeroplane company in China and a foreign technology company in the Top 500. Anti-trust practice was not significant in China until 2003, after the Ministry of Commerce (MOFCOM) issued the provisions on the Takeover of Domestic Enterprises by Foreign Investors, which required some pre-merger notifications to 11

NEWS | analysis >>

► THRESHOLDS FOR MERGER CONTROL NOTIFICATION The new thresholds require merger control notification if either of two thresholds are fulfilled: • If the combined worldwide revenue in the preceding accounting year of all business operators participating in the merger exceeds RMB10bn (approximately US$1.4bn), and at least two business operators have revenue in the PRC exceeding RMB400m (about US$57m) • If the combined revenue in the PRC in the preceding accounting year of all business operators participating in the merger exceeds RMB2bn (approximately US$286m), and at least two business operators have revenue in the PRC exceeding RMB400m (about US$57m)

be filed. Since then, M&A teams working on deals in China have been increasingly backed by anti-trust experts.

Devil in the details The uncertainty has precipitated demand for legal services among clients adopting a wait-and-see approach. It has also caused a divide within the legal community in China. In March, MOFCOM put up draft provisions for review and consulted with numerous local and international legal practitioners before publishing a AML draft. These new merger notification thresholds proved to be a complex mesh of provisions that did not gel with market realism. Then, on 3 August, the State Administrative Legislative Council published “Implementing Regulations on Concentrations”, which filtered out five of the proposed 19 articles on the notification thresholds for mergers. “There’s substantial improvement from what was set out in the draft,” said Nathan Bush, counsel at O’Melveny & Myers’ Competition Practice Group based in Beijing. “For example, the

“Besides foreign giants, large SOEs have a significant chance of becoming the target of the new law, so they’ll seek legal advice and services from law firms when they make strategic decisions, especially on pricing and M&A transactions” ZHAN HAO, GRANDALL new thresholds are based purely on the revenues of the merger parties involved, as opposed to being based on market share. Thresholds based on market share are highly subjective, whereas ones based on revenues are more objective and measurable.” However, the brevity of this new draft also generated grey areas that disconcerted some lawyers. “Except for this recent announcement, none of the promised further guidance or clarification on the AML has yet to be published by the Chinese authorities,” said Kirstie Nicholson, competition law specialist at Lovells in Shanghai. “Therefore, there remains a lack of clarity about how the prohibitions will be applied and enforced by the authorities in practice.” For example, the new filing thresholds for mergers are noted but there are neither details on the types of deals that need to be filed with the Anti-Monopoly Bureau authorities nor guidelines on which types of revenues count under different types of transactions. Similarly, it is not made evident how exchange rates are determined when applying the revenue thresholds. “I’m concerned about the lack of transparency and certainty for foreign

“We’ve had a huge amount of interest from clients who have connections in China. They’re eager to understand to what extent the law is relevant to how they do business. This is especially the case for those whose businesses have a large market share in China” CHENG YUAN, LINKLATERS 12

investors. There are no case precedents and no deadlines. This makes business difficult to operate in. It seems that if we want certainty, we’ll have to approach the authorities for pre-consultation,” said Cheng Yuan, Beijing-based antitrust lawyer at Linklaters. Leading players in certain industries may also face an increase in litigation and a certain degree of uncertainty in winning a case. “Since the AML allows civil law suits, all companies face the risk of civil anti-monopoly litigation and monopoly liability,” said Michael Zhang, a senior legal consultant at Sheppard Mullin Richter & Hampton. “However, the AML is a substantive law rather than a procedural law. The procedure of the civil anti-monopoly law suit and the level of jurisdiction will remain unclear.”

Impacts on the M&A and investment community The AML being in place marks a milestone for the country’s legal development, and changes the traditional way of doing M&A deals in China as the provisions for penalty for non-compliance mean that all parties must consider the anti-trust risks in deal closing. “Instead of simply signing the transaction documents, the decision makers on both sides started to recognise the necessity of consulting the anti-trust lawyers in advance if there’s any risk that the Ministry of Commerce will reject the deal,” said Zhang. Peter J Wang, a litigation partner at Jones Day’s Shanghai’s office, echoed this view. “Our clients are eager to make sure they’re complying with the new law, but they need to know how. And some important or high-profile cases may be determined based on factors that really aren’t about competition,” said Wang. Asian Legal Business ISSUE 8.9

NEWS | analysis >>

“The law has enough ambiguity and exceptions in it that it can be abused if enforcement guidelines and practice are not clear and transparent.” In relation to ambiguity and abuse of the new law, an oft-heard quandary in legal circles is: how effective will the new AML be in handling administrative monopoly and misuse of governmental power for anticompetitive purposes? “A key area of concern is the extent to which Article 7 of the AML may give an exemption to state-owned enterprises. Article 7 is an extremely ambiguous provision,” said Nickolson. “In particular, the definition of a state-owned enterprise and whether the AML does actually make exemptions is unclear. This may remove a significant number of business operators from the scope of the AML, thus impacting upon its effectiveness as a cross-sector competition law.”

“Our clients are eager to make sure they are complying with the new law, but they need to know how. And some important or high-profile cases may be determined based on factors that really aren’t about competition” PETER WANG, JONES DAY Local anti-trust law experts, however, hold a slightly different perspective. Zhan Hao of Grandall, expects SOEs will also need anti-trust compliance services from external counsel. “Besides foreign giants, large SOEs have a significant chance to become the target of the new law, so they’ll seek legal advice and services from law firms when they make strategic decisions, especially on pricing and M&A transactions,” said Zhan.

The AML is also anticipated to have an impact on global M&A transactions taking place in other jurisdictions if any of the parties have significant market shares in China. Local firms are looking forward to more cooperation with their international counterparts advising them on global M&A deals. How the new law and its enforcement will affect community legal services markets will be closely monitored over the next few months. ALB


Korea’s new look financial services industry Further deregulation is set to shake up South Korea’s still nascent financial services sector. With free trade agreements between Korea and the US, the EU and Australia high on the government’s agenda, is a loosening of the regulations which prevent foreign law firms from setting up shop soon to follow? Seoul is on the radar of regional and international law firms, as ALB reports in the first of a two-part series Getting up to speed Over the past 18 months South Korea has been implementing financial reforms aimed at accelerating what has been consistent but steady growth since the 1997 financial crisis. The new Lee Myung-Bak government, which came to power on 25 February this year with a mandate to revitalise the economy, has been given credit for this new momentum. With attractive economic indicators, a strategic position in the region and

fast-growing sovereign funds looking for investment opportunities, even in the context of the unstable global economy the opportunities for Korea are enormous. Moves such as reforming key manufacturing industries, strengthening relationships with key trading partners, the privatisation of state institutions and the continued reform of Chaeb l (Korean MultiNational corporations) will benefit not only Korea but also everyone else who deals with the country.

Key legislative reform Underlying the changes are two key pieces of legislation, known as the Capital Markets Integration Act and the Capital Markets Consolidation Act. The Integration Act has changed the landscape of the financial services market by merging some of the supervisory and administrative bodies and by abolishing others. The Consolidation Act will consolidate the six main laws that regulate financial services, the main purpose being to 13

NEWS | analysis >>

“Since its entry into the WTO, Korea has been talking about opening up the legal market, and foreign firms, particularly UK, US and Australian law firms, are very interested in that happening” MICHAEL CHANG, ALLENS ARTHUR ROBINSON

create a more competitive industry and foster the growth of investment banking institutions. According to Kun Ho Hwang, chairman of the Korea Securities Dealers Association, Korean financial firms will be able to achieve the economies of scope needed to operate on the level of leading global investment banks. Size may come through growth or consolidation. Michael Chang of Australian firm Allens Arthur Robinson, who spent nearly six years seconded to Korean law firm Shin & Kim, predicts consolidation. “The niche firms will probably combine with the larger firms.” And the international institutions will be definitely be involved, Chang says. “For example, in the funds management area you have already seen consolidation taking place, with both local and foreign firms purchasing local asset managers.” Seoul-based partner Eui Jong Chung of Bae, Kim & Lee says the new legislation will “try to eliminate the walls between capital markets companies, including asset managers”. He believes the reforms will “allow these businesses to form one company that can conduct every piece of business”. The new law will also bring about the introduction of a more extensive range of financial investment products to Korea while at the same time focusing on customer protection. In short, the deregulation means greater diversification in investment products which “should create many opportunities for securities firms to expand their business and products” says Pil-Kook Lee, a foreign legal consultant with Kim & Chang. And advisors are positive about the process to date. There’s been “huge participation” by the banks, investment banks and fund managers says Chang. “The process has been well managed, with a lot of industry participation.” 14

Step one: housekeeping While the Consolidation Act will not come into effect until February 2009, the first stage of reform has already begun. As from 4 August, licensed companies have a two-month window in which to obtain a new licence. If no change to their business is contemplated, the reauthorisation and re-registration involves a simple confirmation. However, says Chung, if the company wishes to add a new segment to the scope of its business, the process will be much more complicated and time consuming because of the need to comply with new requirements. It is safe to say that South Korea’s commercial law firms have had a busy two months. And the work volumes are not likely to decrease. Once the new law is enforced, Chung expects that additional work will follow as opportunities arise to advise on new and complicated legal issues.

Broader impact Most of the international investment banks active in the global financial markets are already on the ground in South Korea but, in light of the recent reforms, there is likely to be increased interest across all sectors. Lee highlights the new government’s intention to privatise many publicly owned companies and merge others together, providing yet another stream of work for the country’s advisors. Privatisation targets include the Korea Development Bank, Woori Financial Group and the Industrial Bank of Korea. Private equity is set to grow and John Walker, chairman of the Macquarie group of companies in Korea and chairman of the Australia– Korea Business Council, believes that domestic private equity funds will soon emerge as the dominant players. Lee agrees, having seen much more private equity activity recently in a

sector that did not exist four or five years ago. Strategic investors are no doubt pleased about the simplification of the procedure for reviewing business combinations that present lowcompetition issues. Korean lawyers will soon have yet another new area of regulation to cover. In 2007, the government set up a taskforce to investigate allowing hedge funds to operate in Korea. It is likely that they will be introduced gradually, and Kim & Chang’s Lee expects that the first introduction will occur next year.

Keeping up with demand That the demand for high-end legal services by sophisticated financial institutions will increase is clear. How will Korea’s firms cope? While Lee does not necessarily think there is a shortage of lawyers in Korea, he does concede that there are not many firms that can service the needs of sophisticated banking clients. Chung acknowledges firms will need to employ more lawyers as workloads increase, particularly given “that many foreign financial investment companies will want to come to Korea, given the relaxation of restrictions”. Since international firms cannot set up offices nor enter into joint ventures with domestic firms, one way of meeting demand is for firms to employ more foreign legal consultants who must be supervised. Otherwise, Lee believes, it will mean an increase in billable hours for Korean lawyers with the right experience and expertise. And an increase, one would assume, in law firm profits.

Obvious inefficiencies While Macquarie’s Walker has nothing but praise for Korea’s domestic law fi rms and the international fi rms that specialise Asian Legal Business ISSUE 8.9

NEWS | analysis >>

news in brief >> ► HK IPO VOLUMES Issue date totals



Morgan StanleyShinhan Norske Skog acquisition STX ShipbuildingSTX Engine Aker Yards acquisition Kangho AMC-CDL Hotels acquisition LS Cable Acquisition of Superior Essex

Shin & Kim

Kookmin Bank Bank CenterCredit acquisition

Shin & Kim

Shin & Kim, Evergreen Law Group Cleary Gottlieb, Kim & Chang, Wachtell, Lipton, Rosen & Katz, Bae, Kim & Lee Shin & Kim

Value (US$) 835


468 Undisc.


in Korean matters, he welcomes an opening of the legal market. “Life would be much easier if foreign firms could hang out their shingle,” says Walker. “It’s a little inefficient to have to use foreign and domestic firms, but it hasn’t hurt our ability to operate in Korea,” he continues. To service clients active in Korea, many international fi rms have Korean specialists, often based in their Hong Kong or Tokyo offices. They work regularly with Korea’s large commercial fi rms, a situation set to continue in the short term at least.

Opening up the market While not designed to accompany the recent financial market reforms, a gradual opening of the legal sector is a hot topic. It became a point of negotiation during the recently concluded KorUS FTA talks, but has long been on the agenda. “Since its entry into the WTO, Korea has been talking about opening up the legal market, and foreign firms, particularly UK, US and Australian law firms, are very interested in that happening,” Michael Chang explains. To deal with fears that large international firms will take over the market if they are allowed to enter, a three-step transition period has been

Proceeds (US$m)

1 Jan–7 Aug 2008



1 Jan –7 Aug 2007



YOY growth (%)

mooted, not dissimilar to the route Japan took when relaxing its restrictions. Chung understands that, if the KorUS FTA is ratified, US law fi rms will be permitted to open a branch office within a few years. The next stage will permit joint ventures with Korean law fi rms and the employment of Korean lawyers by foreign law fi rms. It is likely that pending FTA negotiations with the EU and Australia will suggest similar plans. But, as Chung points out, ratification of the KorUS FTA is still pending in both countries. The reaction to these plans is mixed. Lee is “neutral” when it comes to the effects of opening the market and predicts that, even if the opportunities arose, international fi rms would continue to base their Korean practices out of their Hong Kong regional bases. Other commentators believe that the recent rash of mergers between local fi rms may be the fi rst defensive move by an industry readying itself for future competition. Brendon Carr, an American attorney working as a foreign legal consultant in Seoul, believes that while mergers may help strengthen local fi rms, consolidation will also increase demand for foreignlicensed attorneys, because “the larger the fi rms get the more likely they are to attract domestically-originated international work as well as inbound work from multinationals”.

And finally… New regulation, new products and growth in all sectors, combined with an inevitable shortage of sophisticated commercial advisors and eradication of inefficiencies will force the issue. The shift in the demand and supply of legal services in Korea will occur; it’s just a matter of time. ALB

Number of issues


Full year 2007



Full year 2006



Full year 2005



Source: Thomson Reuters

► CHINA A SHARE IPO VOLUMES Issue date totals

Proceeds (US$m)

1 Jan–7 Aug 2008



1 Jan –7 Aug 2007



YOY Growth (%)

Number of Issues


Full year 2007



Full year 2006



Full year 2005



Full year 2004



Full year 2003



Full year 2002



Full year 2001



Full year 2000



Source: Thomson Reuters

► SHARE BUYBACKS IN ASIA (EX. JAPAN & AUSTRALIA) 1 Jan–8 Aug 2008 Target nation

Rank value (US$m)

Market share

Number of deals

South Korea




























Hong Kong






Industry total




Source: Thomson Reuters


Sign off >> F

igures from Thomson Financial have shed some light on recent IPO activity. The table below reveals the extent to which China dominated the Asia-Pacific IPO charts. The country was responsible for US$21bn in deals, with its closest rival, India, at US$4.5bn.



Proceeds (US$m)


PetroChina Co Ltd


Legal entrepreneur launches virtual vision


China Shenhua Energy Co Ltd



China Construction Bank Corp







Ping An Ins(Grp)Co of China



China Pacific Ins(Grp)Co Ltd



China Life Insurance Co Ltd


ilicon Valley lawyer-entrepreneur Craig Johnson recently launched a virtual law firm with 14 other lawyers. Johnson hopes the firm – titled Virtual Law Partners – will forge a new model for the legal industry and encourage work-life balance while working from home.

The new system is also geared to save on overheads so that clients are charged less, and attorneys are said to get 85% of what they bill. VLP lawyers can also set their own rates; however, the average billing rate is estimated to be around $400 an hour.


China Coal Energy Co Ltd






China Railway Constr Corp


Aspiring partner sues over broken promise

CC says no to chow on company credit



former Orrick Herrington & Sutcliffe associate is suing his former firm over an alleged broken agreement to make him a partner. According to Patrick Hoeffner, the firm had promised to bring him into the partnership to prevent him leaving and taking a client with him. During this time Hoeffner claims he turned down several offers, and was hoping to receive US$100m (£51m) in damages based on lost future earnings and other alleged economic losses as a result of his failure to become an Orrick partner. A New York State judge has since rejected this claim and ruled that Hoeffner may only seek nominal damages – which can be as low as $1. However, a jury could still conceivably award Hoeffner punitive damages.

nce again, Clifford Chance is tightening its wallet, and this time it’s hitting employees where it hurts – in the stomach. According to the cost-cutting conglomerate, leisurely lunches, breakfasts and after-hour snacks will no longer be coming out of the company pocket, so associates will have to cater for themselves. Following the recent taxi saga, CC has now slashed its dinner subsidies as well as cab charges, amidst a background of soaring food prices – the beloved staff deli has been shut for breakfast and afternoon tea and turned selfservice, and associates working double-time on weekends will now be forced to search for foodstuffs in the Canary Wharf shopping malls.

Singaporean firm with all the trimmings R

ajah & Tann employees have got it good. The Singaporean firm recently introduced some fresh new incentives for staff – and the extras are sure to go a long way when it comes to employee retention rates. • One-month paid sabbatical: Deserving senior legal associates who have stayed true to the firm for four years or more will be entitled to a one-off offer of a breezy month of paid leave to do, well… whatever they want really. The activity is not specified, so they will be able to use the paid leave to go on their honeymoon, help look after the baby or just relax. • Chill-out lounge: Employees at this forward-thinking 104

firm are also blessed with a 17th floor lounge, complete with game consoles like the Nintendo Wii and Microsoft Xbox, as well as a pool table. Making sure to cover all bases, the firm also provides a free breakfast daily, as well as lunch once a week, and a free flow of Ben and Jerry’s ice cream for its 600-plus employees. Not bad.

* ALB staff are currently lobbying to have the same incentives applied in their offices around Asia. Asian Legal Business ISSUE 8.6



Law firm merger of a different kind

uk report Linklaters and Freshfields go head to head in ECM rankings Linklaters and Freshfields have topped the Thomson Reuters European equity capital markets rankings, with both firms coming out on top in relation to number of deals and value of deals respectively. The figures revealed that while Linklaters had successfully advised managers on 20 deals over the first half of 2008 (nine more than Freshfields, which came in second), the firm’s deals totalled US$14.6bn over the six-month period, behind Freshfields which worked on deals worth a total of US$29.8bn. CMS mulls over merger options CMS Cameron McKenna recently revealed it is considering a major UK merger as an option to boost the firm’s presence in London. Although the firm has not decided on any specific targets, managing partner Duncan Weston said the firm is investigating various types of merger.

Eversheds expands in Europe Eversheds has signed an alliance agreement with 12-partner Dutch practice Faasen & Partners which will cement the firm’s presence in both Amsterdam and Rotterdam. The alliance, expected to be made official on 1 October 2008, will introduce Faasen & Partners as a member of Eversheds International, an international network of law firms in 24 jurisdictions with more than 2,500 lawyers. Bottom rung of the Linklaters equity ladder could be lowered – if plans by partners go ahead Linklaters’ lawyers generally enter the equity with eight years’ PQE but a proposal – part of the firm’s consultation on its partnership structure – would allow senior associates and salaried partners to do so on the same level of experience as their counterparts in more established sectors when they launch new practices. Profitability of the new practice would largely influence how much a rung is lowered.

¨ ROUNDUP • Linklaters’ Belgium partner Jean-Pierre Blumberg has replaced Jean-Marc Lefèv to take on the role of European managing partner, representing the firm’s mainland Western European offices • Clyde & Co partners have approved plans to set up an international board to drive the firm’s global strategy, which will be chaired by commercial partner Anthony Garrod • Norton Rose has re-elected chief executive Peter Martyr for another three-year term • Commercial partner Peter Valert has taken over as managing partner of DLA Piper’s Prague office


ingapore-based law firm Colin Ng & Partners (CNP) and global professional services provider Tricor Singapore Pte Ltd have formed a strategic joint venture, effective 1 September 2008. The new entity, to be known as CNP Corporate Services Pte Ltd, will boast around 140 personnel, over one-third of whom are lawyers qualified to practise in various jurisdictions throughout Asia. The new entity will offer a wide range of corporate secretarial services ranging from accounting and China entry to offshore structuring and consulting. The new entity will continue to offer legal services to new and existing clients through the CNP arm of the business. It is not the first time that Asian law firms have found it necessary to expand the scope of their activities in this way. In 2001, Singapore firm Drew & Napier established DrewCorp Services to provide dedicated corporate secretarial services to its clients. More recently, Korean firm Shin & Kim established several consulting businesses designed to offer its clients unprecedented access to the lucrative Chinese market and other emerging markets in the region. With governments in rapidly developing Asian countries showing more and more interest in attracting FDI to their shores, such moves are likely to continue in the future as law firms of all shapes and sizes realise the commercial utility of expanding their business acumen. ALB

• Keeping up with its reputation as one of the best-paying law firms outside of the Magic Circle, Macfarlanes has unveiled across-the-board salary raises for all of its associates, with some receiving up to a 6.5% hike • Recent figures reveal that Pinsent Masons now has the fastest growing AIM practice in the top 10, beating both DLA Piper and Norton Rose to become the top legal advisor on London’s junior market. The firm has acquired three new AIM clients in the last three months, and has now represented 59 AIM companies in total • Linklaters, Weil Gotshal & Manges and DLA Piper will all take lead roles on the upcoming £1.1bn sale of Foodvest to private equity group Lion Capital • Chief executive David Gray has stepped down from the helm at Eversheds, sparking a leadership contest. UK managing partner Bryan Hughes is tipped to take his place • At Clifford Chance, Laurent Vallee, formerly a Conseil d’État judge, joins as head of CC’s Paris-based tax practice while Amy Mahon returns to the London office as a corporate partner from Macquarie Bank


Asian Legal Business ISSUE 8.9


news in brief >>


Clifford Chance Asia MP steps down


agic Circle firm Clifford Chance has revealed that its Asia managing partner, Jim Baird, has stepped down from his post, effective immediately. Baird was Jim Baird, Clifford Chance believed to have fallen ill while travelling through Asia recently and was in a critical condition in a Hong Kong hospital. Baird, first appointed managing partner for Asia in 2001, has been with Clifford Chance for nearly 23 years, 18 of which

were as a partner in the firm’s Hong Kong office. Clifford Chance has announced that it will hold a series of ballots among partners in its Asia practice group to select Baird’s successor. While Clifford Chance’s Asian practice group grew by 22% in 2007, it is unclear as to whether the firm will opt to elevate someone from within its ranks or seek a lateral hire to fill the void left by Baird. The fluidity of the employment market for experienced partners in Asia at the moment suggests that Clifford Chance may well opt for the latter. ALB


Major firm merger fizzles out


xpectations of an impending alliance between Heller Ehrman and Baker & McKenzie have ended, following reports that Heller has called off merger talks. Although the two firms were reportedly on track to join forces, it is believed that conflict over changes to Heller’s internal management structure is to blame for the sudden halt in negotiations. A union with Bakers would have potentially created America’s largest nationally headquartered firm, with a turnover of around US$2.5bn.

Both firms have refused to comment on the issue, but it seems there are no hard feelings. The two firms recently worked together on a US$1.25bn deal – Heller advising Singapore’s sovereign wealth fund on an energy investment in a Bakers client, the Dallas-based Oncor Electric Delivery Company. Bakers is unlikely to be excessively troubled about the merger collapse. Revenue for the US giant surpassed the US$2bn mark for the fiscal year to the end of June 2008, and the firm reported an overall profit increase of almost 20%. ALB

HKEX APPOINTS NEW MEMBERS OF THE LISTING COMMITTEE The Listing Committee of the Hong Kong Stock Exchange has appointed two new members. Members of the Committee hold office for one year but can be reappointed. Herbert Smith partner John John Moore, Herbert Smith Moore is one of the newly appointed members. Moore is a US-qualified partner in the firm’s corporate practice group in Hong Kong. Terence Keyes, former Goldman Sachs managing director in the investment banking division and Merrill Lynch’s head of Asia corporate finance, is the other.

ZHONGLUN W&D VENTURES INTO THE MIDDLE EAST Amid a wave of international firms entering the Middle East, Zhonglun W&D has established a Middle East practice group in its Beijing head office. The firm’s Middle East group is headed by senior counsel Ahmad Kusayer, and consists of four lawyers. The need to further grow the size of the team to meet clients’ demands has been recognised by the firm. The group focuses on providing legal services to Chinese clients doing business in the Middle East and Middle Eastern companies investing in China. Zhonglun W&D, the first Chinese firm to open an office in London, is also likely to gain a footprint in the Middle East. Although there is no specific plan yet, the firm sees the possibility of setting up a branch office in Dubai or Saudi Arabia in a few years.


Project financing still strong


ontinued strong growth is expected in Asia-Pacific resources and infrastructure project financings during the next 12 months. Allens Arthur Robinson partner and head of the firm’s project finance group Phillip Cornwell said the project finance market can withstand global credit rationing, record energy prices, and slowing growth in the US and European Union. “Although commodity prices have come off, the Chinese economy is still growing and analysts do not see an early end to the resources boom. Banks are still willing to back well-structured projects,” said Cornwell.

There is considerable interest in mezzanine-level resources project financing from specialist private equity and hedge funds. This workflow could help encourage more favourable market conditions, explained Cornwell. “The Australian and Asia-Pacific project finance markets showed great resilience [to the credit crunch] in the first half of 2008,” said Cornwell. In the first half of 2008, Allens advised on project finance deals worth A$5.15bn (US$4.79bn). The firm said it has a 33.7% market share of Australasian project finance deals, which is claimed to be as large as that of the second- and thirdplaced firms combined. ALB 17


us report Merger turns sour for French office with US ambitions Taylor Wessing’s French office and US firm Nixon Peabody have locked horns in a legal battle, following botched merger talks between the firms. Taylor Wessing France claims Nixon poached 13 of its partners in violation of a non-disclosure agreement and is consequently seeking an injunction to prevent the hire and suing the firm for US$5m. Nixon Peabody is allegedly responding by seeking an injunction and US$1m plus punitive damages from Taylor Wessing for tortuous interference with advantageous business relations. Due to the nature of Taylor Wessing’s firm structure, each of the international offices operates as a separate legal entity. Alston & Bird proceeds with West Coast merger Alston & Bird is set to merge with West Coast firm Weston Benshoof Rochefort Rubalcava & MacCuish, a deal that will provide Alston with its first LA outpost. Atlanta-based Alston already has six domestic offices, and the merger with 83-lawyer Weston will create a combined firm of almost 900 lawyers. This total will be boosted with the addition of an extra 12 IP lawyers, including three partners, that

the firm recently poached from the Silicon Valley office of Akin Gump. Bakers is on a roll Baker & McKenzie has shattered the US$2bn revenue mark, ending the fiscal year 2008 in June with a figure of US$2.19bn, and a reported increase of almost 20% in global fee income. Firm-wide profits per partner have also improved from last year, with the US giant reporting double-digit growth – a 20% increase to US$1.206m from US$1.063m last year. Hammonds on the prowl for transatlantic merger partner Hammonds is moving full steam ahead with plans to revamp its US strategy and initiate a transatlantic merger. The firm – whose US business is worth £15m – is said to be considering three strategies at the moment: a merger with one US firm, a strategic alliance which would lead to a more formal association, or maintain the status quo and develop its existing relationships with US corporates and law firms. Hammonds’ managing partner has confirmed that if a merger does win out, the firm would prefer to match with a firm that has a significant presence in Eastern Europe and/or Asia.


Legal pioneer in


ne of the world’s leading law firms, Clifford Chance, has opened an Abu Dhabi office. The firm – one of the rare few that had the foresight to start a legal practice in Dubai 33 years ago – saw the strategic need to respond to demand for its services and strengthen its regional presence in the UAE. “The pace of development and change there has created a new legal landscape, and we need to have a presence on the ground to develop and strengthen our key client relationships,” said Graham Lovett, Clifford Chance’s Gulf managing partner.


Going local to go

W ¨ ROUNDUP • Heller Ehrman may be on the lookout for a new DC managing partner, following the loss of its current Washington office head Geoffrey Aronow to Bingham McCutchen • Reed Smith will soon set up in Silicon Valley following the hire of Morrison & Foerster partner Rich Scudellari • Hunton & Williams recently raided Akin Gump for nine partners, who are to be distributed throughout the firm’s offices in Washington DC, Houston and Los Angeles • Orrick Rambaud Martel has appointed Yves Lepage as the first head of its Paris project finance group • Thelen Reid Brown Raysman & Steiner has lost another of its name partners, with tech and IP attorney Richard Raysman bidding the firm goodbye to join New York’s Otterbourg Steindler Houston & Rosen • US mega-firms Shearman & Sterling and Sullivan & Cromwell have bagged top roles in insurance giant Allianz’s US$9.8bn sale of Dresdner Bank to German rival Commerzbank. Once the merger is complete, Commerzbank will lead in the German private and business banking market


ongPartnership – the first and only Singapore firm to open offices in the Middle East – is doubling its business opportunities by adding two local Arabic-speaking lawyers to its six-person team in Abu Dhabi. This strategy has helped it pull in deals that may have remained in the domain of local firms. “This works well for both outbound and inbound deals, and is important when some clients are more comfortable speaking Arabic,” said Paul Sandosham, WongPartnership’s head of practice in the Middle East. “Our strategy in the Middle East is to be the link for our clients on an international level, and language is an important part of securing deals. We’ve found many clients here are interested in investing not just in Singapore but in China and India as well.” Asian Legal Business ISSUE 8.9


news in brief >>

Dubai extends long arm to Abu Dhabi Building on the entrenched networks of their Dubai office, Clifford Chance is clearly trying to protect its competitive edge in the oil-rich region. “We intend to build on our long-term success in Dubai, both through this expansion and our strengthening relationship with Al-Jadaan & Partners in Riyadh, to consolidate our position as the leading international law firm in the region.” Graham Lovett will be heading the Abu Dhabi office, with banking and finance partner Richard Ernest leading an initial team of 10 lawyers on the ground there.

Ernest joined the firm 11 years ago and has worked in the firm’s London, Moscow and Frankfurt offices. Peter Deegan, a partner in real estate currently based in the firm’s Warsaw office, will relocate to Abu Dhabi, and capital markets partner Chris Walsh will be seconded from London to the office. The Abu Dhabi office will focus on finance, capital markets, projects, corporate, real estate and litigation, and is expected to add between 20 and 30 lawyers in the next two to three years to respond to growing clientele demand. ALB

DACHENG OPENS SHENZHEN AND HANGZHOU July was a much-celebrated month at Dacheng. China’s second-largest law firm has added two more locations to its existing 13-office national network, making it the firm with the largest number of branch offices in the mainland. The office in Shenzhen, which opened on 19 July, is the firm’s first entrant into the Pearl River Delta region. With an existing office in Xiamen, the new office strengthens Dacheng’s presence in southern China. It has eight partners and 15 lawyers, and is headed by senior partner Liu Xinde. A week after the Shenzhen opening, Dacheng celebrated the opening of its new Hangzhou office. Headed by partner Jiang Yinhua, the second office in the Yangtze River Delta will leverage the firm’s established resources and practices in Shanghai to provide clients with quality advice and services in the areas of corporate, finance, securities and foreign investment. Currently, there are nine partners and 12 lawyers in the Hangzhou office.

international To this effect, the firm works closely with its network of local firms in Saudi, Bahrain and Qatar, and has a nonexclusive alliance with a local law firm in Dubai with which it collaborates for expedience. Even before WongPartnership set up office in Abu Dhabi last year, it had acted for Aabar Petroleum Investments Company PJSC in 2006 in its acquisition of Pearl Energy Limited, an exploration and production company listed on the Singapore Exchange, for about US$547m. Local firms are also keen to work with international firms as it gives them exposure to more clients. “The number of Arabic-speaking lawyers is also small, and many of them have a preference to work as in-house counsel in large corporations as the remuneration packages can be

more attractive than being in private practice,” said Sandosham. However, the local talent squeeze may change as there is also much demand driven by the rapidly developing economy which requires legal infrastructures in various sectors. This is probably why the sun never does seem to set in the Middle East for international law firms that flock there. In recent weeks, firms including Clifford Chance, Latham & Watkins, Hogan & Hartson, Vinson & Elkins, Denton Wilde Sapte, DLA Piper and Norton Rose have boosted their teams by relocating partners to the oil-rich region. Of particular interest is that some of the firms with bases in Dubai are increasingly looking to Abu Dhabi for the next big growth surge. ALB

TROUTMAN SANDERS EXPANDS US CAPACITY TO BENEFIT ASIAN CLIENTS US firm Troutman Sanders, with offices in Hong Kong and Shanghai, is to merge with another US firm, Ross, Dixon & Bell. The merger, effective 1 January 2009, will create a 1,700-employee firm. When the merger is complete, Troutman Sanders will for the first time operate offices on the West Coast of the US and in Chicago, the size of its Washington office will double, and its insurance, professional liability and commercial litigation practices will Robert Webb, Troutman Sanders be significantly strengthened. “This deal is good not only for our two firms but also for our clients, who will benefit from greater depth, value and enhanced resources,” said Robert Webb, Troutman Sanders’ managing partner.





Intellectual Property

International Arbitration

Patents (Amendment) Bill 2008: Entitlement of Government to Import Any Relevant Health Product in Times of National or Extreme Emergency



he Patents Amendment Bill (Bill No. 15 of 2008) (the “Bill”) was presented by the Minister for Law and read for the First time on 21 July 2008. The Bill seeks to amend the Patents Act (Cap. 221) (the “Act”) to implement certain measures under the Agreement on Trade-Related Aspects of Intellectual Property Rights (the “TRIPS Agreement”) as amended by the Protocol thereto concluded in Geneva on 6th December 2005, and also to give effect to the Decision adopted by the General Council of the World Trade Organisation on 30 August 2003 on the implementation of paragraph 6 of the Declaration on the TRIPS Agreement and Public Health adopted in Doha on 14 November 2001. The proposed amendments seek to allow the Government and any party authorised in writing by the Government to import any relevant health product, and to do anything in relation to any relevant health product so imported, for or during a national emergency or other circumstances of extreme urgency, provided that the Government complies with certain notification requirements in relation to the relevant health product. Definitions of the terms “national emergency” and “circumstances of extreme urgency” are not proposed in the Bill. In the event that this right is exercised, the Government will pay such remuneration to the patentee as may be agreed, or as may be determined by a method to be agreed between the Government and the patentee having regard to the economic value of the patented invention. If no agreement is reached, the reasonable sum of remuneration shall be determined by the court pursuant to section 58 of the Act. However, if the patentee has received or will receive any other remuneration in respect of the relevant health product, the Government need not pay any remuneration. The Bill also empowers a court that has terminated a right under section 56 of the Act to make such consequential orders as the court thinks necessary. The other key amendment proposed under the Bill includes the restriction of Part X of the Act to contracts and licences relating to patented products or inventions that have been entered into or granted on or after 23 February 1995 (but before the date of commencement of the amending clause in the Bill). Part X of the Act deals with the avoidance of restrictive conditions in contracts for the supply of a patented product, in licences to work a patented invention, or in any contract relating to such supply or licence. The full text of the Bill is available on the Singapore Parliament website at Ang Kai Hsiang, Associate Intellectual Property and Technology Group Alban Tay Mahtani & de Silva LLP Phone +65 6428 9874 Email:


wo of the largest pieces of international arbitration I have handled within the past 5 years have reinforced the following belief: having decided on arbitration as the preferred mode of dispute resolution, contracting parties almost invariably give little or no systematic thought as to whether the arbitration ought to be institutional or ad hoc, the preferred institution, the applicable arbitration rules and whether provisions should be incorporated for consolidated arbitration hearings involving related disputes. The two cases I refer to were both large and complex, and involved multi-parties and contracts between different entities within the same group. In the first case, while all of the contracts provided for arbitration in San Francisco, two different institutional rules were chosen in the contracts. In the second case, while some contracts provided for disputes to be referred separately to the Singapore and English courts, other related contracts provided for arbitration in London. In both cases, there were no contractual provisions for any related arbitral disputes to be consolidated or heard together. Needless to say, when the disputes under these related contracts arose, they resulted in unnecessary delay and substantially increased costs. In the first case, substantial delay resulted in co-ordinating between the different arbitration institutions for the appointment of a common tribunal to deal with all the related arbitrations, and yet further delays resulted after the tribunal was appointed to finalize the formalities which were required under the differing institutional rules. Thankfully, the second case was amicably resolved very shortly before 3 separate sets of court and arbitration proceedings were commenced in Singapore and London. But for that resolution, the parties would have ended up in complex and costly litigation and arbitration on related issues before different bodies. What these cases highlight is the importance for negotiating parties to give systematic thought to the nature and types of disputes which are likely to arise, both under the contract being negotiated and any other related contracts involving the same or related parties, and then consider how best and efficiently to deal with those likely disputes. A real danger is for parties to simply adopt arbitration provisions which have historically been used in their organizations without proper thought as to whether those historical provisions will best serve their, and their related companies’, interests having regard to the nature and types of disputes which they have assessed as likely to arise.

Mr Harpreet Singh Nehal, Senior Counsel, is a Director of Drew & Napier LLC’s Litigation and Dispute Resolution Department, and holds an LLM from Harvard Law School. He is named as a leading lawyer in his field by Asia Pacific Legal 500 and described as “first-rate”. He can be contacted at +65 6531 2446 or

Harpreet Singh Nehal, SC

Ang Kai Hsiang

Asian Legal Business ISSUE 8.9



Arbitration in Dubai emerging as next sweet spot for law firms


s the legal fraternity in the United Arab Emirates (UAE) bulks up through the rush of foreign solicitors to fill the seemingly insatiable demand for legal services, arbitration is emerging as the next gap to address. “There is increased work in arbitration in the UAE. Last year, there was a record of 77 new arbitration cases that were referred to the Dubai International Arbitration Centre (DIAC) last year and 80% of the cases were construction related,” said James Kwan, an energy and infrastructure partner at Simmons & Simmons who specialises in arbitration. This year so far, 55 new cases were brought to DIAC. Apart from the development boom in almost all sectors of the economy, Kwan said several factors are driving up the numbers of arbitration cases.

First, the explosion in construction activity in Dubai lends itself to disputes. Disputes arising from time delays in construction work are common, as contractors who signed contracts to complete their projects within a short timeframe could not deliver. Secondly, there is an increase in the number of foreign investors in the UAE who prefer arbitration to litigation as the method of dispute resolution. The widespread practice of appeals and the fact that UAE court proceedings are held entirely in Arabic mean the length of time taken in litigation is much longer than in arbitration for foreign parties. Thirdly, the accession to the New York Convention by the UAE in 2006 has enabled arbitration awards conferred in any of the 142 member states to be enforced in the UAE, and vice versa.


PE investments increase in China and India despite regional fall No. of deals

China India Taiwan Hong Kong Australia

No. of companies 138 155 5 10 68

No. of firms

136 152 5 10 60

118 119 5 17 37

Sum invested (US$m) 1,694.7 1,477.9 177.0 94.1 87.6

Source: Thomson Reuters


sia-Pacific private equity (PE) investments in the first half of 2008 are down by 41.8% compared to the same period in 2007, according to statistics released by Thomson Reuters. The study examined 214 PE transactions totalling US$13.7bn in the region, excluding Japan and Australia. However, PE investments in China and India are bucking the trend. From January to July 2008, Chinese companies attracted US$1.7bn worth of investments from 138 deals, a slight increase from US$1.6bn for the same period last year. This accounted for 46.9% of the total regional activity. During the same period, India remained a hotbed of regional PE investments, receiving a total of

US$1.5bn from 119 deals, while Australia saw a 68.5% decline, from US$8.7bn to just US$2.7bn. The region performed considerably better than Europe, which experienced a 55.9% decrease. The Americas were the hardest hit, suffering an 84.2% drop in PE investment. ALB ► ASIA-PACIFIC PRIVATE EQUITY BUYOUT VOLUMES (EXCLUDING JAPAN AND AUSTRALIA) Rank date

Value (US$m)

Number of deals


23,620.9 234



YOY Growth (%)

CHINA US law firms continue Chinese expansion



“The UAE has been progressive in trying to adopt international best practice to improve arbitration, so as to instil confidence in investors that their disputes can be resolved in a fair and impartial manner,” said Kwan. He has advised on multi-million-dollar disputes over energy sales, the building of power plants, and oil concessions in the Middle East and Asia. “Dubai will be the leading place for arbitration in the Middle East as investments increase in this region. It has an arbitration centre with a board of trustees consisting of eminent arbitrators to direct the centre, rules which can be easily assimilated, and is known for its transparency and independence. Abu Dhabi is much wealthier, but currently has no internationally recognised arbitration centre,” he said. ALB


-41.8 Source: Thomson Reuters

S firm Dechert has been granted a licence to open an office in Beijing, its first in mainland China, the firm has said in a statement. The Beijing office will represent domestic and international companies, financial institutions, and private investors in a full range of corporate matters and transactions, cross-border M&A, and compliance and corporate governance issues. “The decision to establish on-theground resources in Beijing results from our assessment of our clients’ current and potential business interests in mainland China and neighbouring countries,” said Dechert chairman Barton Winokur. Earlier this year, the firm opened its first Asian office in Hong Kong after entering into a formal association with local firm Hwang & Co. So far this year, 10 US firms have obtained licences to open firms in China. Bullivant Houser Bailey has formed a strategic alliance with Lehman Lee & Xu and following the entrance of Covington & Burling, Taft Stettinius & Hollister, and Weil, Gotshal & Manges. ALB 21

NEWS | appointments >>

White & Case



Going to



Jiang Yinchun

Lan Tai

Long An

Corporate and securities


Zhang Shuguang Liu Xu


Long An


Jia Wei


Foreign investment and international trade Real estate

John Chu

Broad & Bright

Jun He

Cao Yu Andrew Lewis Mark Blanksby Luke Gannon Gregory Puff James Kwan

Haiwen & Partners Simpson Grierson Pinsent Masons Freehills O’Melveny & Myers Allen & Overy

Covington & Burling Norton Rose Clyde & Co DLA Piper Shearman & Sterling Simmons & Simmons

Tham Yuet-Ming Jeff Lane Mark Fairburn Owen Chan Anthony Wong Lee Hyeon Joo Eva Wang

Pfizer Wilkinson & Grist White & Case Stephenson Harwood & Lo Maples & Calder National Tax Service Spreadtrum Communications

Woon-Wah Siu Bertie Mehigan Huey Yan Tong Marcus Chow Brad Roach

Bell Boyd & Lloyd White & Case White & Case Singapore Stock Exchange White & Case

DLA Piper Laracy Gall O’Melveny & Myers Lovells White & Case Yulchon Wilson Sonsini Goodrich & Rosati Thelen Reid O’Melveny & Myers O’Melveny & Myers Drew & Napier Lovells


Corporate, investment and financing Corporate and M&A Corporate Construction Transactional funds M&A Arbitration & dispute resolution Regulatory and compliance Litigation Insolvency & restructuring Banking & finance Banking & finance Taxation Corporate & securities law


Hong Kong Hong Kong Hong Kong Hong Kong Hong Kong Seoul Shanghai

Securities Finance & restructuring Finance & restructuring Banking & corporate Energy & resources

Shanghai Singapore Singapore Singapore Singapore

Beijing Dubai Dubai Hong Kong Hong Kong Hong Kong





Clifford Chance

Peter Deegan


Abu Dhabi

Clifford Chance

Chris Walsh


Abu Dhabi

DLA Piper

Duncan Pickering


Abu Dhabi

Taylor Wessing

Florian Ranft



Taylor Wessing Covington & Burling Covington & Burling Denton Wilde Sapte Linklaters

Christoph Hezel Ellen Eliasoph Stuart Stock Paul Stothard Erik Söderlind

Munich Washington Washington London Sweden

Beijing Beijing Beijing Dubai Hong Kong

Ashurst DLA Piper

Geoffrey Green David Cox

London Brussels


Richard Ginks


Hong Kong Hong Kong/ Beijing Singapore



New role


Juris Corp

Nisar Ookabhoy



Juris Corp

Huzefa Nasikwala



Juris Corp

Sonali Sharma



Juris Corp

Vandana Sekhri



Juris Corp

Hoshedar Wadia



Hanafiah Ponggawa & Partners

Fabiola Hutagalung



* See also News section for further news on partnership expansion



OMM snaps up White & Case partners for new Singapore office O’Melveny & Myers has set up an office in Singapore to expand its Asia practice, with three former White & Case partners forming the core team. As part of the new Asia Strategic Capital and Finance Group, OMM partners Bertie Mehigan and Thong Huey Yann – previously finance and restructuring partners with White & Case in Singapore – will work with other lawyers in the firm’s Asia offices to advise clients in respect to complex debt, equity, hybrid financings, and other capital raising transactions across asset classes and capital structures. Senior restructuring and insolvency partner Mark Fairbairn, who recently joined OMM’s Hong Kong office from White & Case, will also be part of this group. Freehills

DLA Piper

Hong Kong: DLA Piper launches transactional funds legal practice DLA Piper will launch a dedicated new Asian transactional funds practice, after decades of operating for clients on equity capital market and M&A matters in Asia. Luke Gannon, formerly a Luke Gannon partner and head of funds at Freehills, has been appointed to head the practice. He said he decided to join DLA Piper because it would give him more opportunity to work cross-border and experience a new culture. “Hong Kong is one of the biggest financial centres in the world; it’s still the gateway to China,” he said. “I’ve had experience working with the Singapore and Hong Kong markets, and have been here many times on business, so that was another reason why I came.” Allen & Overy


Simmons & Simmons hires arbitration partner from Allen & Overy To boost the support for Asian clients who are increasingly investing in the Middle East and Middle Eastern clients who are looking to do business in Asia, Simmons & Simmons has brought James Kwan onboard dispute resolution expert James Kwan as a partner of its China Disputes Group team. He will be based in the firm’s Hong Kong office. Prior to joining Simmons & Simmons, Kwan had been a dispute resolution consultant with Allen & Overy, based in Dubai for two years. He is on the arbitration panel of the China International Economic and Trade Arbitration Commission (CIETAC) and an honorary member of the Dubai International Arbitration Centre. Asian Legal Business ISSUE 8.9

NEWS | appointments >>

Wilkinson & Grist

Laracy Gall

Jeff Lane moves to boutique dispute resolution firm Jeff Lane, the Hong Kong representative of FraudNet – an international network of law firms that specialises in the field of fraud and white-collar litigation and investigation – has joined Laracy Gall, a specialised dispute resolution law firm in Hong Kong, as a partner. Previously a partner with Wilkinson & Grist, Lane practised commercial litigation. He has about 20 years’ experience in both litigation and arbitration in Hong Kong. Lane has represented local and international clients in a wide range of large-scale banking and insurance disputes, and has led several multijurisdictional fraud and tracing exercises. He is also a contributing editor of the Hong Kong Civil Procedure, and sits on a number of committees with the Law Society of Hong Kong.

Norton Rose – New Zealand

Norton Rose – Dubai

Partners needed to handle sovereign funds in Middle East, Norton Rose Norton Rose has relocated corporate partner Andrew Lewis to Dubai from New Zealand, taking the partner head count to nine in the Dubai office. “The market in the Middle East is moving ahead, with financial institutions and sovereign wealth funds looking to do large and more complex deals. You have to staff your offices with experienced people to do these transactions,” Andrew Lewis said its corporate chief Tim Marsden. Lewis, who focuses on private equity and venture capital work, is the second recent Norton Rose hire from New Zealand. The firm brought corporate finance partner Andrew Abernethy into its Dubai arm from Bell Gully in June. Lewis was previously a partner with Simpson Grierson in Auckland. Norton Rose opened its Abu Dhabi office in May, with regional head Campbell Steedman relocating to the new office. The firm’s Saudi practice went live at the beginning of this year through an alliance with local practice Abdulaziz Al-Assaf.


DLA Piper

Compliance is the future DLA Piper’s Hong Kong office has appointed litigation and regulatory group consultant Tham Yuet-Ming as a consultant in its litigation and regulatory group. Tham said that the major shift of businesses to Asia and increasing enforcement activity by authorities in the region Tham Yuet-Ming have precipitated a need for firms and companies to ensure that they conduct their businesses in accordance with the regulatory and compliance frameworks of their host country. “Companies who want to do business in Asia cannot spend their resources firefighting; they need to ensure that they are prepared as they are moving into unfamiliar terrain. Getting regulatory and compliance advice helps them to work through the issues at an earlier stage, rather than inadvertently violating any laws.” Intense scrutiny and rigorous enforcement of the Foreign Corrupt Practices Act (FCPA) across jurisdictions from the US to China have prompted many multinationals to play it safe. In China alone, for example, businesses could be subject to reviews by the State Administration for Industry and Commerce, and by the provincial and municipal tax bureaus. Tham, formerly the regional compliance director for American pharmaceutical heavyweight, Pfizer, helped establish Pfizer’s regional compliance function in Asia-Pacific and Japan. The former Singaporean public prosecutor has also advised and defended companies in allegations of fraud and corruption, and conducted large-scale investigations with authorities in China, Japan, Thailand, Vietnam, Hong Kong and Korea.


Financial Update: UK Pension Transfers to Hong Kong


er Majesty’s Revenue and Customs (HMRC) is scrutinising qualified recognised overseas pension schemes (QROPS) for potential abuses, with the spotlight thought to be falling on Hong Kong. Under the rules, UK pensions can be transferred to a QROPS but 70% of the funds transferred must be used to provide an income for life. The trustees must provide a permanent undertaking to this effect. Some providers have however been promoting their schemes on the basis that after five years the entire fund can be paid out! This is not possible. HMRC has confirmed the trustees may pay out up to 25% of the funds transferred if the member has reached Normal Minimum Pension Age. The ‘five year rule’ is a reporting rule in that the trustees must report any payments from tax-relieved pension monies if at the time of payment the member has not been non UK resident for five tax years. Some providers seem to be under the impression the trustees obligations expire after five years. That is not the case. Whilst a proper assessment should be carried out before electing to transfer, the primary advantages of a QROPS are as follows:• Overseas pension income is not subject to UK tax, but a UK pension is – whether or not you are UK resident. • Pension funds are free of UK Inheritance Tax for UK domiciled individuals. • The pension fund monies may be freely invested in a very wide variety of investments. • After five years there will no longer be a compulsion to purchase an ‘annuity’ to provide a regular income during retirement. Moreover, in the event of your death the amount used to purchase an annuity (typically around 75% of the pension fund) would be lost forever! With QROPS the full value of the pension fund will be available for your beneficiaries. • Your Hong Kong employer (if you have one) can contribute up to 15% of your total remuneration to a Hong Kong ‘ORSO’ (Occupational Retirement Schemes Ordinance) Scheme and this amount will not be subject to Hong Kong salaries tax. During the past year we have successfully completed UK pension transfers amounting to several millions. If you would like to explore the possibility of transferring your UK pension to Hong Kong please contact David Bojan at Horwath Financial Services. David R. Bojan Managing Director Horwath Financial Services Ltd. Tel: (852) 2511 8337 Fax: (852) 2802 7613 Email:

David R Bojan


NEWS | regional update >>

Regional updates



CHINA Paul Weiss

PHILIPPINES SyCip Salazar Hernandez & Gatmaitan

MALAYSIA Tay & Partners

SINGAPORE Loo & Partners

INDIA Singh & Associates

Each month, ALB draws on its panel of country editors to bring readers up to date with regulatory developments across the region

Hong Kong’s Proposed Competition Law The Hong Kong Government has been considering the promulgation of a competition law for many years. Such law may finally be issued since a public consultation paper in relation to the draft law has been circulated for comments with the aim of passing the bill in the 2008-2009 legislative session. Similar to other countries, the proposal seeks to prohibit two types of conducts when they have the purpose or effect of substantially lessening competition: “[participating] in agreements and concerted practices” and “abusing substantial market power.” The “agreements and concerted practices” prohibition focuses on horizontal arrangements, whereas vertical arrangements are instead evaluated under the “substantial market power” prong. Neither conduct is a “per se” infringement, though the suggested market share threshold which triggers review for “abusing substantial market power” is 40%. An independent Competition Commission would be established to issue guidelines specifying examples of anti-competitive activities and clarifying infringement thresholds, to investigate and determine whether an infringement has occurred, and to apply sanctions and remedies. This Commission would be authorized to impose civil penalties of up to HK$10 million for violation of the proposed law. A separate Competition Tribunal would also be established to review the rulings of the Commission, with the power to impose even more severe penalties. These administrative proceedings of the enforcement bodies would likely be less formal and swifter than the courts’, and the Tribunal’s decisions are appealable to the Court of Appeal. Despite its efforts, the new Law raises

additional issues. One major issue relates to how mergers should be considered. The paper suggested three options: (i) only completed mergers raising “serious competition concerns” would be investigated without clear definition for that term; (ii) include a merger provision but with a delay in enforcement; or (iii) exclude a merger provision but allow reconsideration after review of the new Law’s effect. Clearly none of the options is satisfactory. Another issue involves the proposed Law’s exemptions and exclusions. “Government and statutory bodies” are controversially excluded, raising concerns of Government self-interest. Other exceptions are relatively undefined and raise questions as to how and to whom they might apply, including for anti-competitive agreements with overriding economic benefits, operations of public services of general economic interest, and certain activities to be exempted by the Chief Executive on public policy grounds. Will Hong Kong enhance its competitive edge by the enactment of this Law? Until these uncertainties are resolved and questions answered, the answer to this question will not be known for awhile. Written by Jeanette Chan, partner Melissa Mao, summer associate Paul, Weiss, Rifkind, Wharton & Garrison Paul, Weiss, Rifkind, Wharton & Garrison Unit 3601, Fortune Plaza Tower A No. 7 Dong Sanhuan Zhonglu Chao Yang District, Beijing 100020, PRC Email: Beijing Ph: (8621) 5828-6300 Hong Kong Ph: (852) 2536-9933

Asian Legal Business ISSUE 8.9

NEWS | regional update >>


The Philippines’ Civil Aviation Authority Act of 2008 To provide a safe and efficient air transport and regulatory services in the Philippines, the Civil Aviation Authority Act of 2008 (Republic Act No. 9497) was enacted. Under the law, the Air Transportation Office was abolished and replaced by the Civil Aviation Authority (CAA), which shall have jurisdiction over the restructuring of the civil aviation system and the development and regulation of technical, operational, safety and aviation security functions. The CAA is an independent regulatory body with quasi-judicial and quasi-legislative powers and possessing corporate attributes. It is attached to the transportation department for policy coordination. It is headed by a Director General, who shall be responsible for the exercise of all powers and the discharge of all duties of the CAA and shall have control over all its personnel and activities. The corporate powers shall be vested in a board composed of department secretaries, with the transportation secretary as chairman. The Director General may conduct schools for the purpose of training employees in subjects necessary for the proper performance of all authorized functions of the CAA. He may also authorize attendance of courses given in such schools by other government personnel and personnel of foreign governments, or personnel of the aeronautical industry. He or his representative shall have the right to inspect civil aircrafts and other aviation facilities to ensure that the same are being operated according to the law and applicable regulations and directives. The Board shall establish, pursuant to the law, the Enforcement and Legal Service and the Flight Standards Inspectorate Service. The former is a permanent

MALAYSIA office tasked to implement civil aviation regulatory, supervisory and administrative mandates of the Director General, while the latter is a permanent office designed to assist the Director General in the certification and inspection of aircraft, airmen and air operators. The law grants CAA fiscal autonomy and an exemption from taxes, customs and tariff duties. It likewise exempts technical personnel from the application of the Salary Standardization Law, hence posts for technical personnel shall become attractive as better salaries shall be given. With the passage of the law, international aviation standards would be met and air travel would be safer, thereby increasing tourism and investments that would create more employment. Thus, it is hoped that the law would serve not only as a comprehensive framework for transforming civil aviation in the country but also as an instrument for furthering national economic development. Written by Emmie-Lou L. Siongco SyCip Salazar Hernandez & Gatmaitan SSHG Law Centre 105 Paseo de Roxas, Makati City 1226 Philippines Phone: (632) 817-9811 to 20 Fax: (632) 817-3896 Email: Website:

Windfall profit tax in the power sector in Malaysia Independent power producers ( IPPs) in Malaysia are grappling with a problem which is now almost elegantly tossed back on their doorsteps by the government. It has been a problem in the making since the IPPs signed power purchase agreements ( PPAs ) with the national utility company, Tenaga Nasional Berhad in the last 2 decades. The terms of these PPAs were perceived as lopsided in favour of the IPPs. The problem came to a head when fuel prices shot through the roof and electricity tariffs had to be increased. Malaysia’s benign inflation of 2% to 3% rose to about 8%. Efforts to re-negotiate the PPAs were unsuccessful in the past. Faced with contractual obligations and pressure to further increase tariffs, the government issued the Windfall Profit Levy ( Electricity ) Order 2008. This new regulation prescribes electricity as ’prescribed goods’ under the Windfall Profit Levy Act 1998. The rate of the levy is 30% of the PBIT of an IPP in excess of 9% of ROA in a financial year. The reference to profits before interest and tax unnerved bondholders because bonds issued by IPPs could be put on rating watch and possibly downgraded. The regulation will be administered by the Royal Malaysian Customs and Excise Department and all IPPs with installed capacity of more than 30 megawatts and who sell electricity to a supply authority will have to register with the customs. The levy is payable over monthly installments based on an estimate pegged to the preceding year’s PBIT to be adjusted after the current financial year’s accounts have been audited. The ensuing protests in the financial market have perhaps caught many by surprise. IPPs being asset heavy have typically financed their ventures with considerable debts and the use of PBIT as the measure for


NEWS | regional update >>

INDIA the windfall tax puts a squeeze on figures assumed by rating agencies when the debts were rated and bought by pension funds and institutional investors. The government’s response was to announce a scheme to exempt IPPs from this windfall tax if they successfully re-negotiate their PPAs with the national power company. That is not a perfect outcome for the IPPs but a master stroke for the government and the national utility company. Written by Tay Beng Chai Tay & Partners 6th Floor, Plaza See Hoy Chan Jalan Raja Chulan 50200 Kuala Lumpur, Malaysia Tel: +603 - 2050 1888 DID: +603 - 2050 1881 Fax: +603 - 2031 8618 Email:


SPH, SGX and FTSE launch new FTSE ST China top index On 7 July 2008, Singapore Press Holdings (SPH), Singapore Exchange (SGX) and FTSE Group (FTSE) are pleased to announce the launch of a new index within the new China index. The new China index called FTSE ST Index series that currently track the top 20 Chinese stocks listed on the Singapore Exchange. The inclusion of the new revenue criterion allows companies that were previously not eligible for the existing FTSE ST China Index to be included in the new FTSE ST China Top Index. Such companies include Ferrochina, Hsu Fu Chi International and Yanlord Land Group. To be eligible for inclusion in the new index, companies must have either at least 30 percent ownership by the Chinese government, companies or nationals; or derive at least 50% of revenues from China.


The new index has been created to respond to the demand from institutional investors and fund managers in China and around the world for an index that will give them instant exposure to a smaller, readily tradable basket of highly liquid Singapore-listed China stocks. SGX, SPH and FTSE also have a FTSE ST China Index that tracks 50 Chinese companies listed on the SGX, and they will continue to act as a general market barometer of the state of China companies listed here. Both the FTSE ST China Index and the FTSE ST China Top Index will offer opportunities for the creation of and investment into China index-linked products, including exchange traded funds (ETFs), structured products and other derivatives. Companies in both indices are selected based on their market capitalisation levels as of 20 June 2008. They are subject to the same index calculation methodology, free float weighting and liquidity screening criteria as the revamped Straits Times Index (STI) and other FTSE ST indices which were launched on 10 January 2008. The FTSE ST China Top Index will be added to the real-time, intra-day values of the STI and other FTSE ST indices displayed at the following websites: • SPH keyIndices.html • SGX • NextView • ShareInvestor and FTSE will also display the end-of-day index values on its website at http:// Written by Ms Eng Hui Ting and Ms Cecilia Law Corporate Finance Executive Ph: (65) 6322-2237 Fax: (65) 6534-0833 E-mail: enghuiting@loopartners. and Ms Cecilia Law Corporate Practice, Senior Legal Associate Ph: (65) 6322-2283 Fax: (65) 6534-0833 E-mail: Loo & Partners LLP 88 Amoy Street, Level Three Singapore 069907

Singh & Associates

The Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008 In a step forward in the growth of primary market of India, the Securities and Exchange Board of India (the Board), introduced a new regulation known as SEBI (Issue and Listing of Debt Securities) Regulations, 2008 (the Regulations). ‘Debt Securities’ means non-convertible debt securities creating or acknowledging indebtedness, including debentures, bonds and such other securities of a body corporate or any statutory body by virtue of a legislation, whether constituting a charge on the assets of body corporate or not but excludes bonds issued by Government or such other bodies as may be specified by the Board, security receipts and securitized debt instruments for which separate regulatory provisions. The “issuer” means any company, public sector undertaking of statutory corporation which makes or proposes to these regulations or which has its securities listed on a recognized stock exchange. The issuer or any person in control of the issuer, or its promoter, has not been restrained or barred by the Board from accessing the securities market or dealing in securities and such direction or order is in force. The issuer has made an application to one or more recognized stock exchanges for listing of securities, taken a principal approval for listing of its debt securities, credit rating has been obtained from at least one credit rating agency and same is disclosed in the offer document; an arrangement has been made with a depository registered with the Board for dematerialization of the debt securities; at least one or more merchant bankers registered with the Board has been appointed out which one shall be a lead merchant banker; one or more debenture trustees as per the provisions of Indian Companies Act, 1956 and Securities and Exchange Board of India (Debenture Trustees) Asian Legal Business ISSUE 8.9

NEWS | regional update >>

Regulations, 1993 has been appointed. The issuer has to take care that debt securities are not issued for providing loan to or acquisition of shares of any person who is part of the same group or who is under the same management. No issuer shall make a public issue of debt securities unless a draft offer document has been filled with the designated stock exchange through the lead merchant banker. The lead merchant banker shall ensure that the draft offer document clearly specifies the names and contact particulars of the compliance officer of the lead merchant banker and the issuer. He shall ensure that all comments received on the draft offer document are suitably addressed prior to the filing of the offer document. The issuer may determine the price of debt securities in consultation with the lead merchant banker and the issue may be at fixed price or the price may be determined through book building process in accordance with the procedure as may be specified by the Board. The offer document shall contain all

material disclosures which are necessary for the subscribers of the debt securities to take an informed investment decision and shall not disclose any material fact which may make the statements made therein, in light of the circumstances under which they are made, misleading or false. A trust deed securing the issue of debt securities shall be executed by the issuer in favour of the debenture trustee within three months of the closure of the issue. The proposal to create a charge or security, if any, in respect of secured debt securities shall be disclosed in the offer document along with its implications. The issuer shall give an undertaking in the offer document that the assets on which charge is created is free from any encumbrances and if the assets are already charge to secure a debt, the permissions or consent to create second or pari passu charge on the assets of the issuer have been obtained from the earlier creditor. While listing of securities issued to the public is mandatory, the issuers may also list their debt securities issued on private placement basis subject to compliance

“Asian Legal Business has done a great job covering local news, deals, and general trends in the legal market in Asia” Partner, Minter Ellison

Asian Legal Business is Asia’s leading legal magazine. Published from three regional centres, each issue is packed with news, hard hitting analysis and investigative journalism. Regional editors provide up to the minute legal and regulatory updates, while a team of dedicated journalists provide in-depth analysis of all the issues facing lawyers and in-house counsel throughout the region.

of simplified regulatory requirements as provided in the Regulations. Non Banking Financial Companies are exempted from mandatory listing. The debt securities issued to the public or on a private placement basis, which are listed in recognized stock exchanges, shall be traded and such trades shall be cleared and settled in recognized stock exchanges subject to conditions specified by the Board. In case of trades of debt securities which have been made over the counter, such trades shall be reported on a recognized stock exchange. having a nation wide trading terminal or such other platform as may be specified by the Board. A simplified listing agreement for debt securities is under preparation and will be announced soon by the Board. Written By Mr. Manoj K Singh, Managing Partner & Ms. Daizy Chawla, Partner For more information, please contact:Singh & Associates, Advocates and Solicitors N-30, Malviya Nagar, New Delhi-110017 Ph: 91-11-26680927, 26687993, 26680331 Fax: 91-11-26682883 Website: Email:


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Firm Profile

Watson, Farley & Williams


atson, Farley & Williams LLP (“WFW”) is a leading international law firm with offices in major financial centres in Europe, Asia and the USA. It has a long history of working in Asia and has had a significant presence in Singapore. The Singapore office celebrated its 10th anniversary on 5 June 2008 at the National Museum of Singapore. The office has flourished and, after 10 years, not only represents clients in the immediate South East Asia region but also plays a significant role in advising and supporting its clients across a wide geographical area from the Gulf through Pakistan, India, China, Japan and Australia. The Singapore office works closely with the firm’s other global offices, a structure of particular benefit to international clients. The firm as a whole is increasing its geographical spread, having recently opened offices in Milan, Munich and Athens, and is well positioned in some exciting and growing business sectors which enhances its ability to go from strength to strength. WFW Singapore differentiates itself from other law firms in the region by its exceptional finance, corporate and litigation capabilities. Its client base includes multinational companies, financial institutions, as well as government bodies, and is seeing a dramatic and ever increasing flow of work in each of its practice areas. WFW Singapore has experienced growth of 40% turnover year on year, with 2007 being a record year, resulting in over 50% profitability. The office anticipates such growth will continue and plans to fortify its presence in the region. The Singapore office, now with 27 fee-earners, has welcomed 6 new fee-earners over the past few months. “We are building our finance


group at a senior level and, in particular, adding to our project finance capability”, said partner of the International Finance Group and head of the Singapore office, Chris Lowe. “Apart from lateral hires, we also expect to promote some of our senior associates to the partnership during the course of the year”. Senior associate Damian Adams was recently promoted to partner in the International Corporate Group which is headed by partner Ken Cheung. The International Litigation Group, which is headed by Raja Bose, has been growing exponentially: the Singapore team had its busiest year in 2007/8 resulting in the hiring of two more associates to its team in May 2008 to cope with the increased workload, bringing its total strength to 9 assistants. The team is ‘firing on all cylinders’ and rapidly gaining a reputation as heavy weights in major construction, offshore oil & gas and engineering disputes in the region. The Singapore office also leads the pack on finance transactions with partners Chris Lowe, Goh Mei Lin and Madeline Leong leading a team of 9 assistants that provide unrivalled diversity and depth to this global finance power house. The team won the Asset & Corporate Finance Deal of the Year 2007 and the SE Asia Shipping Firm of the Year, both awarded by Asian Legal Business. WFW was also the only law firm to be nominated as a finalist for the Ship Finance award at this year’s Seatrade Asia Awards. The Singapore office has been involved in a number of significant deals from across all its practice areas including: • Acting for 2 international oil companies in separate disputes against an Australian engineering contractor in relation to 2 FPSO contracts for the fabrication,

construction and installation of topsides process modules and a wellhead jacket and platform respectively. • Acting for Thoresen Thai Agencies Public Company Limited of Thailand and its group of companies (the “TTA group”) in respect of its sale to, and leaseback from, Jakartabased PT Perusahaan Pelayaran Equinox (“Equinox”) of the general cargo ship, m.v. “Thor Sailor”. Equinox is an Indonesian integrated shipping, logistic and offshore services business and a licensed Indonesian national shipping company. • Advising the Asian Development Bank on the financing of a US$4.25 billion Mundra ultra mega power project in India by Tata Power Company. • Advising Monsanto Company on the divestment of its butachlor and alachlor businesses (two kinds of selective herbicide) and other assets located in the Philippines, Thailand, Vietnam, India, Pakistan, Bangladesh and Taiwan to Sinochem International Corporation and its subsidiaries. • Advising Sevan Drilling Pte Ltd in the US$400m financing of Sevan Marine’s deepwater, from mandated lead arrangers GE Corporate Finance Bank, GE Capital Corporation and DVB Group Merchant Bank (Asia) Ltd. This deal won the Lloyds Shipping Economist Project Finance Award 2007. WFW has a work-hard, play-hard ethos: below is a photo of the team on an office retreat. Watson, Farley & Williams LLP 16 Collyer Quay #12-02 Hitachi Tower Singapore 049318 Phone +65 6532 5335 Fax +65 6532 5454 Website:

Asian Legal Business ISSUE 8.9

FEATURE | award winners >>

ALB SE Asia Law Awards Winner: STS - STATS ChipPAC Singapore Deal of the Year and Singapore M&A Deal of the Year Of all the deals short-listed at the ALB South East Asian Law Awards 2008, the STS–STATS ChipPAC deal had ‘winner’ written all over it


n 1 March 2007, Singapore Technologies Semiconductors Pte Ltd (STSPL) announced it was making a voluntary general offer to acquire all the issued ordinary shares and certain convertible notes of Stats ChipPAC Ltd, a company dual listed on the NASDAQ Select Markets and the Mainboard of the Singapore Exchange Securities Trading Limited (SGX-ST). Part of the deal involved making an options proposal for all outstanding options, vested or unvested, of STATS’ employee share option schemes. The offer by STSPL, which had held more than 75% of STATS’ predecessor ST Assembly Test Services Ltd (ST), came barely three years after ST’s merger with ChipPAC Ltd.

Public excitement “The offer generated quite a bit of excitement in the market,” says Gary Pryke, director, Drew & Napier, who were retained as counsel to STATS ChipPAC. (Allen & Gledhill were retained as counsel to the acquirer.) “There were several extensions of the closing date with the market watching closely whether STSPL would increase its offer price before finally closing on 18 May.” Public excitement peaked in the run up to the offer’s close when a new shareholder made it clear that they would not accept the offer. At this stage, according to Pryke, the deal could have gone either way: “it looked less likely that STSPL would be able to secure acceptances equalling at least 90% of the issued share capital”.

Deal mechanics The way that the deal was structured contributed to it being special, according to Pryke. “STSPL structured a two-tier offer to entice at least 90% of STAT’s shareholders to tender their shares in

Glenlivet Award winners for Singapore In-house Team of the Year at the ALB SE Asia Law Awards 2008 The STATS ChipPAC in-house team: Cheryl Ng; Elaine Sin; Janet Taylor (general counsel); Joanne Shuck; Cyndi Lim

acceptance of the offer. “All shareholders who tendered their shares in acceptance would receive S$1.75 per ordinary share and S$17.50 per ADS if STSPL received acceptances resulting in it holding at least 90% of STATS’ issued share capital.”

Challenges STATS’ dual listing in Singapore and the US brought challenges: the deal itself was something of a ‘test case,’ for what was at the time Singapore’s new Code on Takeovers and Mergers (the Code). “The requirement to comply with both the Code as well as US tender offer and securities law requirements presented unique issues not typically faced in a takeover offer subject only to the Code,” says Pryke. But the differences did not end there. For, as Pryke notes, while the Singapore Code and its US equivalent are substantively similar, the expectations underlying them are quite different, especially those pertaining to the role of corporate boards. In Singapore, the target company typically concentrates on assessing the offer on the table; it is rare to look for strategic alternatives – the latter is mandated both by regulation and expectation in the US. To overcome this, Pryke notes, STATS went down a largely uncharted path. “STATS announced that it had formed a special committee to ‘review and consider the Offer and such other strategic

alternatives available to the Company as the special committee may deem appropriate’,” he says.

Legacy Pryke notes that the way in which the issues thrown up by the crossjurisdictional nature of the transaction were dealt with will provide, if not a precedent, at least a starting point for dealing with similar issues in such transactions. “The deal’s been instrumental in demonstrating that the Code is sufficiently flexible to deal with such transactions, which are likely to feature increasingly in the Singapore market.” ALB ► STS–STATS CHIPPAC: THE FIRMS INVOLVED* • • • • • • •

Allen & Gledhill Allen & Overy Shook Lin & Bok Drew & Napier Jones Day Kirkland & Ellis Sullivan & Cromwell WongPartnership

* Arranged alphabetically

► COMPLEXITY: STS–STATS CHIPPAC SNAPSHOT • US$1.6bn complex ‘going private’ transaction subject to Rule 13e-3 • STATS ChipPAC dual SGX and NASDAQ listing • The first real test for Singapore’s Code on Takeovers and Mergers • Negotiating complex corporate governance and disclosure requirements in two jurisdictions


FEATURE | offshore law firms >>

BT Partnership: A firm on the move Since opening its doors in 2003, BT Partnership has not only experienced spectactular growth, but emassed a client portfolio that puts much larger firms to shame. Far from resting on their laurels, ALB found that this dynamic firm is setting itself up for much more of the same.

► AN IMPRESSIVE TRANSACTIONAL TRACK RECORD: • Counsel to property arm of large European investment bank in the US$38m disposal of its equity participation in a property business in Indonesia • Indonesian counsel to one of the largest nickel mining in the world on its US$13bn share acquisition • Counsel to one of Indonesia’s largest investment companies on its US$32m share acquisition in a prominent coal contractor • Counsel to a Singaporean investment fund in its acquisition of a prominent Indonesian company • Indonesian counsel to a US investment fund in its high-profile acquisition of a Japanese electronic devices manufacturer • Indonesian counsel foreign investors in their purchase of a substantial interest in a Kalimantan-based mining company • Assisting Lazard Freres & Co. Inc. in the arrangement of over 10 high value loans • Assisting Schroeder & Co. Inc. in the arrangement of over 15 high value loans • Assisting Cargill Financial Services International Inc. and Chelsea Financial Services LLC. to purchase the following loans from Schroeder & Co. Inc.

► LITIGATION SUPREMOS: BT PARTNERSHIP’S LITIGATION EXPERTISE • Credit Suisse First Boston v. Timber and Wood producer public company • UBS A.G. v. PT. Hotel and Building owner public company • Deutsche Bank A.G. v. Stationery maker company and its personal guarantors • BNP Paribas and Deutsche Bank A.G. v. Forestry public company • BNP Paribas and Deutsche Bank A.G. v. Petrochemical public company • Glencore International A.G. v. Coal Distributor company • Representing OCM Opportunities Fund II Limited, a US fund management entity in defending illogical claims brought by PT Indah Kiat Pulp & Paper Tbk wrapped under tort accusation with main intention is to nullify their corporate guarantee, the land mortgage and collateralised assets and the underlying US Bonds agreements worth over $US500m . • Representing Haycraft Overseas Limited as the owner of some land title and real property worth over $ US50m who must have brought tort actions against IBRA and its successor in order to retrieve these assets from unauthorized recognition. The firm won the judgment up to the Supreme Court level



n the Indonesian legal world, BT Partnership is considered something of a rising star- one of just a handful of firms to be household names for many of the large corporates operating in and out of the region. However, after having rapidly expanding its client base, bolstering key practice areas and taking home the ALB Employer of Choice award for Indonesia, there is little doubt that BT Partnership’s star has now well and truly risen. The firm now boasts three well developed practice areas; banking & finance, capital markets and commercial law and a tax and investment department- departments which are capable of handling everything from litigation, arbitration and insolvency and restructuring to high-end corporate financing, M&A’s and energy and natural resourcessomething which put the firm in an ideal position to capitalise on the high levels of foreign investment that are expected to flow into Indonesia in the months and years ahead.

Growth: a work-in-progress Not content with being one of the fastest growing firms in Indonesia, expansion is still on the brain at BT Partnership. “We are a firm that is continually growing both in terms of headcount and the matters handled, so growth is definitely a work in progress,” says Bastian “Moving from a boutique firm to almost very close to a full-service firm very quickly has been very quick and others say that means you will become complacent- but that is not the case here; we are still looking to become bigger and better. And, to be sure, Bastian is on the lookout for viable growth avenues, both in terms of emerging areas of law and also recruitment of lawyers. “No other country in the world is blessed with a greater wealth of natural resources than Indonesia,” says Bastian highlighting that there will be a lot of work for the country’s law firms emerging our of oil and gas rich areas such as Kalimantan and Sumatra. “We are doing a lot of work in these areas already- we are handling a lot of M&A work in the oil, gas and energy sectors at the moment.” With more and foreign countries interested in playing a role

in Indonesia’s building and infrastructure projects, Bastian has also noted an increase in the amount of work on offer here. “Inbound investment activity has really skyrocketed- we are handling such a diverse array of work at the moment; shipping, transportation and logistics- all the area which support the infrastructure projects.” Shariah compliant financing is also set to boom in the world’s most populous Islamic nation, especially as it consciously tries to catch up with regional leader Malaysia. According to Bastian, the next few years will see Indonesia rise to be a market leader in this area but not in the ‘Sukuk’ (Shariah-compliant bonds) market. “In my opinion, we will see structured Shariah- compliant financings take off in the near future,” he says noting that Shariah- compliant hedge funds could also move, depending of course of a number of factors. For Bastian, these are both areas of law which “are much more attractive and interesting” for experienced banking and finance lawyers. “We are having to wear many hats.” And, with all of this work on offer, and the prospect of plenty more to come, BT Partnership is keenly looking for professional and astute lawyers.

There’s no place like home Indonesia’s legal services market remains one of the most competitive in the world, with many of the best and brightest legal talent lured overseas by large firms, so much so that there is a real dearth of technically astute lawyers that Indonesian firms can chose from, but it’s a pattern which is ironically favourable for the legal market as a whole. “International experience whether it be working overseas or working in a firm with global reach is only a good thing for the legal market in Indonesia- its especially good when they return home to Indonesia,” says Bastian. And, in fact, it’s something both Bastian and the other half of BT Partnership’s dynamic duo- partner Satrya Wijaya Teja have done. Bastian started his career at one such large firm while Teja worked in the Singapore offices of New York firm Mandel, Asian Legal Business ISSUE 8.9

Profile FEATURE | offshore law firms >>

BT Partnership

Katz, Manner & Brosnan. Both are evidence of the fact that for Indonesian lawyers there is no place like home- a trend that Bastian says will only increase in the future. “As the sophistication of transactions being handled in Indonesia increases, more and more Indonesia lawyers will start to return”- and it is something that BT Partnership is looking forward to. Widely recognised as one of the best firms in Indonesia for young lawyers to ply their trade, BT Partnership is stepping up efforts to hire suitably qualified Indonesian lawyers. “We are looking for lawyers with at least 3 years practical experience whom we will consider as associates,” says Bastian. “We want a lawyer who can show independence; be resourceful and take initiative- and in return BT Partnership will offer them something that large firms cannot: exposure to a high volume of sophisticated corporate work, regular client contact with a view to partnership.” Indeed, these were the very factors behind why it took home the ALB Employer of Choice award for Indonesia. “It might sound like a cliché, but we know our staff are our biggest asset- for

us retention is the key to growing our firm,” says Bastian. The firm also boasts enviable life-balance philosophies which, unlike other firms, are considered to be much more than just empty rhetoric. “We are by nature a flexible firm- there is strong camaraderie in our team, but most of all we all share each others business and personal successes,” Bastian says. “At BT Partnership we all believe in working together- growth as a team and with our clients are vitally important.”

Netting the big fish While BT Partnership has experienced tremendous growth in its client portfolio since opening for business in 2003, Bastian notes that the firm’s recent addition as the Indonesian member of the world’s oldest global alliance- Mackrell International has only served to increase the number of clients knocking at its door. “Our membership of Mackrell has allowed us to tap into the client base in foreign markets,” says Bastian noting that the firm is now receiving regular instructions from clients located in the Middle East, especially in the banking, finance and infrastructure spaces.

And while the amount of cross-border advisory work that is coming to the firm as a result of its membership is also on the way up, Bastian believes that its true worth lies with two factors. Firstly, the fact that it is a means by which medium sized firms such as BT Partnership can globalise their brand and secondly because it gives the firm access to over 50 law firms in over 35 countries. “We can tap experts in the Middle East or Eastern Europe with a simple phone call and be better able to service our clients here in Indonesia as a result,” says Bastian. “Member associations such as Mackrell, show prospective clients that we are internationally savvy- something which is so important in today’s business environment,” says Bastian.

► BT PARTNERSHIP CONTACT DETAILS • Address: BRI Tower, 19th Floor Jl. Jend. Sundirman No. 45 Jakarta 10210 Indonesia • Tel: 62 21 5700 777 • Fax: 62 21 5700 8777 • Email: • Web:


ALB IN-HOUSE LEGAL SUMMIT Lead Sponsor and Official Airline


ALB In-house Legal Summits are elite forums tailored exclusively for the region’s leading in-house counsel. Following overwhelming success in Singapore, Hong Kong, India, Korea, China, ALB In-House Legal Summit will be staged in Hong Kong for the fifth year. An extensive range of focused practice area workshops are combined with interactive panel discussions and networking opportunities at this “must attend” legal event of 2008.


WHAT DELEGATES SAID ABOUT PREVIOUS SUMMITS: ……great topics and speaker! GEMERAC COUNSEL, ITC Construction Holdings Limited

I have attended the summit every year for 4 years now, and strongly approve of the professional manner in which it is being put together.

The summit is great. Very informative. We took the chance to meet people in the legal community, including professional consulting companies. We talked with them about the market and our plans…… It’s definitely worth the time. CHARLES MENG Assistant General Counsel, Legal Director, AMD Co., Ltd.

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Very relevant topics SILVER CUI, General Counsel, Elcoteq Lead Sponsor and Official Airline

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FEATURE | Hot 100 >>


Bangkok ngkok to Be Beijing and nd Sydn Sydne Sydney to Shanghai, over er the last 12 months th a wealth alth o of lawyers wyers have set et our news ws room ab abuzz. In n this year yea year’s ALB B Hot 100 we have again catalogued the e feat feats of those w who have risen tto prominence. i Now in its fifth year, the ALB Hot 100 aims to provide an admittedly subjective overview of the past year, listing those legal personalities who have performed exceptionally in their field, courted controversy and turned heads in the legal arena. After all, winning the game is not the be all and end all – the style, poise and class with which you play also counts. The purpose of this article, as always, is not to offend or serve as a definitive guide to the industry but, rather, to entertain


With gusto and gravitas, these are the men and women who have made their mark by leading their firms/organisations and practice groups from strength to strength

Name: Desmond Ong Title: Managing partner – Singapore Firm/organisation: DLA Piper Location: Singapore

Why hot: Ever since Ong joined DLA Piper as Singapore managing partner in 2005, big things have been expected of him. In 2008, Ong has proved that he is not one to disappoint. Under his leadership, the firm has attracted its fair share of Singapore’s M&A activity, including the high-profile Heckman Corporation acquisition of China Water.

Name: Robert Ashworth Title: Head of corporate practice – Asia Firm/organisation: Freshfields Bruckhaus Deringer Location: Hong Kong

Why hot: Ashworth has been pivotal in maintaining Freshfields’ position atop M&A leaderboards throughout Asia in 2008. Ashworth has worked on high-profile transactions ranging from Anheuser-Busch’s US$739m contested takeover of Harbin Brewery to Criteria Caixa Corp’s US$508m acquisition of a further 4.55% stake in the Bank of East Asia.

Name: Crispin Rapinet Title: Middle East & Asia regional managing partner Firm/organisation: Lovells Location: London/Asia

Name: Damian Paul Title: Managing director Firm/organisation: M+K Location: Melbourne

Why hot: Rapinet was re-elected as Lovell’s Middle East and Asia regional managing partner earlier this year after presiding over three years of stellar growth. The firm expanded its operations in all Asia jurisdictions through key lateral hires, having poached Owen Chan, Fred Chang and Brad Roach from Hong Kong and Singapore firms and a trio of Sukuk experts from MiddleEast rivals Denton Wilde & Sapte.

Why hot: Put this one in the ‘watch this space’ category. Melbourne firm M+K has ambitious plans for the next two years, including doubling its revenues and adding offices in Adelaide, Brisbane, Darwin, Hobart and Perth. Will this latest venture to create a national operation dedicated to servicing mid-market businesses be successful?

Asian Legal Business ISSUE 8.9

FEATURE | Hot 100 >>

Name: Keith Johnson Title: Head of corporate/M&A Asia Firm/organisation: Linklaters Location: Hong Kong

Name: Lindsay Esler Title: Managing partner Hong Kong Firm/organisation: Deacons Location: Hong Kong

Name: Liu Zhengdong Title: President Firm/organisation: Shanghai Bar Association Location: Shanghai

Name: Elaine Lo Title: Chairman of the Asia board Firm/organisation: JSM Location: Hong Kong

Why hot: Widely regarded as the Linklaters’ ‘point man’ in the east for high-profile corporate and M&A matters, Johnson has presided over another stellar year for Linklaters in Hong Kong, capped off by the firm’s involvement in some of the largest transactions of 2008 to date. These include Rio Tinto on BHP Billiton’s takeover offer and China Netcom Group Corporation (Hong Kong) Limited on its merger with China Unicom Limited.

Why hot: It takes a lot to make the ALB Hot 100 list two years in a row, but Esler was almost an automatic inclusion this year. Not only did his firm become the exclusive Hong Kong member of the prestigious Lex Mundi network, but it also worked on a number of most high-profile deals in the Greater China region, ranging from Wing Lung Bank’s share disposal to Beijing Enterprises US$475m share placement.

Why hot: Liu Zhengdong, the founding and managing partner of Shanghai firm Junyue, made the headlines when he took over the helm of the Shanghai Bar Association from Lv Hongbing, who stepped down at the end of his three-year term. Liu, the youngest of the presidents of local bar associations, will follow in the footsteps of his predecessor to lead the legal profession from strength to strength and to better service Shanghai’s dynamic growth as an international business and financial hub.

Why hot: With Lo’s “global vision”, Johnson Stokes & Master (JSM) has merged its 250-lawyer, seven-office network with regional newcomer Mayer Brown. The JSM partners were admitted into Mayer Brown’s equity, with average profits per equity partner at JSM reportedly slightly higher than Mayer Brown’s US$1.135m. The merger creates a firm with a network of 300 lawyers across Asia – working in Hong Kong, Beijing, Shanghai, Guangzhou, Thailand and Vietnam – as well as 1,000 lawyers in the US and 500 in Europe.

Name: K Shanmugam SC Title: Minister for law Firm/organisation: Singapore Government Location: Singapore

Name: Lawrence Liu Title: Chief representative Firm/organisation: ACC China Location: Beijing

Name: Tan Chong Huat Title: Managing partner Firm/organisation: KhattarWong Location: Singapore

Why hot: A pillar of the legal community in Singapore and former senior partner at Allen & Gledhill, Shanmugam was unveiled as the country’s new minister for law and second minister for home affairs earlier this year. He was charged with implementing Justice VK Rajah’s recommendations regarding the liberalisation of Singapore’s legal services market.

Why hot: Liu has been appointed as the chief representative of the Association of Corporate Counsel in China. He is responsible for building its membership in China, and setting up a platform for Chinese corporate counsel to take their place in the international community. Liu regularly hosts seminars and provides training for in-house lawyers in Chinese enterprise, raising legal skills, practices and ethics of China’s in-house legal profession to international standards. Liu serves as general counsel of the China Electronic System Engineering Corp.

Why hot: One of Singapore’s youngest managing partners, Huat has wasted no time in implementing the firm’s ‘blue ocean’ expansion strategy. After successfully applying for a licence to practise law in Vietnam, the firm announced earlier this month that it had formed an alliance with Malaysian firm KK Chong and Co.


FEATURE | Hot 100 >>


Name: Gavin McClaren Title: Head of SE Asia Practice Firm/organisation: Allens Arthur Robinson Location: Singapore

Name: Izumi Akai Title: Partner, co-head of Japan practice Firm/organisation: Sullivan & Cromwell Location: Japan

Name: Michael Pitt Title: Chairman & national managing partner Firm/organisation: Moray & Agnew Location: Sydney

Name: William Fazio Title: Managing partner Firm/organisation: Herbert Geer Location: Melbourne

Why hot: McClaren has presided over another stellar year for Allens in the region. Not only has the firm cemented its position as the leading firm in emerging legal markets like Vietnam, but it has also figured prominently in many of 2007/08 most prominent transactions. The ALB SE Asia Law Awards 2008 Vietnam Deal Firm of the Year, Allens led the equitisation and partial sale of state-owned insurer Bao Viet, the largest Vietnamese M&A deal to date.

Why hot: The ALB Japan Law Awards 2008 International Deal Maker of the Year, Akai has been intimately involved in some of Japan’s most significant IPOs, including Citigroup’s acquisition of Nikko Cordial, which was the largest ever acquisition of a Japanese company by a foreign company.

Why hot: Pitt has presided over strong growth at Moray & Agnew in the face of difficult conditions including tort reform and reduced litigation. Far from lying low, the firm has instead gone into expansion mode, picking up a team of insurance lawyers from Hunt & Hunt, including partner Alex Bolton.

Why hot: Fazio has guided Herbert Geer through a solid expansion regime, including the recent merger of the firm with Nicol Robinson Halletts in Brisbane and building a full-service practice in the Brisbane market. Frequently making the news pages with his latest manoeuvres, Fazio has come to represent the evolving face of the mid-tier in a consolidation environment. But he’s not just about growth for the sake of growth. Fazio has also emphasised the need for a coherent firm culture built on mutual respect and collaboration.

Name: John Atkin Title: Managing partner (retiring) Firm/organisation: Blake Dawson Location: Sydney

Name: John Nerurker Title: Chief executive officer Firm/organisation: Mills Oakley Lawyers Location: Melbourne

Name: Danny Gilbert Title: Managing partner Firm/organisation: Gilbert + Tobin Location: Sydney

Name: Juan Martinez Title: Managing partner Firm/organisation: Home Wilkinson Lowry Location: Melbourne

Why hot: Atkin has recently announced that he’s leaving the managing partner role to focus on a consultancy business, but it’s worth noting his achievements. Atkin is credited with turning the firm around from a period of declining revenue growth in 2002/03 to its current healthy state: the firm has just finished its second year of double digit revenue growth. He also oversaw the firm’s renewed focus on its energy & resources and M&A practices, and the firm’s rebranding by dropping “Waldron” from the old Blake Dawson Waldron name.

Why hot: Nerurker presides over the firm which was crowned winner of ALB’s Australian Fast 10 award in December last year on the back of impressive revenue growth of 54% for 2006/07. And not content to rest on its laurels, Mills Oakley also picked up the gong at the ALB Australasian Law Awards 2008 for Melbourne Firm of the Year for, among other things, its industry leading professional development program.

Why hot: It’s been an impressive 12 months from Gilbert + Tobin with Danny Gilbert overseeing many key achievements such as the establishment of the firm’s alliance with leading Chinese firm King & Wood (the first such alliance of its kind), participation in top deals such as the PBL Media LBO and the luring of five partners away from top-tier firms. All this was capped off with the firm being named the Sydney Firm of the Year at the ALB Australasian Law Awards 2008.

Why hot: Another year, another acquisition. Martinez has continued Home Wilkinson Lowry’s expansion warpath this year with the acquisition of Ebsworth & Ebsworth. That acquisition follows on the heels of last year’s merger with Abbot Tout. The Ebsworth & Ebsworth acquisition had industry observers scratching their heads over the compatibility of the two firms – and it’s still early days yet for the marriage – but the Home Wilkinson Lowry story is certainly one to follow.

Asian Legal Business ISSUE 8.9

FEATURE | Hot 100 >>

Name: Andrew Grech Title: Managing director Firm/organisation: Slater & Gordon Location: Melbourne

Name: Charles Guan Title: Managing partner Firm/organisation: Grandall Legal Group Location: Shanghai

Why hot: Following last year’s groundbreaking move to list Slater & Gordon on the ASX, Grech has followed up with strong revenue results and further acquisitions in the form of the acquisition of the personal injuries and professional negligence practice areas of Queensland firm Quinn and Scattini, and the acquisition of regional practices in West Melbourne, Coffs Harbour, Nowra and Bunbury.

Why hot: Guan has enjoyed an outstanding year. Deal highlights include advising Giant Interactive Group on its IPO, Cgen Media on its sale to Focus Media, Hoau Logistics (China’s largest road transportation group) on its sale to TNT Group and Jiayu Logistics on its sale to YRC Worldwide. He was awarded best lawyer for M&A by Global M&A Research Center and the CMAA in 2007. At the ALB China Law Awards 2008, the firm was awarded Shanghai Firm of the Year.

Name: Wang Zhongde Title: Managing partner Firm/organisation: Dacheng Location: Beijing

Why hot: Under Wang Zhongde’s management, Dacheng has had another bumper year. The firm has opened five new offices across China in the past 12 months, doubled the revenues and attracted a large number of new lawyers and partners. With all these achievements, Wang has been awarded Managing Partner of the Year at the ALB China Law Awards 2008. He speculates that his firm will continue the exponential growth in the coming years.

Name: Wang Ling Title: Managing partner Firm/organisation: King & Wood Location: Beijing

Name: Kyung-Joon Choi Title: Partner Firm/organisation: Yang-Heon Location: Korea

Why hot: King & Wood has set itself an ambitious plan to make the country’s largest firm a dominant player on the high-end corporate, capital markets and cross-border transaction scene. The person tasked with this project is Wang Ling, the firm’s managing partner. Under Wang’s management, the firm has expanded into emerging key markets in second-tier cities, including Tianjin, Suzhou and Qingdao, and ventured into Australia through establishing an strategic alliance with Sydney-based leading firm Gilbert + Tobin. It also topped many league tables, such as Bloomberg’s 2007 Ranking of IPO issuers counsel on the Hong Kong Stock Exchange by volume.

Why hot: Choi is the co-managing partner of the new law firm YangHeon, formed by the recent merger of law firms Kim Chang & Lee and Kim & Company, and is regarded as one of the top Korean attorneys in international banking and finance.

Name: Zhu Linhai Title: Managing partner Firm/organisation: AllBright Location: Shanghai

Why hot: After losing a few important members of the corporate group, AllBright’s new managing partner, Zhu Linhai, has revamped the firm’s management structure and is leading Shanghai’s largest firm to new heights. AllBright’s revenues increased to US$32m in 2007, while the number of partners has grown from 41 to 62. In September last year, the firm established the Sino-Global Legal Alliance with Lovells and eight leading domestic firms.

Name: Som Mandal Title: Managing partner Firm/organisation: FoxMandal Little Location: New Delhi

Why hot: Mandal leads the largest law firm in India in its continuous expansion in India and abroad, being the first Indian commercial law firm to open an office in London. Name: Datuk Zaid Ibrahim Title: Former senior partner (now minister in charge of legal affairs and legal reform) Firm/organisation: Formerly Zaid Ibrahim & Co Location: Malaysia

Why hot: It’s not often that a lawyer is classed as ‘hot’ for leaving the firm that he created but, in the case of Datuk Zaid Ibrahim, the ‘hot’ tag is certainly warranted. Earlier this year, the chairman and senior partner of Zaid Ibrahim & Co relinquished his shareholding in the law firm – the largest in Malaysia – following his appointment as minister in the Malaysian government, but not before playing a pivotal role in forming a groundbreaking joint-law venture in Vietnam – AGZI LCT – with Allen & Gledhill and LCT Lawyers.

Name: KT Jung Title: Attorney Firm/organisation: Kim & Chang Location: Korea

Why hot: As chair of the M&A and Corporate Practice Group and Antitrust & Competition Practice Group, Jung has led the firm from strength to strength, capped off with the coveted advisory role on Doosan Infracore’s acquisition of IngersollRand Co’s Bobcat for US$4.9bn – the country’s largest overseas acquisition.



FEATURE | Hot 100 >>

Technically brilliant and boasting superior skills in existing and emerging areas, these are the lawyers who have been at the vanguard of change in the profession

Name: Celia Lam Title: Partner Firm/organisation: Linklaters Location: Beijing


Name: Simon Watt Title: Partner Firm/organisation: Bell Gully Location: Wellington

Why hot: Bell Gully’s environmental law team came in for high praise during ALB’s client survey for the 2008 environmental law guide. Watt has made a name for himself as a leading climate change law specialist, not only in the New Zealand market but also globally.

Name: Diana Chang Title: Senior partner Firm/organisation: Chang, Pistilli & Simmons Location: Sydney

Why hot: This commercial litigation and dispute resolution specialist, who was one of the founding partners of Chang, Pistilli & Simmons, has been consistently nominated as a leading practitioner by peers and in practice guides. This was capped off by her appointment to the Takeovers Panel this year. The work must be a comfortable fit; as an M&A boutique firm, Chang, Pistilli & Simmons has worked many times with the Panel.

Why hot: Lam topped off a wonderful year by winning the International Dealmaker of the Year at the ALB China Law Awards 2008, cementing her reputation as a leading equity dealmaker. In the last year, Lam has worked on a series of market-shaping deals, including ICBC’s US$5.5bn acquisition of a strategic interest in South Africa’s Standard Bank and China Railway Group’s US$5.5bn IPO.

Name: Pip Greenwood Title: Partner Firm/organisation: Russell McVeagh Location: Auckland

Name: Teresa Handicott Title: Partner Firm/organisation: Corrs Chambers Westgarth Location: Brisbane

Why hot: Greenwood’s involvement in some of New Zealand’s highest profile deals, including Telecom New Zealand’s multi-billion dollar disposal of the Yellow Pages Group, saw her propelled into the spotlight at this year’s ALB Australasian Law Awards, picking up the prize for New Zealand Dealmaker of the Year ahead of a strong field of nominees. Greenwood is also a member of the New Zealand Takeovers Panel.

Why hot: Handicott was instrumental in achieving ACCC approval for the Suncorp–Promina merger and the complicated financing associated with the project. She was recognised for her work at the ALB Australasian Law Awards 2008, where she won the prize for Australian Dealmaker of the Year. Handicott is a member of the Australian Takeovers Panel.

Name: Martijn Wilder Title: Partner Firm/organisation: Baker & McKenzie Location: Sydney

Name: Margaret Cole Title: General counsel Firm/organisation: Babcock & Brown Location: Sydney

Why hot: Nowadays climate change law and carbon trading expertise are fashionable areas of practice, but spare a thought for those who were involved in the this work back when it was considered an eccentric niche area. Wilder has been practising exclusively in the area for nearly 10 years and is recognised as one of the pre-eminent climate change lawyers in the world. He is chair of the NSW government’s Climate Change Council (formerly the Greenhouse Advisory Panel).

Why hot: Winner of In-house Lawyer of the Year at the ALB Australasian Law Awards 2008, Cole led Babcock & Brown’s key involvement in a number of headline deals over the course of 2007, including the A$8bn ‘auction-style’ acquisition of Alinta, which was the largest M&A transaction in the energy sector for the year.

Asian Legal Business ISSUE 8.9

FEATURE | Hot 100 >>

Name: Joydeep Hor Title: Managing partner Firm/organisation: Harmers Workplace Lawyers Location: Sydney

Name: Cyril Shroff Title: Partner Firm/organisation: Amarchand & Mangaldas & Suresh A Shroff & Co Location: India

Name: Yan Yu Title: Managing partner Firm/organisation: Jiayuan Location: Beijing

Why hot: Well known for his expertise in employment law, particularly in EEO and antidiscrimination, Hor also has some anti-discrimination cases involving high-profile media personalities to his name, including the Jessica Rowe/Channel 10 dispute. He is highly regarded in the industry. Meanwhile, Harmers has taken out the award for Employment Specialist Firm of the Year for the second time running at the ALB Australasian Law Awards 2008.

Why hot: Shroff is considered one of India’s leading lawyers in corporate M&A, foreign investments, banking, project finance and structured finance. He led the firm in its representation of an ICICI Bank capital raising, one of the biggest equity issues in Indian history, with a combined value of approximately US$4.34bn.

Why hot: Yan Yu enjoys a strong reputation for her work in capital markets. She excels in providing full services and support to large companies, especially large stateowned enterprises, in relation to their IPOs and financing. Most recently, Yan has been involved in the US$1.5bn ‘first A then H’ listing of China South Locomotive, the A-listings of China Railway Group, and China Coal in Hong Kong and Shanghai.

Name: Michelle Hung Title: General Counsel & Company Secretary Firm/organisation: COSCO Pacific Limited Location: Hong Kong

Name: Michael Gagie Title: Partner – head of Hong Kong office Firm/organisation: Harney Westwood & Reigels Location: Hong Kong

Name: David Yu Title: Partner Firm/organisation: Llinks Location: Shanghai

Why hot: Noted as one of ALB’s InHouse 25 for 2008, Hung’s COSCO have been involved in a number of high profile transactions such as its $US4.6bn fleet acquisition and the US$250m sale and lease back marine containers for Florens Container Corporation.

Why hot: The head of Harney’s Hong Kong operations, Gagie is considered to be leading the way in all things commercial and corporate related, and warranting a special mention for his intimate knowledge of alternative listings, which is a skill considered vital in the current economic climate.

Why hot: Led by David Yu, Llinks’ M&A team has reported strong performance in the past 12 months with the completion of more than 30 deals. Deal highlights include advising Zim Israel Integrated Shipping Services on its US$2.7bn investment in China Railway United International Container, advising on Shanghai Automotive Industry Corporation (Group)’s acquisition of Nanjing Automobile (Group) Corporation, and acting for the target company in Warburg Pincus’ US$200m investment in Red Star Maclline.

Name: Toru Ishiguro Title: Partner Firm/organisation: Mori Hamada & Matsumoto Location: Japan

Why hot: Ishiguro is highly regarded in capital markets and banking & finance, and is considered to be an expert in both international and domestic work. The firm was not only involved in one of the country’s largest real estate deals of the year, the LCP REIT acquisition; it was also involved in SoftBank Mobile’s mega US$18bn-plus securitisation deal.


FEATURE | Hot 100 >>


Name: Ewen Crouch Title: Partner Firm/organisation: Allens Arthur Robinson Location: Sydney

Name: Philippa Stone Title: Partner Firm/organisation: Freehills Location: Sydney

Name: Jeanette Chan Title: Partner Firm/organisation: Paul Weiss Location: Hong Kong

Name: Wang Lei Title: Partner Firm/organisation: Gaopeng & Partners Location: Beijing

Why hot: Some of Crouch’s credits for the past year include working on the Wesfarmers – Coles Group takeover, and advising on the aborted bid for Qantas. It’s part of a long string of mega deals for Crouch and he is currently advising on the BHP – Rio Tinto bid, the secondlargest takeover bid of all time, and the first ever takeover involving two Australian – UK dual-listed companies. Crouch was Dealmaker of the Year at the ALB Australasian Law Awards in 2006 and was nominated again this year.

Why hot: Last year’s ALB Dealmaker of the Year didn’t go home from the ALB Australasian Law Awards 2008 empty handed: Stone and her team were recognised for their efforts in the Energy & Resources Deal of the Year Award (for the A$8bn Alinta acquisition) and the M&A Deal of the Year Award (for the Wesfarmer – Coles deal). She missed out on the individual award for Dealmaker of the Year, but continues to be well respected by her peers in the industry.

Why hot: Known as a serious rainmaker within the firm and, as ALB once described her, a ‘household name’ in the Asian deal-making community, Chan has proudly led her firm from strength to strength in the highly competitive and fast changing field of technology, media and telecommunications. Deals that her firm worked on in 2007 include Lenovo’s acquisition of IBM’s personal computer business and work surrounding the sale of broadband internet cable in Taiwan.

Why hot: Wang Lei, a former deputy chief of the WTO Desk in the Ministry of Foreign Trade and Economic Cooperation, who had engaged in negotiations of China’s WTO accession, is a veteran lawyer and expert in the WTO and international trade remedy areas. In the past 12 months, Wang has been a regular speaker invited by officials from other Asian countries, such as Laos and Vietnam, to advise them on matters relating to the WTO.

Name: Hironori Shibata Title: Partner Firm/organisation: Anderson Mori & Tomotsune Location: Japan

Name: Hee Woong Yoon Title: Partner Firm/organisation: Yulchon Location: Korea

Name: Dong Zhengwei Title: Partner Firm/organisation: Zhongyin Location: Beijing

Name: Wang Jiabin Title: Partner Firm/organisation: Lifang & Partner Location: Beijing

Why hot: The winner of Japanese Dealmaker of the Year at the ALB Japan Law Awards 2008, Shibata was involved in some of the biggest deals of 2007/08 including Citigroup–Nikko Cordial and the Universal Studios Japan IPO.

Why hot: Yoon led Yulchon as the main counsel in Lotte Confectionery’s acquisition of Guylian, one of the world’s leading brands of premium Belgian chocolates. It is rare for a Korean law firm to be the main counsel in a high-profile international transaction.

Why hot: Dong Zhengwei is the first lawyer to put China’s newly enacted anti-trust law to the test and has become well known domestically and globally. He has formally lodged a complaint with the regulators against Microsoft for breaching the anti-monopoly law and proposed a US$1bn fine on the global software giant. The regulators, including the Ministry of Commerce and the National Development and Reform Commission, have officially notified Dong that investigations would be conducted.

Why hot: Wang is dual qualified in the PRC and the US, and specialises in IP law, TMT and US ITC 337 investigations. With an increasing number of Chinese companies being affected by the US ITC’s section 337 investigations, he has often been sought out by Chinese companies to resolve their IP and trade-related disputes overseas. A Lifang team led by Wang is currently representing several Chinese clients in two patent infringement cases before the ITC.

Asian Legal Business ISSUE 8.9

FEATURE | Hot 100 >>

Name: Su Xiaoxi Title: General counsel Firm/organisation: Haier Group Location: Qingdao

Name: Zhang Yuejiao Title: Senior counsel Firm/organisation: Jun He Location: Beijing

Why hot: In the same way that the Haier Group is among the pioneers in establishing global brands and global markets, the Group’s general counsel, Su Xiaoxi, is a pioneer in assisting the Group in ventures at home and abroad. Under Su’s leadership, the in-house department has worked with a large number of international and national firms, and values the role of external counsel. The in-house team never stops improving internal practice standards and management, and broadening and deepening their expertise.

Why hot: Zhang Yuejiao is the first ever Chinese judge on the WTO’s highest judiciary body –the Appellate Body, which gives final rulings to trade disputes. Zhang was appointed by the WTO late last year and commenced her four-year term of office on 1 June 2008. Zhang has extensive experience in the areas of international trade, finance and investment. She has held senior positions at the Ministry of Commerce and the Asian Development Bank.

Name: Chang Chao-Tung Title: Partner Firm/organisation: Lee and Li Location: Taiwan

Name: Chung Swee Loong Title: Partner Firm/organisation: Albar & Partners Location: Malaysia

Why hot: Widely recognised as an industry leader in commercial litigation and private equity finance, Chang had another stellar year in 2007, having worked on deals such as Taiwan Broadband communications US$920m share sale and TMSC’s $US2.5bn ADR offering.

Why hot: A major player in the ALB SE Asia Law Awards 2008 Malaysia Deal Firm of the Year, Chung was pivotal in seeing through Malakoff Berhad’s share placement (the largest of its kind in Malaysian corporate history) as well as a slate of other notable transactions.

Name: Mitsuhiro Yasuda Title: Partner Firm/organisation: Nishimura & Asahi Location: Japan

Name: Michael Palmer Title: Head of sports and media Firm/organisation: Harry Elias Partnership Location: Singapore

Why hot: One of Japan’s leading capital markets and securitisation finance lawyers, Yasuda’s move from Linklaters to Nishimura & Asahi bolstered that firm’s capital markets practice. It subsequently played a leading role in the GE Capital’s corporation bond issue, which won the ALB Japan Law Awards 2008 Debt Market Deal of the Year.

Why hot: The head of Harry Elias Partnership’s sports and media practice (the first of its kind in Singapore), Palmer has been appointed as a member of the organising committee for the 2010 Youth Olympic Games. In addition, he is also a member of the Singapore Parliament.

Name: Dong Woo Seo Title: Partner Firm/organisation: Bae, Kim & Lee Location: Korea

Why hot: Seo is the go-to person for Korean domestic M&A and works on various high-profile hostile takeovers in Korea.

Name: James Kwan Title: Partner Firm/organisation: Simmons & Simmons Location: Hong Kong

Name: John Moore Title: Partner Firm/organisation: Herbert Smith Location: Hong Kong

Name: Liu Chi Title: Senior counsel Firm/organisation: Jun He Location: Beijing

Why hot: Another recent lateral hire, Kwan’s defection from Allen & Overy was considered a coup for Simmons’ practice in Asia and the Middle East. A world leader in arbitration and construction law, Kwan, who has an intimate knowledge of the different arbitration models throughout the region, is certain to raise the firm’s practice and profile.

Why hot: One of only two lawyers appointed to the Listing Committees of the Main Board and the Growth Enterprise Market (GEM) of the Hong Kong Stock Exchange, Moore showed that he is the premier US-related capital markets lawyer in the region, having worked on transactions such as the Sino-Ocean Holdings US$1.77bn IPO.

Why hot: Liu Chi, who leads the way in sports law and arbitration, has played an important part in ensuring disputes arising during the 2008 Beijing Olympic Games are resolved effectively and fairly. Last November, he was appointed by the Court of Arbitration for Sport (CAS) as one of the 12 ad hoc arbitrators for the CAS ad hoc Division for the Beijing Olympic Games. The Division provides all participants in the Games with free access to justice rendered within time limits that the same duration as the Games.

Name: Zia Mody Title: Partner Firm/organisation: AZB & Partners Location: India

Why hot: One of the leading authorities on corporate M&A law, securities law, private equity and project finance, she also serves as a member of various NGOs in the field of education and empowerment of rural women.



FEATURE | Hot 100 >>

Moving in-house, into private practice, joining the competition or just on the way up. Here are some of the remarkable movers of the past 12 months

Name: Richard Dammery Title: Partner Firm/organisation: Minter Ellison Location: Melbourne

Name: David Krasnostein Title: Head of global private equity Firm/organisation: MLC Location: Sydney

Name: Quentin Solomon Title: Partner Firm/organisation: Deacons Location: Melbourne

Why hot: Minter Ellison scored a coup earlier this year by signing up the Coles Group’s executive general counsel and company secretary. Dammery, who joined Coles in 2005, led the project teams on two landmark transactions – the sale of Myer and the takeover (by scheme) of Coles by Wesfarmers. At the time of the move, Dammery predicted that movements between private practice and the corporate world would become more commonplace.

Why hot: In a year where we saw several general counsels move into more direct management roles, David Krasnostein was one of the legal chiefs who bid farewell to the legal profession. He left the general counsel role at NAB and is now head of global private equity at MLC. Krasnostein felt that it was time to “get out of the comfort zone” and get into a role that would make use of his experience in law, M&A and risk management.

Why hot: Solomon’s departure from Clayton Utz – where he had worked for 21 years – was a blow to the firm, coming as it did at a time when competition for specialist lawyers in the banking & finance field was fierce. Clayton Utz had previously referred to Solomon as “one of the firm’s most experienced banking and finance lawyers”. It is not just rival firms that are the source of the competition for talent, either, as banks and financial institutions are keen to strengthen their in-house teams.

Name: Tim Lester Title: Partner Firm/organisation: Allens Arthur Robinson Location: Perth

Why hot: Tim Lester, formerly managing partner of Lovells’ Tokyo office, made the switch to Allens Arthur Robinson in Perth in May this year. Lester was crowned International Dealmaker of the Year at the ALB Japan Law Awards 2007 for advising SoftBank on the US$16bn acquisition of Vodafone Japan. This transaction included the world’s largest leveraged buyout in 17 years. The Perth-born lawyer says his decision to return to Western Australia was motivated by family circumstances and that he was also attracted by the strength of the economy and the high transactional activity in the state.


Name: Emilios Kyrou Title: Justice Firm/organisation: Victorian Supreme Court Location: Melbourne

Why hot: In May this year, Kyrou, then a partner at Mallesons, was appointed a justice of the Victorian Supreme Court – only the third solicitor to be accorded this honour after Justice Rosemary Balmford and the now retired Justice Bernard Teague. Justice Kyrou was sworn in on 22 May in a ceremony attended by notable members of the legal community, including Juan Martinez, managing partner of HWL Ebsworth, and Mike Ferraro, chief legal counsel at BHP Billiton, both in this Hot 100 list.

Asian Legal Business ISSUE 8.9

FEATURE | Hot 100 >>

Name: Bronwyn Pott Title: CEO Firm/organisation: Swaab Attorneys Location: Sydney

Name: Rabindra Jhunjhunwala Title: Partner Firm/organisation: Khaitan & Co Location: India

Why hot: Earlier this year, Pott was appointed National President of the Australian Legal Practice Management Association, and is responsible for learning & development for the national board. Pott is well regarded in the industry, particularly for her attention to the quality of client service and interaction.

Why hot: Advisor to several Indian conglomerates and multinational companies, especially in M&A transactions, Jhunjhunwala worked on the sale of direct and indirect equity and loan interests in India’s Hutchison Essar to Vodafone Group UK.

Name: John Davis Title: Managing partner Firm/organisation: Sparke Helmore Location: Sydney

Why hot: Davis has led an impressive recruitment drive at Sparke Helmore, netting lawyers from DLA Phillips Fox, Ebsworth & Ebsworth and Home Wilkinson Lowry to name a few. In difficult times, Sparke Helmore has affirmed its commitment to the insurance sector and is looking to improve profitability by reengineering work practices and using technology.

Name: Mike Ferraro Title: Chief legal counsel Firm/organisation: BHP Billiton Location: Melbourne

Name: Brian Salter Title: General counsel Firm/organisation: AMP Location: Sydney

Name: Eddy Hendra Title: Partner Firm/organisation: Hendra, Soenardi & Rekan Location: Indonesia

Name: Andrew Lewis Title: Partner Firm/organisation: Norton Rose Location: Dubai

Why hot: In 2008, there was a major career shift for Ferraro, who stepped down from his role as managing partner at Freehills in order to take up the post of chief legal counsel at BHP Billiton. Ferraro had been with Freehills for 16 years and had been managing partner since 2005. Ferraro was subsequently replaced by Mark Rigotti, who serves alongside Peter Butler in Freehills’ dual managing partner structure.

Why hot: Fortune favours the bold. After 26 years at Clayton Utz, Salter made the move in July this year to the general counsel role at AMP. He had previously worked with some of AMP’s lawyers, so there were a few familiar faces when he took the plunge. Salter replaced David Cohen in the general counsel role.

Why hot: Hendra has partnered this dynamic firm with great aplomb in 2008. Heavily involved in the equity and M&A spheres in the rapidly developing Indonesian legal services market, the firm played a pivotal role in Indonesia’s second largest transaction of 2008, PT Adaro Energy’s US$1.3bn IPO.

Why hot: The second lawyer in 2008 to trade life in the land of the long white cloud for the jewel of the UAE, Lewis is an acclaimed private equity and venture capital expert, has acted on the establishment of the New Zealand government-owned New Zealand Venture Investment Fund (VIF), the lead investor in the six venture capital funds currently active in the New Zealand market at his old firm Simpson Grierson.


FEATURE | Hot 100 >>

Name: John Chu Title: Partner Firm/organisation: Jun He Location: Beijing

Why hot: One of the five founding partners of Jun He, John Chu decided to rejoin one of the country’s leading law firms 12 years after he left. Since leaving the firm in 1994, Chu worked as in-house counsel for Motorola, Nortel and General Motors, and, most recently, was a partner with Beijing firm Broad & Bright.


Name: Rahmat Bastian Title: Managing partner Firm/organisation: BT Partnership Location: Indonesia

Name: Cavinder Bull SC Title: Partner Firm/organisation: Drew & Napier Location: Singapore

Why hot: Bastian’s BT Partnership is quickly gaining a reputation as one of Indonesia’s most dynamic firms. It was the Indonesia ALB Employer of Choice in 2008, and boasts a market share and client portfolio that defies its size.

Why hot: One of only a handful of senior counsels to be appointed in Singapore before the age of 40, Bull is considered to be an excellent litigator who boasts a bevy of MNCs as regular clients.

Name: Gregory Puff Title: Partner Firm/organisation: Shearman & Sterling Location: Hong Kong

Name: Howard Zhang Title: Partner Firm/organisation: Davis Polk Location: Beijing

Why hot: Puff’s high-profile return to Shearman & Sterling from arch-rival O’Melveny & Myers proved he is in high demand. Widely regarded as one of the most accomplished M&A lawyers in the region, Puff has worked on a number of groundbreaking deals in 2008, including advising Mindray and eAccess on Japan’s first shareholder-approved hostile takeover defence plan (poison pill).

Why hot: Former managing partner of O’Melveny & Myers’ Beijing office, Zhang has given up his management role to focus on fee-earning as a partner in Davis Polk & Wardwell’s Beijing office, which was opened last February. Zhang is renowned for his expertise in venture capital and private equity transactions. At his new role in Davis Polk, he will advise clients on cross-order securities, M&A and strategic investment transactions.

Asian Legal Business ISSUE 8.9

FEATURE | Hot 100 >>

Name: Andrew Lui Title: Managing partner Firm/organisation: Salans Location: Hong Kong

Name: Liu Yi Title: Executive partner Firm/organisation: Run Ming Location: Beijing

Name: Liu Wei Title: Managing partner of the Beijing office Firm/organisation: DLA Piper Location: Hong Kong/Beijing

Why hot: When Paris-based firm Salans set about recruiting for its new operation in Hong Kong, it started at the top, with the hire of Lui from Pinsent Masons. An expert in M&A, private equity and public offerings, Lui is expected to mastermind the firm’s plans to establish a Greater China presence.

Why hot: A team of former Junyi lawyers led by Liu Yi has joined forces with Run Bo Law Office headed by Wang Yadong to forge a new brand – Run Ming. The team has brought their substantial expertise in aircraft finance/ leasing, aerospace projects, banking & finance, and foreign investment to the new firm. Since being established, the firm’s lawyer headcount has increased by 20% and the revenues growth has been “very satisfactory”.

Why hot: Less than two years after joining DLA Piper, Liu Wei has been elevated to managing partner of the firm’s Beijing office. Liu, who obtained a PhD degree in law from the University of Cambridge, is also the joint head of DLA Piper’s Asia capital markets practice. He specialises in H-share and red-chip listings in Hong Kong and has advised on more than 100 IPOs and listings, including the US$5.5bn listing of China Railway Group and the recent China Merchants Bank’s acquisition of Wing Lung Bank.

Name: Nick Seddon Title: Regional managing shareholder of Asia Firm/organisation: Heller Ehrman Location: Hong Kong

Name: Li Zhiqiang Title: Partner Firm/organisation: Jinmao-Kaide Location: Shanghai

Why hot: Jinmao, established for 20 years and one of the top three law firms in Shanghai, has split into two. Former managing partner Li Zhiqiang and eight other partners have splintered off to establish Jinmao-Kaide, while the remaining partners and lawyers continue to practise at Jinmao. The split-up case, spurred by an acrimonious quarrel between senior partners, received a high profile in Shanghai’s legal community.

Name: Andrew Abernethy Title: Partner Firm/organisation: Norton Rose Location: Dubai

Why hot: If you are an international M&A lawyer, you need to be where the international M&A work is. Thus said Andrew Abernethy earlier this year when he revealed his plans to quit New Zealand firm Bell Gully and link up with Norton Rose’s Dubai office. The move reflects the opportunities on offer for firms and individual lawyers alike, as the Gulf countries have some of the world’s largest aggregations of sovereign wealth funds. It is effectively a large pool of capital that is looking for a home and for an opportunity, Abernethy told ALB. And he’s not the only one to make this observation – several other highprofile lawyers have also made the switch to Dubai this year.

Why hot: The former Asia head of DLA Piper has jumped ship to Heller Ehrman to succeed Jonathan Palmer as the regional managing shareholder. Seddon has been credited with the rapid expansion of DLA Piper in the region, demonstrating rapid revenue and headcount growth under his leadership, and two new office openings. His track record of growing law firms positions Heller Ehrman for rapid expansion.



FEATURE | Hot 100 >>


Foresight, business acumen and a measure of cunning are the traits of lawyers in this category. Put faces to the names behind some of the watershed events in the industry this year Name: Shibeer Ahmed Title: Head of Dubai office Firm/organisation: Lovells Location: Dubai

Name: Janet Taylor Title: General counsel Firm/organisation: STATS ChipPAC Location: Singapore

Why hot: Taylor scooped the pool at this year’s ALB SE Asia Law Awards. She won Singapore In-house Counsel of the Year, and her STATS ChipPAC legal team took home the In-house Team of the Year award, after having been instrumental in the US$1.6bn merger of STS and STATSChipPAC in 2007.

Why hot: Despite only entering the Middle East in May 2007, the team at Lovells is quickly establishing a reputation as a market leader, especially in the Sukuk market. Under Ahmed, Lovell’s Dubai team has closed 13 Sukuk deals worth more than US$12bn.

Name: Laurence W Bates Title: General counsel Firm/organisation: GE Japan Location: Japan

Name: Philippe Taverne Title: Partner Firm/organisation: Cotty Vivant Marchisio & Lauzeral Location: Singapore

Name: Paul Sandosham Title: Head of Middle East practice Firm/organisation: WongPartnership Location: Middle East

Name: Greg Skehan Title: Joint senior partner Firm/organisation: Colin Biggers & Paisley Location: Dubai/Sydney

Why hot: The ALB Japan Law Awards 2008 In-house Lawyer of the Year, Bates presided over a record transactional year for the company, including GE’s disposition of its global plastics business and its acquisition.

Why hot: Taverne made headlines earlier this year when he announced that Cotty Vivant Marchisio & Lauzeral would be applying for a licence to practice Singapore law under the qualifying foreign law firm scheme (QFLF), at the time the only firm to commit to doing so.

Why hot: When WongPartnership entered the Middle East in 2007, their colleagues in Singapore derided it as a crazy move. Yet, three years on, it has proved to be something of a masterstroke; not only has their Doha office prospered but the firm has found it necessary to open another office in Abu Dhabi.

Why hot: Skehan, who leads the insurance group at Colin Biggers & Paisley which won Insurance Specialist Firm of the Year at the ALB Australasian Law Awards 2008, has been in the vanguard for important developments such as the firm’s expansion into Dubai and diversification of its insurance practice. At a time when many full-service firms are shedding their insurance practices, Skehan is looking at innovative ways of improving viability.

Asian Legal Business ISSUE 8.9

FEATURE | Hot 100 >>

Name: Zhang Wei Title: Head of legal Firm/organisation: Industrial and Commercial Bank of China Location: Beijing

Name: Mike Edwards Title: Managing director – Singapore Firm/organisation: Cains Location: Singapore

Name: Tim Bednall Title: Partner Firm/organisation: Mallesons Location: Sydney

Why hot: ICBC has had an outstanding year, and at the helm of its legal department is Zhang Wei. After ensuring everything went smoothly for ICBC’s IPO in 2006 – the world’s largest-ever global public offering – Zhang has had another busy year assisting the bank in closing big-ticket M&A transactions. He has led his in-house team, working closely with the board executives and external counsel, and ensured the resounding success of ICBC’s recent US$5.5bn investment in South Africa’s Standard Bank and handling the bank’s remittance freezing dispute with the US Treasury’s Office of Foreign Assets Control.

Why hot: One of only a handful of off-shore firms to open offices in Singapore, Edwards was relocated from Cains’ Isle of Man headquarters to lead its recently opened Singapore office. A renowned capital markets and asset finance expert, Edwards has been given a mandate for growth and is likely to look to lateral hires for this in the months ahead.

Why hot: Bednall is a member of Mallesons’ deal team which worked on major deals such as the PBL Media Ltd LBO and Airline Partners’ A$11bn bid for Qantas, and won Australian Deal Team of the Year at the ALB Australasian Law Awards 2008. He is currently working on another massive deal, BG’s bid for Origin Energy, and is consistently recognised in global directories as a leader in his field.

Name: Chang-Weon Rhee Title: Partner Firm/organisation: Shin & Kim Location: Korea

Why hot: Rhee handles many high-profile Korea-related M&A transactions, including representation of Fila Korea in its US$400m acquisition of Fila’s global footwear and apparel business, the first buy-out by a Korean subsidiary of its global parent business group.

Name: Graham Lovett Title: Gulf managing partner Firm/organisation: Clifford Chance Location: Abu Dhabi

Name: Tang Jinlong Title: Chief partner Firm/organisation: Zhongyin Location: Beijing

Name: Andrew Mills Title: Director Firm/organisation: Greenwoods & Freehills Location: Sydney

Why hot: Riding the wave of a major overhaul of China’s Law on Lawyers, Zhongyin’s founding partner Tang Jinlong has announced a plan for converting the firm to special general partnership, a similar structure to limited liability partnership in the US, following a merger between Zhongyin and Zhengtai. Tang is the first managing partner to take the plunge to adopt the new structure, hoping to grow the size of the firm significantly and better manage risks associated with existing practices and further growth.

Why hot: Just when you thought the multidisciplinary practice model was dead, along came the announcement that specialist tax advisory firm Greenwoods & Freehills was welcoming Victorian chartered accounting firm Shaddick & Spence to the fold. Mills was one player who made himself available to explain how the model would work. And if you’re wondering about the “Freehills” part of the name, no, it’s not a coincidence – Greenwoods has a formal association with Freehills that gives it access to some of the largest corporate clients in Australia.

Why hot: Clifford Chance is one of only a handful of firms that entered the Middle East early, opening an office in the UAE more than 30 years ago. Over the last few years, however, it has had to weather increased competition. In 2008, ALB finds that the firm has done so with great aplomb, preserving its market share in the region with a number of high-profile lateral hires and partner relocations.

Name: Mohit Saraf Title: Partner Firm/organisation: Luthra & Luthra Location: India

Why hot: As head of the firm’s project finance, cross-border finance and structured finance practice, Saraf advised United Spirits on over US$1bn financing in the acquisition of Whyte & Mackay, making United Spirits the second-largest liquor company in the world.

Name: Pu Lingchen Title: Partner Firm/organisation: Zhonglun Location: Beijing

Why hot: With extensive experience in anti-dumping proceedings, Pu Lingchen has been in the spotlight. He was invited by the Ministry of Commerce to give a lecture to a delegation of developing country officials in Beijing this June. At the lecture, Pu shared his knowledge and experiences with trade officials from a number of countries including Thailand, Vietnam, Malaysia, Russia, South Africa and Brazil. In 2007, Pu Lingchen provided supporting legal arguments as an expert consultant to the Ministry of Commerce in the negotiation of the WTO Doha Round about rules of anti-dumping and countervailing.

Name: Filippo Modulo Title: Head of the China Desk Firm/organisation: Chiomenti Studio Legale Location: Rome

Why hot: Filippo Modulo’s Asia practice group has grown significantly after Chiomenti signed a merger deal with Birindelli & Associati. The integration gives Chiomenti, a leading Italian firm, a presence in Beijing, Hong Kong, Shanghai, Singapore, Hanoi and Pyongyang. The deal will offer a host of inbound and outbound legal services such as M&A, banking & finance and capital markets to both Italian and Chinese clients. Modulo and his team, undoubtedly, will have an exciting year ahead.


FEATURE | offshore law firms >>

Partnering clients in new directions:

Q&A with Loo Choon Chiaw – With a prestigious clientele bursting at the seams including local and foreign governmental ministries and agencies, international banks and financial institutions and public listed companies and over 23 years of capital markets experience, ALB finds out how Loo & Partners LLP is managing the perfect partnership with its clients market for a niche practice offering quality and effective legal advice and services, with a personal touch and at reasonable (not cheap) rates. After 23 years, we remain focused in the areas which we excel, namely, banking, corporate finance, general corporate, commercial and cross-border work. Even for contentious work, we only undertake litigation and arbitration in those areas. Over the last 23 years, we don’t talk much about being a viable and cost-effective alternative to large firms. We merely act on it, and this is something that we live and breathe day-by-day in all that we do. In this sense, we don’t follow St. Paul’s exhortation and try to be all things to all men, but we steadfastly serve only those sectors of the legal market in which we excel. Judging from the modest success which we have achieved to date, we must have done something right.


oo & Partners LLP is a law firm on the move. What started out as a niche commercial practice in 1985 has developed into a highly specialised corporate law firm offering comprehensive legal advice and solutions within the broad categories of banking, corporate finance, general corporate, commercial and crossborder work. ALB sat down with Loo Choon Chiaw to discuss the evolution of his firm into one of the major players in the rapidly changing Lion city. ALB: Your firm, unlike many in the marketplace, has managed to stay true to its roots as a boutique banking & financial service practice yet has still experienced strong growth- is there a secret to this? LCC: We don’t have a secret recipe. We have merely stayed focused over the years. When I started the firm in 1985, I did so with the intention of establishing a practice that offered clients an alternative to the larger players in the legal market place. I saw that there was a need in the Singapore legal


ALB: Your clients are noted as being among the most loyal of all, what would you say is the best way to retain clients in an age when they are spoilt for choices? LCC: No matter how this question is put, you will always get the same template answer from lawyers throughout the world. You will be told that clients are the most important assets of their practice and client-care is the utmost consideration. Some may be waxing lyrical about the virtues of offering clients with innovative advice and solutions resulted from their “think outside the box” approach. Nowadays you hear of lawyers being taken into new jurisdictions and practice areas by their clients; this is really a hallmark of the traditional lawyerclient relationship, and of course with the globalisation of businesses, you also hear of the emergence of global lawyers, I would like to think that our relationship with our clients is slightly different. We don’t see our role as clients’ advisors per se, rather we position ourselves as clients’ strategic partner in tackling their daily challenges. We believe that the commercial utility and pragmatism of our advice and solutions actually open

doors for our clients and provide them with more options, in terms of the choice of a new territory for the sale of their products, the choice of a particular jurisdiction where they ought to domicile their special purpose vehicles for their intended acquisition, the alternative venues in which they may seek their public listing status, the choice of jurisdiction which they should file a claim against their opponents. The list goes on. ALB: How important is it to be a firm with a global reach, and an international perspective? LCC: It is vitally important. Most, if not all, of our clients conduct businesses in many different jurisdictions throughout the region. A company may be incorporated in Singapore, but wish to issue shares or notes on Hong Kong Stock Exchange, or be head-quartered in Taipei and wish to obtain credit facilities from a French bank operating in Singapore, or be incorporated in the PRC and wish to inject its assets into a listed company based in London and mount a reverse takeover of the latter, these are things which are becoming more and more common in this globalised age. Although we do not physically maintain any offices outside Singapore, we have developed strong working relationships with leading law firms in all of the ASEAN region and other major financial centres, including Hong Kong , PRC, Taiwan, London, New York and Frankfurt, which allow us to serve the needs of our clients very effectively. We leave no stone unturned in our daily searches for the best legal solutions in meeting the special needs of each client. For instance, Loo & Partner LLP has been advising Taiwanese clients on their investment in Singapore since we started our practice in 1985. I myself have had the good grace to be retained as the General Counsel of several Ministries of Taiwan and the Taipei Representative Office since the late 80’s, and as Singapore legal counsel in the historic ‘Koo-Wang’ talks between Chinese and Taiwanese representatives in 1993. I was extensively consulted by the Ministry of Asian Legal Business ISSUE 8.9

Profile FEATURE | offshore law firms >>

Loo & Partners LLP

managing partner, Loo & Partners LLP

Economic Affairs of Taiwan on the ‘LookSouth’ policy, when the relationship between Taiwan and the PRC was somewhat tense, concerning the legal issues relating to the overseas investments of Taiwanese enterprises into the region, including the feasibility and merits of Taiwanese enterprises venturing into the PRC via and through a Singapore subsidiary. In recognition of my role and contributions, I was specifically mentioned in the Ministry’s published Whitepaper entitled ‘Look-South Policy (Investments)’ dated 11 January 1994. We were instructed by the Taiwanese Government, in 2004, to represent its Civil Aeronautics Administration in the Singapore Courts, when the latter was brought in as a third party by SIA in connection with the clash of SIA’s aircraft operating flight SQ006 in Taipei. Recently, we were instructed by the Taiwanese Government to recover USD30 million, which it offered, via two middlemen, to the Papua New Guinea Government for technical assistance, after the sum had gone missing, which matter, as did the matter relating to the SQ006 air clash, attracted much media attention here and abroad. In similar vein, from the early 90’s, we have been advising both Singapore companies on their out-bound PRC transactions and PRC enterprises on their in-bound Singapore projects, proposed listing plans and M&A transactions in the region. Incidentally, we were the legal advisors for the first PRC entity which was successfully listed on the Frankfurt Stock Exchange. Gone were the days when a local law practice could confine itself to undertaking domestic transactions. With the world rapidly becoming a global village, or to use the language of Thomas Friedman, the famed author of ‘The World Is Flat’, rapidly becoming ‘flat’, no local law practice can survive well without having an international perspective and a global (or at least, a regional) reach. ALB: Your practice has received glowing commendations internationally for the high calibre of your IPO/capital markets work how did you attain this position?

LCC: We are currently assisting several PRC, Taiwanese, Hong Kong, Korea and local clients in their Singapore IPO applications. We have been fortunate of having a good pipeline of cases throughout the years. For instance, in 2007, which was a bad year for local IPOs, we acted (whether as counsel for the Issuer or Issue Manager) in 8 out of 65 cases. There is certainly a room for growth, for which my colleagues and I shall work harder. Judging from the amount of capital markets work and queries from prospects, on proposed IPOs, acquisitions, RTOs, corporate governance and compliance matters that are coming through the doors at the moment, we are extremely confident that we shall be kept reasonably busy even in the prevailing adverse economic climate. We are able to achieve modest success today because I have a great team of colleagues at Loo & Partners LLP. Without the total dedication and commitment of my other colleagues, we shall not be able to attain what we have achieved. ALB: What advice would you give your clients (and prospective clients) in the light of the prevailing adverse economic climate? LCC: I don’t have a crystal ball. I don’t know when we could bid farewell to the sub-prime debacle. I can’t tell whether there would be a collapse of another major financial institution in the United States as some have predicted. However, as an optimist, I always believe that crisis presents opportunities. Indeed, in Chinese the term crisis (危机), comprises (危机) danger and (机会) opportunities. For strong and well-managed companies, the crisis weeds out some of their competitors, and may help them to increase their market share. In the case of companies with available resources, they may start to search for good acquisition opportunities as assets are generally valued lower now than 12 months ago. It is essentially a buyer’s market and bargains await a shrewd buyer, provided that it is duly equipped with the quality advice and assistance of its legal partner!

► THE CORPORATE COMMITMENTS OF LOO & PARTNERS LLP We strive as follows: • To be the best amongst our peers • To attract and retain committed team members • To enable each member to attain his or her full potential • To be our clients’ strategic partner in tackling their daily challenges • To implement changes necessary to better serve our clients, increase efficiency and reduce costs • To maintain a level of profitability that sustains growth, funds further investments to enhance our overall capabilities and provides fair rewards to members

► LOO & PARTNERS LLP PLAUDITS • Loo & Partners provides advice that is “prompt, relevant and effective” Asia Pacific Legal 500 2003/2004 Edition • “Loo & Partners is highly recommended for capital markets, IPOs and corporate governance issues” Asia Pacific Legal 500 2003/2004 Edition • “Loo & Partners is very positive and client focused and a joy to work with” also “Loo & Partners is very knowledgeable about Singapore mindsets and legal processes”- Asia Pacific Legal 500 2003/2004 Edition • The firm has “an impressive array of international banks among its clients” Asia Pacific Legal 500 2003/2004 Edition • “Loo & Partners’ excellent IPO practice covers mandates from pre-listing financing to postlisting corporate governance advice.” – Asialaw Profiles 2005 • “Loo & Partners focuses on providing quality banking and capital markets advice, capturing a significant amount of initial public offering (IPO) work”- Asialaw Profiles 2007 • Recognised for outstanding regulatory work and high transaction volume in the areas of institutional, corporate and business banking.

► LOO & PARTNERS LLP CONTACT DETAILS • Address: 88 Amoy Street, Level Three, Singapore 069907 • Tel: 65 6534 3288 • Fax: 65 6534 0833 • Email:


FEATURE | higher education >>

Moving on up – down under Australia’s elite universities continue to earn worldwide recognition

► ASK THE EXPERTS ALB magazine asked leading academics for their top tips for professionals considering improving their qualifications in Australia. Here's what they said: • Look at the substance of the degree program – not just the reputation of the university • Select programs with a transnational emphasis • Use the website of the Council of Australian Law Deans – – as a one-stop shop for learning about legal study programs in Australia

► AUSTRALIAN LAW SCHOOL RANKINGS 1. University of Melbourne 2. University of Sydney 3. Australian National University (ANU) 4. University of New South Wales (UNSW) 5. Monash University 6. University of Queensland 7. University of Western Australia (UWA) 8. University of Adelaide 9. Macquarie University 10. Griffith University 11. Queensland University of Technology (QUT) 12. University of Technology Sydney (UTS) Source: Australian Education Network



ustralia’s attractiveness as an education destination continues to grow, with the country now home to three of the world’s top 100 universities. This is according to annual rankings released in August by Shanghai Jiao Tong University – and it is an indication not just of the increasing prestige of the nation’s seats of higher learning, but also of its economic strength. The University of Melbourne and Australian National University were joined by University of Sydney, which cracked the top 100 for the first time to come in at number 97 in what is one of the few indices of global university performance available. This prompted Sydney vice-chancellor Michael Spence to note that “it is an indication of the strength and quality of Australian higher education that we perform so well in world-class competition”. The Jiao Tong rankings, which show that Australia (with its population of barely more than 20 million) is more

than competitive with European nations of similar size and wealth, saw ANU slip from 59th to 57th place, while the University of Melbourne shot up six places to take 73rd in what is normally an otherwise stable top-100 list. And as Australia is home to 29 law schools – more than twice the number on a per capita basis than the US – and one of the world’s most inviting cultures and climates, it is no wonder that so many lawyers, aspiring lawyers and other students are heading down under to hone their skills. Indeed, according to the Australian Department of Education, Science and Training, over 392,000 international students were enrolled at Australian institutions, with over 55,000 of them at universities and other centres of higher learning – an increase of nearly 10% over the past five years. Nor is it just students – international academics are also a heavy presence at Australian universities like the University of Melbourne. That institution, which Asian Legal Business ISSUE 8.9

FEATURE | higher education >>

hosts the largest Masters of Law offering in the world, has in the past year alone had over 50 visiting academics and practitioners on its staff, according to University of Melbourne Professor of Law Richard Garnett.

Study, local; practice, global “The Australian legal system can claim in many ways to have set international benchmarks,” says Michael Coper, dean of law at the Australian National University, Canberra. “At different times, the High Court of Australia has been regarded as the intellectual leader amongst national courts in the common law world. Australian jurists are held in high esteem throughout the world. Australian law graduates are recognised internationally for their high levels of legal skills and knowledge. “It’s a great place in which to undertake the study of this basic discipline: a relatively young country that has absorbed many foreign influences, moulded them into something unique and can now export the resultant product – in this case, Australian legal education – with confidence and pride.”

The business of business Many students who come to Australia are already graduates but are looking to augment their skills further and one routine scenario is the lawyer who decides to pursue an MBA. Australia experienced a proliferation of schools

during the boom of the 1990s and today this country is home to 38 business schools – and about 25,000 MBA students, many of them from overseas. Given its close proximity to Asia, however, it is no surprise that it has become a particularly popular destination for regional lawyers seeking to enhance their business acumen, and take advantage of local specialist programs in areas such as Chinese language and international management Most of the top schools have campuses in Asia and exchange programmes with prominent Asian institutions. For instance, Macquarie Graduate School of Management (MGSM) in Sydney has them in Hong Kong and Singapore, Monash Graduate School of Business (GSB) in Melbourne has one in Malaysia, while Melbourne Business School (MBS) is a member of Partnerships in International Management, a global consortium of business schools that facilitates the exchange of MBA and masters students worldwide.

Culture vultures Large numbers of international students in Australian business schools have also generated an extensive network of Asian alumni, who use this country as their preferred business platform and, to its credit, Australia has embraced the opportunities this exposure gives it. In fact, a large number of expatriates

“It is an indication of the strength and quality of Australian higher education that we perform so well in worldclass competition” MICHAEL SPENCE, UNIVERSITY OF SYDNEY all over Asia are particularly active in accounting and legal services and it now has more employees working in the fi nancial sector than Hong Kong and Singapore. All this means that Australia is an incredibly cosmopolitan destination where Asian and other international students have little trouble settling in, and it is no surprise that even with its relatively small population, the nation attracts the third-largest number of overseas students in the Englishspeaking world after the UK and the US. With a new prime minister, Kevin Rudd, who – as ALB went to print – announced plans to turn this country into the West’s most “Asialiterate country”, the enmeshment between these two continents is sure to continue, and the students who move back and forth between the two regions will undoubtedly help lead the way. ALB



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SPECIAL REPORT | Malaysia >>



Asian Legal Business ISSUE 8.9

SPECIAL REPORT | Malaysia >>

Mixed business Malaysia’s lawyers are doing well despite the odds – but longer-term structural reform of the local legal market is on the cards


t is a country that, having once been nearly ruined by the Asian financial meltdown, is today rapidly becoming a global hub for Islamic financing, far outstripping neighbours such as Indonesia (the world’s most populous Moslem nation) and using a legal system inherited from the British to do so. It is a jurisdiction where the largest law firms are virtually united in their stance against the local bar council in a dispute with the central bank over the issue of foreign competition. And it is a place whose politics stand at a dangerous crossroads, characterised as they are by charges and countercharges that are simultaneously salacious and deadly serious. Welcome to Malaysia, 2008, where the local legal industry is surviving – and in some areas thriving – despite economic and political turmoil and slowing growth rates. According to Tay Beng Chai, managing partner and head of the corporate M&A practice

at Tay & Partners, economic and political shocks are being felt in some areas, while others still remain quarantined from the worst of the pain. “In the area of Tay Beng Chai, M&A, it’s fair to say that Tay & Partners there’s been a decline in the number of big transactions taking place. Lawyers are still busy, but the value of transactions have dropped”, reports Tay, which is something that reflects both the shrinking pools of credit to fund large, ambitious deals and the increasingly gun-shy nature of markets smarting from the collapse of large, complex instruments which triggered the sub-prime crisis. These impressions are confirmed by Raslan Loong chief executive partner Caesar Loong, whose mediumsized boutique firm of 21 lawyers – including five partners – has lately seen a major shift away from M&A




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► MALAYSIA : AN ISLAMIC FINANCE CENTRE To further promote Malaysia as a centre of Islamic finance, the Government recently announced a series of six measures to further promote the sector through favourable tax treatment, including that: • Income tax exemption for 10 years be given to all Islamic banking and takaful companies that conduct their business in foreign currencies. Recently the government allowed Islamic banks and takaful companies to conduct international currency transactions from anywhere in Malaysia and not just from the Labuan Offshore Financial Centre. An income tax exemption makes it viable for banks and takaful companies to set up units from anywhere in Malaysia. • An additional 20% stamp duty exemption be given on instruments related to Islamic financing for three years. • Income tax exemption for 10 years be given to local and foreign fund managers who manage Islamic funds for foreign investors. This would also bode well for the promotion of foreign Islamic fund management activities. • Personal tax relief on study fees, up to a maximum of RM5,000 per year will be extended to Islamic studies conducted in institutions of higher learning, including the International Centre for Education in Islamic Finance. • Tax deductions be given on expenses incurred in establishing an Islamic stock broking firm. Government sources say this was to support the national agenda to make Malaysia an Islamic financial hub. • Tax deductions on expenses incurred in the issuance of Islamic products to be extended from year of assessment 2008 to 2010. Source: PricewaterhouseCoopers

Source: The Economist


SPECIAL REPORT | Malaysia >>

“Asian banks, Malaysian banks and financial institutions aren’t as exposed to or invested in CDOs as banks in the West – the pool of funds investing in those instruments is a different pool of money. That’s the good news” 68

and other transactional sort of work towards internal restructuring and insolvency deals over the past six months as economic jitters and political uncertainty take their toll on the deal market. “There’ll be a lot more work in the areas of insolvency and restructuring,” predicts Loong. “The economy isn’t as strong as the government likes to make out, and while a lot of the economy is driven by oil and commodities, the fact is that many other sectors aren’t doing that well. Certainly, Malaysia remains one of the favourite investment targets in the region, but with the political situation unclear, people are waiting to see what happens.” Not everyone remains so sanguine. Albar & Partners’ managing partner Zaid Albar says that the local debt market has started to sail into the wind, in no small part thanks to populist policies of the Malaysian government. While Albar reports that his firm’s commercial, banking and litigation practices remain quite busy, and that restructuring and refinancing work is on the upswing, “it’s more on the private debt side that things are starting to slow down a bit, and we don’t know how long that’s going to last. Banks are finding it difficult to underwrite bonds. And now the private debt market has been made less attractive since the government imposed a windfall profit tax on independent power producers, or IPPs.” This extra 30% tax – which has begun to fall on palm oil plantations as well, and which Trade and Consumer Affairs Minister Datuk Shahrir describes as a measure “to ensure balanced distribution of income to deserving groups” – may be politically expedient to a government which saw five of 13 state federations fall to the opposition in last March’s historic balloting, but it has thrown a monkey wrench into the cash flows upon which a number of bond issues were predicated. Outside the deals arena, one area that remains quite active – and where a number of specialty firms are making their mark – is intellectual property. Although trademark infringements are not as common a sight in Malaysia as they are in neighbouring countries such as Indonesia, the fight against counterfeit products remains a staple Asian Legal Business ISSUE 8.9

SPECIAL REPORT | Malaysia >>

of boutique intellectual property firm Wong Jin Nee & Teo, according to partner Teo Bong Kwang. “We’ve been working actively on the enforcement end”, reports Teo, who says that his fi rm has been involved with companies such as mobile phone giant Nokia, denim apparel maker Levi Strauss, and the American clothing brand Abercrombie & Fitch to fight infringements of their brands and trademark. “This area remains very busy, but we’re also told that in other sectors such as conveyancing, things are a lot tougher, because our economy isn’t that fantastic at the moment,” says Teo. Likewise, Malaysia’s push to become a biotechnology hub in the region has brought a new stream of work to lawyers such as Tay & Partners’ Siewing Su, who heads up that firm's intellectual property practice. “It’s definitely developing, and we’re generating a lot of work as a result – IP is very resilient. We’re not as badly

affected as, say, the private equity and capital markets.” However, it is not all bad news for those markets. “The other observation is that on the debt side, capital markets are still quite healthy, especially when it comes to Islamic finance. These areas are less adversely affected by the problems in the Western world, principally because Asian banks, Malaysian banks and financial institutions aren’t as exposed to or invested in CDOs as banks in the West – the pool of funds investing in those instruments is a different pool of money. That’s the good news.” As Ronald Tan, who heads the firm’s capital markets practice points out, “the Malaysian domestic market as well as the Islamic bond market is a bit like an oasis of sorts – there’s still a lot of liquidity in those markets.”

Bad marriages or wedded bliss? But the biggest question swirling around Islamic finance in Malaysia is

whether foreign firms will be allowed in to the market to work on deals in this area. Although a select few law firms – such as UK’s Eversheds, which enjoys a strategic alliance with Kuala Lumpur’s Shahrizat Rashid & Lee – have a presence in the country, there is increasing pressure both internally and abroad, for a more comprehensive structural reform of the Malaysian legal market in this area. And the lion’s share of medium to large firms spoken to by ALB indicated Teo Bong Kwang, Wong Jin Nee their support for the & Teo entry of foreign firms – although there was great disagreement as to the details, and whether such a liberalisation should be confined to allowing just a handful of overseas players to set up shop in Kuala Lumpur, with their ambits limited to international Islamic finance transactions, or whether an

Islamic finance and liberalisation in Malaysia


alaysia’s central bank, Bank Negara Malaysia, plans to make Malaysia an international islamic financial centre (MIFC) that will be a hub for Islamic fund raising and product origination. Whilst the figures differ, in 2007 it was reported that Malaysia’s percentile share of the global Islamic bond (sukuk) market was 65% of outstanding instruments, or roughly US$62 billion. Its competitive advantage is clear. Documentation for sukuk musharakah, sukuk ijarah, sukuk mudharabah, sukuk bai bithaman ajil, as well as for a whole range of other loan products, are all common place in Malaysia. However much of the demand has come from domestic issuers. Bank Negara realizes that in order for Malaysia to become a significant global financial player it needs to be a point of origination for a wide array of international issuers as well, and to do this it must make Malaysia an attractive international destination for Islamic fund raising. To succeed Malaysia must also provide an environment that permits key capital markets players to relocate and operate in Malaysia with minimal restrictions. One obstacle remains the restrictions imposed on the entry of foreign law firms and this is seen as a hindrance to the

development of the MIFC. Unlike Singapore or Hong Kong, Malaysia does not have a structure whereby foreign law firms may be licensed to practise foreign law along side its own local law practitioners. Although the Malaysian Bar has submitted a proposal to the Malaysian government to permit the formation of joint ventures between foreign law firms and local firms, the proposal is appropriate only if foreign law firms wish to practise Malaysian law. In all likelihood, leading international law firms hired for their country specific expertise are unlikely to want to practice in a tight local market at the outset, if at all. On the other hand what may be desired is a local presence to provide foreign law services to their international clients - a category of activity which the Malaysian Bar Council does not promote. The resistance of the Malaysian Bar to the entry of foreign firms to practise foreign law seems somewhat misplaced given that local law firms do not practise foreign law and it is difficult to see how the practice of foreign law in Malaysia by foreign firms would encroach into the traditional work of local law firms. Some Malaysian lawyers who oppose the idea of liberalization also rely on the argument that as Islamic finance is well developed in Malaysia,

Firm Profile


there is no need for foreign players. This view misconceives the position of shari’iah principles in financing documents and may also overstate the level of local documentation expertise for cross border transactions. Islamic financial products cannot exist in isolation from a national legal system and must be expressed and given effect under a national law (see, Shamil Bank of Bahrain EC vs. Beximco Pharmaceuticals Ltd, CA [2004] 2 All E.R. 1072). In order for Malaysia to be viewed as an important international player, international issuers and investors must be free to choose the national law by which their obligations will be regulated, and this will often be a law that is not Malaysian. So it stands to reason that the presence of foreign law practitioners in Malaysia remains critical to the development of the MIFC. Loong Caesar Raslan Loong, Malaysia


SPECIAL REPORT | Malaysia >>

“The bar council doesn’t have a lot of clarity on [KL being an Islamic finance centre] issue, and they’re still operating under the mindset that these guys will come in and make inroads on their local turf, which I think is incredibly small minded” open slather model is more appropriate. While the Malaysian Bar Council has been dragging its heels on the issue for years, the country’s central bank, Bank Negara, has been pushing hard for its proposal to allow a maximum of five firms from overseas to come to Malaysia with a licence to work solely on Islamic finance transactions, and has recently launched an international campaign to promote the country as a hub of Islamic finance. The hinges of the door keeping foreign firms out are squeaking as players from the US, Europe and Australia are backed in their calls for openness by the World Trade Organisation and trade agreement negotiators, all of whom are calling for greater market access. Indeed, the debate seems to be characterised by two sides who are looking at the same question from very different perspectives – and Malaysia’s top lawyers say that the bar council lacks the perspective to see over the horizon and appreciate the long-term 70

advantages that foreign law firms could bring not just to the local legal market but to the country and economy as a whole. “The bar council is Mariette Peters, Zul Rafique & very concerned with Partners things like human rights and constitutional rights and indigenous rights”, notes Zul Rafique partner Mariette Peters, who says that while all these concerns are legitimate, she and many others would like to see the bar council focus more on the business of law. Foreign firms looking for a base to launch complex, international Islamic finance deals have plenty of options, Kuala Lumpur’s major players say, and failing to welcome them only serves to chase money and talent overseas. The presence of international firms would also give local firms the impetus they need to keep their skills on an equal footing with the world’s best

practice. “Obviously, we’d like to see Malaysian law firms doing this sort of work but if foreign firms wind up here doing it, then that means that Malaysian firms will simply have to improve the quality of their work to compete. That’s why we’re not really opposed to the entry of foreign firms (under Bank Negara’s proposal”, says Muthanna. “The reality is that, in Malaysia, the number of firms that can do this sort of work isn’t more than 10”, adds Muthanna, suggesting that the smaller firms whom the bar council is trying to protect from foreign predators have misplaced concerns. “What Bank Negara has gotten absolutely right is their understanding that if you want to make Kuala Lumpur a dynamic hub for international Islamic finance, then you have to have all the key players physically here”, comments Loong. “That means the bankers, the originators, the market makers, and their service providers, including the lawyers. These players are going to promote Malaysia as an originating point, and you need the foreign law firms to advise out of Kuala Lumpur on instruments that are regulated by US or UK law. “They have a lot of clarity. The bar council doesn’t have a lot of clarity on this issue, and they’re still operating under the mindset that these guys will Asian Legal Business ISSUE 8.9

SPECIAL REPORT | Malaysia >>

come in and make inroads on their local turf, which I think is incredibly small minded.” While support for the entry of international law firms into the Malaysian market may be strong among the country’s legal elite, the question of what form such an entry should take remains controversial. Should international firms be allowed only to practice Islamic finance, working on international deals from their own stand-alone offices? Or is a more Singaporean model, with its joint law ventures, and all that implies, appropriate? While in theory, joint ventures offer a host of opportunities for local law firms, from the perspective of lawyers watching from their towers in Kuala Lumpur, the JLV model is far from perfect. “There’s definitely some concern that [under the JLV model] foreign law firms might not transfer technology and knowledge, and that they wouldn’t really integrate with the local legal

community”, says Tay. Speaking for himself, he would rather see foreign firms set themselves up strictly as offshore practices. “We know, from watching Singapore’s experience, that often the two constituent firms of a JLV have two different agendas. One wants to do local work and quite jealously guards its turf, and meanwhile the foreign firm doesn’t share what it’s doing. The scope is very different – they’re sleeping in the same bed but are having different dreams”. Indeed, says Loong, “big city or New York law firms aren’t interested in Malaysian law and say the whole need for a JLV is irrelevant if all you want to do is practice English or American law with a physical presence here.” Not everyone agrees that JLVs are completely irrelevant to Malaysia’s future, however. “The major key to the model is whether or not the foreign firms are willing to share information,” says Albar.

“But we also recognise that there’s certain expertise which can come from foreign firms. Certainly these things can sometimes be a bit like a forced marriage, but we know the problems with the Singapore model; we know the weaknesses and we can take those into account.”

Are you experienced? The obverse of the foreign firms question is that of retaining talent in a dynamic region where, for the moment, even the biggest local law firms have trouble keeping smart young attorneys from heading abroad in pursuit of bigger pay packets and more complex deals. While most law firms report little major change in their year-onyear headcounts, these numbers tell only half the story. “In terms of recruiting first year lawyers, there’s certainly not a problem”, says Muthanna. “There’s sufficient supply and we’re able to capture the ones that we want. But

Recent Developments in Capital Markets’ Law and Regulation


uch more is expected to follow in Malaysian Capital Markets Law and Regulation. In September 2007, the Capital Markets And Services Act 2007 (“CMSA”) came into force, that is, except for Division 2 of Part VI which regulates Takeovers & Mergers. The old law on Takeovers & Mergers in Division 2 of Part IV of the Securities Commission Act 1993 and The Malaysian Code on Take-overs And Mergers 1998 remains. A new Malaysian Code on Takeovers And Mergers is expected when Division 2 of Part VI of CMSA comes into force. While much is probably being considered for the new Code, Division 2 of Part VI of CMSA already tells us much of what may lie in store. There can be expected, a change in the threshold for mandatory offers. Currently, a person is only required to make a mandatory offer on shares in public companies or private companies subject to the present Code, if he and persons acting in concert acquire more than 33% in such a company. This will change to 30%. The

new Code may extend its regulation to other entities including, foreign entities and entities like unit and Real Estate Investment Trusts (“REITS”). It reflects the growing importance for globalisation in Malaysia Capital Markets and the increased introduction of other vehicles as with REITS. The Malaysian Securities Commission’s (“SC”) new Guidelines on the Offering of Equity and Equity-Linked Securities and Guidelines on the Offering of Equity-Linked Securities for the MESDAQ Market have also rationalized and liberalized some existing regulatory requirements for SC approval. Companies with foreign based assets and operations now basically follow the same criteria for listing in Malaysia as companies with Malaysian operations. Greater flexibilities are also given to the listing of property development and construction companies, acquisitions involving MESDAQ Market listed companies, the need for financial forecasts and SC approval for acquisitions of significant assets used for core

Firm Profile

Wong Beh & Toh

businesses. The SC has also moved to further enhance the standards of conduct. New guidelines were introduced in Guidelines on Principal Advisers for Corporate Proposals and Guidelines on Due Diligence Conduct for Corporate Proposals. A new Stamp Duty Exemption Order has also been introduced. It is to facilitate mergers of companies listed on Bursa Malaysia Securities Berhad. Further enhancements and new regulations can be expected as Malaysia’s Capital Markets move to meet an evolving and globalised environment.

Wong Tat Chung Senior Partner Wong Beh & Toh Peti #30, Level 12, West Block Wisma Selangor Dredging, 142-C Jalan Ampang, 50450 Kuala Lumpur, Malaysia. T: +603 2713 6050 F: +603 2713 6052 E:


SPECIAL REPORT | Malaysia >>

“There’s sufficient supply and we’re able to capture the people that we want. But when it comes to finding experienced litigators and corporate lawyers – especially corporate lawyers – who have practiced for four or five years, things are more difficult. So many lawyers in those areas have already made the move to Singapore. There’s a real shortage of lawyers with this level of experience, and these lawyers are being poached” when it comes to finding experienced litigators and corporate lawyers – especially corporate lawyers – who have practiced for four or five years, things are more difficult. So many lawyers in those areas have already made the move to Singapore. There’s a real shortage of lawyers with this level of experience, and these lawyers are being poached.” Meanwhile, Loong thinks that the bar council should go further to ensure the future of the profession in Malaysia. While some see a dearth of lawyers at the experienced end of the field, Loong sees a surfeit of entry level lawyers who, when combined with what he describes as “too many fi rms with too many profit centres”, are hurting the reputation of Malaysia’s bar. “What we need to do as a profession is to start looking seriously at the practice issues and regulating the quality of lawyers entering the profession”, says Loong, who says that there is room for the bar council to take a more proactive role reforming the business of law. “The bar council should be forcing law fi rms to consolidate at this point. There are too many lawyers and too many profit centres, and while there’s some pressure for consolidation at the moment it’s very ad hoc. Big fi rms would like to consolidate with smaller ones and vice versa, but at the moment there seems to be no real movement to make that happen.” Despite this enthusiasm it remains an 72

open question as to whether Malaysia’s law firms will consolidate of their own accord or have consolidation thrust upon them by the bar council, although many firms say they are actively studying the issue. “I think some consolidation would make sense,” confirms Muthanna. “We’re certainly considering it on our part. We feel that we need to fill certain gaps that exist in our own capabilities, but to fill them organically by training and recruitment and so on might take too long and we might lose the market window – from that perspective we feel that a better way to go might be a merger with a mediumsized firm.” Certainly, Malaysia has a lot going for it, more than many of its neighbours. Resources remain a strong source of foreign exchange. The growing ability to tap Islamic capital provides a check against the sub-prime credit crunch causing so much heartburn in the West. And the Malaysian government’s push to diversify the economy and promote high-tech industries, such as biotechnology, provides further insulation against economic shocks. But while the legal market will always have a role servicing these areas, the fact remains that further structural reforms – some of them painful – will have to be undertaken to allow it to truly thrive. And as Teo puts it, “we need to get ready for the challenge.” ALB Asian Legal Business ISSUE 8.9

Firm Profile SPECIAL REPORT | Malaysia >>

Tay & Partners

Tay & Partners: Legal advice with a business approach Tay & Partners does not only provide sound legal advice; it also has an understanding of the business climate that foreign investors need and are adept in helping FDIs navigate regulatory challenges during leaner economic times


ay & Partners is often considered to be a “young firm” amongst the established law firms in Malaysia. It first opened its doors to Malaysia about 20 years ago and since then it has become known for its services that combines solid legal expertise with a business-oriented approach. The firm has a friendly team of more than 30 lawyers. Although this is fewer than some larger Malaysian firms that have up to 100 lawyers, Managing Partner, Tay Beng Chai says his leaner team is more attuned to transactional work and can provide first class legal service and responsiveness that in-house counsels and investment banks look for.

Younger firms get a better deal In the Malaysian market corporations are increasingly becoming accustomed to using law firms that have established themselves in the last two decades for high-profile deals, says Tay. He gave the example of his firm’s work for Asia’s leading agribusiness group, Wilmar International, which was headed by partner Chang Hong Yun, in its acquisition of Malaysian listed PPB Oil Palms. The deal worth US$3.7bn was the first major cross-border takeover involving two publicly-listed groups in Singapore and Malaysia, according to Tay. Another example he gave was a 25% stake acquisition (US$238m) in Affin Holdings Berhad by The Bank of East Asia. Tay says the client was pleased that it was permitted by the regulators to acquire the 25% stake despite the usual 20% single shareholding limit in Malaysian banks.

More than just legal advice When asked why large corporations are choosing Tay & Partners, Tay points to the firm’s approach to legal services. He says that in the midst of the global economic turmoil investors are now, more than ever, looking for legal counsel that offers an insight into the market. “We see ourselves as business

lawyers, providing business solutions from a legal perspective,” he said. The firm’s corporate department offers a wide range of corporate and commercial law services with banking and finance, mergers and acquisitions, debt and equity capital market, project financing, joint ventures, investments and real estate being its main focus. “Our lawyers in this department are adept at advising and helping clients navigate FDI and other regulatory issues,” said Tay.

Malaysian markets turning for the better? Tay says that real estate funds and investors are anticipating more attractive pricing for investment properties and projects. He believes that tumbling share prices will in turn bring more acquisition activities into Malaysia, providing firms with a steadier flow of work. “Private equity and the big corporations in Malaysian market will bounce back. The presently tough economic times actually yield opportunities for M&A transactions. Although the financial, banking and manufacturing sectors are slow, we are seeing a lot of logistics work in distribution and port management,” he said. Islamic capital markets work is also growing says Ronald Tan, head of debt capital markets. “This year several notable foreign issuers have issued Ringgit-denominated Islamic bonds known as Sukuks, he says, “to tap liquidity which is otherwise unavailable in their home markets due to the global credit crunch”. Tan believes that Islamic instruments, generally regarded as being more conservative since they require asset-backing, will have be considered more attractive during slow investment periods, particularly for derivativetype instruments. “If our mandates are a reflection of the trend, we are confident that despite economic headwinds, the Islamic capital market will be healthy and continue to grow,” he said.

“We see ourselves as business lawyers, providing business solutions from a legal perspective.” TAY BENG CHAI, TAY & PARTNERS.

► RECENT MAJOR PROJECTS AND CLIENTS • Excel Step Investment: exchangeable bonds issuance (US$132m) • Eurobond restructure, first Eurobond conversion into equity in Asia (US$123.76m) • Wilmar International- PPB Oil Palms takeover (US$3.8bn) • The Bank of East Asia-Affin Holdings Berhad 25% stake acquisition (US$238m) • MISC Berhad-Pelabuhan Tanjung Pelepas Sdn Bhd joint venture (value undisclosed)

► MEET THE PARTNERS Tay Beng Chai: Tay is the Managing Partner of the firm and heads the Corporate and Commercial Department. With more than 20 years’ experience in M&A, corporate/commercial, capital markets, finance and insolvency related matters, Tay has overseen cross-border transactions, advised foreign investors and MNCs on Malaysian investment and acquisitions. Ronald Tan: With extensive experience in equity, debt capital markets, corporate and cross-border M&A, Tan has advised blue-chip and Fortune 500 MNCs on their Malaysian investments. David Lee: Was made a Partner of the firm on 1 January 2008. He primarily focuses on foreign investments and has extensive experience in property / real estate transactions. Lau Lee Jan: Lau heads the firm’s practice in Johor Bahru. With more than 26 years’ experience, Lau acts for Malaysian financial institutions in financing and security documentation. Chang Hong Yun: Chang has more than 15 years experience in banking, finance, real estate and corporate/commercial matters, Chang is also actively advising various in-bound transactions into China.

► DID YOU KNOW? • In the Cross Border Deal of the Year category at the 2008 National Mergers & Acquisitions Awards in Malaysia, Tay & Partners advised the acquirors in 2 of the 7 shortlisted deals • Firm was nominated as a finalist at the 2008 ALB SE Asia Law Awards as Malaysia Deal Firm of the Year • Managing Partner Tay Beng Chai has regularly been listed as a leading corporate and M&A lawyer work in the Asia Pacific Legal 500 (2005-2006) and (2007-2008) • Partner Ronald Tan is recognised as a leading capital markets specialist and was recently acknowledged as one of the world’s leading Islamic finance practitioners


Islamic Banking and Finance Property/real estate M&A Commodities


FEATURE | property investment >>

Asian property Market benefits from firm foundations As the effects of the credit crunch continue to cripple real estate markets elsewhere, Asia remains resilient – and investors are keen to snap up a piece of the property pie


roperty has long been seen as the ultimate consistent investment, performing suitably, if not brilliantly on the global front. The key reason for its success and stability, however, lies in the domino effect triggered by population increasing worldwide – the more people, the more construction is required, whether it be housing, offices or shopping malls. In Asia, one of the fastest growing regions on the planet both economically and population-wise, investment in property is still as hot as it was a few years ago when the Asian REIT was introduced, and the area’s steady growth despite the global credit crunch has aroused new interest in the market.

Sole survivor Property’s appeal in Asia has always been strong and 2007 in particular saw a rise in the volume of transactions in commercial property. Figures from property services firm Cushman & Wakefield for 2007 revealed a 27% increase in Asian commercialproperty transactions to US$145bn – impressive growth spurred on by an 74

overall rise of 87% in foreign investment to US$73bn. This year, however, the credit crunch impacted on a global scale, and the volatile mix of mortgage stress and general affordability woes has slowed the erstwhile thriving market. But while the credit fiasco continues to ravage the US, the UK and Australia, investment property in Asia is faring a bit better, thus demonstrating its resilience in spite of the global downturn. Managing director of ALFA Property Services, John Brun, believes it is a mixture of conventional thinking by investors and Asia’s natural attraction that has seen the region escape the turmoil practically unscathed. “People in Asia – and also those who call the region home – have been more resilient as we tend to be far more conservative than Western Countries, and rather than make decisions based solely on emotion, we make sure there is sufficient logic to support our decision. We plan for a ‘worst case scenario’ before proceeding,” he explains. “Drivers for growth include location, value for money, travel time to reach

destinations, occupancy rates and what I like to call lifestyle returns. People are now investing in ‘lifestyles’, which have an underlying ‘investment’ component, whereby they are now enjoying the fruits of their labours – but, they also receive a return on their investment.” The recent decision by international investment bank JPMorgan to invest more than US$1bn in Asian real estate over the next three years is testament to its ongoing attraction, and this show of confidence is also set to strengthen the market further. US-based Russell Investments, which manages over US$211bn in assets, was also reported to be preparing to increase its exposure to Asian real estate as it sees growing markets in China and India withstanding the persistent global downturn. And these are just two. Property investment units from Jones Lang LaSalle and Prudential, and Singapore developers such as CapitaLand and Keppel Land are other keen investors that seem to be looking at property in Asia in the midst of the current crisis Attractive prices and a good return on investment (ROI) also helped the Asian markets retain their appeal, Brun says. “Compared, say, to London where a property costs you about £250,000 to £350,000, hopefully providing you a net yield of 3–4% with taxes on the way in and out, here you could buy a very attractive property for US$500,000 to US$700,000 producing a much higher yield, and – with the right advice – little if any tax on the way out.” As the region is a major business hub, companies are also keen to invest in the its commercial property and offices, with the credit crunch highlighting the importance of expanding into somewhere more resilient. “The other reason is that around 50% of the world’s wealth is based in cities like HK, Tokyo, Singapore, KL, and the main cities in China – and, if we take India on board, this of course increases,” says Brun. “Most international business now striving to remain buoyant knows it must be based in Asia, bringing along disposable income to invest in secure, safe investment properties.”

Hot spots in Asia Spurred on by strong economic growth, real estate in Asia is flourishing across the entire region, from China to Asian Legal Business ISSUE 8.9

FEATURE | property investment >>

“When people say they don’t think Bali is a good investment, I laugh – six five-star resorts and four major projects have started in the last three years” JOHN BRUN, ALFA PROPERTY SERVICES Cambodia and Singapore to India, and investors are taking full advantage. A survey by global real estate advisory business DTZ, recently revealed that 56% of all respondents (investors) plan to increase exposure to Asia-Pacific real estate (against only 15% wanting to reduce it). Although China remains the primary area of interest for investors, the survey reported some shift in focus away from Japan, Australia and Singapore in favour of emerging markets such as Vietnam and Indonesia. Other new markets, like Thailand, Bali and Cambodia are also attracting attention and flourishing on the back of a tourism boom and privacy demands. In particular, property development in Phuket has expanded to four small

islands nearby with investments worth around THB20bn currently under way. “Thailand, Bali and Vietnam are popular and with good reason,” says Brun, “and because most people have invested their own funds there, they seem to feel ripples or market changes only very slightly – if at all. “One of the hottest spots in Thailand, I believe, is in Phang Nga, along the west coast. Also, Bali is once again a hive of activity, and there are some excellent opportunities, with some major management companies investing considerable amounts to ensure their success. When people tell me they don’t think Bali is a good investment, I can only laugh – the area has six five-star resorts, plus another four major projects started up in the last three years or so!

I tend to think that the multinationals there already have spent considerable amounts of time and funds to ensure it does succeed.” The real estate market in Cambodia is also going strong, bolstered by the tide of tourism. Over 818,000 visitors arrived there in the first four months of 2008 – a 14% increase on the same period in 2007 – and government economic reforms to encourage investment are also set to open it up even more and draw people in. “I do believe that places like Cambodia, Laos will soon come onto the market, along with Borneo and some locations in the Philippines,” says Brun. “I know it will be exciting and the growth has only just started! However,” he adds, “as I advise all my clients, no-one should ever do anything without seeking sound professional, legal advice.” Indeed, but in the midst of all this positive growth, increased investment, construction and crossing of new borders, expert legal guidance is vital to the success of any development and investor – and those firms poised to provide them with this are sure to benefit too. ALB


FEATURE | energy & resources >>

ENERGY & RESOURCES SET TO BOOM IN ASIA Despite possessing their fair share of the world’s minerals and natural resources, emerging economies in Asia have yet to fully realise their gains from the resources boom



merging economies in Asia continue to thrive as China exercises its dragon appetite for energy & resources in order to sustain its rapid economic development. However, not all areas are blooming as they should, with inadequate and outdated legal infrastructure frustrating lawyers in some jurisdictions, forcing them to sit on the sidelines while others rake in the deals and reap the profits.

Malaysia’s potential boom stifled Legal uncertainty and bureaucracy may be the two bugbears that are holding back the huge growth potential of Malaysia’s energy & resources market – particularly in the mining sector – and causing frustration for lawyers. According to Business Monitor International’s 2008 Malaysia Mining Report, which includes a five-year industry forecast, the government is urging miners to revive abandoned mines, especially tin mines, while also encouraging the states to issue more mining licences. In Malaysia, the states are responsible for the issue of mining licences in consultation with federal agencies like the Department of Minerals and Geoscience and the Department of the Environment. Lawyers acting for foreign clients, who depend upon them to facilitate their business operations, have found themselves harking back to traditional methods of communication. They have been travelling interstate and approaching state officers directly, addressing the issues face to face. Azmi Mohd Ali, senior partner of Azmi & Associates, told ALB that Malaysia has failed to take full advantage of the current boom in demand for minerals, as foreign investors are still being hampered by the rigid legal infrastructure. Although there is a mineral policy at the federal level, implementation is mostly done at the state level, and the states are generally not equipped to handle and regulate systematic mining activities on a large scale. “This makes the structure rigid, and it is further exacerbated by red tape,” says Azmi. “The policies are unclear and left to the discretionary views of different state officers at different stages of the process.” Asian Legal Business ISSUE 8.9

FEATURE | energy & resources >>

Azmi’s firm handled a MYR100m project for a European calcium carbonate mining company whose application for land acquisition with mining lease took more than a year to complete. “It is very frustrating, as the opportunities to render advisory work to companies hungry to procure resources are growing, but we are unable to grab them because the time delay causes them to consider shifting their mining investment elsewhere,” Azmi says. The appeal of the mining industry is gaining currency, with China buying up resources overseas to sustain its rapid development. Calcium carbonate is a mineral that can be used in the construction industry as a building material, in the purification of iron from iron ore in a blast furnace, and in the oil industry in drilling fluids. Malaysia’s National Mineral Policy, which was formulated in 1994, requires miners to pay taxes based on their operating profits. To revive mining and exploration activities, the government has abolished export duties on most minerals, except ores and concentrates. High import duties on minerals and a cut in import duties on mining equipment are among some of the incentives for domestic players. Foreign investors exploring minerals in Malaysia are allowed to control 100% equity and can also form JVs with local companies. However, state authorities still hold the sole power to issue exploration and mining rights. “Prices of minerals are rising, but with legal uncertainty in policy, bureaucratic hurdles and the limitations of what can be exported out of Malaysia, foreign companies are limited in what they can and cannot do,” says Azmi. “It can be improved and should be improved soon.” Bauxite, coal, feldspar, gold, iron ore, kaolin, mica, monazite, struverite, tin and zircon are the main minerals currently produced by the Malaysian mines. Business Monitor International has forecast an average growth rate of 5.9% over 2008–12 leading to a mining industry value of US$163.9m at the end of the period. Aluminium looks set to be the latest resource to contribute to Malaysia’s mining boom. Rio Tinto recently announced that it had received approval from the Malaysian government for a

US$2bn aluminium smelter project at Similajau in Sarawak. The project is to be a 60:40 joint venture with local group Cayha Mata Sarawak. The smelter would have an initial capacity of 550,000 tonnes of aluminium per year, with the potential to expand at a later date to 1.5m tonnes. The JV is expected to generate up to 4,700 jobs in the area.















Southeast Asia


China’s dragon appetite for energy

Source: World Investment Report 2007, United Nations Conference on Trade and Development

Given particularly strong Chinese demand in the natural resources and energy sector, Chinese outbound investments are likely to soar. The top deal so far this year was Aluminium Corporation of China (Chinalco) and US aluminium producer

far this year from 129 deals, compared to US$7.6bn from 111 deals for the same period in 2007. “The trend of investment in the natural resources sector is set to continue as the PRC requires natural

“Prices of minerals are rising, but with legal uncertainty in policy … foreign companies are limited in what they can do. It can … and should be improved soon” AZMI MOHD ALI, AZMI & ASSOCIATES Alcoa’s acquisition of a 12% stake in Rio Tinto for US$14.2bn in February 2008. Chinese cross-border outbound acquisitions in this sector have a rank value of US$15.9bn from 27 deals so far compared to US$1.23bn from 29 deals in the same period last year. Paul Chow, an M&A partner at Linklaters in Beijing, which advised ICBC on its US$5.5bn acquisition of a strategic interest in South Africa’s Standard Bank, told ALB that China’s outbound investment will “accelerate”. “A large proportion of the domestic banks’ foreign reserves, accumulated through IPOs and recapitalisations, are US-dollar based,” says Chow. “As the US dollar has depreciated, the banks have an incentive to convert this cash into assets and, increasingly, assets to be found overseas. The RMB gaining strength over the dollar is, in parallel, also making foreign investment easier.” The energy and power industry also saw high growth in both the value and number of deals cut in Chinese outbound acquisitions. The two industries that registered negative growth were the retail and high technology industries. In the latest figures from Thomson Reuters, China’s cross-border outbound acquisitions have risen to US$45.2bn so

resources to feed its manufacturing base,” says Seung Chong, an M&A partner with White & Case in Hong Kong. “Previously, China obtained access to a stable supply of materials via long-term contracts. Why not take an interest in the source itself?” Seung, who has recently published a book examining the issues arising from M&A transactions in China, notes that examples of PRC outbound investments in natural resources include investments in Chile (copper), Peru (zinc), Kazakhstan (oil) and Australia (bauxite, iron ore and uranium). “Another interesting trend is that PRC companies are sourcing natural resources from countries where US or European companies are reluctant to invest,” says Seung. Hong Kong is the most active target of Chinese acquirers followed by UK and Singapore. In March, SinoSing Power, a subsidiary of China Huaneng Group, China’s largest independent electricity provider, paid US$3bn for Singaporean electricity company Tuas Power. Chinese companies that take the long-term view and secure the sources of natural resources in order to sustain the country’s economic growth and expand its international distribution networks Cont p80f


► THE FIRM EXPERIENCE IN ENERGY & NATURAL RESOURCES • Legal counsel for PT Pertamina (Persero), the Indonesia’s oil and gas state owned company for the legal due diligence of planned restructuring for 60 of Pertamina’s subsidiaries and jointventure companies • Assisting an Indonesian company in preparation on the legal documentation for the bidding of North Bone block PSC • Assisting foreign investor in the shares acquisition of a nickel Indonesian company holding the PKP2B (Perjanjian Karya Pengusahaan Pertambangan Batu Bara/Coal Mining Exploitation Working Arrangement) • Assisting foreign investor in the acquisition of Indonesian TAC/Technical Assistance Contract company in mining business • Legal counsel for an established Indonesian mining company, i.e. PT Darma Henwa, Tbk. for its mining business activities which is ranging from operational, commercial and supporting matters, including representing in reviewing contracts related to Asam-Asam Coal Mine Project • Legal counsel for several foreign investors (such as Bhoruka Energy Limited, DCM Shriram Consolidated Ltd, Metis International Trading Ilp, JSW Energy Limited, MGM Resources, Jindal Stainless Limited) in the coal mining cooperation agreement and related agreements to the coal mining transactions, with Indonesian coal mining companies • Legal counsel for several companies and/ or Group companies in the acquisition of Indonesian companies including assisting for the post acquisition legal works related in plantation business, such as Applied Agricultural Resources Sdn. Bhd., Asia Pacific Land Bhd., Gan Teng Siew Realty Sdn. Bhd., IJM Plantations Bhd., J.C. Chang (Pte) Ltd., Kuala Lumpur Kepong Bhd. (KLK Group), Metro Kajang Group, NPC Resources Bhd., Tanah Emas Corporation Bhd., United Plantations Bhd., Wilmar Plantation Group • Legal counsel for PT Bridgestone Sumatera Rubber Estate, an Indonesian plantation company as the subsidiary of Bridgestone Corporation



he increasing demand for energy has become a great opportunity for Indonesia with its huge deposit of mineral resources and a vast land area with a favorable climate for Indonesia to develop its potential for palm oil. In 2006, Indonesia passed Malaysia to become the world’s largest producer of palm oil, producing approximately 16 million tons per year. Investing in mining, oil and gas, and plantations can be politically and socially sensitive. Business in these sectors is very much dependent on approvals from a multiplicity of central and provincial government institutions. HANAFIAH PONGGAWA & PARTNERS (the “Firm”) is one of Indonesia’s premier independent law firms. With over 30 lawyers, the Firm is fully equipped to serve the diverse needs of both domestic and international clients. The Firm has its roots in one of Indonesia’s post-independence law firms, the office of L. Hanafiah, established in 1953. It was later reconstituted in 1990 as Hanafiah Soeharto Ponggawa and reorganized at various times in the 1990s to reflect Indonesia's changing situation before taking its present structure in 2001. The Firm represents a wide range of clientele including multinational companies, large and small domestic companies, financial institutions, government agencies, local governments and individuals. The Firm’s long experience enables it to help clients anticipate and minimise the risks that can come into play. Recently, the Firm has been assisting various type of clients in acquiring coal mining rights in many areas in Indonesia, taking over oil and gas concession, and in investment in and acquisition of palm oil and sago plantations. All such transaction are handled by our Energy & Natural Resources Group. The Firm’s scope of work when assisting clients in the field of oil and gas includes the following: • rendering preliminary advice to clients with no experience in investing or doing

business in mining, oil & gas, in Indonesia; • obtaining mining authorities/contracts of work from the Indonesian central and/or local government; • establishing joint ventures in the mining, oil and gas sectors between foreign investors and Indonesian companies; • assisting in negotiations and/or obtaining various contracts with the oil & gas state owned company (“Pertamina”) and/ or the oil and gas operating entity (“BP. Migas”), such as technical assistance, production sharing contracts; • obtaining licenses and fulfilling registration requirements for clients who will engage in providing supporting services in the mining, oil & gas sectors; • advising or negotiating on several important aspects in relation to the obtaining of mining, oil & gas’ contracts, licenses and registrations, such as regional autonomy aspects, environmental aspects and other aspects surrounding the business of mining, oil & gas; • assisting with negotiations for the establishment of refinery projects; • advice on tax related issues in the mining, oil & gas sectors; • advice on employment related issues in the mining, oil & gas sectors; • dispute settlement in relation to the mining, oil & gas sectors. • Clients of the Firm include not only multinational companies active in the mining, oil and gas sectors, but also domestic Indonesian companies and provincial governments.

JAKARTA OFFICE Wisma 46 Kota BNI, 41st floor Jl. Jend Sudirman Kav 1 Jakarta 10220 – Indonesia Tel: +6221 5746545, 5701837 Fax: +6221 5746464, 5701835 Mobile: +62.812.888.88.99 Emails:

Asian Legal Business ISSUE 8.9

Firm ProďŹ le FEATURE | energy & resources >>

Hanafiah Ponggawa & Partners

Partner in-charge in Energy & Resources

Al Hakim Hanafiah Mr. Al Hakim Hanafiah is one of the founders of the Firm. Graduated from the University of Indonesia Law School and earning his LL.M degree from University of Washington School of Law, Mr. Hanafiah has practiced law for over 23 years. Mr. Hanafiah is registered in BAPEPAM (Capital Market Supervisory Board) Capital Market Legal Counsel and registered in PERADI (Indonesian Advocates Association) as Advocate. He can be contacted at

Fabian Buddy Pascoal Having graduated from the University of Indonesia, School of Law, Mr. Pascoal joined the Firm in 1992. Mr. Pascoal earned his LL.M degree from the University of California at Berkeley, Boalt Hall School of Law. Mr. Pascoal is registered in BAPEPAM (Capital Market Supervisory Board) Capital Market Legal Counsel, registered in PERADI (Indonesian Advocates Association) as Advocate and registered as Intellectual Property Consultant. He can be contacted at

Andre Rahadian Mr. Rahadian graduated from the University of Indonesia, School of Law and continued to obtain an LL.M degree from Boston University School of Law and an M.Sc. in Finance from Boston University, Metropolitan College. He is registered in BAPEPAM (Capital Market Supervisory Board) as Capital Market Legal Counsel and registered in PERADI (Indonesian Advocates Association) as Advocate. He can be contacted at

Giovanni Muhammad Mr. Muhammad is a graduate of the University of Indonesia’s Faculty of Law and joining the Firm since 1996 which has wide range of experience in energy & resources, specifically in plantation sector. Mr. Muhamad can be contacted at


FEATURE | energy & resources >>


From p77

“The Chinese economy is still growing and analysts do not see an early end to the resources boom” PHILLIP CORNWELL, AAR

also thrive with the support of the Chinese government. “The PRC government is encouraging its companies to go global,” says Chow. “This comes in different forms, such as quicker regulatory approval and possibly financial support. To date, much of the cross-border M&A has been led by stateowned or semi state-owned enterprises.”

Indonesia rising Direct foreign investment in Indonesia soared by 73% to US$10.3bn last year and a bigger sum is expected in 2008, despite the global credit crunch, given Indonesia’s ability to tap Islamic capital. “Foreign investment is strong. We have original investors like the Japanese and British, but investors from India and China are now our biggest investors in energy & resources. We’re also seeing a lot of big Thai investments,” says Andre Rahadian, partner at Indonesian firm Hanafiah Ponggawa & Partners. In March, Guohua Electric Power Corporation, a subsidiary of China

Firm Profile

Mochtar Karuwin Komar


Coalbed Methane as an Alternative Energy Source

he recent electricity shortages in Indonesia have been a national wake-up call for the need to find alternative energy sources. One promising alternative energy source is coalbed methane (“CBM”). Although methane released during coal mining is often viewed as a security hazard and a low-valued resource, CBM is an economic source of methane gas that is generated and stored in coalbeds. Indonesia has CBM reserves estimated at 453 trillion cubic feet, the seventh largest reserve in the world. CBM is governed under Law No. 22 of 2001 on Oil and Gas, and its business is classified as upstream activities. The implementing regulations are provided under Minister of Energy and Mineral Resources Decrees No. 33 of 2006 on CBM Business (“Decree 33”) and No. 40 of 2006 on Procedures for Determining and Tendering Oil and Gas Working Areas (“Decree 40”). Encouraging CBM utilization is part of the diversification and conservation of energy, as provided under Law No. 30 of 2007 on


Shenhua Energy, China’s top coal producer, received approval to develop a coal mine and power plant in Indonesia. Two months later, Indian energy company Reliance Power announced plans to invest US$650m in an Indonesian coal mine. Last year, Tata Power, another Indian firm, paid US$1.1bn for stakes in two Indonesian coal mines owned by Bumi Resources. Such strong appetites will contribute to growth in Asia-Pacific resources and infrastructure project financings in the next 12 months, and will certainly see lawyers scrambling to get in on the deals in the energy & resources sector. AAR head of project finance Phillip Cornwell says the market can withstand global credit rationing, record energy prices and slowing growth in the US and Europe. “Although commodity prices have come off, the Chinese economy is still growing and analysts do not see an early end to the resources boom,” he says. “Banks are still willing to back well-structured projects.” ALB

Energy (“Energy Law”). Such development accordingly deserves to be given incentives from the Government. In addition to the large reserves, sufficient data on CBM is generally available to the Government from prior reports made during mining exploration and in particular, CBM located within existing oil and gas fields and coal mining sites. Therefore, the basic infrastructure is largely already available for its development. To begin tapping CBM, a business enterprise shall firstly secure a CBM working area. Decree 40 stipulates generally that a CBM working area can be granted through a regular tender or a direct offer, unless stipulated otherwise under Decree 33. Considering the fact that CBM reserves are mainly found in existing coal mining or oil and gas fields, Decree 33 stipulates that currently operating miners (contractors under a Coal Contract of Work or under Oil and Gas or holders of Mining Authorizations) will be given priority to develop CBM within their respective mining fields, provided they establish a separate enterprise to specifically develop CBM in that

area. In the event a miner is interested in developing CBM in its existing mining field, accordingly, it will be granted a CBM working area through direct designation. Last but not least, CBM development is also environmentally friendly. It is now the Indonesian Government’s goal to harmonize CBM related regulations to promote its development with incentives provided under the Energy Law and the Kyoto Protocol to aid in the fight against global warming.

By Ahmad S Djoyosugito Mochtar Karuwin Komar 14th Fl. Wisma Metropolitan II Kav. 31, Jl. Jend. Sudirman Jakarta 12920, Indonesia P.O. Box 2844 Jakarta 10001 Tel +62 21 571 1130 Fax + 62 21 571 1162 Asian Legal Business ISSUE 8.9

Firm Profile FEATURE | energy & resources >>

Mori Hamada & Matsumoto

Current Situation of Emissions Trading in Japan Overview of Acts against Global Warming in Japan


lthough the first commitment period of the Kyoto Protocol commenced this year, in which Japan is obliged to reduce greenhouse gas emissions by six percent from 1990 levels, Japan does not have and has not yet decided to implement any domestic emissions trading system (ETS) or “capand-trade” system at this time. Instead, the Japanese government depends heavily on voluntary action by the industry. For example, the Federation of Economic Organizations (Keidanren) adopted a “Voluntary Action Plan” where each industry segment sets voluntary reduction targets. Many of the governmental organizations have independently introduced policies to assist voluntary action by the private sector. For example, the Ministry of Economy, Trade and Industry (METI) will soon start a voluntary scheme called “domestic CDM.” The Ministry of the Environment (MOE) has established a scheme called “emissions trading system by voluntary participation” where a participant commits to engage in greenhouse gas reduction in exchange for subsidies. These policy measures are based on voluntary action by the private sector and are managed by a specific governmental organization through little coordination with other policy measures managed by different organizations.

Emissions Trading in Japan Despite the absence of a domestic ETS, the Kyoto Mechanism has shown a rapid growth in Japan. With respect to the public sector, the New Energy and Industrial Technology Development Organization (NEDO), an independent administrative agency, has begun to purchase Kyoto credits on behalf of the Japanese government. The private sector, especially the power and steel industry, is also very active in Kyoto Mechanism because it intends to donate Kyoto credits to the government in the event that it fails to comply with its Voluntary Action Plan. According to a published report, the Japanese

industry, as a whole, will purchase 300 million tons of Kyoto credits to comply with the Voluntary Action Plan. Over the years, the increased use of the Kyoto Mechanism pushed the government to establish a legal and technological framework for the Kyoto Mechanism. In 2006, the Law Concerning the Promotion of Measures to Cope with Global Warming was revised and it established a Japanese national registry required for the Kyoto Mechanism. The revised law also sets clear rules for the Kyoto credits transaction. For example, the assignment of Kyoto credits becomes effective only upon the transfer of records in the registry and bona-fide purchase of Kyoto credits will be protected. From a technological viewpoint, in November 2007 the Japanese national registry established a connection with the international transaction log, which enables Kyoto credits transactions to be carried out. As a result of these infrastructure developments, the transaction volume of Kyoto credits continues to increase.

Recent Development Recently, the Japanese government has begun to seriously consider the introduction of the domestic cap-and-trade system. A committee organized by the MOE has published an interim report which sets out the actual and realistic plans for the Japanese ETS . A committee organized by METI, who has and continues to strongly oppose the introduction of the ETS, has published a report that lists considerations to be taken into account if the ETS is introduced. In March 2008, a council of advisers to the Prime Minister, Mr. Yasuo Fukuda, was formed to consider the introduction of the ETS.1 As a result of a series of serious discussions, the Prime Minister made a speech entitled “In pursuit of “Japan as a Low-carbon Society2“” on June 9 2008. In this speech, he showed his willingness to the introduction of ETS. However, he did not manifest the introduction of a mandatory ETS, but rather, he proposed an “experimental introduction of an integrated domestic market of emissions

trading” from autumn this year. It is not yet certain whether the mandatory ETS will be introduced after the experimental ETS.

Our Activity in This Field Mori Hamada & Matsumoto is very active in the global warming practice field. We regularly advise foreign and domestic clients on almost every aspect of this field. Our clients include manufactures, power companies, financial institutions and governmental organizations. Our advice ranges from the CDM projects, secondary market transactions, regulatory advice and development of financial products to rule making for emissions trading. In particular, we are very active in the infrastructure development of emissions trading. For example, I am a member of an advisory committee established by the MOE and METI. We also assist the Tokyo Stock Exchange in establishing a CER market. We will continue to assist our clients in their efforts to combat global warming. Takeshi Mukawa is a partner of Mori Hamada & Matsumoto, a full-service law firm based in Tokyo. His practice focuses on financial transactions, environment and global-warming practices. He is a member of the advisory committee on the emissions trading scheme by the Ministry of the Environment, advisory committee on the infrastructure development of Kyoto credits transactions by the Ministry of Economy, Trade and Industry. Takeshi was educated at the University of Tokyo (B.Ag.) and University of California, Davis School of Law (LL.M.).

By Takeshi Mukawa, Partner of Mori Hamada & Matsumoto Marunouchi Kitaguchi Building, 1-6-5, Marunouchi Chiyoda-ku, Tokyo 100-8222 Japan tel: +81 3 5223 7763 email: website:

1 2


FEATURE | offshore financial centres >>

Finding the difference in similarity: The convergence of offshore financial centres ► TOP OFFSHORE FINANCIAL CENTRES • Bahamas has the largest number of registered vessels. The other key vessel registration jurisdiction is Panama, although ironically it is not normally considered to be ‘offshore’ for ship registration purposes • Bermuda has the largest number of registered captive insurance companies, and is the second largest domicile for offshore funds • British Virgin Islands has the largest number of offshore companies • Cayman Islands has the largest value of AUM in offshore funds, and has the strongest presence in the US securitisation market • Gibraltar does not dominate the offshore market in any particular specialisation, but retains a strong presence in most fields • Jersey is a dominant player in the European securitisation market and the European REIT market • Luxembourg is believed to be the largest offshore Eurobond issuer • Mauritius: has double taxation avoidance treaties with over 30 countries

► MULTI-JURISDICTIONAL OFFSHORE FIRMS IN ASIA Conyers Dill & Pearman Maples and Calder Appleby Walkers Ogier Cains Harney Westwood & Reigels


Increasing convergence and competition between offshore financial centres and the growing sophistication of offshore transactions is pushing offshore firms in some new and novel directions


n an effort to keep up in the race for offshore supremacy, leading offshore law firms have, in recent months, been adding new jurisdictions to their sphere of practice. Global managing partner for Appleby, Peter Bubenzer, says for a firm to be the global leader in offshore law, they would need to have a footprint in all of the major offshore jurisdictions, have depth of experience in all those centres, and provide consistency of service across their different global offices. He says the key advantage of the multi-jurisdictional model is being able to advise clients on the comparative advantages and disadvantages of different locations and structures, based on a deep knowledge of each competing jurisdiction. It appears offshore firms are increasingly seeing this “one-stop shop” model as the way forward, and are striving to quickly gain a foothold in key jurisdictions. Hong Kong managing partner for Walkers, Hugh O’Loughlin, says his firm will also look to expand into new jurisdictions in the future. “We’re always considering other offshore

jurisdictions. This isn’t just a reaction to competition, but a result of where our clients need our services,” he says. The leading firms pursuing this multi-jurisdictional model include Walkers, Appleby, Maples and Calder and Conyers Dill & Pearman. Together, they have a combined presence in over 10 locations around the globe. However, it is not just these well known multi-jurisdictional firms that will continue to pursue further growth. Players from less talked about offshore jurisdictions are also feeling the pressure of competition, and the growing sophistication of offshore transactions and structures. One such firm is Harney Westwood & Riegels, long the premier provider of BVI-related counsel. In the past, Harneys has marketed its sole, deep focus on the BVI as its key strength, but its recent merger with Cayman firm C.S. Gill & Co, the establishment of ‘BRIC’ desks and the increasing reputation of its Hong Kong office speaks volumes of its desire to expand its brand globally – a trend that firms of all shapes and sizes are quickly embracing. Asian Legal Business ISSUE 8.9

FEATURE | offshore financial centres >>

“We’re always considering other offshore jurisdictions. This isn’t just a reaction to competition, but a result of where our clients need our services” The global offshore game One of the key drivers of growing multi-jurisdictional practice in the offshore world has been convergence and competition between offshore jurisdictions themselves. With growth in the volume of incorporations and usage of offshore jurisdictions, these financial centres are increasingly trying to stand out from the crowd. The most popular jurisdiction in terms of the number of incorporations was the BVI, despite minimal regulation and its perceived links with activities such as money laundering. In 2007, there were over 750,000 incorporations in the jurisdiction – with a large number of them linked to Asia. However, with all offshore jurisdictions vying for the attention of businesses and individuals and with the differences between each of them decreasing, there are some serious new players on the scene. Cains’ growth, meanwhile, is also coming from the east, mainly from the emerging markets of India, Kazakhstan and China, which is the rationale behind their recent opening of an office in Singapore. Says partner Michael Edwards: “We realised that you can’t build an Asian practice from Europe. We looked at various locations, including Dubai and Shanghai, but chose Singapore because it’s increasingly being used as a hub for southeast Asia and it has a very close relationship with India.”

Mauritian mission Bubenzer said the firm went in to Mauritius at the behest of a client. “So often people say changes and developments are client-driven,” he explains. “I’m happy to report that it was

true in this case. A client indicated they’d seen a significant opportunity for us and them, and felt they’d like an international firm they recognised and could use on the ground.” He said it was the existing competitive tax-treaty network with fastgrowing Chinese and Indian economies through Global Business License (GBL) company structures, in addition to potential European and US investment in infrastructure projects in Africa, that sold the firm on making an entry into this competitive offshore jurisdiction. Malcolm Moller, managing partner of Appleby in Mauritius, suggests that Mauritius is the best choice for offshore structuring. “The selection of an appropriate offshore domicile for companies will often hold the key to successfully accomplishing goals of investment appreciation, asset protection, and tax planning. Mauritius has consistently made clear it remains committed to developing and maintaining conditions conducive to attracting international business.”

Friend of financial services Investors wishing to establish a presence in Mauritius to provide banking, securities, insurance or fiduciary services will find the offshore oasis a comfortable home. The business architecture of Mauritius has been redesigned to offer investors a hassle-free environment in which to start and operate. The corporate tax rate for businesses operating in the domestic sector is now 15%. October 2006 saw new rules introduced that ensure foreigners can obtain an occupation permit to work and reside in Mauritius in three days.

Regulatory framework The success of Mauritius as a financial services centre has depended largely on the maintenance of its reputation of probity, through the construction of a robust regulatory framework that is balanced by being business friendly. Mauritius supports international initiatives (FATF, Basel, IOSCO, IAIS) aimed at preventing the jurisdiction from being used for money laundering and terrorist financing, and the jurisdiction has never been blacklisted. The two regulators for the financial services sector, namely the Bank of Mauritius and the Financial Cont p88f

► OFFSHORE FIRMS – WHO, WHERE AND HOW BIG Name: Appleby Locations: Bermuda, BVI, Cayman, Jersey, Mauritius, London, Hong Kong Total fee earners: 211 Web address: Name: Bedell Cristin Locations: Jersey, Guernsey, London, Dublin, Geneva Total fee earners: 74 Web address: Name: Cains Locations: Isle of Man, London, Singapore Total fee earners: 35 Web address: Name: Carey Olsen Locations: Guernsey, Jersey, London Total fee earners: 142 Web address: Name: Collas Day Location: Guernsey Total fee earners: 42 Web address: Name: Conyers Dill & Pearman Locations: Anguilla, Bermuda, BVI, Cayman, Dubai, Hong Kong, London, Moscow, Singapore Total fee earners: 129 Web address: Name: Harneys Locations: BVI, Anguilla, London, Hong Kong Total fee earners: 55 Web address: Name: Maples and Calder Locations: BVI, Cayman, Dubai, Jersey, Ireland, Hong Kong, London Total fee earners: 218 Web address: Name: Mourant du Feu & Jeune Locations: Cayman, Guernsey, Jersey, London, New York Total fee earners: 132 Web address: Name: Ogier Locations: BVI, Cayman, Jersey, Guernsey, Ireland, Hong Kong, London, Montevideo, New Zealand Total fee earners: 200 Web address: Name: Ozannes Locations: Guernsey, Jersey Total fee earners: 44 Web address: Name: Walkers Locations: Cayman Islands, BVI, London, Jersey, Hong Kong, Dubai Total fee earners: 151 Web address:


Firm Profile FEATURE | offshore financial centres >>


Aircraft Finance – The Way Forward with Appleby……


s one of the oldest established offshore law firms in Hong Kong, having first opened its doors in 1990 and with over 50 legal professionals and staff, Appleby has been recognized as the leading offshore firm and an established member of the “offshore magic circle”. Its reputation as the preeminent firm in the offshore world has been based in part on its structured and asset finance practice which has a notable emphasis on aircraft transactions across Asia. The firm’s specialty in aircraft finance encompasses the entire region from Moscow to Tokyo with a focus on the rapidly growing markets of the Middle East and the PRC. Recent trends in the aviation market noted by our team include continued growth and expansion in the PRC and India despite higher oil prices and concerns of recession in the US and other countries that have had an adverse impact on those economies. This trend is, at its most fundamental level, a factor of the need in those emerging markets for an infrastructure and an airline industry that can support the size of their populations and the rapid growth in their economies, an issue that if not properly dealt with by industry and government will undermine potential development. This concern has been raised in the press not infrequently in relation to India in recent months. In the PRC, the central government has responded to the issue recently by, amongst other things, approving applications by a number of banks to set up financial leasing companies and there has been a general rise in the role played by domestic aircraft leasing entities which would, one would expect, offer increasing competition to overseas leasing companies in the future. This has in turn been supported by investments by the China Development Bank. In the Middle East there has been a rise in the number of Sharia Law compliant structures in a booming market where analysts estimate over US$50 billion worth of aircraft orders were announced, in 2007 (comprising over 50% of the worlds total aircraft orders). In


the Asian market generally there has been an increase in the number of low cost carriers that have developed along similar lines to the established low cost model in Western markets. Appleby’s aircraft finance clients include banks, transaction arrangers, finance and operating lessors, manufacturers, airlines, export credit agencies and private owners. It’s lawyers have acted as lead offshore counsel for these clients on almost every type of structure from Sharia compliant entities to Japanese Operating Leases. They have a combined 175 years of experience in the area and hold a variety of awards and rankings from international journals and bodies most of them having practiced with the “onshore magic circle” or Wall Street firms for a number of years in asset finance before bringing their experience to the offshore jurisdictions in which they work. Owen Jones, who was named in the IFLR (2006) as an “expert lawyer” for his aviation work in the Cayman Islands, is the lead practitioner in the Hong Kong office and has been involved in the financing and securitization of close to 900 aircraft from all the major manufacturers. This niche practice is supported by over 800 lawyers and staff across Appleby’s growing list of offices which include the Cayman Islands, the British Virgin Islands, Jersey, Bermuda, London, Mauritius and of course Hong Kong. The Mauritius office opened in early 2007 and has been the location of a number of aircraft financings designed to exploit the double taxation treaty Mauritius has with the growing markets of Singapore and India. The legal practice is bolstered by a full service trust and administration arm in all jurisdictions which enables Appleby to provide its clients with well established aircraft finance professionals on the board of any special purpose vehicle along with share trustee services for off balance sheet vehicles. Frances Woo, Appleby’s Hong Kong managing partner comments “through our long presence in the Asia-Pacific region we understand and cater to the distinct identities and cultures of our clients” and further

Frances Woo

Owen Jones

adding “the depth of our experience in this area across our offices, and particularly in Hong Kong, is well established and each aircraft finance lawyer on the team in Hong Kong is multi-jurisdictional in terms of their own practice. This is a key advantage given the increasing number of offshore multijurisdictional transactions”. The overall picture for the regional aircraft market is good (despite its highly cyclical nature) and that in turn means a healthy future for the law firms active in this region. Appleby stands ready to continue to be a major offshore player in this growth and development. Further information can be obtained on the firm’s website at: where a number of articles and client briefings are available.

Asian Legal Business ISSUE 8.9

Firm Profile FEATURE | offshore financial centres >>

Harney Westwood & Riegels

Harneys: An offshore firm with global reach


arneys is one of the leading offshore law firms with offices in the British Virgin Islands, the Cayman Islands, Anguilla, London and Hong Kong. Harneys has 56 lawyers globally, and over 200 staff in total.

Addition of a Cayman Practice

Michael Gagie

Harneys recently opened its Cayman Islands office via a merger with Cayman Islands firm CS Gill & Co. Harneys partners Kieron O’Rourke and Tim Clipstone have relocated to Cayman and the firm is building Cayman legal teams for its offices in London and here in Hong Kong. “Our intention in providing Cayman advice is to enable us to better serve both existing and potential clients. In Asia, we recognize that clients are using corporate vehicles established in either one or both of BVI and Cayman for particular types of transactions or business/product lines and we believe there is substantial demand from clients for an alternative to existing Cayman law providers in the market,” says Michael Gagie, the head of the Hong Kong office.

Hong Kong Office Harneys has been providing legal services to Asian clients for over 20 years and opened its Hong Kong office in February 2005. Key practice areas for the Hong Kong office include banking & structured finance, corporate, M&A and investment funds services. Since opening, Harneys’ Hong Kong office has experienced good growth in terms of workflow, doubling its revenue last year and will be adding two new lawyers over the coming quarter, according to Gagie. “Having a physical presence in Asia has really benefited our business not only in terms of raising both our profile and share of work in the region, but it has helped us to understand better


what clients need in this region and we have responded to that.”

Client Services Gagie says that Harneys distinguishes itself from the other firms by providing the same level of excellent client service to all clients, ranging from leading international businesses and banks, to local private companies and individuals. “In Asia, we understand that speed of response, provision of real time advice and competitive pricing are key criteria for clients looking for legal advisers and as a service provider, we work hard to fulfill those expectations for all our clients.” Gagie also believes that his firm’s increased focus on the ‘BRIC’ (Brazil, Russian, India and China) and emerging market economies will, in the longer term, pay dividends both for the firm and its clients wherever they are: “A number of our recently recruited lawyers were targeted by us for their legal and linguistic backgrounds. We are working towards having full service teams of lawyers who themselves come from those jurisdictions which have an increasing demand for offshore services and who understand the local market requirements and conditions. Our recent hire of Chetan Nagadra, a senior Indian lawyer, is a good example of this.”

Harney Westwood & Riegels 1507 The Center 99 Queen's Road Central Central Hong Kong Michael Gagie, Partner Email: Phone: 852 3607 5300

Asian Legal Business ISSUE 8.9

FEATURE | offshore financial centres >> f

From p83

Services Commission, are both active in the supervision of the bank and nonbank financial services sector.

On-shores in offshore clothing Michael Gagie, Hong Kong managing partner at Harneys, notes that differences between off-shore locations are dissipating in the face of increased international competition. “It’s probably inevitable to a certain extent, with each jurisdiction promoting their own business over the other, that there’ll be some convergence.” Marc Yates, partner at Ogier, says that his firm’s strategy is based on this convergence. As the benefits of each jurisdiction become more homogeneous “the driver for determining where a structure is located will depend on client factors: convenience, location – of both the business operations and management – and location of their investor base,” he says. Offshore firms that focus on only one jurisdiction realise the need to broaden their scope. Hong Kong is a good example of a jurisdiction that is an onshore international financial centre, but in some ways can be considered offshore. And while it does not have a no-tax regime like some other jurisdictions, it is still has an attractive, low tax rate. Singapore is establishing itself in much the same way. “Other jurisdictions like Singapore are promoting themselves as onshore offshore jurisdictions,” says Frances Woo, partner at Appleby, highlighting the Lion City’s similar incentivisation schemes. The evolution of well-defined tiers in the offshore world is a trend that may come under pressure in light of these developments. Hitherto, the top tier was made up of jurisdictions that catered for the more sophisticated, substantive and complex above board transactions, and the bottom tier was those jurisdictions that wellestablished companies would not touch. Now, ALB finds that companies of all shapes and sizes are finding that exploring both tiers, especially when it comes to listings and offerings, may serve as the perfect way to insulate themselves from the volatilities of the global liquidity crisis.

The lure of listing offshore The tendency to use vehicles incorporated in offshore jurisdictions 88

For many companies operating in emerging markets, ‘offshore’ now means ‘access to investors’ which allow businesses to list on a foreign exchange is growing in popularity. Whereas in the past, companies who wanted to list preferred to err on the side of caution in uncertain economic times and postpone, but now ALB finds that they are choosing to list despite economic uncertainty – however, listing is now following a different script. Not only are they occurring offshore with greater regularity, but the biggest exponents of offshore listings are Asian companies. However as Christopher Bickley, a Hong Kong-based partner at Conyers Dill & Pearman, explains, it is not simply a matter of using a vehicle incorporated in an offshore jurisdiction to list, but it is all about finding markets that are both internationally accepted and (perhaps more importantly) where there is ready access to investors. In some cases, it can even mean transcending the often stereotypical view of offshore locations as tax havens. “Tax advantages are a given, but tax alone isn’t a sufficient reason to list offshore. You need to find a jurisdiction that’s accepted by the capital markets,” says Bickley. Foreign investors want to invest using exchanges they are familiar and feel comfortable with. In this regard, the London, New York and Hong Kong markets, in particular, offer political and economic stability as well as established legal and regulatory systems. This comfort is also important to the underwriters and ratings agencies. Hence, while a foreign listing not only offers greater safety if the listed company plans on a secondary offering or a refinancing in the future, it can also bring with it exposure to the globalised business world and facilitate the development of a platform for international expansion. Other business issues may make the flexibility and control offered by offshore jurisdictions more attractive, an issue of special importance with many companies from the Asian region where legal and institutional frameworks are still in the embryonic stage of development – or, as Bickley notes, jurisdictions where laws and

regulations are, “not as flexible and user friendly” as those in the West.

Finding your audience Tailoring a listing to appeal to an appropriate investor base is well illustrated by the admission of Beijingbased China Boqi Environmental Solutions Technology to the Tokyo Stock Exchange in August 2007. Advised by PRC firm Guantao, China Boqi was the first Mainland China-based company to go public on the Tokyo bourse’s first section. The technology at the core of the company was developed in Japan, and because the Japanese investors were familiar with it, and because of the company’s desire to cooperate with Japanese technology companies, Tokyo was a natural market for them. The company’s stock soared 61% on its first day of trading. China Boqi used a Cayman Islands-domiciled company as the listing vehicle, and Guantao used Conyers Dill & Pearman for advice and services for the corporate structure. The Tokyo Stock Exchange is just one foreign exchange that hopes to attract more Asian companies. As noted by Greg Knowles, a partner in the Hong Kong office of Caymans firm Maples, the Tokyo exchange’s Mother’s Index, a secondary board, has generated some interest for Asian companies, with Maples advising several Caymanincorporated companies looking to list there.

Which offshore jurisdiction? Although factors relating to investor and capital access dominate, those that ALB spoke to believed that the choice of jurisdiction will always be dictated by counsel’s preference, in other words, firms would almost always play to their respective strengths, history and marketing strategy. Depending on the circumstances and objectives of the business seeking a foreign listing, there will be a ‘best fit’ in terms of foreign exchange and offshore vehicle. Asian companies must rely on their domestic legal, tax and accounting advisors to help them identify the best offshore jurisdiction through which to access Cont p92f Asian Legal Business ISSUE 8.9

FEATURE | offshore financial centres >>

The Jurisdictions: British Virgin Islands “To Bid or not to Bid” - practical considerations for takeovers of listed companies


ith the listing of offshore companies now commonplace on the public markets and in view of current market conditions, it is inevitable that some of these companies will become targets for takeover offers. For those BVI companies with London listings, the UK’s city Code on Takeovers and Mergers (the City Code) will not apply and as a consequence, the regulation of a takeover bid for a BVI company will have three sources: (1) common law; (2) in statute under the BVI Business Companies Act 2004 (the Act); and (3) in the company’s memorandum and articles of association. Where a BVI company is looking for liquidity and seeks funding through access to the public markets in London, it has become common practice to incorporate into the company’s articles of association certain provisions of the City Code (particularly dealing with mandatory offers akin to the provisions of Rule 9 of the City Code). However, there remain conflicting opinions as to whether this is the correct approach and a number of English lawyers still believe that it is unnecessary to restrict the flexibility of an offshore company in this way. There is of course no “one size fits all” approach in this area and ultimately the approach taken will be investor driven and will depend on the investors being targeted. The key is to ensure a balance is struck and that the end product is both sufficiently familiar and palatable to investors, whilst keeping an eye on the exit / takeover scenario.

Offer for all of the Issued Shares Often a bid for a BVI company will be structured as an offer for all the shares in the target company. On a successful bid, a bidder, having acquired 90% or more of the target’s shares, will then want to focus its attention on the “squeeze out” mechanics available in the Act. The BVI law equivalent to the English law compulsory acquisition of shares provisions is contained within Section 176 of the Act. This enables the remaining minority in a takeover situation to be swept up. One distinction between the English law regime and the BVI law regime in this respect is that rather than the squeeze out being structured as an acquisition of the


remaining shares by the bidder, under BVI law, the squeeze out is structured as a redemption of the minority shares by the target company at the instigation of the bidder. The ability to squeeze out minority shareholders can be exercised at anytime and therefore not within a specified period following a successful bid. In a bid scenario, shareholders holding 90% of the votes of the outstanding shares may give a written instruction to the company directing it to redeem the shares held by the remaining shareholders. Such a redemption is funded either from the target company’s own resources or, more likely, by the bidder via the target. Upon receipt of the written instruction in these circumstances, the company is required to redeem the shares, irrespective of whether or not the shares are by their terms redeemable, and give written notice to each member whose shares are to be redeemed stating the redemption price and the manner in which the redemption is to be effected. The Act does provide a mechanism for minority shareholders to dissent from a redemption of their shares. Significantly, this dissent right does not give a minority shareholder the right to prevent the redemption from occurring rather, the dissent right gives the shareholder the opportunity to dissent from the price being offered for their shares. Where a “fair value” for the shares cannot be agreed between the company and the dissenting shareholder, the Act also provides for an appraisal procedure to enable the fair value to be determined by independent appraisers. Once determined, this fair value needs to be paid in cash which might be significant for a bidder on non-cash offers.

Arrangements In addition to schemes of arrangement, the Act also provides for plans of arrangement. There is a clear overlap between the concept of a scheme and plan of arrangement and we may see amendments being made to the legislation to formally unite the two going forward. Both permit various corporate transactions to be court sanctioned. There are, however, some significant differences which are worthy of comment. A plan of arrangement can be instigated by the directors making an application to the court for its approval. It is usual for the court approval to require shareholder and creditor approval and to impose certain advertising requirements. Shareholder approval in this instance will simply be by way of a resolution of the shareholders - typically a simple majority - and therefore a lower threshold than under a scheme. The provisions for a plan of arrangement do permit the dissent rights to be utilised and so, despite clearing the relevant shareholder approval threshold to satisfy the court, it may still be necessary to cash out those who disapprove. Dissenters cannot prevent the arrangement from happening. These arrangement provisions are frequently discussed as a structuring option. We have seen arrangements being used by clients to afford different advantages in different jurisdictions, for instance to mitigate tax liabilities in Russia and China and to reduce regulatory requirements in the US. The possibility of having a court sanctioned process involving a relatively low requirement for shareholder consent is indeed attractive.

Scheme of Arrangements

Statutory Mergers and Consolidations

As with takeover offers for English companies, a bidder for a BVI company can, as an alternative to an offer for all the issue shares, structure a takeover offer by way of a scheme of arrangement. A BVI scheme requires the approval of 75% of the target company’s shareholders present and voting on the arrangement and once sanctioned by the BVI court, is binding on all shareholders. This will be entirely familiar to English lawyers. The dissent rights provided for in the Act and described above are not available in this situation.

Two company law concepts frequently utilized in offshore jurisdictions as a structuring tool for transactions, but which are alien to English law, are the uses of the statutory merger regime or statutory consolidation. Both of these mechanics are provided for under the Act. Under the merger provisions, two or more BVI companies (or a BVI company and a foreign company provided that the laws of the jurisdiction of the foreign company permit a statutory merger) can merge in accordance with a procedural process involving approval by each respective companies’ directors and Asian Legal Business ISSUE 8.9

Firm Profile FEATURE | offshore financial centres >>


shareholders of a plan of merger and the filing of this plan of merger, together with articles of merger, with the Registrar of Corporate Affairs in the BVI. The fundamental difference between a merger and a consolidation is that with a merger, the two constituent companies merge together with one company surviving whilst, with a consolidation, the two constituent companies come together to form a new entity – the consolidated entity. The legal effect of a statutory merger or consolidation is that, with effect from the effective date of the merger or consolidation, the assets and liabilities of each constituent company automatically vest in the surviving company or the consolidated company. The non-surviving company in a merger and both constituent companies in a consolidation are automatically struck off the register of companies in the BVI. A virtue of either process is that the threshold for shareholder approval of the transaction will, subject to the company’s memorandum and articles of association, be a simple majority. As with arrangements, the procedure available in the Act for dissenting shareholders to receive “fair value” for their

shares also applies where a statutory merger or a consolidation is used.

Disposition of Assets A further option available as an alternative to structuring a deal as a takeover of the target company, would be for the bidder to agree to purchase the pertinent assets of the target company. However, it should be noted that if the assets sold represent more than 50% in value of the assets of the target company, then Section 175 of the Act would apply (unless that section has been expressly excluded in the target company’s memorandum and articles of association), such that the sale would require the approval of a shareholders resolution (a simple majority unless the memorandum and article of association provide for a higher threshold). As before, the procedure available to dissenting shareholders to receive “fair value” for their shares also applies in disposition of assets under Section 175 of the Act. In the current market conditions we are seeing more M&A activity, including a significant amount of public M&A. When faced with the acquisition of an offshore

Excellence.Offshore Ogier is one of the largest providers of offshore legal and fiduciary services and advises on BVI, Cayman, Guernsey and Jersey law. Ogier has over 750 people providing legal advice and bespoke, professional trust and company administration services in all time zones and key financial markets to companies, investment funds, trusts, real estate holding structures and numerous other types of structure.

Duncan Smith, Ogier

target, it is essential for advisors to consider all possible structuring options, appreciating that the offshore jurisdictions can often provide a flexible and appealing solution not always available in the onshore world. By Duncan Smith, Managing Partner, Ogier, Hong Kong and Simon Dinning, Managing Associate, Ogier, London

Recent awards and recognition: ‘Offshore Law Firm of the Year 2008’ The Hedge Fund Journal ‘Securitisation Deal of the Year 2008’ IFLR Awards ‘Offshore Law Firm of the Year 2007’ The Lawyer Awards ‘Offshore Law Firm of the Year 2007’ CityWealth Magic Circle Awards ‘Top Offshore Law Firm 2007’ Alpha Awards ‘Top Offshore Law Firm 2007’ FactSet Global Filings ‘Offshore Legal Team of the Year 2007’ STEP Awards

Duncan Smith, Partner, Hong Kong +852 3656 6010 British Virgin Islands • Cayman Islands • Guernsey • Hong Kong Ireland • Jersey • London • Montevideo • New Zealand


FEATURE | offshore financial centres >> f

From p88

their preferred exchange. Globally, the competition between exchanges to attract listings is fierce, particularly between those in the major financial centres – London, New York and Hong Kong. NASDAQ, the New York Stock Exchange (NYSE) and the Singapore Stock Exchange (SGX) have opened offices in Beijing to better enable them to compete against the Hong Kong Stock Exchange (HKEX), reflecting China as a major source of new listings. However, it remains to be seen whether this will give way to a change in listing patterns. Certainly, Yates does not think so. “We might see more flexibility with the Hong Kong Stock Exchange. But ultimately it’s [dependent on] where your investors are,” he says.

Companies throughout the Asian region must rely on their domestic legal, tax and accounting advisors to help them identify the best offshore jurisdiction through which to access their preferred exchange He observes that the “appeal of AIM is the massive pool of liquidity.” And it is something that is expected to increase as bi-lateral relations between the two continue to deepen. In addition, the LSE’s new secondary market – the Specialised Fund Market – aims to target hedge funds, feeder funds and private equity vehicles and is said to handle listings in a more ‘fund-friendly manner’ than would AIM, by relaxing several admission requirements.

London: LSE, AIM and SFM The Alternative Investment Market (AIM) is a junior market of the London Stock Exchange (LSE) and is the most common London exchange for offshore listings. AIM now has over 1,600 members, 20% of which are either domiciled or have their main business operations outside of the UK. Some 48 Chinese companies are listed on AIM. “There’s a tendency for PRC companies to look to the AIM market”, says Xu Ling, a partner at Guantao. Companies choosing to list shares on AIM typically use Jersey or Guernsey structures, since BVI and Cayman companies can only list GDRs. In addition, there is consensus that the London market also appeals to Indian companies, which have a reputation of using Isle of Man companies as the listing vehicles. “Several Indian companies started the trend and others have followed,” says Edwards.


New York: NYSE and NASDAQ Despite the relatively high costs associated with a US listing, the prestige and the robust corporate governance offered by a US listing remains attractive to Asian companies. As to which offshore jurisdictions are preferred, Yates says the Asia market is more familiar with BVI and Cayman companies. As of April 2008, the NYSE Group (which now includes Euronext exchanges) has 52 companies from Greater China listed, including 42 from Mainland China, five from Hong Kong, and five from Taiwan. There are approximately 46 companies from Greater China listed on NASDAQ, the second largest overseas market for the exchange. In the past, NASDAQ was the preferred exchange for China-based technology companies, but a major shift began to occur in 2006 as the NYSE and Hong Kong Stock

Exchange began to aggressively court Chinese companies.

Hong Kong: HKEX HKEX has become a natural choice for Chinese companies, particularly for SOEs. Increasingly, companies that list on the H-Share market are doing so in connection with an A-share listing on the Shanghai Stock Exchange. Traditionally BVI, Bermuda and Cayman companies form part of these offshore structures for Hong Kong. HKEX has special rules for Bermuda and Cayman companies that require, among other things, extra provisions to be included in incorporation documents to bring them up to the standard accepted by the HKEX.

Singapore: SGX and Sesdaq Foreign listings account for approximately one-third of listings on SGX and its junior Sesdaq board, by number and market capitalisation. Forty-eight percent of the foreign listings are by Chinese companies. Sources at the SGX told ALB that they expected this number to increase to over 50% by 2012. And firms, it seems, are keen to replicate the success they have already had elsewhere in Asia, in the Lion City; eager to capitalise on the government’s efforts to establish Singapore as the financial and legal hub in Southeast Asia. ALB

Asian Legal Business ISSUE 8.9

Firm Profile

SS&R Legals


Pre and Post IPO Advisory

R Financials was established by a group of professionals with years experience in corporate finance and capital market practices. The group combines multi talented and valuable partners to provide suitable financial advisory specifically designed to meet the clients need. We offer a full range of services to support multi facet financial transactions of various industry, either privately or publicly held, domestic or cross border structure, from a green field to the established business stage. We emphasize our advisory approach on a quick review process, original ideas, sound judgment, and excellent execution. We maintain a focused and well organized practice to deliver business solutions to our clients. We note that the long standing and new clients consistently turn to us for our signature characteristics and on hand services.

Our capital market advisors have been involved in number of IPO Preparation and Post IPO Transactions (right issues, convertible bonds issuance, back door listing, etc) of state-companies and privately owned base. We structured the transaction scheme and arrange the financing includes its publication, road shows and prospective investors linkage. Our team has sizeable and reputable track record in capital market related transactions.


Corporate Valuation Our valuation services offer a broad range of valuation of all types of businesses. Our certified valuation team assists the clients to determine the market value of its business interest and/or investment. Our valuation approach emphasize on clear understanding of valuation objective and substances combined with sound professional analysis and business research to assure the reliable results.

Our Focus & Commitment We focus on ensuring clients receive the best quality of service in the areas we specialize in. Our objective is to provide clients with “Value Added Financial Services” i.e. comprehensive advice to clients based on a clear and real understanding of the issues and with costseffective and competitive fees.

Our Services It is consisted, but not limited, of:• Corporate and M&A Advisory • Restructuring & Reorganization Advisory • Pre and Post IPO Advisory • Corporate Valuation • Structured Funding Advisory & Arranger Services • Islamic Finance Advisory

Corporate and M&A Advisory We advise for corporate transactions in various industry sectors, such as telecommunication, insurance, mining, shipping, and some conglomerated business groups. Our team has a wide array of industry, legal and corporate finance knowledge and experiences as required to the execution of related corporate and M&A transactions.¬

Restructuring and Reorganization Advisory We experience in numerous corporate, financial and capital restructuring and reorganization exercises. Our professional team has handled various distressed companies and provided necessary advice to maximize any potential sustainability. We developed alternatives of solution and arrange any potential strategic alliance with prospective investors.


Structured Funding Advisory & Arranger Our investment banking team used to assist our clients for funding arrangement from multi sources and structures. We will review clients’ fundamental sustainability to determine the best and suitable funding structure, either through equity, debt or mezzanine funding scheme. Besides arrange the potential investors to participate in our clients funding structure, we will also hand on the negotiation process to assure the close of prospective financing deals.

Islamic Finance Advisory Our Islamic finance team focuses on innovation and targets to advise Islamic financial institutions as well as Sharia’ compliant businesses. Our team is actively committed to bringing unrivalled Islamic finance and strategy expertise to inspire and support the success of its clients. Our expertise ranges from Islamic assets financing, Islamic project financing, sukuk issuance, Islamic private equity and Islamic M&A. The strategic network of relationships with local, regional and international partners brings top expertise and a truly global reach to our client companies.

Back row (L to R): Gregorius Priyo Satongko, Gamal Muaddi and Rachman Bakary. Front row, (L to R): Rahajeng Handayani, A.Setiadi and Dyani Yulinta Saryono

Represented Industry & Clients To date the members of the firm has advised and represented clients from around the globe investing in Indonesia or dealing with Indonesian company and comprising of individuals to institutional clients as well as private and public companies and covering a wide range industry. • Aviation Industry • Media • Banking • Mining • Construction • Manufacture • Energy • Property • Financial Services • Pension Fund • Food & Beverage • Steel Industry • Healthcare • Technology • Hospitality Industry • Telecommunication • Infrastructure

Our Affiliates SR Legals is an Indonesian law firm join as exclusive member of TAGLaw®. TAGLaw®is a global alliance of high quality, independent law firms headquartered in St Petersburg, Florida, USA, with more than 140 member firms based in nearly 100 countries which networking has the global reach to help clients wherever the growth of their business takes them.

Our Team With qualified team, consisting of Principal, Consultants and Associate, we provide a high qualification and to call on additional resources we draw from our networks whenever the clients or assignment require to result a cost-effective advisory services to our clients, moreover any matter assigned to us is handled or supervised directly by a Principal.

Our Contact Detail SS&R Legal Consultants Ariobimo Sentral 5thFloor Jl. HR RasunaSaid KavX-2 No 5 Jakarta 12950, Indonesia Tel: +62 21 5264715, 2525835 Fax: +62 21 2525760, 2525895 Email: Asian Legal Business ISSUE 8.9

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International firm seeks banking & finance lawyer to work on a broad range of finance matters with well regarded partner. Strong partnership prospects and excellent remuneration package. You will be HK or SG qualified. (PT1965) 5-7 YRS PQE

The variety of PRC-related projects at this highly-regarded company that will involve you in construction, energy, and financing matters. You should have projects experience and be fluent in Mandarin. Attractive package. (IS1040) 5 YRS+ PQE



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US law firm & leading name in finance with enviable client list are expanding HK leverage finance team. Seeking a lawyer to be at the forefront of sophisticated transactions. Add to experience and work closely with Tokyo & London. (PT1938) 5 YRS+ PQE

This prestigious financial institution is looking for a high-calibre lawyer to support their prime brokerage business. You should have experience dealing with bonds, equity derivatives and securities laws. (IS1025) 3-6 YRS PQE



International firm with ranked litigation practice seeks mid level lawyer. Work with the head of the practice, on contentious and non contentious matters service leading financial clients across the Asia Pacific region, Chinese skills required. (PT1969) 4-5 YRS PQE

Powerhouse real estate group seeks lawyers for its HK and Tokyo office. You will be responsible for major transactions and investment/fund projects. Relevant experience essential. Prospect for business development. (IS1028) 6 YRS+ PQE



Do you have extensive experience advising real estate financing deals in the PRC? Join this international power player to handle the best deals in commercial & residential property developments. Leading firm experience required. (PT1958) 5-8 YRS PQE

Illustrious financial institution seeks lawyer. You will be involved with cutting edge finance transactions, particularly in asset finance. Relevant experience required. Rare prospect for junior lawyer to take the next step in their legal career. (IS1038) 2 YRS+ PQE



Be part of the business team of this global firm. Analyze and resolve Business Intake and Conflicts of Interest, this role ensures compliance process to maintain firm’s competitiveness and reputation. A great alternative for long hour work. (PT1968) 5 YRS+ PQE

World class investment bank seeks lawyer to assist with a diverse range of Indian and offshore businesses and products. Corporate/capital markets experience is essential. Diverse role within a dynamic commercial environment. (IS1031) 3 YRS+ PQE







HONG KONG OFFICE Please contact James Garzon at (852) 2521 0306 or email

SINGAPORE OFFICE Please contact Jeremy Small at (65) 6829 7155 or email Visit our website to see the latest in-house and private practice vacancies worldwide.

Asian Legal Business Sep 2008  

The magazine for lawyers and in-house counsel with jobs, firm ratings, legal analysis and all the latest legal news and views

Asian Legal Business Sep 2008  

The magazine for lawyers and in-house counsel with jobs, firm ratings, legal analysis and all the latest legal news and views