ISSUE 7.4
M&A:
Strategy and sophistication fuel domestic market
并购交易策略和结构的复杂性促使法律服务日趋成熟
Going boutique:
Industry trend gathers pace
律所精品化发展道路的分析与探索
Lewis’ Lovells departure: A sign of the times?
吕立山离开路伟给在华国际律所的启示
CHINA
2010年企业法律顾问调查 In-house Survey 2010:
Corporate counsel seek value over price
n DEALS ROUNDUP n UK, US REPORTS n LATERAL MOVES n APPOINTMENTS n LATEST CAPITAL MARKETS DATA
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News | editorial >>
The younger generation: cause for celebration?
S
everal senior partners who are regular attendees at the ALB China Law Awards have noted that each year they’re seeing not only their ‘old’ friends but also a growing number of younger lawyers taking part in the legal industry’s most prestigious event.
“Younger lawyers – who are mostly in their 30s – have become an increasingly important force in the legal industry. As the legal and regulatory environment has been changing at an unprecedented rate and magnitude, they appear to be most skilled at learning new things and adapting to the changes,” said one senior partner at the recently held 2010 Awards. Senior partners at Jun He, like many other Chinese firms, share the same view and are promoting a growing number of younger lawyers to partner ranks. Currently, thirty-something lawyers account for nearly 50% of the firm’s 95 partners and counsel, up 20% from just two years ago. “Younger lawyers are contributing significantly to business development. They have stronger teamwork ability and a stronger focus on specialised areas of law, so they will contribute to the firm’s further integration and modernisation,” said David Liu, Jun He’s senior partner. Recognising that young lawyers are the future of the profession, the All China Lawyers Association (ALA) is keen to ensure that the younger generation have various opportunities to build up their expertise and their international exposure. Each year the association organises several young lawyer training schemes with other countries. Recently, ten lawyers have been sponsored to participate in a four-month work placement program in Australia. Of course, older lawyers will still sometimes make comments about the younger generation, especially those under 30, not fully appreciating the concept of hard work, loyalty and client service. Yet each generation has its unique culture and values. At their core, young lawyers require constant opportunities to learn and challenging work – and they want to be proud of what they do. Young lawyers of today will drive the legal world of tomorrow, a world which is likely to be vastly different from today. Most of the change will be positive.
At their core, young lawyers require constant opportunities to learn and challenging work – and they want to be proud of what they do www.legalbusinessonline.com
IN THE FIRST PERSON “We’ve made the decision to initiate several rounds of lateral hires and promotions in 2010” David Liu, Jun He(p8)
“The cost base and fee structure of international firms have created a natural market segmentation affecting their opportunities for growth and expansion” Robert Lewis, AllBright (p12)
“Many in-house legal departments have built up strong internal expertise in the areas of the law which significantly impact their companies. The perception of in-house lawyers as not doing interesting or challenging work is now largely outdated” Sami Fargad, eLong.com (p30)
CHINA
1
CONTENTS >>
contents 10 28 COVER STORY ALB China In-house Survey 2010 The 2010 results reveal that the ever-maturing inhouse profession in China is not only searching for ways to adopt best international practice but also seeking to use external resources to add value to in-house expertise
ANALYSIS 8
Job market begins upward move After a dismal 2009 the legal job market and salary levels have started to turn with the tide. ALB takes a look at who’s hiring and which skills are currently most in demand
10 Lewis’ Lovells departure: a sign of the times? In a move that could provoke international firms into lengthy periods of introspection over their China strategies, the former managing partner of the Beijing office of Lovells, Robert Lewis, is joining AllBright 13 Going boutique: niche players expand market influence The growth of boutique firms has been one of the main themes of China’s legal industry over
the past 12 months, with the GFC proving a blessing in disguise for the burgeoning boutique practices
FEATURES 34 M&A: strategy and sophistication fuels domestic market One of the most striking trends seen in the global M&A markets throughout the past 18 months is the intensity of China’s interest in overseas acquisitions. While the explosion of Sino-foreign M&A activity has been the impetus for both international and domestic firms to ramp up their ability to handle outbound transactions, the deals completed recently are showing growing sophistication by Chinese investors and lawyers alike
40 Offshore fightback While offshore financial centres have taken a battering throughout the financial crisis, those centres and the lawyers who ply their trade there remain unfazed, convinced of the important role that these facilities will play in the world economy
REGULARS 4 DEALS 16 NEWS • Zhonglun W&D uses alliance for outbound work • PRD’s 2020 vision drives SD & Partners growth • Jade & Fountain adds two partners, prepares for Beijing launch
The Updates section of ALB China is sponsored by the following firms: Beijing editor
Arbitration editor Guantao is a leading PRC firm with core businesses in capital markets, M&A, real estate, restructuring & insolvency, and energy & resources. With a team of nearly 150 lawyers nationwide, Guantao provides advice of high quality to clients home and abroad. Headquartered in Beijing, it has offices in Shanghai, Shenzhen, Xi’an, Dalian, Chengdu, Ji’nan, Xiamen, Tianjin and Hong Kong.
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International tax editor 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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ISSUE 7.3
ALB China issue 7.4
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NEWS | deals >>
deals in brief
| equity MARKET |
Firm: Allen & Overy Client: Sinopec
►►China Merchants Bank rights offering 招商银行发行A股配股
Firm: Herbert Smith Client: Sinopec
Value: US$3.2bn
Firm: Jun He Client: Issuer
Firm: Skadden Client: Sinopec
Firm: Davis Polk Lead lawyer: James Lin Client: Issuer
• Acquisition from China Petrochemical Corp, Sinopec's parent, marks its first acquisition of overseas upstream assets
Firm: Herbert Smith Client: Issuer
• Goldman Sachs, ING and UBS Investment Bank were underwriters for the transactions
Firm: Commerce & Finance Client: Underwriters Firm: Freshfields Client: Underwriters
| M&A | ►►Geely–Volvo acquisition 吉利收购沃尔沃 Value: US$1.8bn
• First global rights offering by a Chinese bank and the first rights offering by a Chinese company made available to US investors • UBS AG and CICC were the global coordinators of the global rights offering, BNParibas, JP Morgan, Merrill Lynch and UBS were the joint lead underwriters and Citi was the financial adviser of the H share rights offering • Davis Polk assisted the client in managing the entire US rights offering process, including direct involvement in the communications with its qualifying US shareholders and handling various enquires
| M&A | | M&A | ►► China Mobile–Shanghai Pudong Development Bank acquisition 中移动入股浦发 Value: US$5.8bn
Firm: Shanghai United Law Firm Lead lawyer: Wang Feng Client: Shanghai Pudong Development Bank Firm: Haiwen & Partners Client: China Mobile
4
HEADLINE DEAL
• China Mobile and Pudong Bank will form a strategic alliance to offer wireless financial services including mobile bank cards and payment services • Shanghai United is Pudong Bank’s long-term legal advisor, first advising the bank in 1999 on its IPO and providing legal services regarding its follow-on offerings and debt market and financing transactions
►►Sinopec–Sonangol Sinopec International stake acquisition 中石化收购非洲石油资产 Value: US$2.5bn
Firm: Haiwen Lead lawyer: Lan Jie Client: Geely Firm: Freshfields Lead lawyers: Christopher Brown, Avril Martindale Client: Geely Firm: Cederquist Lead lawyer: Peter Wirell Client: Geely Firm: Hogan & Hartson Client: Ford • Transaction encompasses agreements on IP rights and supply and R&D arrangements between Volvo, Geely and Ford • For advice on Zhejiang local legal matters and many domestic contentious issues, Geely mostly works with long-term external counsel Lou Tao, managing partner of Zhejiang Xing Tao law firm
“We expect [the China Merchants Bank Rights Offering] to be a precedent-setting deal, in that we established procedures for conducting a rights offering to qualifying US shareholders through a private placement as part of an A+H share rights offering, including significant complications presented by the CCASS system” James Lin, Davis Polk ISSUE 7.4
NEWS | deals >>
| JOINT VENTURE | ►► Chinalco–Rio Tinto Joint Venture 中国铝业与力拓成立合资公司 Value: US$1.35bn
Firm: Baker & McKenzie Lead lawyers: Stanley Jia, Andrew Lucas Client: Aluminium Corporation of China (Chinalco)
►► YOUR MONTH AT A GLANCE Firm
Jurisdiction
Deal name
Allens Arthur Robinson Allen & Overy Arendt & Mederach Baker & McKenzie
China/Australia China/Angola China/Europe China/Australia China/Hong Kong China/Sweden China/Hong Kong China/Europe China/US China/US China/Hong Kong China/US
Chinalco–Rio Tinto JV Sinopec–Sonangol Sinopec International stake acquisition Joyou Frankfurt IPO Chinalco–Rio Tinto JV EQT Greater China–Japan Home Centre acquisition Geely–Volvo acquisition Zhongsheng Group Hong Kong IPO Joyou Frankfurt IPO China Merchants Bank rights offering Trina Solar follow-on public offering Zhongsheng Group Hong Kong IPO China Lodging Group NASDAQ IPO
China China/US China/US China/Europe China/US China/Australia China/Europe China/Australia China/Peru China/Sweden China/Australia China/Peru China/Hong Kong China/Europe China/US China China/Sweden China/Europe China/Korea China China/Angola China/Australia China/US China/Sweden China/US China/US China/US China/Hong Kong China/Europe China/Hong Kong China/US China/Australia China/Australia China/Australia
Cederquist Clifford Chance CMS Hasche Sigle Commerce & Finance Conyers Dill & Pearman
Stanley Jia Baker & McKenzie
Firm: Allens Arthur Robinson Lead lawyers: Scott Langford, Richard Kriedemann, Nic Tolé Client: Rio Tinto • JV entered into to develop the Simandou iron ore mine in Guinea and follows Rio Tinto’s decision to reject Chinalco’s US$19.5bn bid last year • Baker & McKenzie also recently advised CNOOC in its US$3.1bn investment in Argentina • In the past 18 months Allens Arthur Robinson has worked with Rio Tinto on matters spanning Asia, Africa, Europe and North and South America, as well as Australia
Dacheng Davis Polk Dewey & LeBoeuf Fangda Partners Fasken Martineau Ferara Kerin Freehills Freshfields
Haiwen & Partners Hammonds Han Kun Herbert Smith
Hogan & Hartson Jun He
Jingtian & Gongcheng
“This is considered to be a world-class iron ore project and an important part of Allens Arthur Robinson’s relationship with Rio Tinto is our ability to work with it on global transactions” Scott Langford, Allens Arthur Robinson www.legalbusinessonline.com
King & Wood Latham & Watkins Mallesons McMillan Muniz, Ramirez, PerezTaiman & Olava Norton Rose Paul Hastings Shanghai United Law Firm Shearman & Sterling Skadden Simpson Thacher Bartlett Trendlaw Associates Rajah & Tann Rodrigo, Elias & Medrano, Abogado Watson, Farley & Williams WongPartnership Woo Kwan Lee & Lo Zhong Lun Zhong Yin
Value ($USm) 1,350 2,500 149 1,350 undisc 1,800 370 149 3,200 184 370 126
Deal type Joint venture M&A Equity market Joint venture M&A M&A Equity market Equity market Equity market Equity market Equity market Equity market
CSCEC–Shenzhen Zhonghai Investment Management acquisition China Lodging Group NASDAQ IPO China Merchants Bank rights offering Joyou Frankfurt IPO Trina Solar follow-on public offering CST Mining Group–Chariot Resources acquisition Joyou Frankfurt IPO CNOOC–LNG acquisition CST Mining Group–Cape Lambert Lady Annie acquisition Geely–Volvo acquisition CST Mining Group–Chariot Resources acquisition CST Mining Group–Cape Lambert Lady Annie acquisition Zhongsheng Group Hong Kong IPO Joyou Frankfurt IPO China Merchants Bank rights offering China Mobile–Shanghai Pudong Development Bank acquisition Geely–Volvo acquisition Joyou Frankfurt IPO China Hao Ran Recycling Korean IPO AutoChina International Ltd follow-on offering Sinopec–Sonangol Sinopec International stake acquisition CNOOC–LNG acquisition China Merchants Bank rights offering Geely–Volvo acquisition Trina Solar follow-on public offering China Lodging Group NASDAQ IPO China Merchants Bank rights offering Zhongsheng Group Hong Kong IPO Joyou Frankfurt IPO Zhongsheng Group Hong Kong IPO Trina Solar follow-on public offering CNOOC–LNG acquisition CST Mining Group–Chariot Resources acquisition CST Mining Grou–Chariot Resources acquisition
472 126 3,200 149 184 235 149 1,350 120 1,800 235 120 370 149 3,200 5,800 1,800 149 43 70 2,500 1,350 3,200 1,800 184 126 3,200 370 149 370 184 1,350 235 235
M&A Equity market Equity market Equity market Equity market M&A Equity market M&A M&A M&A M&A M&A Equity market Equity market Equity market M&A M&A Equity market Equity market Equity market M&A M&A Equity market M&A Equity market Equity market Equity market Equity market Equity market Equity market Equity market M&A M&A M&A
China/Peru China/Singapore China China/Australia China/Angola China/US China/US China/Europe China/Singapore China/Australia
CST Mining Group–Cape Lambert Lady Annie acquisition Gallant Venture–Shanghai property acquisition China Mobile–Shanghai Pudong Development Bank acquisition CST Mining Group–Chariot Resources acquisition Sinopec–Sonangol Sinopec International stake acquisition Trina Solar follow-on public offering China Lodging Group NASDAQ IPO Joyou Frankfurt IPO Gallant Venture–Shanghai property acquisition CST Mining Group–Chariot Resources acquisition
120 561 5,800 235 2,500 184 126 149 561 235
M&A M&A M&A M&A M&A Equity market Equity market Equity market M&A M&A
China/Denmark
Bank of China–FH Bertling financing
China/Singapore China/Hong Kong China/Europe China/US China
Gallant Venture–Shanghai property acquisition EQT Greater China–Japan Home Centre acquisition Joyou Frankfurt IPO China Lodging Group NASDAQ IPO Beijing Haohua Energy Resource Shanghai IPO
40 Finance 561 undisc 149 126 293
M&A M&A Equity market Equity market Equity market
Does your firm’s deal information appear in this table? Please contact
alb@keymedia.com.au
61 2 8437 4700
5
NEWS | deals >>
| M&A | ►► CNOOC–LNG acquisition 中海油完成印尼东固LNG股 权收购
restructuring of banking facilities totaling approx US$179.5m extended to the holding and project company owner of the Shanghai property
Value: US$1.35bn
Firm: Mallesons Lead lawyers: James Fahey, Joshua Cole Client: BG Group Firm: Herbert Smith Lead lawyers: Anna Howell, Alexander Aitken, Justin D’Agostino Client: CNOOC Firm: Freehills Client: CNOOC • James Fahey and Craig Rogers have been key advisers to BG on all aspects of its Queensland Curtis LNG project • Herbert Smith also represented CNOOC in its 2005 bid to acquire US oil company Unocal for US$18.4bn • CNOOC receives strong support from its renowned in-house legal team led by general counsel Zhao Liguo for PRC legal advice and deal executions
| M&A | ►► Gallant Venture– Shanghai property acquisition 新加坡Gallant Venture 进军中国房地产 Value: US$561m
Firm: Rajah & Tann Lead lawyers: Goh Kian Hwee, Serene Yeo, Ng Sey Ming, Jan Tan, Grace Chia Client: Gallant Venture Firm: WongPartnership Client: Gallant Venture Firm: Paul Hastings Client: Lugano Property Holdings • Deal involved US$202.5m investment by notes with warrants in the SPV; US$142.5m acquisition of the holding company of the Shanghai property from the Carlyle Group; related financing for the investment involving a facility aggregating approximately S$264m from Standard Chartered; and
6
| M&A | ►► China State Construction Engineering Corporation– Shenzhen Zhonghai Investment Management acquisition 中国建筑收购深圳中海 Value: US$472m
Firm: Dacheng Client: CSCEC • Consortium of investors include Blackstone Group Holdings, Atlantis Investment Management and Warbug Pincus
| EQUITY MARKET | ►► Zhongsheng Group Hong Kong IPO 中升集团香港上市 Value: US$370m
Firm: King & Wood Lead lawyers: Wang Jianping, Jing Gang Client: Issuer Firm: Freshfields Lead lawyers: Chris Wong, Calvin Lai Client: Issuer
• Freshfields acts as Hong Kong and US counsel to Zhongsheng Group, team was also involved in the issuer's pre-IPO investment by General Atlantic
"Zhongsheng is the first PRC-owned and operated car distributor to be listed on the Hong Kong Stock Exchange and it will be closely followed by other peers in the field" Amy Lo, Clifford Chance
| equity MARKET | ►►Beijing Haohua Energy Resource Shanghai IPO 北京昊华能源上海挂牌上市 Value: US$293m
Wang Jianping King & Wood
• First time Freshfields has had a mandate from CST
| EQUITY MARKET | ►►Trina Solar follow-on public offering 天合光能发行美国存托股票 Value: US$184m
Firm: Latham & Watkins Lead lawyer: David Zhang Client: Issuer Firm: Fangda Partners Client: Issuer Firm: Conyers Dill & Pearman Client: Issuer
David Zhang Latham Watkins
Firm: Jun He Client: Underwriters Firm: Simpson Thacher & Bartlett Client: Underwriters
Firm: Zhongyin Lead lawyer: Tang Jinlong Client: Issuer
• Trina Solar is the first US-listed solar power company to raise capital in the equity markets this year
• Citic Securities is deal underwriter
• Latham & Watkins is issuer’s longterm legal advisor
| M&A | ►►CST Mining Group–Chariot Resources acquisition 中国科技集团收购加拿 大上市公司Chariot
• Credit Suisse Securities, Goldman Sachs and Barclays Capital acted as bookrunners for offering
Resources Limited Value: US$235m
Firm: Conyers Dill & Pearman Client: Issuer Firm: Clifford Chance Lead lawyer: Amy Lo Client: Underwriters
Kong regulators, resolving all legal issues for its client
Firm: Freshfields Lead lawyer: Kay-Ian Ng Client: CST Group Jing Gang King & Wood
Firm: Jingtian & Gongcheng Client: Underwriters • Morgan Stanley, UBS and BOCI Asia were underwriters for the deal • King & Wood advised the issuer on all aspects of its restructuring and listing with respect to PRC law, and also provided responses on all PRC law-related questions to Hong
Firm: Fasken Martineau Client: CST Group Firm: Muniz, Ramirez, PerezTaiman & Olava Client: CST Group Firm: Shearman & Sterling Client: Chariot Firm: McMillan Client: Chariot Firm: Rodrigo, Elias & Medrano, Abogado Client: Chariot ISSUE 7.4
NEWS | deals >>
| EQUITY MARKET | ►► Joyou Frankfurt IPO 中宇卫浴欧洲上市 Value: US$149m
Firm: CMS Hasche Sigle Lead lawyer: Philipp Melzer Client: Issuer Firm: Trendlaw Associates Client: Issuer Firm: Hammonds Client: Issuer Firm: Arendt & Medernach Client: Issuer Firm: Ferara Kerin Client: Issuer
“[The China Lodging IPO] has an excellent combination of legal advisors for the issuer, investors and underwriters and thus proceeded very smoothly” Anthony Zhao, Zhong Lun
| equity MARKET | ►► China Lodging Group NASDAQ IPO 汉庭纳斯达克首次公开募股 Value: US$126m
Firm: Freshfields Lead lawyers: Heiner Braun, Christian Zeppezauer Client: Shareholders Firm: Zhong Lun Lead lawyer: Anthony Zhao Client: Shareholders
Firm: Conyers Dill & Pearman Client: Issuer
Firm: Jingtian & Gongcheng Client: Underwriters
Firm: Zhong Lun Lead lawyers: Anthony Zhao, Ke Yongbin Client: Underwriters
Firm: Dewey & LeBoeuf Client: Underwriters • Joyou’s IPO is the fourth IPO of a
Chinese company on the German stock market following public offerings of waste-to-energy specialist ZhongDe, Asian Bamboo and telecommunication service provider Vtion Wireless • CMS previously also advised ZhongDe, Asian Bamboo and Vtion on their listings on the Frankfurt Stock Exchange • Dewey also advised underwriters of ZhongDe and Asian Bamboo’s IPO
Howard Zhang Davis Polk
• CST (listed on HKSE) has recently completed a number of transactions involving copper mining projects in Australia and Peru, worth a combined total of US$1.4bn • Freshfields coordinated two major transactions – separate acquisition of Chariot Resources and Cape Lambert Lady Annie – across several jurisdictions
| equity MARKET | Anthony Zhao Zhong Lun
Firm: Simpson Thacher & Bartlett Client: Underwriters • Zhong Lun was previously China Lodging Group’s long-term legal advisor, having advised the hotel chain in numerous acquisitions, PE investments and fund raisings
| M&A | ►► CST Mining Group–Cape Lambert Lady Annie acquisition 中国科技集团收购秘鲁铜 矿项目 Value: US$120m
“The IPO process of Joyou was closely monitored by a number of other Chinese companies interested in going public in Germany. As the IPO of Joyou has been successful we expect these companies to kick-off similar IPO projects shortly” Philipp Melzer, CMS Hasche Sigle www.legalbusinessonline.com
Firm: Norton Rose Client: CST Group Firm: Freehills Client: Cape Lambert
Firm: Jun He Client: Issuer Firm: Davis Polk Lead lawyers: Howard Zhang, James Lin, John Paton Client: Issuer
Firm: Freshfields Lead lawyer: Kay-Ian Ng Client: CST Group
►►AutoChina International Limited follow-on offering 开元汽车增股发行 Value: US$70m
Firm: Han Kun Lead lawyers: Charles Li, Leia Zhang Client: Rodman & Renshaw • Rodman & Renshaw acted as the lead placement agent and Chardan Capital Markets acted as coplacement agent for offering
| equity MARKET | ►►China Hao Ran Recycling Korean IPO 中国浩然再循环公司韩国上市 Value: US$43m
Firm: Hammonds Client: Issuer • China Hao Ran became the first China-based environmentallyfriendly recycled paper manufacturer and tenth Chinese
company listed on Korea Stock Exchange • Also first Jiangsu-based Chinese company that went public in Korea
| PROJECT FINANCE | ►►Bank of China–FH Bertling financing 中国银行为英国博特宁提 供资金 Value: US$40m
Firm: Watson, Farley & Williams Lead lawyer: Madeline Leong Client: Bank of China Madeline Leong Watson, Farley • Facilities will & Williams allow FH Bertling to finance its new-building orders at Zhong Chuan Heavy Industry in Zhejiang province
• Singapore office of Watson, Farley & Williams advised the Bank of China regarding financing provided to two subsidiaries of German shipowner, FH Bertling, with support of buyer’s credit insurance from China Export & Credit Insurance
| M&A | ►►EQT Greater China–Japan Home Centre acquisition EQT中国收购香港日本城 Value: Undisc.
Firm: Baker & McKenzie Lead lawyers: Cheung Yuk Tong, Tracy Wut Client: EQT Firm: Woo Kwan Lee & Lo Client: Shareholders
Cheung Yuk Tong Baker & McKenzie
• EQT has 40% ownership in Japan Home Centre while the two founders, Peter Lau and Lisa Ngai, have together retained 60% stake • Baker & McKenzie had lead responsibility for overall documentation and general transaction management
7
NEWS | analysis >>
Analysis >>
Job market,
salaries begin upward move After a dismal 2009, the legal job market and salary levels have started to turn with the tide. ALB takes a look at who’s hiring and which skills are most in demand
W
hile the brakes were applied to recruitment and promotion of lawyers in 2009, signs are now appearing that the legal job market is back on the rise. The latest manifestation of this trend comes from Zhong Lun, one of the country’s largest firms, which has added 31 new partners so far this year, including nine lateral hires. Other firms that have recently been active in partner-level recruitment include Jun He, AllBright, Global, Grandall, Guangsheng & Partners and Jade & Fountain. “The adverse market conditions in the first half of 2009 made us defer our promotion and recruitment plans,” said David Liu, senior partner of Jun He. “As the business environment and client demand continues to show improvement, and as we set our strategic plans for the new decade, we’ve made the decision to initiate several rounds of lateral hires and promotions during 2010.” Following a round of promotions in January which saw eight new partners elected, Jun He is looking to hire more experienced lawyers – including senior partners – to beef up its new practice groups, including WTO, international
trade and IP. Recruitment activity among leading Shanghai and Beijing firms has also recovered strongly, a trend seen by Nick Zhang, the founder and director of LawInn – the first human resource consulting firm specialising in the legal sector in the PRC. “It’s quite evident that the domestic private-practice sector is taking advantage of the strained employment situation among international firms,” he said. “Many Beijing and Shanghai firms have been active in recruiting senior candidates – particularly those who have worked in international firms – and growing new practices since the end of 2009. Some mid-tier firms are even seeking opportunities to take on entire practice teams or merge with other firms of a similar size and market position.”
In-house strong
In-house job openings are also available, particularly in mid-sized foreign invested enterprises (FIEs) that previously had no in-house legal team, and domestic companies looking for potential IPO or M&A activity. “Mid-sized FIEs increasingly need one or more dedicated in-house counsel to manage all the legal issues as their
►► Changes in lawyer compensation Categories Headquartered in US/UK foreign firms Headquartered outside US/UK foreign firms Domestic firms In-house (MNCs) Overall average year-on-year change
2006 +17.2% +18.5% +19.2% +14.5% +17.3%
2007 +18.5% -11.0% +19.4% +1.0% +10.0%
2008 +1.0% +12.3% +0.7% -6.1% +2.0%
2009 -19.5% -2.8% -18.7% -4.0% -11.0%
Notes: • percentages are average year-on-year changes • Headquartered in US/UK foreign law firms have global reach and multiple locations • Headquartered outside US/UK foreign law firms are regional, from Australia, Hong Kong, Singapore, Japan and Europe, with a limited number of overseas offices • Domestic law firms are large/boutique PRC firms based in Shanghai/Beijing serving international clients Source: LawInn’s annual salary surveys
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investments and projects grow in China. When domestic companies prepare for an IPO or an M&A transaction, they naturally will need to establish an in-house legal function,” said Cherol Cheuk, a legal recruitment consultant in Hudson Legal’s Shanghai office. “The improving economic conditions have triggered new demand for these companies to search for in-house counsel. It’s also a way to optimise the financial structure of their legal spending.” Cheuk and her team have recently made several placements with clients. And while a number of international firms and MNC in-house departments have announced vacancies and hired additional staff, recruiters have noted that most of them are still trying to bring their existing staff back up to full work capacity. Laurence O’Laughlin, general counsel of Intel China, predicts that in-house departments won’t hire significantly this year, but as always, talent with certain specialised skill sets will be in demand. “China’s rapidly developing legal system has meant inhouse departments will have a greater demand for environmental law and litigation management skills. There will be increasing specialisation of inhouse roles,” said O’Laughlin. “China has been very active in the last year in the areas of competition, environmental protection, and IPR. In-house lawyers, especially those with several years’ experience in private practice and specialised knowledge in those areas, will continue to have abundant opportunities to demonstrate their skills in the marketplace.”
Most employable staff
While the market is yet to recover fully and firms are hiring with caution, they will inevitably make room for genuinely sought-after talent if the opportunity arises. “Since Q4 2009 we have seen associate recruitment at law firms pick up in China,” said Doreen Jaeger-Soong, managing director of Hughes-Castell.” Top-quality capital markets lawyers who are bi-lingual and have strong academics are once again highly sought after. Apart from capital markets, practice areas such as arbitration & dispute resolution, IP ISSUE 7.4
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business development and management skills are also highly valued in the private sector. “Several years ago, legal work and client mandates were plentiful, and [the] top priority for firms was to ensure they had enough competent lawyers to handle the workloads. Those days are long gone and firms now consider rainmaking skills, leadership abilities and the book of business as equally essential criteria when hiring senior candidates,” said Zhang.
►► IN DEMAND: China jobs advertised on www.legaljobscentre.com Seniority
Sector
Practice area
(POE >3) 12 (POE 6 >) 21 Private practice 32
Litigation 5
Others 7 Corporate 20
M&A 8
In-house 38 (POE 3-5) 31
IP 8
Capital markets 12
Commercial 12
Salaries to recover, slowly
Source: www.legaljobscentre.com, 14 April 2010
and M&A are recruiting heavily.” M&A lawyers, particularly those who have PE and venture capital expertise, are currently in high demand. The latest recruiting plans of Jade & Fountain, Guangsheng and Global are cases in point – all three firms have appointed additional partners to their M&A and PE practice groups. Earlier this year, former DLA Piper associate Jason Liu joined Guangsheng as a partner to head the firm’s PE and M&A practice group (currently consisting of four partners and four associates). “There will be more PE and M&A deals for 2010, especially RMB fund
investments and restructuring of prior offshore investments,” Liu said. “China will still be the focus of investments from the global perspective.” To facilitate its rapidly growing practice areas in M&A and PE/ VC, Jade & Fountain has appointed Lawrence Guo, formerly a partner with Broad & Bright, and William Lu, formerly a senior associate at Allen & Overy, as partners; Global has secured the service of Lin Huawei from Paul Hastings.
Wider skillsets required
In addition to technical excellence,
The ‘2009 Legal Salary Survey & Review” issued by LawInn in March 2010 (see tables, below) has confirmed that legal salaries in foreign firms, leading domestic firms and in-house departments of MNCs in China all experienced a drop in 2009. According to the report, associates in the PRC offices of UKand US-headquartered global firms and leading domestic firms took the deepest cut in compensation, with an average year-on-year change of -19.5% and -18.7% respectively. Lawyers working in the PRC offices of smaller foreign firms like those from Australia, Singapore, Japan and Europe, and
►► 2009 Salary levels revealed ►► Foreign firms–HEADQUARTERED IN US/UK
►► Domestic firms
Associate–with foreign bar PQE Sample Annual Average Average of Average of size compensation 2009 top 50% of top 20% of range (RMB) samples samples Senior (>6 yrs) 30 400,000-2,550,000 1,186,970 1,592,540 1,996,720 Middle (3-5 yrs) 20 236,000-1,300,000 760,130 1,020,660 1,170,000 Junior (<3 yrs) 9 300,000-850,000 651,890 n/a n/a
Associate PQE
►► Foreign firms–HEADQUARTERED IN US/UK
►► In-house counsel–MNCs
Associate–without foreign bar PQE Sample Annual Average Average of Average of size compensation 2009 top 50% of top 20% of range (RMB) samples samples Senior (>6 yrs) 27 250,000-1,700,000 615,040 822,070 1,055,200 Middle (3-5 yrs) 34 151,000-815,000 347,200 453,440 554,430 Junior (<3 yrs) 20 100,000-260,000 174,750 226,800 257,500
PQE
►► Foreign firms–HEADQUARTERED OUTSIDE US/UK
►► In-house counsel–PRC enterprises
Associate PQE
Senior (>6 yrs) Middle (3-5 yrs) Junior (<3 yrs)
Sample Annual Average Average of Average of size compensation 2009 top 50% of top 20% of range (RMB) samples samples 13 360,000-1,660,000 635,540 817,430 n/a 13 129,100-1,000,000 314,390 418,290 n/a 10 60,000-272,000 133,600 183,000 n/a
Note: limited sample size in each category means average may not be statistically valid
www.legalbusinessonline.com
Senior (>6 yrs) Middle (3-5 yrs) Junior (<3 yrs)
Sample Annual Average Average of Average of size compensation 2009 top 50% of top 20% of range (RMB) samples samples 32 150,000-1,000,000 385,660 507,810 666,670 54 65,000-500,000 204,550 254,980 304,410 32 44,000-230,000 119,030 155,630 191,000
Sample Annual Average Average of Average of size compensation 2009 top 50% of top 20% of range (RMB) samples samples Senior plus (>10) 31 174,000-3,887,000 1,145,280 1,729,170 2,547,500 Senior (>6 yrs) 38 170,000-1,600,000 600,080 828,680 1,122,500 Middle (3-5 yrs) 33 100,000-500,000 251,170 331,530 411,430 Junior (<3 yrs) 13 60,000-234,000 121,310 161,000 n/a
PQE
Sample Annual Average Average of Average of size compensation 2009 top 50% of top 20% of range RMB samples samples Senior plus (>10) 7 290,000-890,000 631,430 n/a n/a Senior (>6 yrs) 14 115,000-660,000 323,430 451,860 n/a Middle (3-5 yrs) 19 75,000-400,000 202,320 278,300 n/a Junior (<3) 7 60,000-200,000 122,430 n/a n/a Source: ‘The 2009 Legal Salary Survey & Review’ issued in March 2010 by LawInn HR Consulting
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in-house counsel in MNC in-house legal departments, experienced a much smaller reduction in salary – an average year-on-year change of -2.8% and -4% respectively. Although salary levels hit bottom last year, Zhang predicts that the upward movement in salaries won’t be at the same pace as hiring demand, and it will take quite some time before they surpass their pre-GFC peak. “Having been through a turbulent time, law firms, particularly international firms,
will take a more sensible and rational approach to compensation packages when they make lateral hires. Also, candidates have become more mature and will take other important elements into consideration when they consider a career move,” he added, echoing a key finding of ALB’s recent ‘Employer of Choice’ survey. Zhang also expects compensation for junior lawyers to remain flat, but top-notch talent to continue to enjoy the highest pay checks. ALB
就业市场回暖，薪酬回升势态初现
尽
管2009年律师招募和晋升活动有所停滞，但有 迹象表明，法律就业市场的形势及薪酬水平已 逐渐开始好转。中伦律师事务所的近期的招聘活动就 很好地证明了这一点，到目前为止，该所今年已新增 了31位合伙人，其中有9位由其他律所加入。近来积 极招募合伙人和律师的其他律所还包括：君合、锦天 城、环球、国浩、广盛和九州丰泽。 君合高级合伙人刘大力表示：“鉴于2009年上半年 市场形势严峻，我们推迟了晋升和招募计划。随着 业务环境和客户需求持续好转，加上我们制定了新 的十年发展规划，我们将在2010年开展几轮招聘活 动及内部晋升。” 君合在1月份的一轮晋升中提拔了 八位新合伙人，接下来，君合将招聘经验更丰富的 律师（包括高级合伙人），借此壮大律所的新兴业 务团队，包括WTO、国际贸易及知识产权等业务。 罗英人才（LawInn）的创建人兼董事张宁认为，上 海和北京著名律所的招募活动已有强劲回升。LawInn 是中国法律行业首家专注于人力资源的机构。他 称：“很明显，国际律所就业形势萎缩，会让国内律 所受益。北京和上海的不少律所一直积极招募高级律 师，尤其是曾为国际律所效力的律师，而且自2009年 底以来就始终致力于发展新业务。一些中型律所甚至 寻找机会，希望吸收结构完整的业务团队，或者与规 模和市场地位相当的其他律所进行合并。” 企业内部工作机会亦不断涌现，尤其是原来未设 立内部法务团队的中型外商投资企业（FIE），以及 寻找机会进行潜在的首次公开招股（IPO）或并购活 动的国内公司。Hudson Legal上海办事处的法律人才 顾问Cherol Cheuk指出：“由于中型外商投资企业在中 国的投资及项目活动不断增加，这些企业越来越需要 一个或多个专门的内部法律顾问，来管理所有国内法 律事宜。更多国内公司正着手筹备IPO或并购交易， 他们自然也需要组建内部法律事务部。” Cheuk及其团队近期协助多家此类客户招聘了公 司律师，她表示：“经济形势持续改善，致使这些公 司对内部顾问律师有了新的需求。这也是优化公司 法律开支的财务结构的途径之一。”尽管一些国际律 所和跨国企业的内部部门已公布了空缺职位并招聘 新员工，但招募人员留意到，绝大多数公司仍试图 利用现有员工来完成工作。
需求最大的专业律师
尽管仍然有众多律所对招聘人员仍持谨慎态度，但毋 庸置疑，如果有好的人才，律所还是会把握机会，尽 力争取。“我们发现自2009年第四季度以来，中国律 所的助理律师招募活动就已增加。”Hughes-Castell的 董事总经理Doreen Jaeger-Soong表示，“能力突出、 精通双语且学术能力过硬的资本市场律师再一次受到 热捧。除资本市场外，仲裁纠纷解决、知识产权和并 购等领域也进行了大量的招募活动。” 目前，市场对并购律师（尤其是拥有私募股权及 风险资本专业知识的律师）的需求量也很强劲。九 州丰泽、广盛和环球的最新招募动向就是很好的例 子。这三家律所都委任了新合伙人，壮大了他们的
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并购和私募股权业务团队。今年初，欧华前任助理 律师刘新辉作为合伙人加入广盛，领导该律所的私 募股权和并购业务团队。该业务团队现由四位合伙 人和四位助理律师组成。刘律师表示：“2010年私 募股权和并购交易将会增加，特别是人民币基金投 资和前期境外投资重组。从全球来看，中国将依然 是投资重点。” 为推动律所在并购和私募股权／风险资本业务领域 的发展壮大，九州丰泽已委任郭林军（原为世泽合伙 人）和卢少杰（原为安理高级助理律师）为合伙人， 而环球已聘用曾任职于普衡的林华伟。 除专业能力超群外，业务开发和团队管理能力也 正成为律所考量人才的重要标准。张先生表示：“几 年前法律工作和客户委托业务非常多，律所的首要 要务是，确保拥有足够的工作能力强的律师来完成 工作。如今时过境迁，律所在招聘高级律师时，将 专业技能、领导能力和业务拓展水平等视为同等重 要的标准。” 跨国企业的内部部门将采用类似方式 — 慎重地 开展招聘活动。英特尔中国的总法律顾问Laurence O’Laughlin预测跨国企业的法务部门今年不会进行 大规模的招聘，不过一直以来，具有特定专业技能的 人才始终受到欢迎。O’Laughlin表示：“中国法律制度 正迅速完善，这意味着公司对环境法和诉讼管理等专 业能力的需求会高涨。公司法务部门作用将愈发专业 化。去年，中国在竞争、环境保护和知识产权法律法 规方面积极有重大发展。内部律师，特别是在律所拥 有数年执业经验和拥有较强专业知识的律师，将会有 广阔的发展空间，在市场中大展才华。”
薪酬缓慢回升
LawInn于2010年3月发布的2009年律师薪酬调查报告 （2009 Legal Salary Survey & Review）显示，2009 年间，外资律所、国内领先律所及中国境内跨国公司 法务部门的律师薪酬均有所下降。报告表明，总部位 于英国和美国的全球性律所中国办事处和国内领先律 所的律师薪酬下降幅度最大，较2008年水平平均分别 下降19.5%和18.7%，而对于总部在澳大利亚、新加 坡、日本及欧洲等国外律所的中国办事处，及跨国 公司的内部法务部门工作的律师而言，薪酬降幅相 对较小，平均水平分别下降2.8%及4%。 尽管薪酬水平已于去年触底回升，但张先生表示， 虽然法律人才市场需求回升，但薪酬并不会以同等 速度回升。而何时能回到2007的最高水平仍尚无定 论。张先生说道：“经历一段特殊的动荡时期之后， 律所（尤其是国际律所）在进行横向招聘时，将采取 更明智合理的方式制定薪酬方案。”他还补充说：“律 师团体自身也日渐成熟，他们考虑跳槽时将不仅仅只 考虑薪酬，还会思量其他重要因素。”这与ALB近期开 展的“最佳雇主”调查结果不谋而合。 张先生还预计，初级律师的薪酬将持平，而顶尖人 才将持续享受最高薪金。调查结果显示，即使是在全 球经济衰退时期，经验最丰富、训练有素的杰出律师 的薪酬，仍有所增加。
Analysis >>
Lewis’ Lovells departure a sign of the times?
I
n a move that could provoke international firms into lengthy periods of introspection over their China strategies, Robert Lewis, former managing partner of the Beijing office of Lovells, is joining AllBright’s Beijing office as a senior international legal consultant to head up the firm’s international practice. His new appointment with AllBright will become effective on 1 May 2010, the same day that Hogan Lovells will be officially formed as a result of the merger between Hogan & Hartson and Lovells. At the same time, he is to take on the role of chief administrative officer (CAO) of the Sino-Global Legal Alliance (SGLA), of which both Lovells and AllBright are founding members. Lewis said his latest career venture was not related to the Hogan Lovells merger but rather was an entrepreneurial move to address changing market conditions and lead the next stage of development of the SGLA. At AllBright, he will continue to cooperate closely with Hogan Lovells, which will remain an important member of the SGLA.
Evolving market
“In recent years, the legal services market has experienced dramatic changes and has seen a huge shift towards increasing use of local firms, which are growing not only in size but also capability. My move to join AllBright shows my endorsement of the local profession,” said Lewis. While local firms are moving even closer to their international counterparts in terms of breadth and quality of service, the price gap between the two remains wide. This, together with the fact that international firms ISSUE 7.4
NEWS | analysis >>
must still contend with market barriers, has meant domestic clients and pricesensitive inbound investors have good reason to opt for a local advisor. “The cost base and fee structure of international firms have created a natural market segmentation affecting their opportunities for growth and expansion in China. In certain important segments of the market, they would never be able to achieve the same scale and coverage as local firms,” said Lewis. “However, services provided by local firms are not always 100% satisfactory, particularly to local subsidiaries of foreign multinational clients. Real opportunities exist in the middle ground between the current offerings of international firms and local firms. That’s a major area of interest to me.” Joining AllBright enables Lewis to offer a new value proposition for both foreign and domestic clients – providing an international standard of service through a national network at a local price. His proposition is similar to that of local market leaders such as King & Wood and Jun He and upcoming mid-tier firms, which have all recruited an increasing number of foreign and Chinese lawyers with considerable international exposure from international firms. “Undoubtedly, there are a lot of very capable and experienced international practitioners in local firms, but I believe it is people at my level of seniority who represent the closing of the last mile gap between what local firms and foreign firms can offer in China. Being able to have that level of seniority and experience will help the existing teams of local firms provide an additional degree of comfort for certain types of clients and bring the practice up one more level,” said Lewis, who has nearly 20 years of practice experience in China with international law firms and as Asia general counsel of a major multinational corporation. “Given the pricing differential and the market access restrictions, more senior lawyers, and even partners, at international firms are going to local firms. I’m not creating a new trend, but I believe my move will help accelerate this overall market trend that will provide further momentum to the growth of local firms. Meanwhile it necessarily requires foreign firms to www.legalbusinessonline.com
Real opportunities exist in the middle ground between the current offerings of international firms and local firms. That’s a major area of interest to me” 11
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rethink and reposition in China over time,” he said.
New roles, new plans
In his new role as a senior international legal consultant of AllBright Beijing, Lewis will be responsible for developing and leading the firm’s international legal team in Beijing, focusing on inbound investment and M&A, cross-province work for domestic subsidiaries of MNCs, and outbound commercial transactions and investments for Chinese enterprises in market segments not addressed by the major
of identifying a handful of senior international practitioners to bring on board. Minimum standards for partner performance will be set upfront to ensure the sustainability and longterm success of the partnership. In his new roles with AllBright Beijing and the SGLA, which was essentially his own brainchild, Lewis will also be responsible for establishing international-standard law firm management, know-how and business development systems and help promote closer cross-firm cooperation among the SGLA member firms in respect of management systems and client work.
“In recent years, the legal services market has experienced dramatic changes and has seen a huge shift towards increasing use of local firms, which are growing in size and capability” Robert Lewis, AllBright international law firms in China. He will start with AllBright’s existing team in Beijing but plans to build a comprehensive spectrum of practices by attracting some additional specialist firms and teams to join. In fact, he is already in the process
In connection with these moves, Lewis will relinquish the role of chairman of the SGLA, which he has held since its establishment in 2007. The new chairman will be Xue Yunhua, managing partner of Guangzhou-based SGLA member firm,
Guangda, and former vice-president of the national All-China Lawyers Association. At the same time, Thomas Man, a partner in Lovells’ Beijing office, has been appointed as a vice chairman of the SGLA. And Lawrence Zhu, managing partner of AllBright, and Cai Xueen, managing partner of Wuhan-based SGLA member firm Dewell, continue as vice chairmen. Opportunities aside, Lewis is also prepared for a challenging process ahead. “Anyone who goes to a local firm must have an entrepreneurial approach, and no one should expect the local firms are in the position to underwrite the compensation for a senior partner from a foreign law firm. I also expect that in the initial period it will take an appropriate period of time to build up a new business, and hopeful it will be a smooth process,” he said. Given that Lewis’ services will be available at a new hourly rate of RMB3,200 – fully 45% less than his current Lovells rate – and in appropriate cases for a blended hourly rate of RMB2,000, that ‘appropriate period of time’ may hardly be any time at all. ALB
资深外国律师加入本地律所凸现国际律所‘高资费’瓶颈
资
深国际律师吕立山先生近日宣布将于5月1日正 式加入锦天城律师事务所北京办公室，担任资 深国际法律顾问，负责该所北京国际业务的拓展。 同时，他还将担任中世律所联盟的首席行政官，以 带领该联盟迈入新发展阶段。此前，他曾是路伟国 际律师事务所北京代表处管理合伙人。吕先生表示 加入锦天城后， 他将通过中世律所联盟的平台继续 保持与路伟（即将成为Hogan Lovells）的深入合作。 虽然他不是首位由国际律所加入本地律所的合伙 人，但却是加入本地律所中最资深的外国律师之一。 他已在华执业达20年之久，在加入路伟前曾任北电网 络亚洲区总法律顾问。吕立山先生此次的重大职业转 变，将给众多在华国际律所带来启发，并促使他们重 新深思在华发展策略。 吕先生表示，中国法律市场的进一步成熟和本地 律所的不断强大是促使他加盟锦天城的主要原因。 同时，国际律所高昂的法律服务费率和在华执业范 围限制，已逐步成为抑制国际律所在某些重要领域 发展业务的因素。 加入一家领先的国内律所能够使他在全国范围内 提供国际标准的法律服务，但却只收取与国内市场 同等水平的服务费用。他认为，目前市场上对这类 法律服务需求强劲，将有相当大的业务发展空间。
国内市场成熟
吕先生表示：“近年来，国内法律服务市场发生了重 大变化。本地律所不仅在规模，专业能力或是市场 占有率上都有大幅提升。加入本地律所的决定是我 对本地律师行业的高度赞赏。” 本地所不论在专业或是服务水平上与国际律所的差 距迅速减小，但是两者在服务费用上的差距却仍然可
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观。国际律所的高资费和在华执业范围的限制都已成 为制约他们发展的瓶颈，在发展国内客户和对价格较 为敏感的外国企业时尤其明显。 “国际律所的费率和计费方式是他们在华发展业 务的天然障碍。在一些特定重要服务领域，他们将 无法超越本地律所。但是，在这些领域本地律所提 供的服务常常未能令客户满意，特别是跨国企业在 国内的子公司。能够提供真正国际标准服务的本 地律所尚不多见，这种市场断层给我们带来了绝 佳的机会。” 加入锦天城后，吕先生能够通过该所的本地资源以 及中世联盟的全国网络为客户提供国际标准，本地价 格的法律咨询和服务。这一目标与一些国内领先律所 十分类似，这些律所也在近期招聘了大量曾在国际律 所工作过的律师以及合伙人加入。 他说：“毋庸置疑，一些国内所已经拥有一批非常 有能力和经验丰富的国际人才。但是，只有随着更 多管理级别资深合伙人的加入，国内所和国外所的 最终差距才会被弥合。相信他们的加入会让一些客 户群提高对本地所既有团队的信任程度，并带领这 些团队迈入更高台阶。” 他同时表示：“费率的差距以及国际所在华业务范 围的限制将促使更多律师和合伙人从国际所流向本 地所。我只是其中一员。但我相信，我的职业转变 将为本地律所未来的发展带来更多动力，并为众多 在华国际律所带来启发，促使他们重新深思在华发 展策略。”
新职位，新计划
在担任锦天城北京办公室资深国际法律顾问后，吕 先生将负责该所北京国际业务的拓展，侧重于外商
投资、并购、跨国企业在华分公司在国内市场的扩 展、以及国内企业在海外的投资和商业项目。这些 领域尚未引起国际律所关注。 他计划在不久后通过吸引一些专业团队加入，使 锦天城北京办公室发展成为一个能够提供全方位、 综合法律服务的平台。他已经在积极招募其他国际 律师加入。但他同时表示，将尽快设立一系列严格 的合伙人业绩衡量标准体系，以保证较高的平均实 力和长期的可持续发展。 同时，作为中世律所联盟的首席行政官，他还肩负 着带领该联盟迈入新发展阶段的重任。他于２００７ 年领导了该联盟的设立，并一直担任联盟主席。在新 职位上，吕先生将为本地成员所制定国际标准的律所 管理系统，知识和业务发展系统以及促进更实质、紧 密的跨所业务合作。 该联盟的新主席将由广州成员所，广大律师事务所 的管理合伙人薛云华出任。路伟北京合伙人Thomas Man和武汉得伟君尚首席执行合伙人蔡学恩，以及锦 天城管理合伙人朱林海共同担任副主席。 除了机遇之外，吕先生也已做好应对挑战的准 备。他说：“每一位加入国内律所的外国律师都应该 有企业家的精神，而不是期望国内律所能够开出与 国际律所同等水平的报酬。我知道在一个新的平台 重新发展业务并不容易，而且可能会需要花一定时 间来奠定基础。” 然而，在新的平台吕先生每小时的服务费率将为 ３２００人民币，相对他在路伟时的标准减少了４ ５％。同时，他还能通过由不同等级律师组成的团 队，以每小时２０００人民币的价格为客户提供服 务。可想而知，新价格的优势将成为他取得不凡业 绩的助推器。 ISSUE 7.4
NEWS | analysis >>
Analysis >>
T
he growth of boutique firms has been one of the main themes seen in China’s legal industry over the past 12 months. While the financial crisis presented a heavy burden for larger full-service law firms to shoulder, it proved to be a blessing in disguise for burgeoning boutique practices. Post-GFC, these boutique firms across China are reaping the rewards of their tighter focus. Being boutique isn’t just about resisting large-scale growth, of course, it is about a certain quality of work and carving out a market niche. Boutique firms have features that their fullservice counterparts lack – lower costs and tailored ‘bespoke’ legal services, for example – and these are qualities which have successfully fuelled their practices over the past year. Keeping with existing core philosophies has paid off for many.
Smart strategy
Going boutique: niche players expand market influence
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Over the last year many boutique firms have seen a one-, two- or threefold increase in work volumes and revenues. They have also gained major clients who have migrated from bigger firms in search of lower fees and customised legal advice. Boutique firms such as Tiantong & Partners, which specialises in high-end corporate litigation, reported 100% growth in volumes for 2009, with 90% of its total revenue derived from that one sector. Tiantong’s focused strategy has won the firm long-term clients like Changhong, the four major banks and Sinochem. “Our clients have told us that they used to just tolerate disputes because they didn’t have a developed legal department. Over time, their legal teams have evolved along with Chinese law, and they now understand the need for and advantages of solving issues with litigation,” says partner Ding Le. The firm also attributes its success in part to the financial crisis. “As litigation specialists, we saw the GFC as our biggest opportunity to shine,” said Ding. “Bad economic times resulted in a rise in conflicts and disputes and many firms have come to us for litigation advice. One area that showed a notable increase in the number of cases was labour disputes, usually related to large-scale layoffs in companies. We seized this chance to 13
NEWS | analysis >>
“Commercial law firms will naturally evolve into boutique firms... I anticipate a large rise in the number of boutique firms” Jane Chen, managing partner, Sunshine Law Firm
provide the best legal service in order to retain clients for the future.”
Tailored services
The ability to tailor legal services is a key weapon in the boutique firm’s arsenal. Boutique firms can fastforward past unnecessary processes and potential costs, and the task of assigning resouces to mandates is for them often more straightforward. “Large full-service firms have to manage big groups of practitioners. Sure they can diversify more, but communication and work conflicts also tend to arise in such situations. In boutique firms direct communication seldom poses a problem, hence lawyers work swiftly together on all cases. We have the same expertise and vision,” said Ding. The fact that legal practitioners in boutique firms have one focal point means they are often intimately familiar with the changes in law, regulations and policies pertaining to their practice area. A good example of this is seen in niche specialisation areas, such as tax. Shanghai ForTran is one of the leading boutique tax firms in the country – tax advice contributes 80% of the firm’s total revenue each year. The firm has chosen to grow organically and within its specialisation. “Tax is a specialty that requires nothing less than expert advice and foresight. Our lawyers are highly up-to-date with the market and possess great foresight on tax evolutions,” said partner Lu Guoyang.
Industry specialists
►► some key boutique law firms Law Firm
Key practice area/ industry
Managing partner
Tiantong & Partners
Litigation
Jiang Yong
Sunshine Law Firm
New energy
Jane Chen
Shanghai ForTran
Tax
Lu Guoyang
Alpha & Leader
Finance
Tan Weishi
Shanghai Jin Neng
Energy
Yue Wenhui
Lexfield
IP
Jan Liu
GoldenGate
IP
Tim Meng
*This table does not purport to be exhaustive
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While some law firms launch their boutique practices to focus on particular practice areas, others have profited from concentrating on industry sectors. Sunshine Law Firm is one example, providing legal services for the development, investment, financing, construction, operation and management of energy projects. Specifically, the firm designs strategies and legal structures for energy project deals, and is also involved in the coal, electricity, natural gas and oil markets. 95% of Sunshine’s total revenue comes from advising on energy projects for its long-term clients (State Electricity Regulatory Commission, State Grid, China Guodian Corporation, and China
Power Investment Corporation). Like Tiantong, Sunshine has concentrated on an even narrower market focus over the past 12 months: new energy. The firm provides legal advice on the development and construction of nuclear, wind and solar power facilities. “Rather than simply report to our clients on what the law says, we attempt to educate and teach our clients on how to approach and solve legal problems,” said Jane Chen, managing partner of the firm.
Tough choice
Lawyers often describe the choice of ‘going boutique’ as one that requires courage and involves long periods of ‘growing pains’. “The main focus of going boutique is the ability to isolate a single practice area and let go of others. Many firms are incapable of doing that,” said ForTran’s Lu. “The first few years will definitely be tough, but with patience and determination, you will pull through.” While boutique firms usually keep up good collaborative relationships with other firms, they still feel competitive pressure from large generalist Chinese firms. Several boutique firms have merged with or lost a large number of partners to their larger competitors, due to their inability to get work on large-scale projects. For example, Kingfield Law Firm, which specialises in shipping and aviation law, recently merged with Dacheng; Guangzhou-based IP firm Roy Liu & Partners merged with Beijing Lifang & Partners; and Jun Yi merged with Jun He in 2007. While some boutique firms have lost the will to endure those ‘growing pains’, many are still tempted by the success of those who have stayed the course, and the boutique model seems to be here to stay. “In the past, legal problems were much simpler in nature, dealing mostly with issues pertaining to the individual, debts and crime,” said Sunshine’s Chen. “With the rapid development of China's economy, the legal system has also dramatically expanded. As a result, commercial law firms will naturally evolve into boutique law firms. In fact, many large law firms have set up boutique teams in order to address this very issue. In the future, I anticipate a large rise in the number of boutique law firms.” ALB ISSUE 7.4
NEWS | analysis >>
Update >>
CIETAC COLUMN CIETAC, 当事人选择第三国国籍首席仲裁员的有关实践
当
事人在以仲裁方式解决纠纷时， 常就仲裁庭的首席仲裁员国籍做 出特别约定。例如，一中国公司 和一美国公司签订仲裁条款，即对首席仲 裁员国籍做出如下约定“……第三名仲裁员 (即首席仲裁员)不得是中华人民共和国的 公民或美利坚合众国的公民或国民……”。 首席仲裁员不仅是仲裁程序的组织者，也 是仲裁结果的决定者，他把握着仲裁案件的 公正与公平。当事人对首席仲裁员国籍做出 排他性特别约定，是为了避免首席仲裁员国 籍与一方当事人国籍相同，与另一方当事人 国籍不同，而可能造成的首席仲裁员偏袒相 同国籍一方的现象，是当事人追求案件更为 公平审理的一种表现形式。 在中国国际经济贸易仲裁委员会 （CIETAC）受理的此类案件中，当事人通 常是将中国籍仲裁员排除在外，而选定一 个外籍人士担任首席仲裁员。CIETAC坚持 当事人意思自治原则。在现行CIETAC《仲
裁规则》下，当事人的此类约定，是完全可 以实现的。 自上世纪80年代，CIETAC就开始了外籍 仲裁员参与审理仲裁案件的实践。近年来， 为充分尊重不同国家当事人的意愿，给当事 人提供在《仲裁员名册》中更大的选定范 围，CIETAC不断聘请有影响力的外籍人士为 仲裁员。CIETAC现有来自34个国家和地区的 外籍（包括港澳台地区）仲裁员共276人，占 CIETAC仲裁员总数的近三分之一。 在为当事人提供更多外籍首席仲裁员人选 的同时，CIETAC也发现一些当事人对此类 特殊约定在仲裁程序中的特别之处预估不 足。而这往往导致这一特别约定无法实现或 不能达到预期效果。主要有：第一，语言问 题。当事人如未约定仲裁语言则其为中文， 而这会缩小其选择外籍首席仲裁员的范围， 增加选定困难。如果当事人的往来文件为中 文，则此类证据更会增加外籍首席仲裁员审 理案件的难度。第二，法律适用问题。如当
打造专业化的精品所之路
过
去12个月里，走专业化精品所的发展道路正 成为中国法律行业的主旋律之一。尽管金融 危机对大型综合性律所产生了某些不利影响，但 对于致力于发展成专业化的专家型律所来所却成 为难得的契机。全球金融危机后，这些律所正在 收获他们的“第一桶金”。 成为专业律所并不意味律所需要放弃在规模上 的发展，而是更要着重提高专业优势以及在特定 领域里的资源和市场地位。他们拥有综合性律所 不具备的特质：比如成本较低及为企业提供“量 身定制”的专业法律服务。而正是这些特质在过 去12个月中成功推动了他们业务的蓬勃发展。不 少业律所获得了众多以前曾长期聘用大型综合律 所的客户，从而使其业务量和收入增长了一倍、 两倍甚至是三倍。 2009年专长于高端诉讼业务的天同律师事务所 的营业额增加了一倍，而其总收入的90%来源于 高端企业诉讼领域。天同制定的专注于发展关键 业务领域和特定市场客户的战略成为其成功的关 键，该所牢牢吸引了一些长期客户，例如长虹、 中国四大银行及中化。合伙人丁乐表示：“我们 的客户告诉我们，过去由于没有一个成熟的法务 部门，他们对纠纷常常只能忍气吞声。随着时间 的推移，他们的法律团队也顺应中国法律环境的 改善而得到发展，现在他们了解通过诉讼解决问 题的必要性和好处。” 该律所也将其成功的部分因素归功于金融危机。 丁律师表示：“作为专业的诉讼律所，我们发现全 球金融危机为我们提供了大展身手的绝佳机会。 经济形势的变化导致冲突和纠纷量大大增加，许
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多公司均向我们寻求诉讼意见。”他表示，劳资纠 纷案件数量的增长尤为明显，而劳资纠纷通常又 与公司大规模裁员有关。该所抓住这一机遇，提 供最佳的法律服务，从而获得了不少潜在客户。 丁律师表示：“大型综合性律所需要管理大量执 业人员，虽然确实能包揽更多业务，但也更易发 生沟通和工作冲突，而专业律所采取直接沟通方 式，不容易产生问题。因此律师能就任何案件展 开有效合作，迅速解决问题。”
机会成本，付有所值
专业律所的从业人员有一个共同点：他们熟悉与 其执业领域有关的国内规章和政策的调整。这从 税务等特定专业领域中可见一斑。上海左券律师 事务所是国内为数不多的专业税务律所之一。律 所每年有80%的总收入来自该领域。 合伙人卢国阳表示：“税务是一个严格要求专业 意见和远见的专业领域。我们的律师与市场的最 新态势保持高度一致，并且在税务发展方面具有 卓越远见。我们可依据投资者的不同兴趣为他们 量身定制法律服务。” 阳光时代律师事务所是专业化精品所中的另一 个典范，该律所为能源项目的开发、投资、融 资、建设、运营和管理提供法律服务，特别是为 能源项目交易设计战略和法律结构，同时还涉足 煤炭、电力、天然气和石油市场。 阳光时代总收入的95%来自能源项目及其长期客 户（国家电力监管委员会、国家电网、中国国电集 团公司和中国电力投资集团公司）。和天同一样， 阳光时代在过去12个月中专注于其最核心的市场：
事人已在合同中明确约定适用中国法律， 则仲裁庭特别是首席仲裁员就应熟知中国 法律。而外籍仲裁员对此相比较中国籍仲 裁员并不占优。有时还会影响到当事人实 体权利的实现。第三，仲裁成本问题。外 籍仲裁员的审理费用通常按照小时或者争 议标的额的比例计取。相同的案件，外籍 仲裁员的审理费用要比中国籍仲裁员高。而 外籍首席仲裁员要比外籍边席仲裁员的费用 高。此外，在开庭审理的情况下，外籍仲裁 员还会产生差旅费用。 戴雯：CIETAC 案件经理 电话：+8610 82217752 电邮：daiwen@cietac.org www.cietac.org 地址：中国北京西城区桦皮 厂胡同2号国际商会大厦六层 邮编：100035 电话：+8610 82217788, 传真：+8610 82217766 / +8610 64643500
戴雯
新能源。该律所就核能、风能和太阳能发电站的开 发和建设，以及煤矿的并购提供法律意见。 阳光时代管理合伙人陈臻称：“ 我们试图就如 何处理和解决法律问题，向客户提供有附加值 的咨询及指导服务，而不是简单地向他们解释法 律规定。” 律师认为“迈向专业化”需要勇气，并立志只专注 于单一领域，而且能忍受长期的“成长之痛”。“迈 向专业化的制胜法宝是能忍痛割爱，即选择一个 单一业务而放弃其他业务。多数律所无法做到这 一点。”左券卢律师表示，“最初几年肯定会困难重 重，但只要有毅力和决心，就一定能渡过难关。” 尽管这些专业律所通常与其他律所保持良好的 合作关系，但他们仍面临来自中国大型综合性律 所的竞争压力。律所由于规模小而无法获得大型 项目，因此一些专业律所选择加盟大型综合所。 例如，近期专注于海事和航空法律的乾丰律师事 务所与大成合并；从事知识产权的广州大松律师 事务所与北京立方律师事务所合并；君益于2007 年与君合合并。 尽管一些专业律所不愿忍受“成长之痛”的煎熬， 但不少坚持到底的律所的成功还是得到了认可， 律师也表示那种前景极富诱惑力。阳光时代的陈 律师表示：“过去法律问题的性质较为简单，主 要是解决有关个人、债务和犯罪的事宜。但随着 中国经济的迅速发展，法律体系也急剧扩大。因 此，不少商业律所将自然而然地发展成为专业律 所。事实上，多数大型律所成立了专业团队，以 便解决相关问题。未来，我预计专业律所的数量 将会大幅增加。”
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NEWS | news >>
news in brief >> firms kept busy by high-profile hu trial In the recent highly-publicised High Court case, the four ex-employees of world mining giant Rio Tinto – Stern Hu, Wang Yong, Ge Mingqiang and Liu Caikui – have been served jail terms ranging from seven to 14 years for charges of bribery and stealing trade secrets. They were represented by Shi Keqiang of Shanghai Er Li Law firm and co-counsel Winston Jin of Fangben Law Office, as well as Wang Peihong and Zhai Jian of Zhai Jian Law Firm, and Tao Wuping of Shenda Partners.
shenzhen >>
2020 vision for Pearl River Delta drives SD & Partners growth
力拓案宣判胡士泰获刑十年
上海第一中级人民法院宣判，全球矿业巨头力拓公司四 名员工罪名成立，获刑七至十四年不等。法院判决书中 称，澳籍人士胡士泰及其三名中国籍同事王勇、葛民强 和刘才魁犯贿赂和窃取商业秘密罪，罪名成立。 上海尔立律师事务所的施克强和方本律师事务所的 金春卿担任胡士泰的辩护律师，胡士泰因贿赂罪获刑 七年，因窃取商业秘密罪获刑五年，因认罪态度较好， 共获刑十年。 王勇和葛民强的辩护律师分别是翟建律师事务所的张 培鸿和翟建，两人分别获刑十四年和八年。刘才魁的辩 护律师是申达律师事务所的陶武平，获刑七年。法院没 收所有违法的贿赂收入。 王勇、刘才魁和葛民强的律师确认，其委托人将提出 上诉，胡士泰决定不再上诉。
A
Zhong lun’s Wuhan office attracts international interest Earlier this year, Zhong Lun launched its Wuhan office, as the region emerges as another important market for legal services. Since its opening the office has been host to many of the firm’s international discussions, including a meeting with representatives of Frost Brown Todd, Cincinnati Ohio and Harvest Investment. Discussions revolved around Sino-US business pipelines and the evolvement of the legal service industry in China. As a result an exchange program between Frost-Brown Todd and Zhong Lun will take place for those firm’s lawyers, and a joint conference on facilitating Sino-US investments was agreed on. The new office was also the venue for Zhong Lun’s recent conference with Tindall Gask Bentley (TGB) where the firms discussed future cooperation on IPOS and listings of Hubei and Central-China-based companies on the ASX.
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s the pan-Pearl River Delta region rises to the fore in the global economy, many firms in the region are forming new strategies. One of the most notable is Shenzhen firm SD & Partners: in addition to appointing two new partners it has also revealed plans to set up a national legal group encompassing local firms in all of the country's important economic centres. The firm has already signed a memorandum of understanding (MOU) with five leading firms in Shanghai,
corporate business are Li Zhengmin and Li Jingchao. Li Zhengmin joined the firm from Shenzhen firm Sincere Partners, where he was a senior partner. He specialises in real estate matters and litigation, particularly administrative litigation and administrative reconsideration. Li Jingchao was promoted to partner two years after he joined SD from Guangdong Guoyang in 2008. He focuses on corporate matters, including restructuring, M&A and transactions
“Shenzen’s legal market is developing so fast that a firm has to constantly change for the better or it will vanish” yu junfu, executive partner, sd & partners Beijing, Chengdu and other cities, taking the first step towards its goal. “Shenzhen's legal market is developing so fast that a firm has to constantly change for the better or it will vanish,” said SD & Partner’s executive partner Yu Junfu. “Although the short-term outlook is still challenging for Shenzhen firms because of the GFC impact and the increasingly competitive market, we are very positive about the long-term prospects of the local legal industry.” The new partners hired by the firm to help win more real estate and
such as IPOs and securities offerings. Yu was appointed by the Shenzhen Lawyers Association to lead a study on the profession’s development planning up to 2020. The study predicts that Shenzhen will have over 30,000 lawyers by then, with client demand and growth expected to soar for IP, finance and securities, and practice areas related to shipping and logistic sectors. Shenzhen’s legal market is regarded as being in the top four in China, after Beijing, Shanghai and Guangzhou. At the end of February 2010, Shenzhen had 5,600 lawyers and 325 firms. ISSUE 7.4
NEWS | news >>
uk report Changes at Freshfields Freshfields Bruckhaus Deringer recently became the first UK firm to lift its associate salary freeze for the next financial year. The Magic Circle firm reversed its salary bands in February last year, dropping newly qualified (NQ) salaries from £66,000 to £59,000, but decided to lift the freeze following a partnership committee meeting this February. NQ pay will stay at £59,000 with a one-year PQE lawyer taking home £66,000 and May associates will now move through the salary bands as before, but will not make up the difference by skipping a band. Freshfields also recently announced that Bertrand Pellet – who has been based in Paris for the past seven years – will succeed corporate partner David Higgins as head of the firm’s Middle East and North Africa (MENA) corporate practice.
珠三角地区2020年市场 前景推动晟典加速发展
随
着泛珠三角地区在全球经济中日益发挥重要 作用，该地区诸多律所也在不断提升实力， 制定新的发展策略。深圳晟典是最具代表性的律 所之一，该所不仅于近期任命了两位新合伙人， 还正在筹建一家全国性的律所联盟。 晟典已于5家来自于北京，上海，成都等城市的 领先律所就成立一家全国性的紧密合作型律所联 盟，签订了合作谅解备忘录。该联盟将由10家创 始成员组成。执行合伙人余俊福表示：“深圳的法 律市场正高速发展，律所须不断改变经营方式， 占据更有利的发展空间，否则会被市场淘汰出 局。受金融危机冲击以及竞争日趋激烈的影响， 尽管深圳的律师事务所在短期内仍面临挑战，但 我们对法律服务行业的长期前景充满信心。” 晟典聘请黎拯民和李景超担任合伙人，以期在 房地产和公司事务领域赢得更多业务。加入晟 典前，黎拯民曾在星辰律师事务所担任高级合伙 人。他的业务专长涵盖房地产和诉讼领域，尤其 是行政诉讼和行政复议。李景超2008年离开国扬 律师事务所加入晟典，两年后晋升为合伙人。他 重点从事公司业务，包括重组、并购以及 IPO 和 证券发售等交易。 深圳律师协会委托余俊福负责展望2020年的深 圳律师职业发展规划。研究预计，深圳在2020 年之前将拥有超过30,000名律师，知识产权、金 融、证券以及航运和物流领域的相关客户需求将 大幅增长。 深圳是中国四大法律服务市场之一，规模紧随 北京、上海和广州之后。截至2010年2月，深圳 共有5,600位律师和325家律师事务所。
www.legalbusinessonline.com
Bonuses back for Addleshaw Goddard Associates and support staff at Addleshaw Goddard can again look forward to a bonus this year, after an effective freeze on non-partner bonuses last year. Associates and support staff currently receive bonuses on the basis of four criteria: financial targets, individual performance, productivity and “value” measures, inclusivity and the principle of “One Firm”. Last year no non-partner bonuses were paid because the profit trigger, set at 32% for 2008-09, was not reached. This year, the bonus has a profit trigger of a 26% margin, but if this is not met then Addleshaws has
pledged to still reward “exceptional performance”. The firm said the adjustment was to ‘recognise and reward individual contributions during a difficult time’. UK firms move to merit-based pay Recent reports suggest several UK firms are reviewing the way they reward their associates. Stephenson Harwood has become the latest firm to move away from the lockstep model for associate pay and take on a new merit-based system. The firm’s new system, dubbed the ‘Associate Career Development Framework’, has been in development for a year and will be active as of the next round of appraisals in May. The scheme means that pay will be more closely linked to performance. Eversheds recently announced that it would be overhauling its associate bonus structure to move towards a broader system that recognises team performance and client skills. Set to come into effect on 1 May in the UK offices to start with, the system will be a move away from the current model based purely on chargeable hours. Instead it will see fee-earners other than partners eligible to receive the bonus, based not only on chargeable hours but also individual performance and the financial performance of their own team within each practice group. SJ Berwin has also put associate development at the centre of its strategy for the next financial year, with the firm rubber-stamping plans to recognise work undertaken outside of billable hours.
ROUNDUP • Herbert Smith recently created the position of general counsel, with dispute resolution partner Martin Bakes stepping into the role. CFO John Mullins took over from Norman Green as COO at the end of March • Linklaters may soon find itself embroiled in litigation from creditors of Lehman Brothers after it emerged a report into the bank’s demise found that Lehman had misused an advice letter written by the firm to keep up to US$50bn (£33.24bn) of debt off its US balance sheet, before its collapse in September 2008 • Clifford Chance has unveiled its slimmed-down partnership council, following efforts by managing partner David Childs to streamline management. The new council is down to seven members from the previous 12, and most members will serve for three-year terms • Simmons & Simmons is set to make the MBA a permanent option within its graduate recruitment process. The firm already has 25 of its future trainees signed up onto the MBA program with BPP this September • Carl-Peter Feick is set to take over from Michael Lappe on 1 May as Linklaters new senior partner in Germany • German law firm Noerr is set to open up an office in London at the end of 2010. The office, which will act as a base for advising international clients and will cover M&A, banking, restructuring, media, insurance and international litigation work, is expected to launch in the last quarter and will be staffed with five lawyers
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NEWS | news >>
news in brief >> Zhonglun W&D FOSTERS talents As part of ZhongLun W&D’s encouragement to promising undegraduates, firm partner Xu Zhaohua and managing partner Chen Wen have recently attended the Tsinghua University Law School’s awards ceremony where undergraduates received scholarships in recognition of their capabilities. The Zhonglun W&D scholarships were awarded to law students Li Liuling, Xiang Dingru, Zhang Jinyan, Wang Yichao, Li Yinglu and Shan Dan.
中伦文德嘉奖杰 出法学学生
中伦文德律师事务所 积极鼓励优秀在校生 取得学业佳绩，律所 合伙人徐昭华和主管 合伙人陈文近期参加 清华大学奖助学金颁 奖典礼，为杰出在校 生颁发奖学金。 获中伦文德奖学金 的法学学生包括： 李璐玲、向丁如、张 锦燕、王一超、黎颖 露和单丹。
Norton Rose on Asia hiring spree Norton Rose is filling up its Beijing office, currently offering up to five banking and corporate positions. According to recently posted advertisements, the firm is looking to recruit three banking and two corporate associates in Beijing. Signs of the renewed recruitment market for banking & finance lawyers are also being reflected in Asia’s financial services sector. Banks like Citigroup, BoA Merrill Lynch and UBS are reportedly offering lucrative pay packets and bonuses to fill talent shortages following the crisis.
诺顿罗氏积极扩充亚洲团队
诺顿罗氏律师事务所正积极扩充北京分所团队规模，提 供五个银行和公司业务职位。该所近期公布的职位需求 显示，诺顿罗氏有意在北京招聘三位银行业务律师和两 位公司业务律师。 亚洲的金融服务行业亦呈现出招聘银行和金融律师的 趋势，花旗、美国银行－美林、瑞银等银行在金融危机 之后，开始重金纳贤，弥补人才缺口。诺顿罗氏今年初 进行的调查显示，64%的金融机构预计，在九月之前， 全球银行体系将重新恢复资金流动性。
ENERGY & RESOURCES >>
Natural resources: firms benefit from innovative M&A strategies
C
hina National Offshore Oil Corp ‘s latest cross-border foray is indicative not only of the country’s constant thirst for natural resources but also the sophisticated new strategies being applied by investors and their law firms to cross-border deals. CNOOC has recently joined hands with Argentina’s Bridas Energy Holdings by paying US$3.1bn for a 50% stake in one of its units to boost its production and reserves. CNOOC International (advised by Baker & McKenzie) and Bridas Energy Holdings (advised by Akin Gump) will each hold a 50% stake in Bridas Corp, which has exploration and production activities in Argentina, Bolivia and Chile, mostly through its 40% interest in Pan American Energy. Chairman Fu Chengyu said “This JV is aligned with our philosophy of seeking partnerships to expand our global footprint.” In a separate transaction, PetroChina submitted a joint US$3bn bid with Royal Dutch Shell for Brisbane-based Arrow Energy. Both deals are structured as an oil and gas production JV. PetroChina and Royal Dutch Shell’s bid for Arrow is the largest Chinese JV bid in Australia. Gilbert + Tobin represented Arrow Energy, Allens Arthur Robinson represented Royal Dutch Shell and Blake Dawson represented PetreChina. “JV bids create more work for legal advisors because there is a need, prior
“Deals such as the acquisition of dual-listed multinational corporations clearly show the capability of Chinese companues to execute world-class transactions” xiao yong, vinson & elkins as Shell was already holding a 30% share in some of Arrow’s project assets before the joint bid,” he added. PetroChina and Shell have worked together before in other cross-border deals and according to Shmith, the level of familiarity between the two companies aided the JV. The increasing sophistication of domestic companies’ overseas pursuits needs innovative legal advice. “In addition to the rise in deal numbers and value, corresponding deals completed in 2009 exhibit the growing sophistication of Chinese companies,” said Xiao Yong, a partner at Vinson & Elkins. “Deals such as the
自然资源：创新并购战略令律师事务所获益
中
国海洋石油总公司近期积极参与跨境交易 项目，不仅表明中国对自然资源的持续渴 求，还表明投资人及其律师事务所在参与跨境交 易时奉行更成熟的全新策略。 中海油近期与阿根廷 Bridas Energy Holdings 携手，斥资31亿美元收购其业务部门50%的股 权，巩固自己的生产能力和资源储备。中海油 （贝克•麦坚时提供顾问服务）与 Bridas Energy Holdings（Akin Gump提供顾问服务）将各自持有 Bridas Corp 50%股权，该合资公司在阿根廷、玻 利维亚和智利从事勘探和生产活动，主要借助该 公司在 Pan American Energy 持有的40%股权。 中海油董事长傅成玉表示：“中海油积极寻找合 作伙伴，努力开拓全球市场，该合资项目符合中 海油的经营理念。”
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to the official bid, to work out JV terms with the partner. We have had to work in tandem with AAR and the legal work needed is very much multi-lateral instead of what a straightforward acquisition requires,” said Justin Shmith, the partner who led the Blake Dawson team on the transaction. “This matter had some unusual aspects in negotiating documentation
此外，中石油还与荷兰皇家壳牌集团合作参与 30亿美元的竞标项目，收购布里斯班的 Arrow Energy。两宗交易均涉及油气生产合资项目。 中石油和荷兰皇家壳牌竞标 Arrow 是澳大利亚 规模最大的中国合资竞标。Gilbert + Tobin 担任 Arrow Energy 法律代表，安德慎担任荷兰皇家 壳牌的法律代表，博雷•道森•华隆担任中石油法 律代表。博雷•道森•华隆业务团队负责人 Justin Shmith 表示： “合资竞标为法律顾问带来更多工作，因为在 正式竞标之前，律所需要与合作伙伴共同制定 合资条款。我们必须与 AAR 配合工作，法律工 作并非简单直接的收购内容，而涉及多方面的工 作。此外，由于在参与竞标之前，壳牌已经持有 Arrow 部门项目资产30%的股份，在准备谈判文 ISSUE 7.4
NEWS | news >>
us report White & Case forced into lateral hires As departures at White & Case continue, the US firm has responded by making up five new partners. London-based Jeremy Duffy has been named a partner in the global banking practice. The firm also recently boosted the London financial restructuring & insolvency team with the hire of senior Skadden lawyer Christian Pilkington and relocated New York-based partner Jake Mincemoyer to London to assist with its local finance practice. The move to bolster its global network follows a string of defections across the firm’s international offices since the beginning of the year, the most recent being the chair of the firm’s global IT practice group, Steve Betensky, who has since joined Latham & Watkins.
acquisition of dual-listed multinational corporations – for example Sinopec’s C$10.3bn purchase of Addax Petroleum – clearly show the capability of Chinese companies to execute world-class transactions.” Firms are keen to play a role in leading cross-border transactions, and according to many the 2010 deal pipeline is promising. “China was the world’s largest M&A investor abroad in energy and natural resources in 2009. Given the ongoing increases in domestic Chinese demand, we expect that much of the activity this year will remain in this sector,” he said.
件方面我们还须处理一些特殊工作。 中石油与壳牌此前曾共同参与其他跨境交易， 据Shmith 介绍，两家公司在一定程度上存在相 似性，有助于完成合资交易。 在国内公司积极开拓海外市场的趋势下，法律 顾问服务确有必要紧跟形势发展，推陈出新。文 森•艾尔斯合伙人肖勇表示：“2009年完成的交易 不仅数量和价值大幅提升，还充分表明中国企业 日趋成熟。例如，中石化斥资103亿加元收购双 重上市的跨国公司 Addax Petroleum，充分表明 中国企业的实力提升，有能力完成世界级交易。” 2010年，诸多重大交易前景光明，律师事务 所希望在重大跨境交易中发挥重要作用。肖勇表 示：“2009年，在能源和自然资源领域，中国是 全球最大的海外并购投资人。 www.legalbusinessonline.com
Splitting headache for Hogan & Hartson in Europe The bulk of Hogan & Hartson’s Berlin office have set out to launch independent firm Raue in response to the firm’s merger with Lovells. The 18 Hogan & Hartson Raue partners identified potential conflicts as the driver behind the split and will create a new firm when the merger creates Hogan Lovells on 1 May. K&L Gates also recently took over Hogan & Hartson’s entire Warsaw office and is now set to launch in Poland with the newly acquired base of 38 lawyers – comprising six partners, five counsel and 27 associates. The move marks the
third international launch for K&L Gates this year, following January openings in both Tokyo and Moscow. US firms fight salary battle in the UK The Magic Circle may be in danger of losing the UK’s top students to US firms after a survey highlighted the massive earning potential for junior lawyers in US firms in London. It identified US firm Bingham as a chart-topper, paying its newly qualified lawyers £100,000. Some US firms have recently reduced salaries (including Weil Gotshal & Manges), but Latham & Watkins and Debevoise & Plimpton now pay their UK NQs £96,000 and £94,250 respectively. These top-of-the-market offers are in stark contrast to Magic Circle NQ salaries, which range from £59,000-£61,000. Sharp to take charge at Dewey & LeBoeuf Dewey & LeBoeuf recently appointed litigation and restructuring specialist Peter Sharp as its first London managing partner since the 2007 merger of Dewey Ballantine and LeBoeuf Lamb Greene & MacRae. Sharp was formerly the London managing partner of LeBoeuf and will now also chair Dewey’s London policy committee – a ninepartner group the US firm launched last year to advise on strategy and oversee the UK office’s development as an international hub.
ROUNDUP • Chadbourne & Parke recently poached a team of four disputes lawyers from Howrey’s London office including former international arbitration group head Melanie Willems • Hogan & Hartson and Lovells have established an 18 member committee to oversee the integration of the two firms. The implementation planning committee (IC) is co-chaired by the managing partner of Hogan’s Houston office, Thad Dameris, and the head of Lovells’ commercial and retail banking team, Emily Reed • A possibly self-serving recent research report commissioned by Eversheds has revealed that over half of all clients think that the Magic Circle designation is redundant, with 94% arguing that the profession should reclassify its peer groups • Howrey is set to cut up to 10% of its partnership following a review of its business carried out towards the end of last year. The review identified a 35% drop in profits per equity partner (PEP) during 2009 • DLA Piper is set to launch an office in Brazil, pending approval from the Brazilian authorities and following an alliance with local firm Campos Mello Pontes Vinci & Schiller. Campos Mello will remain an independent firm, but will work closely with DLA Piper, advising international companies on business in Brazil, as well as domestic companies looking to expand or do business in the country
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NEWS | news >>
industry >>
Update >>
Zhonglun W&D uses alliance
如何在马来西亚 设立或发展业务 有限公司，代表办事处和区域办事处或分支？
本
地或外国投资者可以透过三种不同的法律结构 – 有限公 司, 代表或区域办事处和分局, 在马来西亚(大马)设立或 发展业务。
有限公司
有意在大马设立或发展业务的跨国公司通常会设立一家私营有限公 司。此公司拥有分开的法律个体, 并且须有至少两个股东; 管理层方 面则须有至少两名董事。股东的责任仅限于自己的股份总面值, 很 少直接参与公司事务。
代表办事处和区域办事处
代表办事处和区域办事处的结构有别于私营有限公司因为它不是 独立的法律个体, 也不能赚取收入, 亦受到马来西亚工业发展局的 严格监管。
准许的活动: 一 二 三 四 五
协调或规划企业经营活动。 收集和分析资料, 或研究在大马投资和商业机会。 鉴定原材料。 产品开发。 成为在该地区总行的子公司, 分公司和代理商的协调中心。
禁止的活动： 一 二 三 四 五
从事任何交易（包括进出口）。 租赁仓储设施。 代表公司签订商业合同或提供有偿服务。 参与其在大马的附属公司, 联营公司或分行日常管理。 进行任何商业交易或赚取源于其业务的收入。
I
n the hope of winning more mandates on cross-border transactions, Zhonglun W&D has recently joined Interlaw, an international association (established in 1982) of independent law firms from 60 countries. Becoming the first Chinese member firm of Interlaw, the firm hopes to strengthen its capacity in assisting Chinese companies to globalise, especially in energy, mining and capital markets. “Via the membership of Interlaw, we hope to rapidly grow our international contacts and business,” explained Lin Wei, the Shanghai-based partner at Zhonglun W&D. Prior to joining the association, the firm had already established close working relationships with Interlaw members like UGGC in France and Aird & Berlis in Germany. “We frequently work with many Interlaw firms for cross-border transactions and this extensive cooperation also fuels our decision to join the association,” said Lin “We would definitely continue to work with these firms because we need their assistance for our clients’ international ambitions.”
“Via the membership of Interlaw, we hope to rapidly grow our international contacts and business” Lin Wei, partner, zhonglun w&d
分支
除了法律责任, 分支结构和私营有限公司很相似。两者都可在大马赚 取收入, 并须遵守税收法规。 私营有限公司的法律责任来自商业行为。当跨国公司所建立的 分公司违反与其他大马公司签订的合同, 大马公司可以直接起诉该 跨国公司。
资本要求
私营有限公司最低缴足资本是马币二令吉。这表示两个初始股东个 持有可转让给任何人或公司的普通股。 代表处和区域办事处以及分支机构不受任何最低资本要求。
注册
申请成立公司可通过在马来西亚公司委员会填写一份表格, 并提供 三个公司名称。注册费是根据该公司的法定资本。委员会需要一星 期来验证公司申请文件。 分支机构在开始运作前须先与马来西亚公司委员会登记, 批准只 需一天。 设立代表处和区域办事处应提交于马来西亚工业发展局的总干 事。细节请查询马来西亚工业发展局的网站(www.mida.gov.my)。 批准过程一般不超过四周。
结论
如今开放的政策促使投资者选择在马来西亚投资。除了上述要求, 一些有关的商业活动也需要特别执照或注册。 作者：珠海妲（马来西亚阿兹米律师所， 律师） 联系：马来西亚阿兹米律师所，中文团队 姓名: 陈寿阳（马来西亚阿兹米律师所， 伙伴律师） E-mail: chinadesk@azmilaw.com 电话: 00 6 03 2118 5009 | 传真: 00 6 03 2118 5113 地址: Azmi & Associates, 14th Floor, Menara Keck Seng, 203, Jalan Bukit Bintang, 55100 Kuala Lumpur, MALAYSIA 阿兹米律师事务所是一家设在马来西亚的行内领先企业法律师事务 所。本所的国际联系处之一，中文律师团队，熟悉于中华文化和其 企业的经营方式，并涉及中国内地和其它大中华区域的跨边界交易。 本所的中文律师团队除了能使用英语外，还善于使用普通话，广东话 和福建（闽南）话沟通。阿兹米律师事务所更与中银律师事务所（中 国最大的企业法律师事务所之一）建立合作关系。
20
珠海妲
beijing >>
Jade & Fountain adds two partners, prepares for Beijing launch
A
s part of its plans to strengthen its M&A and PE practices and open a Beijing office, Jade & Fountain has hired two additional partners, Lawrence Guo and William Lu, from Broad & Bright and Allen & Overy respectively. The firm has already set up a preliminary operation in Beijing and Guo has been appointed as resident partner-incharge for the planned July launch of the office. Guo specialises in M&A, FDI, PE/VC, securities and corporate work, and will play a key role in the firm’s expansion into Beijing. He said part of his reason for joining Jade & Fountain was the firm’s strategy to serve as an incubator for talented young lawyers to grow into independent and successful practitioners. Lu, on the other hand, previously served as a senior lawyer at Allen & Overy. He has more than 10 years experience representing clients for corporate, commercial and M&A transactions and PE &VC investments, with a focus on TMT business. “Aside from traditional FDI and cross-border work, a domestic firm offers the opportunity for developing a potentially fast-growing China client base. Often, a lot of Chinese clients following ‘going abroad’ strategies will now first approach a domestic firm. This will also offer greater opportunities for domestic firms,” he said. ISSUE 7.4
NEWS | news >>
Legal Traveller >>
for outbound work Given the country’s relentless interest in overseas acquisitions and investments, boosting international capacity has been the priority of many PRC firms over the past 12 months. Jade & Fountain and GoldenGate both became members of TAGlaw, Dacheng joined World Services Group and Gaopeng pledged allegiance to ALFA International. The admittance
process, however, differs from association to association. Interlaw required partners to sit through two interviews with its representatives and then conduct a presentation for Interlaw directors. Votes are then cast to officially select new members. Yet despite the onerous application process, Lin believes that more PRC firms will endeavour to join.
中伦文德加入国际联盟拓展海外市场
为
赢得更多跨境业务，中伦文德近期加入 INTERLAW，该国际律师联盟（建立于 1982年）由60多个国家的独立律师事务所组成。 中伦文德是 INTERLAW 首个中国成员，律所希 望借此巩固服务实力，帮助中国公司开拓全球市 场，尤其是能源、矿产和资本市场。中伦文德上 海分所合伙人林威表示：“借助INTERLAW 成员身 份，我们希望能快速开辟海外合作关系及业务。” 加入该联盟之前，中伦文德已经与INTERLAW 成员建立密切合作关系，例如法国的UGGC和德 国的Aird & Berlis。林威表示：“我们经常与诸多 INTERLAW成员律所合作，参与跨境交易，此类 深入合作促使我们决定加入该联盟。我们将继续
与成员律所合作，因为中伦文德需要得到境外律 所的协助，从而帮助客户开辟海外市场。” 鉴于中国企业热衷于海外收购和投资，在过去 12个月内，提升国际业务实力成为诸多中国律 师事务所的首要工作。九州丰泽和金阙均成为 TAGlaw会员，大成加入World Services Group， 高朋则加入ALFA International。 不过，不同组织的审批流程各不相同。 INTERLAW要求中伦文德合伙人接受该联盟代表的 两次面谈，然后向 INTERLAW董事介绍业务情况。 然后通过投票正式决定是否接纳新成员。 尽管申请流程有些繁琐，但林威认为，定会有 更多中国律师事务所努力加入INTERLAW。
Daniel Harris partner, Harris & Moure US
Favourite city to visit:
Ho Chi Minh, because it reminds me of how Shanghai and Beijing were 10 years ago. It is one part ‘sleepy,’ the other part ‘booming’ and I love that combination. Plus I love the food, which is an incredible combination of French and Vietnamese and Chinese and Thai. Throw in great art at reasonable prices and you have a near-perfect destination.
Most memorable travel experience:
Goroka, Papua New Guinea – I went there to recover two helicopters on behalf of a German client. It took me so long to get there that I don’t even know how long I was actually in a plane. Goroka has to be one of the strangest places on earth: thousands of people greeted our airplane simply because they had nothing else to do and some of them had big bones through their noses! Also, my ‘top of the line’ hotel room had a tiny black & white TV and it received only two stations: one from Korea and one from Australia.
Hardest aspect of a trip:
九州丰泽新增两位合伙人，筹备北京分所
九
州丰泽计划巩固并购和私募股权业务实力， 并在北京成立分所，为此，该律所新聘请 两位合伙人，分别是来自世泽律师事务所的郭林 军和安理律师事务所的卢少杰。 郭林军的业务专长涵盖并购、外商直接投资、 私募股权∕风险投资、证券及公司事务，将在北 京分所筹办过程中发挥重要作用。郭林军曾在 美迈斯和富而德工作十年，随后在世泽担任两 年合伙人。 卢少杰曾在安理担任高级律师。他拥有十余年 工作经验，参与公司事务、商业和并购交易以及 私募股权与风险资本投资，重点参与通信、科技 和媒体领域的业务。 郭林军表示，加入九州丰泽的重要原因是，该
www.legalbusinessonline.com
律所注重培养青年律师人才，帮助年轻人发展成 为独立且成功的执业律师。他表示：“我非常愿 意充分发挥自身作用，帮助律所扩大团队规模， 赢得更多业务，七月即将成立的北京分所尤其令 我兴奋。” 九州丰泽已经在北京开展初步运作，郭林军现 担任主管合伙人。 过去六个月内，大量跨国律所的人才流入中国 本土律所。近期卢少杰加盟九州丰泽即是例证。 卢少杰表示：“除传统的外商直接投资和跨境工 作外，本土律所还提供丰富机会，发展快速增长 的中国客户基础。越来越多有意走出国门的中国 客户会首先选择本土律所。这将为本土律所带来 更多业务机会。”
Seeing everyone I want to see. When I go somewhere, I typically have a long list of people I have promised to visit. But invariably, traffic, work, scheduling and meetings take longer than expected,and this means that I leave the place having to promise to see at least a few people the next time.
Favourite foreign food:
There is a restaurant in Qingdao, China, with Sichuan food to die for. It has a shrimp dish that is so spicy and so good that about halfway through it, I have to decide whether the pleasure is going to be worth the pain – but I always opt to continue.
Essential item to pack: An iPhone, for a million reasons!
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NEWS | news >>
Update >>
beijing >>
International Tax Highlights from the Hong Kong Budget 2010/11 (Part 2) The Honourable Mr John Tsang, Financial Secretary announced the Budget measures on 24th February 2010.
A summary of the current Hong Kong tax rates is set out below:
Profits Tax
The tax rates in 2010/11 will remain unchanged as follows: 2008/09, 2009/10 & 2010/11 Persons other than corporations Corporations
15.0% 16.5%
Property Tax
The Property Tax rate will remain at 15%. It is charged on the owner of land or property situated in Hong Kong at the standard rate on the rent receivable less 20% and is payable in addition to rates. Corporations carrying on business in Hong Kong can elect to be exempt from Property Tax and be subject to Profits Tax instead.
Salaries Tax
Salaries Tax rates and charges Salaries Tax is charged at the lower of: • Net assessable income less charitable donations at the standard rate or • Net assessable income less charitable donations and personal allowances, charged at progressive rates as follows: 2008/09, 2009/10 & 2010/11 Standard Rate Progressive Rates First HK$40,000 Next HK$40,000 Next HK$40,000 Balance
15% 2.0% 7.0% 12.0% 17.0%
Australian firms sway Chinese
A deduction for fees for training courses at approved institutions remains unchanged at HK$60,000 in 2009/10. The deduction for home mortgage interest payments of up to HK$100,000 per year for ten years remains unchanged.
Personal allowances
Applicable to progressive rate taxpayers: HK$ 108,000 216,000 108,000 100,000 50,000
By Debbie Annells, managing director, AzureTax Ltd, Chartered Tax Advisers Suite 1010, 10/F Lippo Centre, Tower Two, 89 Queensway, Hong Kong www.azuretax.com, a member of AzureTax Group (Tel) +852 2123 9339 (direct line), (Main Line) +852 2123 9370, (Fax) +852 2122 9209 Registered with the Chartered Institute of Taxation for purposes of anti money laundering legislation.
22
eeking to provide more comprehensive legal services to a broader base of clientele, Shanghai firm Haworth & Lexon has recently launched an office in Beijing. The new office will focus on capital markets, PE investments, overseas investment and listing and M&A work, as well as assisting existing clients to communicate with various government ministries. Shanghai partner Zhong Peng will be relocated to head the new office, which will be staffed with four lawyers including partner Chen Rong. “As firms seek growth, it becomes necessary to form a national network to provide better service for clients. Beijing is definitely one of the locations firms have to take. More and more Shanghai firms will seek to establish themselves in Beijing because many clients are growing their national businesses and would therefore encounter increasing regulatory problems,” said Bailey Xu, partner at Haworth & Lexon. The difference in client profiles between firms based in Shanghai and those based in Beijing reflects the fact that Beijing is home to SOEs while Shanghai plays host to many MNCs, and this also influences expansion plans. “Beijing is where there are most SOEs and these companies are very active in investments, so there are lots of business opportunities,” said Xu. “In Shanghai, most of our clients are MNCs. Our Beijing office will target domestic companies, especially SOEs. The new branch would also explore other industry >>
Deductible items
2008/09, 2009/10 & 2010/11 Personal allowance: Single Married Single parent allowance Child allowances: 1st to 9th child Year of birth Other years
Beijing a must-have, says S
Debbie Annells
I
t has been a little over a month since ten ambitious Chinese lawyers arrived Down Under to begin their four-month Australia-China Legal Profession Development Program. The lawyers, including partners and Chinese officials from firms like Beijing Guantao and Shanghai Allbright, have been placed in Australian top-tier firms like Mallesons, Clayton Utz, Minter Ellison and Blake Dawson. Zhang Dan, a lawyer in a Jiangsu firm, is placed in Minter Ellison’s Melbourne PE and capital markets team. “In China, I take on work in all practice areas including company law, labour law and commercial disputes according to client requests – there are no specialisations. But in Minter Ellison, my area of work is very specialised and I enjoy it greatly,” she added. And the list of temptations continues. “Solicitors in Australia are paid a wage whereas most Chinese lawyers earn their individual income with their own book of business,” said Zhang. AllBright partner Jennifer Wang has been placed in Blake Dawson’s Melbourne office where she works under partner Justin Schmith. The firm has since benefited from Wang’s experience and expertise in her China practice. “I conducted a presentation for the corporate team because they were very interested in the Chinese legal system. The presentation encompassed information about going public on both domestic and international boards in China,” said Wang. ISSUE 7.4
NEWS | news >>
Haworth & Lexon partner business opportunities in foreign invested funds and be a service base to us to provide services for foreign companies doing business in northern China,” he added. Haworth & Lexon is staffed by 67 lawyers working across offices in Shanghai, Beijing, Chongqing and Sydney.
和华利盛合伙人认为，北京市场不容错失
上
海和华利盛律师事务所致力于为更多客户提供完善的法律服务，该律 所近期成立北京分所。新分所的业务重点包括资本市场、私募股权投 资、海外投资与上市以及并购业务。北京分所还致力于协助现有客户与各 类政府部门沟通。 上海合伙人锺鹏将调至新分所担任负责人，北京分所将 有四位律师，包括合伙人陈荣。 目前，越来越多的上海律所有意成立北京分所，九州丰泽建立北京分所的 申请近期获批后，已成立筹备办事处。和华利盛合伙人徐劲科表示：“随着律 所不断扩大规模，有必要形成全国服务网络，为客户提供更好的服务。北京 无疑是不容错失的重要市场。越来越多的上海律所积极进入北京市场，原因 在于，诸多客户在全国范围内开拓业务，会遇到更多监管问题。” 对于上海和北京的律所而言，其客户类型亦存在差异，北京以国有企业为 主，上海则以跨国公司为主，这种情况亦会影响律所的业务拓展计划。徐劲 科认为：“北京市场的客户主要是国有企业，此类客户积极参与投资，带来大 量业务机会。上海客户主要是跨国公司，即上海、浙江和江苏的外国公司或 外商投资公司。和华利盛北京分所将重点服务国内公司，尤其是国有企业。 新分所还会开拓外商投资领域的业务机会，成为律所的服务平台，为进入中 国北方市场的外国公司提供服务。” 和华利盛现有67位律师，业务覆盖上海、北京、重庆和悉尼。
lawyers during placement
Update >>
Singapore
2
观察名单两年满 除牌退市今朝令度
008年3月，新交所(SGX-ST)推出观察名单(watch-list)，对 于在新交所主板挂牌上市的公司，如果最近连续三个财务 年度均亏损，且最近120个市场交易日的平均市值低于新币 4000万元，则该公司将被列入观察名单。 若列入观察名单的上市公司扭亏为盈，且最近120个市场交易日 的平均市值达到新币4000万元或以上，或公司符合新交所主板上市 条件，则该公司可以向新交所申请从观察名单中移走。 为增强市场透明度，提醒投资者可能面临的投资风险，新交所要 求被列入观察名单的公司须每季度提供关于财务状况及发展情况的 更新报告，以供公众及投资者及时了解其最新发展。 时至今日，列入观察名单的公司已满两年，连续五年持续亏损， 且市值少于新币1000万元，新交所认为不断消耗的资源并不利于 股东，这些公司应被除牌，将剩余资金归还于股东。2010年3月 30日，新交所宣布下列五家公司将被摘牌：通融磁化（General Magnetics）、泉顺发（Chuan Soon Huat Industrial Group）、亚 细亚集团（ASA Group ）、发得科技（Fastech Synergy）及Ionics EMS。另有三家公司因已扭亏为盈，或是最近120个市场交易日的 平均市值达到新币4000万元以上，因此获取额外12个月的时间，让 其改善公司的财务状况，到明年3月份再行评估。 上述五家公司中，Ionics EMS已于2010年3月2日发布公告，宣 布公司将自愿从新交所主板退市，并提供现金退市要约的具体详 情，目前该公司根据新交所上市手册的相关规定，已聘请律师、独 立财务顾问等专业团队着手退市具体工作。鉴于公司已向股东提出 现金退市要约，新交所允许其股票继续交易，直至现金退市完成。 通融磁化与泉顺发已于2010年4月1日被除 牌。 对亚细亚集团与发得科技，新交所同意给予 三个月的时间供其考虑退市要约，并要求每月 公告其进展报告，若公司无法提供退市要约或 三个月届满，则该公司将被除牌。该两公司的 股票已于2010年4月1日停止交易。
吳艷娟 企業事務部法律顧問 Ph: (65) 6322-2232 Fax: (65) 6534-0833 E-mail: wuyanjuan@loopartners.com.sg
吳艷娟
凌隽仪 企業事務部法律顧問 Ph: (65) 6322-2231 Fax: (65) 6534-0833 E-mail: chrisling@loopartners.com.sg
Wang has also been given legal documents to read for her to familiarise herself with the Australian legal system and assist in any future M&A deals involving Chinese SOEs. But the different legal structures have produced some challenges. “Australian firms place great importance on case precedents but in China we never needed to conduct such research. This takes some getting used to,” said Wang. The program, which seeks to foster an increased level of legal cooperation and promote a deeper cross-cultural understanding of the legal systems, has been described by participants as ‘a very enriching experience’. www.legalbusinessonline.com
俊昭法律事務所 88 Amoy Street, Level Three, Singapore 069907
凌隽仪
23
NEWS | news >>
Winston & Strawn
Orrick
►► Promotions Name
Firm
Role
Practice areas
Location
William Lu
Jade & Fountain
Partner
Corporate, M&A
Shanghai
Richard Grams
Troutman Sanders
Partner
FDI, M&A
Shanghai
Zhou Hemin
HaoLiWen
Partner
Customs & tariffs
Shanghai
Clifford Borg-Marks
Lovells
Of counsel
IP
Beijing
Geoffrey Lin
Lovells
Partner
IP
Shanghai
James Fong
Lovells
Partner
Corporate
Hong Kong
Kelly Naphtali
Lovells
Partner
BRI
Hong Kong
Deanna Wong
Lovells
Partner
IP
Hong Kong
Christopher Dobby
Lovells
Partner
Litigation
Hong Kong
Orrick lawyers defect to Winston & Strawn Hong Kong Four litigation lawyers from Orrick’s Hong Kong office have moved to Winston & Strawn, beefing up the latter’s commercial litigation practice. Partner Adrian Yip – who formed part of the 2005 launch team for Orrick in Hong Kong – has taken fellow litigation associates Philip Kwok, Cliff Mok and Genevieve Ku along with him to Winston & Strawn’s Hong Kong office. Winston & Strawn launched in Hong Kong as recently as 2008, through an association with local firm Luk & Co.
奥睿律师转投温斯顿香港办公室
奥睿律师事务所香港办事处四位诉讼律师转投温斯顿国际律师事务所，扩充后者 商业诉讼业务实力。 合伙人Adrian Yip曾是2005年奥睿香港业务筹办团队成员，带领律师Philip Kwok、Cliff Mok和Genevieve Ku共同转投温斯顿香港办事处。 2008年，温斯顿与本地事务所 Luk & Co 建立业务联合，成立香港办事处。
►► Lateral hires Name
Leaving
Going to
Practice areas
Location
Lawrence Guo
Broad & Bright
Jade & Fountain
M&A, FDI, securities, corporate
Beijing
Serge Fafalen
SG Fafalen & Co
King & Wood
FDI
Beijing
Li Zhengmin
Shenzhen Sincere Partners
SD & Partners
Real estate, corporate
Shenzhen
Alex Lloyd
Clifford Chance
Sidley Austin
Corporate finance, capital markets
Hong Kong
Jun He
Anti-dumping, WTO
Beijing
Winston & Strawn
Litigation and arbitration
Hong Kong
Zhou Yong Adrian Yip
JunZeJun Orrick
SG Fafalen & Co
King & Wood
King & Wood on a Swiss roll A year after the first announcement, a team from SG Fafalen & Co Hong Kong (a Swiss and international practice) led by founder and managing partner Serge Fafalen has finally completed the transition process and officially become part of King & Wood’s Hong Kong office. Among all members moved over to King & Wood, Fafalen is the only partner appointment. He is a practising Swiss lawyer and Hong Kong and England & Wales solicitor, and becomes the first Swiss law partner in a PRC law firm. The move was made possible by the full merger between King & Wood and Hong Kong firm Arculli Fong & Ng last June. All activities, client relations and current staff of SG Fafalen & Co Hong Kong have been transferred to King & Wood in Hong Kong, effective 1 April 2010. SG Fafalen Geneva (Switzerland) will remain an independent Swiss legal practice, but it will no longer offer its services to the public.
瑞士合伙人加入金杜香港
在创始人兼主管合伙人范富龙的带领下，香港法隆律师事务所（瑞士及国际业务）工 作团队于近日完成过渡工作，正式加入金杜香港分所。 在所有加入金杜的团队成员中，只有范富龙为合伙人任命。他是瑞士执业律师，还 是香港、英格兰及威尔士律师。他成为中国律师事务所首个瑞士法律业务合伙人， 去年六月，金杜与香港夏佳理方和吴正律师事务所合并为他加盟金杜创造可能。 香港法隆律师事务所的所有业务、客户关系及员工均并入金杜香港分所，自2010 年4月1日起生效。日内瓦法隆律师事务所（瑞士）仍作为独立的法律服务机构，但 不再向公众提供服务。
24
Clifford Chance
Sidley Austin
New corporate finance partner for Sidley Austin Hong Kong Sidley Austin has announced that Alex Lloyd will join its Hong Kong office as a partner in the US corporate finance practice, effective 1 May, 2010. Lloyd’s practice focuses on debt and equity capital markets, including high-yield debt offerings and IPOs. Lloyd received his JD cum laude from Georgetown University and his BA with honors from Dartmouth. He has practiced law in Hong Kong for five years, after previously practicing in Alex Lloyd London and Washington DC.
盛德新任香港公司融资业务合伙人
盛德国际律师事务所宣布，Alex Lloyd 将加入香港办事处，担任美国公司融资业 务合伙人，自2010年5月1日起生效。 Lloyd 的工作侧重债务和股权资本市场，包括高收益债券发售及 IPO。 Lloyd在乔治城大学以优异成绩荣获法学博士，在达特茅斯学院荣获荣誉文科学 士。他在香港有五年法律工作经验，此前一直在伦敦和华盛顿特区工作。
Jun He
JunZeJun
Jun He gains counsel in Beijing Jun He has recently expanded its anti-dumping practice with the addition of counsel Zhou Yong to its Beijing office. Zhou previously served as lead lawyer in JunZeJun’s international trade and WTO practice. He specialises in the areas of anti-dumping and WTO law and has represented clients in over 90 trade remedy cases involving foreign elements.
Zhou Yong
君合北京总部新增顾问律师
君合近期不断扩大反倾销业务团队，北京总部近期新增顾问律师周勇。周勇曾在 君泽君律师事务所主管国际贸易和 WTO 业务。 他的专业领域包括反倾销和WTO 法律，曾作为客户的法律代表参与90多宗涉 外贸易赔偿案件。 Troutman Sanders
Troutman Sanders targets M&A The boisterous M&A action in China has since the past 12 months has tempted many international firms into refocusing their practices. ISSUE 7.4
NEWS | news >>
Over 2009, many firms like Vinson & Elkins (which appointed M&A partner Jay Kolb), Orrick (which appointed M&A partner Wu Niping) and Cadwalader, Wickersham & Taft (which appointed M&A partner Zhang Jiannan) have relocated resources and made new appointments. Troutman Sanders has just jumped on the bandwagon by appointing Richard Grams as partner to boost its Shanghai M&A group. Prior to joining the firm, Grams was head of Stephenson Harwood’s China practice, where he was China co-counsel. Grams has also practised with several international and Hong Kong law firms in Hong Kong and Beijing and he previously worked in-house with Mobil. He handles broad-based FDI, cross-border M&A, PE and commercial matters in Greater China. Grams has experience advising PE funds who are targeting companies in the alternative energy, media, financial services, consumer and industrial sectors in China and Hong Kong. The addition of Grams boosts Troutman Sanders’ presence in China to 30 attorneys. The firm opened its Hong Kong office in 1997 and expanded into Shanghai in 2007.
长盛积极开拓并购市场
过去12个月，中国的并购业务发展如火如荼，令多家跨国律师事务所考虑重新调 整业务重点。 2009年，文森•艾尔斯（任命 Jay Kolb ）、奥睿（任命 Wu Niping ）及凯威莱 德（任命 Zhang Jiannan）等事务所均重新配置资源，任命并购业务负责人，积 极把握市场机遇。 最近，长盛律师事务所任命 Richard Grams 担任合伙人，巩固上海并购业务 团队的实力。 加入长盛之前，Grams 曾主管罗夏信律师事务所的中国业务，担任中国业务联 合顾问律师。Grams在香港和北京的多家跨国和香港本地律师事务所有工作经 历，还曾担任美孚的内部律师。 Grams 熟悉大中华地区的多领域外商直接投资、跨境并购、私募股权及商业 事务。他曾为私募股权基金提供顾问服务，目标公司涉及中国和香港地区的替代 能源、媒体、金融服务、消费品及工业领域。 Grams 加入后，长盛目前在中国市场已拥有30位律师。长盛于1997年成立香港 办事处，2007年将业务拓展至上海。
HaoLiWen
HaoLiWen adds custom law expertise to partnership Shanghai’s endeavours to become a leading international shipping centre has driven the city’s law firms to build up practices and expertise that are relevant to the shipping and logistics industries. One of Shanghai’s rising firms, HaoLiWen, has recently done this by promoting a customs law specialist to partner. Zhou Hemin, with 11 years of legal practice experience, has become a partner and co-heads the firm’s customs & tariffs practice group with senior partner Zhao Deming. Zhou has been practising at the firm for five years as a senior consultant Parry Zhou specialising in customs law, and he also serves as an associate professor at the Shanghai Customs College. The HaoLiWen customs & tariffs team currently consists of seven lawyers. The firm was established in 2003 in Shanghai and has now established two offices overseas – Chicago and Dublin.
昊理文提升海关法专家为合伙人
上海正积极发展成为国际领先的航运中心，本地律师事务所亦积极开拓与航运和 物流相关的业务，补充专业人才。上海昊理文事务所近期将海关法专家晋升为合伙 人，迎合业务发展的需求。 周和敏拥有11年法律服务经验，近期升任合伙人，与高级合伙人赵德铭共同主 管海关和关税业务部。周和敏在昊理文拥有五年工作经验，担任海关法高级顾问 律师，还是上海海关学院副教授。 www.legalbusinessonline.com
Beijing Time Management for PRC Anti-Monopoly Filings
U
nder the PRC’s Anti-Monopoly Law framework, a concentration of undertakings exceeding certain thresholds would have to be filed to the Anti-Monopoly Bureau (“AMB”) of MOFCOM for approval before the measures can be implemented. As a consequence many M&A transactions reaching the thresholds would have to be reported to AMB, which means parties to the transaction need to make extra time in the deal structure for this procedure. After a report is officially filed with AMB it will first be passed to the General Office for a 30-day preliminary review. The 30-day clock starts ticking when an initiation notice is issued. If AMB decides to conduct a further review, it shall normally be completed within 90 days, and in special circumstances after AMB has notified the parties in writing, an extension of 60 days can be imposed. Regardless the pre-filing preparation period, the time period from official initiation to conclusion for a filing could vary from 30 days to 180 days. Parties
Date of filing
Date of initiation
Difference Date of between public filing and notice initiation (days)
Length between initiation and notice (days)
Inbev and ABC
2008.9.10
2008.10.27
47
2008.10.27
22
Coca Cola and Huiyuan
2008.9.18
2008.11.20
63
2008.11.20
118
Mitsubishi Rayon and Lucite
2008.12.22
2009.01.20
29
2009.01.20
94
GM and Delphi
2009.08.18
2009.08.31
13
2009.08.31 28
Pfizer and Wyeth
2009.06.09 2009.06.15
6
2009.06.15
Panasonic and Sanyo
2009.01.21
103
2009.05.04 179
Average
2009.05.04
43.5
106 91.2
As shown above from the six cases published by AMB, the average time between filing and initiation is 43.5 days. The quickest took only 6 days to obtain the initiation notice but later took 106 days for the decision notice. The average time between initiation and public notice is 91.2 days, with the quickest taking only 28 days. It must be noted in most cases which are unpublished, averagely it took 14 days to get to the initiation and another 30 days for AMB to issue decisions. To be on the safe side, parties should allow 50 days for the procedure when planning a deal.
Tips for Preparation: 1. Take full advantage of pre-filing consultation meeting to consult with officials on any potential issues AMB might be concerned. 2. Comply with the formality required and ensure each issue specified by AMB is addressed in the report. 3. Research and prepare market data to support or explain your arguments, even though in certain industries market data is difficult to find. Shaosong Sun, Guantao Law Firm Email: sunshs@guantao.com Yuye Lu, Guantao Law Firm Email: luyy@guantao.com Tel: 8610 66578066 | Fax: 8610 66578016 Add: 17/F, Tower 2,Yingtai Center, No.28 Finance Street, Xicheng District, Beijing 100140, China
Shaosong Sun
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NEWS | news >>
昊理文的海关和关税团队目前有七位律师。该事务所于2003年在上海成立，拥 有两家海外办事处，分别位于芝加哥和都柏林。
Freshfields
Freshfields promotes new finance partner in Hong Kong Freshfields Bruckhaus Deringer has recently promoted a new finance partner in its Hong Kong office. Andrew Heathcote has been elected to the partnership with effect from 1 May 2010. Heathcote is a counsel in the firm’s finance practice group based in Hong Kong and specialises in structured finance. He is joined in the Hong Kong office by Will Higgs, a senior associate from London who specialises in structured finance.
Andrew Heathcote
富而德香港办事处晋升融资业务合伙人
富而德 律师 事 务所 近 期宣布，香港办 事 处晋升融 资业 务 合 伙 人 。A n d r e w Heathcote 获得合伙人任命，自2010年5月1日起生效。 Andrew Heathcote 是富而德香港办事处融资业务部顾问律师，是结构融资领 域的专家。Will Higgs 推荐 Andrew 加入富而德香港办事处，Will Higgs 是伦敦 总部高级律师，专门负责结构融资业务。 Lovells
Counsel appointment and 21 new partners breathe air into Hogan Lovells As part of its preparations for the official merger with Hogan & Hartson in May, Lovells has appointed IP specialist Clifford Borg-Marks as of counsel in its
currently 30-lawyer-strong Greater China IP team located in the Beijing office. Considered something of a pioneer in the IP field, Borg-Marks handled the country’s first copyright case for Sega Enterprises of Japan, immediately after the introduction of the PRC ‘s Copyright Law. He also conducted the first trade dress case in Shanghai for Chupa Chups SA of Spain when the Unfair Competition Law came into force. The appointment comes almost concurrent with the firm’s recent 21 partner promotion, with all new partnerships coming into effect on the day that Hogan Lovells officially launches. After these new appointments are made Hogan Lovells will have more than 800 partners in offices across Asia, Europe, the Middle East and the US. New partners for Greater China include Geoffrey Lin, who joined Lovells Shanghai in 2005 and was promoted to consultant in 2008. Lin will be based in the Shanghai office and will focus on IP work. James Fong, Kelly Naphtali, Deanna Wong and Christopher Dobby will all begin their partnerships in Hong Kong.
豪森路伟任命顾问律师和21位新合伙人
路伟律师事务所将于5月与霍金•豪森律师事务所合并，作为准备工作的组成部分，路伟 任命知识产权专家 Clifford Borg-Marks 担任顾问律师，成为北京办事处30人规模大中 华区知识产权团队的成员之一。 Borg-Marks 在知识产权领域曾做出开创性成就，自中国《版权法》生效后，便立即 作为日本 Sega Enterprises 的法律代表，参与中国首个版权诉讼案。自《反不正当竞 争法》生效后，他还曾作为西班牙珍宝珠公司（Chupa Chups SA）法律代表，在上海 参与首个商业外观诉讼案。 几乎在同时，路伟还晋升21位合伙人。新合伙人身份将自豪森路伟正式成立之日起 生效。新任命生效后，豪森路伟在亚洲、欧洲、中东和美国将拥有超过800位合伙人。 大中华地区新合伙人包括 Geoffrey Lin，他于2005年加入路伟上海办事处，2008年被 晋升为顾问律师。他将在上海办事处工作，重点负责知识产权业务。James Fong、Kelly Naphtali、Deanna Wong 和 Christopher Dobby 将在香港办事处参与合伙人工作。
Firm Profile
Global Law Office
公司收购与重组中的新近趋势与法律问题
随
着后金融危机时期经济环境和政 策取向的变化，内地实力企业在 境内外的收购与重组面临更多机 会，不仅有吉利收购沃尔沃、中 石油和中石化等在海外收购资源，因整体上市 或挽救危困公司而进行的上市公司收购与重组 也案例繁多。有PE投资的公司IPO通过审核增 多，外商投资合伙企业可以开立股票帐户，均 显示A股市场正逐渐成为PE理想的退出环境。 一方面，收购与重组活跃，阶段性产业导向 明确。国务院新近规定加强对房地产开发企业 购地和融资的监管，对存在土地闲置及炒地行 为的房地产开发企业，证券监管部门暂停批准 其上市、再融资和重大资产重组，已公告过的 非公开发行项目如金地集团、保利地产和万科 增发，均尚无定论；地产类公司的收购与重组 外资难以介入，钢铁等限制类行业扩张项目短 时间内不会松动，银行计划在海内外新一轮招 股以提高资本充足率；上市公司资产置换、非 公开发行新股时以资产认购或以现金和资产混
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合认购新股频繁，甚至上市公司分立的特例亦 已出现。另一方面，与收购与重组相关的法律 和政策规定尚有待完善和在执行中统一标准。 非上市公司方面，通过目标企业破产，以 取得无法律上后顾之忧的经营性资产和业务， 面临诸多困难，立案难、地方法院和破产管理 人经验不足而无效率；大型国际公司在收购和 合资过程中面临较长时间的经营者集中申报和 审查。另一些情况是，破产重整需要新的商业 条件注入，成功案例并不多；通过产权交易所 的收购，在保护有限责任公司原股东优先购买 权方面，尚无权威的明文操作规定，律师趋于 严格保护优先购买权；国务院国资委发出了通 知，中央企业进一步获得审批权，在本企业内 部实施资产重组更加灵活。 而在上市公司方面，对重大资产重组有严格 的监管规定，但为二级市场炒作而进行的假重 组时有发生；监管部门对敏感期内幕信息知情 人的核查要求和技术手段在进步，上市公司对 难以界定的股票买卖收益也通过协商后决定收
归公司；监管部门对 注入资产的法律要求， 出现案例中的前后不一 致，比如划拨土地使用 权拟进入上市公司，是 否构成法律障碍。总 之，监管部门正在更加 注重保护社会公众投资 者利益，收购与重组的 法律环境也在优化。
张弢 电子邮箱：zhangtao@globallawoffice.com.cn 环球律师事务所 北京市朝阳区建国路81号华贸中心1号写字楼15层 100025 http://www.globallawoffice.com.cn ISSUE ISSUE 7.4 7.4
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WongPartnership
Singapore introduces new tax incentives for mergers and acquisitions
T
he Budget Speech 2010 on 22 February 2010 by the Singapore Minister for Finance, Tharman Shanmugaratnam, announced a number of new government initiatives to promote economic growth and enhance the productivity of Singapore’s economy. This update will highlight the merger and acquisition (M&A) tax allowance and a related stamp duty remission, both of which will be introduced to encourage companies to consider M&A as a strategy for restructuring, growth, and internationalisation.
M&A tax allowance Current position: An M&A transaction may take the form of an acquisition of shares or an acquisition of business assets (such as land, inventory and equipment). Under existing tax rules, a Singapore company making an acquisition (BidCo) of the shares of another Singapore company (TargetCo) will be unable to claim any tax deductions for the costs BidCo incurred in undertaking the M&A transaction as the income Bidco would earn from holding the shares of TargetCo are taxexempt income. Significantly, if BidCo takes on bank financing for the M&A transaction, the interest costs of BidCo will not qualify for tax deductions either. Conversely, if BidCo acquires the business undertaking of TargetCo, BidCo would earn taxable income from acquiring the business undertaking, and the expenditure wholly and exclusively incurred by BidCo in the M&A transaction would qualify for tax deductions. Such tax deductible expenditure will include advisory fees paid to financial advisers and legal counsel, and interest expenses incurred on bank financing. New position: To avoid this dichotomy of tax treatment and remove the tax disadvantage in undertaking an acquisition of shares, the M&A tax allowance will be granted to qualifying M&As executed from 1 April 2010 to 31 March 2015 (both dates inclusive). The allowance is for an amount equal to 5% of the value of the acquisition capped at S$5m, with the cap applying to the aggregate of all M&As transacted in that year. The allowance granted will be written down equally over five years. www.legalbusinessonline.com
Stamp duty remission Where the qualifying M&As involve a transfer of unlisted shares, stamp duty will also be remitted. This remission is capped at S$200,000 of stamp duty per year. There is no necessity for any remission for listed shares, since a transfer on a scripless basis does not attract stamp duty.
Comment While attractive in itself, the M&A allowance will provide even more food for thought when seen in conjunction with the following additional measures and proposals: • the proposal by the Singapore Exchange to allow the listing of Special Purpose Acquisition Companies – that is, shell companies with no prior operating history that raise capital through an IPO, to enter into future undetermined business combinations such as mergers, share exchanges and asset acquisitions; • sec 32C of the Income Tax Act (introduced in 2009) permitting various tax benefits of amalgamating companies to be transferred to the amalgamated entity; and • the slew of tax measures announced in the Budget Speech 2010 aimed at promoting productivity, innovation and R&D. The Minister for Finance indicated that full details of the M&A allowance will be released by the Inland Revenue Authority of Singapore by June 2010. Clarity will be required on the following: the conditions to be met to obtain the M&A allowance, including conditions as to what would constitute qualifying M&As; and how the value of such M&As would be determined or proven; and whether M&As can include the acquisition of offshore entities by a Singapore entity. It also remains to be seen the extent to which the different measures and proposals may be combined in M&A structures. Based on the budget speech the following tentative comments appear to be valid: • as the cap for the M&A allowance is S$5m for each year of assessment, this appears to translate potentially to an aggregate cap of S$100m for the value of qualifying M&As executed each year • regarding the stamp duty remission for unlisted shares, since the duty is based on 0.2% of the consideration or net
asset value of the shares, whichever is higher, the cap of S$200,000 potentially translates into an aggregate cap of S$100m NG Wai King for the value of qualifying M&As per year, which matches the cap of S$100m discussed for the M&A allowance • it would not be surprising that TAN Kay Kheng the conditions for qualifying M&A transactions will exclude internal group restructuring exercises. However, it is our hope that qualifying M&A transactions would include acquisitions of non-Singapore companies in order to incentivise more Singapore companies to grow an overseas wing • it is not clear whether the nature of the M&A tax allowance would be treated like trading loss and unabsorbed capital allowance, such that group relief treatment would be available. This is important as most M&A transactions are structured with a holding company acquiring the shares of TargetCo. A pure holding company would have no source of taxable income to utilise the M&A tax allowance. Hence, if it is not allowed to transfer the M&A tax allowance as part of group relief treatment, the usefulness of having the M&A tax allowance may be nullified.
Contact partners NG Wai King head – corporate group; head – corporate/mergers & acquisitions practice Direct: +65 6416 8022 Email: waiking.ng@wongpartnership.com TAN Kay Kheng head – tax practice Direct: +65 6416 8102 Email: kaykheng.tan@wongpartnership.com
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Feature | In-house survey 2010 >>
ALB China In-house Survey 2010:
In search of best practice
The 2010 ALB In-house survey results reveal that the ever maturing inhouse profession in China is not only searching for ways to adopt best international practice but also increasingly seeking and using external resources to add value to in-house expertise
►► ALB in-house survey KEY FINDings: ►► Your legal department will most increase the use of
60%
37% 32%
40%
56%
36%
35%
50%
30%
20%
29%
11%
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2%
re a 0% se re m d b y 5 0+ ain % e de c re a d t h e s am sed e by de c 26 re a sed -50% by 1-2 5%
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28
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►► Over the past 12 months, the amount of legal work your legal team outsources has
in c
40%
►► percentage of legal work your company outsources
ISSUE 7.4
Feature | In-house survey 2010 >>
A force to be reckoned with
E
ven during difficult economic conditions, the in-house legal profession has still gone above and beyond expectations. The increased complexity of the legal and regulatory environment, along with generally reduced resources, has provided a great opportunity for in-house lawyers to demonstrate their strategic value to their respective companies. “In-house departments are now seen as an indispensable, cost-effective and expert resource within their respective companies. They have expertise in law and the legal industry, combined with [an] intimate understanding of their companies’ businesses and strategic goals,” says Guo Lijun, general manager of the legal department in China Eastern Airlines, one of China’s three largest air carriers and listed in Hong Kong, US and Shanghai. “In our company, the in-house legal function is regarded as important as finance and
►► This year’s budget for legal spend on external counsel is
audit departments. Its influence is on the rise in every stage and aspect of the company’s operations.” Three in-house counsel in the 22-lawyer team serve as vice presidents – a manifestation of the legal function’s increased prominence within the company. Similar to China Eastern Airlines, an increasing number of companies have more inhouse counsel as part of their senior management or executive teams, and some companies have promoted senior in-house counsel to lead their business units. Former head of legal at Haier Group, Su Xiaoxi, is now a vice president and taking a lead role in the group’s global operation department; and Sinochem International’s legal manager Liu Wenzhao has recently been elected to be deputy general manager of the company’s logistics business unit. These are two of many examples. Sami Farhad, vice president & general counsel of eLong.com, has a
►► Compared to last year, your budget for legal spend on external counsel has 35%
30% 27%
25%
33% 30%
30%
23%
25% 20% 20% 14%
15%
15%
11%
10%
9%
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14% 9%
10% 5%
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5% 2%
www.legalbusinessonline.com
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good vantage point for the evolving profession in China as a US lawyer. “Over time, as companies in China become larger, engage in more complex financial transactions and have more international exposure, businesses are becoming more sophisticated and recognising that a strong in-house legal team can support the healthy growth and development of the company, while avoiding costly risks and disputes,” says Farhad. “Now, many in-house legal departments have built up strong internal expertise in the areas of law which significantly impact their companies. The perception of in-house lawyers as not doing interesting or challenging work is now largely outdated.” As the 2010 ALB China In-house Survey has found, 68% of the polled in-house departments have less than 10 legal staff. However, nearly half of the respondents say that their departments have grown over the past 12 months, while 34% remained the same size. In addition to the steady growth of in-house lawyers, ALB China has also found out that many in-house departments now have more tiers of staff than in the past and the nature of in-house counsel roles have expanded into new areas, mostly non-legal, such as compliance, risk management and company secretarial responsibilities. “With the increasing complexity of the law in China, legal teams now need to have a blend of talents in order to handle the variety of matters which companies face – governance, securities, M&A, compliance, IP,” Farhad says. “Inhouse departments now are generally bigger, due to the pressure to cut external legal costs and the growing need for internal expertise, as well as the need to create career paths to ensure [the] job satisfaction of in-house lawyers.” Another exciting trend reflected by the survey findings is the growing number of in-house lawyers who have taken on more Asia regional roles, overseeing projects and transactions taking place in other parts of the region. For example, Thomas Yih, the
29
Feature | In-house survey 2010 >>
“Many in-house legal departments have built up strong internal expertise in the areas of the law which significantly impact their companies. The perception of in-house lawyers as not doing interesting or challenging work is now largely outdated” Sami Farhad
eLong.com
general counsel of Shanda Games, which listed on NASDAQ in 2009, has added regional responsibilities since the company has decided to expand into more Asia markets. Yih has recently worked on a number of M&A transactions outside China and is preparing for more in the pipeline. During the expansion process, Yih says he and his team will increasingly work with local firms in Japan, Korea and some South-East Asian countries. This trend is even clearer among multinational companies – for example BP China’s legal director Xu Xiangmin, who is also in charge of the legal affairs of BP Asia Petrochemicals; P&G’s Asia general counsel Michael Qiu in Guangzhou; and Watts’ vice president of legal affairs & compliance for Asia, Wendy Wang, in Shanghai – just to name a few.
Internal challenges When it comes to listing their challenges at work, the top three worries of in-house counsel were finding ways to adopt the best international practice within their organisations, ensuring compliance whilst facilitating the company’s business objectives, and team management and training. UBS Securities, which is China’s
►► City in which you are based 50%
47% 38%
40%
first and only full-spectrum domestic securities firm managed by a foreign investor, has a profound understanding of the crucial ability to function as a bridge between the headquarters and the local operations, and international and local expectations. “UBS holds positive views on China’s fast-improving and changing regulatory framework. It’s critical for the local in-house team to closely follow up with the latest legal and regulatory developments,” says Li Lin, the deputy head of the legal and compliance department of UBS Securities. “The firm’s management is very international and experienced, but our business is domestic-market oriented. As a result, one of the major challenges for the in-house team is to adopt and implement UBS’s best international practice in China. The local business environment, market practice and regulatory system are very different from those in the more developed jurisdictions, and that has put a lot of pressure on us.” Willie Uy, director of legal affairs for Shui On Development, shares the same view – avoiding misconduct and complying with laws at home and abroad is a clear priority for global and public companies. He emphasises that a
30%
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►► Type of company you work for 50% 41%
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fo r e en ig n WOterpri invest FI E s e ( e d , J V FI E e , list tc) ed pr list comp ivate ed sta any te com-owe d m u p a ny l ti nat c io sm ompa nal all to m ny e nt e d i er p um rise u ow nlisted s ed com state p an y ot h er s
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Guo Lijun
Willie Uy
Team priorities:
Team priorities:
general manager of legal department China Eastern Airlines 2010 is turning out to be an important and very busy year for the in-house department. We expect a number of key developments to be done within this year. Currently, we are handling a large volume of work relating to the company’s recent joining to SkyTeam Alliance. Our next plan is to develop and install a comprehensive contract management software system, which will allow our in-house team to be involved in and monitor every step of all future contracts, from the drafting to the implementing stages. We are also in the process of developing a formal legal staff training scheme, which is to not only keep our in-house lawyers updated with the latest legal and regulatory developments but also broaden their knowledge base and perspectives. Another focus for this year is to establish an external legal advisor panel and forming the procedure for selection and assessment.
director of legal affairs Shui On Development
The in-house team in the Shanghai headquarters consists of three Hong Kong lawyers, four PRC lawyers and three qualified Hong Kong company secretarial staff, and handles mostly M&A, corporate finance work and company secretarial tasks. This year, apart from continuing with these focuses, the team is planning to jointly launch a campaign with the HR department to promote and ensure highest business ethics standards within the company. We will provide training and seminars on the company’s existing code of conduct and business ethics to all the business units, in view of the increase in business activities and number of new staff.
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good in-house counsel working in China must have good judgement. “As a listed company, we have to practice full disclosure and compliance with a wide range of regulations. However, when doing business in China, the answer to what is right or wrong is not often as clear as black and white. So we have to be very skilled at accessing what’s an acceptable risk and what is not and navigate the company through the fast-developing, complex regulatory landscape,” says Uy. “An important part of our role is to manage communication carefully – both internally and externally – to ensure compliance for any deal execution or development. This role usually adds more to our workload and increases the total time taken to complete a transaction, but it’s critical to keep the company’s reputation and interests intact,” he adds. The chief legal officer, power sector, of Hong Kong-listed GCL-Poly Energy Holdings, Susan Wu, believes her team’s main challenge lies in achieving the right balance between safeguarding the company’s legal compliance and proactively supporting business growth. “For a dynamic company like GCLPoly, we are constantly seizing exciting opportunities to achieve growth.
Naturally one must be alert that every potentially rewarding project comes with commensurate risks,” says Wu. “We work closely with our company’s management, and other functional departments to formulate appropriate business strategy, and assist them in achieving and executing new business goals.” To reach the right balance, Wu says, in-house counsels must strive to be value-adding members to the management teams and not constant alarmists. In house counsels, with their particular knowledge of the industry in which their company is engaged in, must be more innovative than external counsels. They should be more able to devise viable solutions for potential projects to move ahead and become successful business units. Difficulties in attracting and retaining mid to senior level talent who have over six years of practice experience and international exposure is commonly seen as another challenge for leaders of in-house teams. These candidates generally prefer to join private practice where the income is usually higher and offers more flexible work schedules. In addition, increased regulation and more sophisticated work have meant a heightened sense
“When doing business in China, the answer to what is right or wrong is not often as clear as black and white. So in-house counsel have to have good judgement and be very skilled at accessing what’s an acceptable risk and what is not” Willie Uy
Shui On Development
►► The size of your in-house team 70% 68% 60% 50% 40% 30% 20% 12% 13%
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Team priorities:
chief legal officer, power sector GCL-Poly Energy Holdings Team priorities: Upon the completion of the acquisition of Jiangsu Zhongneng Polysilicon Technology Development last year, the solar power sector has become GCL-Poly’s new business focus. Whilst continuing to provide excellent support for the Power Sector, the GCL-Poly in-house legal team has been expanded to provide full support and advice to the company’s new projects and investments in photovoltaic material production and other solar energy projects at home and abroad.
►► Over the past 12 months your in-house team has 35%
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con www.legalbusinessonline.com
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db
In the last few years, our work has supported eLong’s turnaround by helping the company strengthen and improve its operations and lower its costs. We’ve done a lot of operational work, managed disputes relating to the new labour contract law and addressed new issues relating to the internet, e-commerce, and intellectual property, as well as disclosure, related-party and regulatory matters. In 2009, the company reported full-year profitability and in 2010, we’re looking more at providing support on M&A matters and regulatory issues. At the same time, although litigation and arbitration is not a large part of our work, we continue to strengthen our in-house team’s ability to appear in court and manage disputes.
Susan Wu
y1 -20 % y2 1-5 g ro 0% wn by g ro 1-2 wn 0% by 21g 50 re m r o w n % by ain 50 ed +% t he s am e si ze
vice president & general counsel eLong.com
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Feature | In-house survey 2010 >>
“In-house counsels must strive to be value-adding members to the management teams and not constant alarmists. In house counsels, with their particular knowledge of the industry in which their company is engaged in, must be more innovative than external counsels” Susan Wu
GCL-Poly
►► The area in which your department most needs to be improved 40%
39%
of pressure for in-house counsel to stay up to date. Putting in place professional and technical training programs for the legal department becomes an increasingly urgent need.
Strategic outsourcing The findings of the survey have also marked a shift towards more strategical use of external counsel. According to the results, 56% of the in-house teams outsource less than 20% of their total work –however 49% of respondents have seen an increase in 2010 budgets for external legal spend. As in-house teams continue to grow in both size and capability, more work will inevitably be handled. Companies won’t outsource as a matter of course anymore, but will only engage external counsel in particular circumstances. However, when they do outsource work, they will require high-quality performance, quick turnaround time on a specific issue, and in most cases they’ll be willing to pay a fair price. “For most day to day legal matters, external lawyers cannot match the inhouse team in terms of understanding of the issues and speed of response,” says Wu. “However, we do value external counsels’ extensive expertise and knowledge in many other areas of the law. Their logistics, know-how,
precedents and experience in solving similar legal issues are invaluable to us. The in house counsels are there to identify and leverage these advantages and design innovative structures and solutions.” “Fee levels are of a lesser concern when we select external counsel, what we value most are expertise, expertise and expertise,” Wu says. Another clear trend is the increasing use of a blended set of different types of law firms, such as large national firms, mid-size/boutique domestic firms, regional local firms and international firms. Instead of relying on one or two long-term external advisors for everything, clients now much prefer to work with the most appropriate firm on a particular project, transaction or issue. The decision on which firm to use is taken with careful consideration, taking into account key elements including the nature of legal needs to be serviced, a firm’s expertise, resources and cost/value proposition. For this purpose, China Eastern Airlines is in the process of establishing its external legal advisor panel and forming a procedure for selection and assessment. Guo intends to list up to five preferred law firms under each of a set of different practice areas, such as aircraft financing and leasing, corporate
►► ALB in-house survey: what are your team’s priorities for 2010? (CONT) 30%
Martin Ma
senior manager of legal department CapitaLand (China)
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y’s and strate Contr d e c g ic p i b u t isio lan ion n-m nin ak i g ng Op p or p r o t u ni m o t ie s t io n f o r Rem of e uner mp ation loy e es an d S o rg t r uc ani ture s at io n Tra d e v i ni n g el o a n pm d e nt
0%
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A major part of our work last year was to assist the company with its US$2.2bn acquisition of the entire 100% interest in Orient Overseas Developments, a property investment holding company. The transaction was completed in February this year, so our priority for the rest of the year will be support the integration of the two businesses and handle issues and matters arising from the process. As the target company owns a portfolio of seven prime sites in Shanghai, Kunshan and Tianjin, it will come as no surprise that there is to be a significant amount of legal advice and services required. In addition, we will closely follow any new progress of the ‘International Board’ to be launched on the Shanghai Stock Exchange.
Thomas Yih
general counsel Shanda Games
Team priorities: The in-house team assisted the company to be successfully listed on NASDAQ as the spin-off of Shanda Interactive last year. This year, we are looking to add three additional staff to the existing in-house team in support of the increased deals in the pipeline, as the company’s strategic goal is to expand into more overseas markets. We will be working on proposed transactions with local firms in Japan, Korea and some South-East Asian countries, as well as some US and European law firms.
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finance, litigation and arbitration. Three-fifths of the firms on the panel will be domestic, while the rest will consist of foreign firms from different key jurisdictions where the company operates. “We should keep in mind that law firms have a broad range of resources at their disposal and offer a wider pool of expertise. That’s why they still have an important role to play. International firms will also be increasingly useful, particularly to Chinese companies that have more international exposure and increasingly need to handle legal matters outside the country,” Guo says. “Good collaboration and relationships between in-house and external legal teams helps the company better manage legal costs and derive more value from the services,” he adds.
Law firm performance While clients are mostly confident about law firms’ technical expertise, the 2010 in-house survey showed that a large number of respondents stated they were not particularly satisfied with their external counsel’s client services. The majority of negative comments were regarding the availability and approachability of lawyers, their responsiveness to requests, initiatives to understand clients’ businesses and
objectives, and how proactive they are in recognising potential issues and thinking of solutions. “Lawyers in China have started to specialise in certain areas of law and are very diligent and responsible. Although many have developed strong technical expertise, they still lack first-hand knowledge in their clients’ businesses and strategies,” says UBS Securities’ Li. “Some external counsel only take an over-protective, limiting role – instead of giving a clear opinion or definite advice, they tend to provide detailed analysis of the law or equivocal answers. This kind of advice and service essentially has no value to clients.” In certain new and niche areas of the law, in-house counsel are also facing difficulties finding satisfying external help. “It’s a challenge to find real expertise from outside counsel in newly emerging areas such as e-commerce and internet issues. In addition, it’s difficult to find outside counsel that can provide sophisticated business judgments tailored to a specific set of facts or transactions, rather than simply an outline of the relevant rules and regulations,” says eLong’s Farhad. “The result is that it’s easy to spend on outside counsel, but hard to obtain high-quality, timely advice on newlyemerging issues.” ALB
“Law firms have a broad range of resources at their disposal and offer a wider pool of expertise. That’s why they still have an important role to play. Good collaboration and relationships between in-house and external legal teams helps the company better manage legal cost and derive more value from the services” Guo Linjun
China Eastern Airlines
►► Top three areas of expertise inhouse teams most need to develop
Wendy Wang
vice president of legal affairs & compliance – Asia region Watts Management (Shanghai) Team priorities: As the company has changed its China strategy to focus on selling its products to the domestic market, it will actively pursue expansion plans to capitalise on the country’s rapid urbanisation and infrastructure boom. We are expecting more M&A and consolidations in the coming years. Another priority for us is to implement the company’s legal governance, risk management and compliance procedures and enforce those that are already in place. We will provide more legal and regulatory training to members in the business units, and raise the awareness of compliance matters among all staff. A number of recent anti-corruption cases, such as the Rio Tinto case, have served as a catalyst for executives and employees of foreign companies to pay more attention to compliance and staying on the right side of the law. It will help the legal departments to promote legal culture and boost up their power within their companies. www.legalbusinessonline.com
Li Lin
director and deputy head of legal and compliance department UBS Securities Team priorities: The local capital markets have had a large number of new regulations and many new products and services are now allowed by the regulators. As UBS has only been established for three years, our team’s main priority currently is to assist the firm to understand the new regulations and develop more products and services.
1
legal risk management
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contract review
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regulatory and compliance
►► Three types of legal work companies outsource the most 1
litigation and arbitration
2
M&A
3
IP
►► Top 10 criteria for selecting external counsel 1
expertise in specific areas
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responsiveness/turnaround time
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level of fees charged
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individual lawyer reputation
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understanding of your business
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ability to advise across multiple practice areas
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firm reputation and brand
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cultural and linguistic abilities
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provision of commercial perspective
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billing flexibility
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M&A 2010: strategy and innovation on world stage Eye on outbound M&A
O
ne of the most striking trends seen in the global M&A markets throughout the past 18 months is the intensity of China’s interest in overseas acquisitions. Some of the headline transactions include PetroChina and Royal Dutch Shell’s joint acquisition of Brisbane-based Arrow Energy, CNOOC’s 20-year LNG purchase agreement with BG Group, Shanghai Jin Jiang Hotels partnership with Thayer to acquire NYSE-listed Interstate Hotels & Resorts, and China Nonferrous Metals’ partial offer for Lynas Corporation. The explosion of Sino-foreign M&A activity is the impetus for both international and domestic firms
to increase their ability to handle outbound transactions. “The outbound market has certainly been very active – we’re seeing increasing interest from Chinese companies especially in natural resources, manufacturing, technology, media and mining industries,” says Xu Ping, a partner at King & Wood. “This has called for a lot of attention from both PRC and international law firms.” Over the past Xu Ping King & Wood two years, King & Wood has extensively developed its outbound M&A practice with a dedicated task force equipped with US and Canadatrained lawyers. The firm now has 30 lawyers focused on outbound work,
crossborder M&A deals Jun 2009Nov 2009 Sinopec – Addax acquisition Jurisdiction: China/US/ UK Industry/sector: Oil Legal advisors: Vinson & Elkins, Stikeman Elliot, Fasken Martineau
CIC – Teck Resources acquisition Jurisdiction: China/US Industry/sector: Natural resources Legal advisors: Torys, Paul Weiss, Stikeman Elliot
Yanzhou Coal Mining – Felix Resources acquisition Jurisdiction: China/Australia Industry/sector: Mining Legal advisors: King & Wood, Jingtian & Gongcheng, Baker & McKenzie, Allens Arthur Robinson, Corrs Chambers Westgarth
China Pharma – Sihuan Pharmaceutical Holdings acquisition Jurisdiction: China/Singapore Industry/sector: Pharmaceutical Legal advisors: Commerce & Finance, Khattar Wong, WongPartnership, Conyers Dill & Pearman, Paul Weiss
US$10,300m US$1,500m US$2,900m US$318m June 2009 >> 34
August 2009 >>
September 2009 >> ISSUE 7.4
Feature | M&A >>
part of an even larger M&A team. The firm’s closest rival, Jun He, has also boosted its capabilities. “We have a new working group which consists of partners John Chu from Beijing, Hong Kong Jun He and Shanghai. These lead partners have a lot of experience in both inbound and outbound M&A work,” says John Chu, a co-founding partner. As domestic firms have reinforced their M&A capabilities to sustain mandates on cross-border transactions, international firms have also found it imperative to devote themselves to outbound work, making up for the losses suffered by their western counterparts. Freshfields Bruckhaus Deringer, which recently facilitated Geely’s acquisition of Volvo from Ford, is a prime example. “The most prominent change for our Greater China practice is that we are seeing more outbound M&A opportunities,” says Robert Ashworth, partner and head of Asian corporate practice at Freshfields. “Over the past 12 months, that’s where most of the action and our focus have been. We have moved key people around within departments and out to Asia. We are also trying to educate clients by
running seminars and conducting case studies on how to execute foreign M&A transactions,” he adds. Energy specialist, Vinson & Elkins has also seen its work scale steeply tipped towards outbound M&A. “Our practice is significantly focused on cross-border transactions and we have increased the size of our outbound practice by approximately 30%, including partners and lawyers,” says partner David Blumental. Last year the firm enjoyed mandates from Sinopec, advising on its US$10.3bn acquisition of Addax Petroleum (the largest-ever international acquisition by a Chinese energy company). Baker & McKenzie also reports significant growth in its cross-border M&A activity. It has profited greatly from its representation for major conglomerates like CNOOC, Chinalco and CIC onmajor outbound deals.
“Cost-conscious clients and those who are experienced in China M&A deals will be increasingly using large domestic firms rather than international firms for the smaller deals” Dorothea Koo
Baker & McKenzie
Complexity breeds innovation
While large-scale acquisition of foreign assets is not a new phenomenon, Chinese companies now have both the ability to conduct cross-border transactions and the experience to maximise the value from large deals. Investors have become increasingly familiar with the fundamentals of a transaction and deals completed in recent months are showing the growing
Sinochem Petroleum Exploration & Production – Emerald Energy acquisition Jurisdiction: China/UK Industry/sector: Natural resources Legal advisors: Memery Crystal, Freshfields
Air China – Cathay Pacific stake acquisition Jurisdiction: China/Hong Kong Industry/ sector: Aviation Legal advisors: Freshfields
CIC – JSC Kazmunaigas stake acquisition Jurisdiction: China/Kazakhstan Industry/sector: Natural resources Legal advisors: Vinson & Elkins, GRATA law firm
Sinochem – Nufarm acquisition Jurisdiction: China/Australia Industry/sector: Natural resources Legal advisors: Blake Dawson, Arnold Bloch Liebler
US$876m
US$825m
US$939m
US$2,440m
November 2009 >> www.legalbusinessonline.com
35
Feature | M&A >>
“You see a trend of continuing complexity, a move away from acquiring small, single standalone assets to a desire to complete larger transactions. They are viewed as more efficient because in one deal you can acquire more” David Blumenthal
Vinson & Elkins
sophistication of Chinese investors. “We fully expect China to continue its upward trend in acquisitions, since Chinese companies are increasingly participating in deals of significant complexity. Deals such as the Sinopec–Addax acquisition demonstrate the capability of Chinese companies to execute Ashworth world-class transactions,” Robert Freshfields says Blumental. The sophistication of domestic companies and their increasingly complex overseas pursuits necessitate a corresponding leap in innovative legal advice. China National Offshore Oil Corporation’s (CNOOC) latest cross-border foray is indicative of the sophisticated new strategies being applied by investors and their law firms to cross-border deals. CNOOC has recently joined with Argentina’s Bridas Energy Holdings by paying US$3.1bn for a 50% stake in one of its units to boost its production and reserves. As a result, CNOOC International (advised by Baker & McKenzie) and Bridas Energy Holdings (advised by Akin Gump) will each hold a 50% stake in Bridas Corp. In a separate transaction, PetroChina also submitted a joint US$3bn bid with Royal Dutch Shell
for Brisbane-based Arrow Energy. Both the CNOOC and PetroChina deals are structured as oil and gas production joint ventures. “You see a trend of continuing complexity, a move away from small, single stand-alone assets to a desire to complete larger transactions,” says Blumental. “They are viewed as more efficient because in one deal you can acquire more. It is getting more and more interesting.” Many of these deals have seen companies use strategic partnerships leveraging to push their business to the next stage of development. “We are seeing more strategic alliances and relationships between Chinese and foreign companies. There are also more strategic transactions for them to combine or merge both inside and outside of China,” says King & Wood’s Xu. “Alliances are very specific and tailor-made – they have a lot of considerations as to their business model and industry and how they want to work together. There are many optional structures like a share swap where two business partners are on equal footing. There are regulatory challenges in this, especially when there is an MNC involved,” she adds. Needless to say, against a backdrop of highly complex transactions innovation is a key selling point for firms. “For a creative lawyer there are a number of
crossborder M&A deals (CONT) nov 2009Apr 2010 Primus Nan Shan Holdings – Nan Shan Life Insurance acquisition Jurisdiction: China/Taiwan Industry/sector: Insurance Legal advisors: Freshfields, Simpson Thacher, LCS & Partners
China Zijin – Indophil acquisition Jurisdiction: China/Hong Kong/ Australia Industry/sector: Natural resources Legal advisors: TransAsia, Freehills, Baker & McKenzie, Fujian Zenith, Charltons, Minter Ellison, Yorac Arroyo Chua Caedo & Coronel
US$2,150m US$500m November 2009 >> 36
China Minmetals – Hunan Nonferrous Metals acquisition Jurisdiction: China/Hong Kong Industry/sector: Natural resources Legal advisors: Grandall, Freshfields, Commerce & Finance
Shanghai Jin Jiang Hotels – Interstate Hotels & Resorts acquisition Jurisdiction: China/US Industry/sector: Hotels Legal advisors: King & Wood, Baker & McKenzie, Hogan & Hartson, Paul Weiss
US$819m
US$307m
January 2010 >> ISSUE 7.4
Feature | M&A >>
different ways you can structure things – at the end of the day it depends on what the client wants. But by being creative you can differentiate yourself. When you can work around issues clients see you as value-adding and that is exactly what the clients want,” says Freshfield’s Ashworth. “There are a whole host of drivers behind why you may choose a different approach. It might be because of technical business reasons or tax and funding issues. There is no particular innovative structure that everyone would want to follow because not one strategy fits all. Each transaction is different in its own way. I don’t think anyone has rolled out a new ‘product’ that is particularly tax efficient or avoids regulatory scrutiny. Those things are quite few and far between.”
Domestic firms gain ground
The involvement of PRC firms with M&A capabilities on deals has evidently grown hand-in-hand with the country’s foreign development. One of Mergermarket’s recent top-ten table of legal advisors to Greater China M&A indicated that PRC firms are becoming ‘go-to advisors’ for international and domestic enterprises. According to the table, Commerce & Finance was the number-one ranked firm, outplacing Freshfields and Linklaters. DeHeng
came in fifth place, closely followed by Tian Yuan and King & Wood. DeHeng and Tian Yuan advised on the largest M&A deal of 2009 – China Yangtze Power’s US$15bn acquisition of the China Three Gorges Project power generators. Tian Yuan partner Zhu Xiaohui attributes the firm’s success in increasing its mandates to the financial slowdown, as domestic companies begin their international expansion plans by acquiring distressed or bankrupt assets. “Cost-conscious clients and those who are experienced in China Zhu Xiaohui Tian Yuan M&A deals will be increasingly using large domestic firms for the smaller deals, rather than international firms,” says Dorothea Koo, partner at Baker & McKenzie. Blumental agrees.“Some PRC firms are experienced with crossborder deals and also have very good working relationships with various local corporates. They can be helpful and important – especially for clients who do not have much experience in overseas transactions, as they need lawyers with whom they can communicate with trust.” This element of trust appears to be a crucial advantage for most domestic
“There is no particular innovative structure that everyone would want to follow because no one strategy fits all. Each transaction is different in its own way” Robert Ashworth
Freshfields Bruckhaus Deringer
Sinopec – Sonangol Sinopec International stake acquisition Jurisdiction: China/South Africa Industry/sector: Natural resources Legal advisors: Allen & Overy, Skadden, Herbert Smith
CNOOC – LNG acquisition Jurisdiction: China/Australia Industry/sector: Natural resources Legal advisors: Mallesons Stephen Jaques, Herbert Smith, Freehills
Geely – Volvo acquisition Jurisdiction: China/Europe Industry/sector: Automobile Legal advisors: Haiwen & Partners, Freshfields, Cederquis, Hogan & Hartson
US$2,500m
US$1,350m
US$1,800m
March 2010 >> www.legalbusinessonline.com
April 2010 >> 37
Feature | M&A >>
firms. Local clients are choosing to stay in their comfort zones and stick with their close advisors. “Over time we learn about a company’s history, culture, management strategy and decision-making process. It makes it a lot easier for clients and they see us as someone who can hold their hands within and outside of China,” says King & Wood’s Xu. Jun He partner Janet Hui says clientlawyer relationships are important. “Chinese enterprises usually have long-term business relationships with domestic law firms. Local lawyers become very familiar with their company culture and plans. This is why domestic clients will continue to turn to local firms and are in fact relying on us more and more for future work.” And on top of the trust that has been developed over time, it seems that the increasing capabilities of domestic lawyers have proven value for money. “We are equipped with the knowledge and expertise of an international firm but charge lower fees. In deals that do not need Janet Hui international law firms Jun He at large, clients will still entrust their business needs to Chinese law firms,” she says. Haiwen & Partners’ Glenn Su
►► Legal advisors to Greater China M&A: 2009-10 volumes Q1 2009 rank 37 1
Q1 2010 rank 1 2
Law firm Jones Day Freshfields
Value (US$m) Deals 2,269 12 3,610 9
14 6
3 4
Slaughter and May Baker & McKenzie
38,659 4 5,413 4
7 22 – 8 50 3 12 25 81 26 5
5 6 7 8 9 10 11 12 13 14 15
Skadden Haiwen & Partners Allen & Overy Grandall Cleary Gottlieb Linklaters Clifford Chance Latham & Watkins Kim & Chang Lee and Li King & Wood
4,020 2,777 2,478 142 35,950 7,352 588 369 238 163 148
4 4 4 4 3 3 3 3 3 3 3
Source: Mergermarket 2010
describes the requirements for law firms wanting M&A mandates as rapid improvement of the quality of legal services coupled with legal fees being more adaptable to the PRC market; unmatched understanding of the Chinese law, regulatory and business environment, practice and culture; and growing knowledge of foreign laws, practices, cultures and languages. Indeed, having the technical skills becomes imperative. “As local companies expand and internationalise, there will be increasing regulations that need to
be adhered to, [and] local commissions and consents that need to be attained. This is where we come in,” says Liu Gang, a partner at Commerce & Finance, Liu Gang who also notes an Commerce & Finance increase in domestic transactions this year for the firm, in comparison to the first quarter of 2009.
Not just cross-border deals
Large-scale domestic transactions
domestic M&A deals sep 2009- apr 2010 PE consortium – Chery Automobile stake acquisition Industry/sector: Automobiles Legal advisors: Chen & Co, Jingtian & Gongcheng
AsianInfo –Linkage merger Industry/sector: Telecoms Legal advisors: Global, Latham & Watkins, Han Kun, DLA Piper
Shanghai Industrial – Neo-China Land acquisition Industry/sector: Real estate Legal advisors: AllBright, JSM Mayer Brown, Richards Butler, Mallesons Stephen Jaques, Lovells
CSCEC – Shenzhen Zhonghai Investment Management acquisition Industry/sector: Construction / Real Estate Legal advisors: Dacheng
China Mobile – Shanghai Pudong Development Bank stake acquisition Industry/sector: Banking / Telecoms Legal advisors: Haiwen & Partners, Shanghai United Law Firm
US$424m US$733m US$354m US$472m US$5,830m September 2009 >>
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February 2010 >>
March 2010 >>
April 2010 >>
ISSUE 7.4
Feature | M&A >>
continue to flood the M&A market – to the benefit of local firms. “It seems to be a consensus that China will become one of the dominant economies in the world for the next few decades. The large size and value of M&A deals in China is a natural by-product of the rise of the Chinese economy,” says Su. Recently, China Mobile diversified its business operations by acquiring a 20% stake in Shanghai Pudong Development Bank for US$5.83bn. Shanghai United Law Firm and Haiwen & Partners helped the two companies form a strategic alliance to offer wireless financial services, including mobile bank cards and payment services. “Domestic M&A work is picking up. We have seen and been involved in more M&A activity in the domestic market,” says King & Wood’s Xu. “The first quarter has proved to be busier than last year and in that, we are also seeing a broader range of industries like manufacturing, pharmaceutical and retail.”
The experience has been similar at other firms. “For quite some time, there has been talk between the potential purchasers and their targets about pricing. But over the past months, buyers have been in a better position to invest in different projects domestically, and there continues to be strong signs that the volume of work will continue to increase.” For the foreseeable future then, M&A practices that have got their value proposition right are likely to have an abundance of transactions to keep their teams busy. “Accompanying the growth of PRC companies are their sophistication and internationalisation and hence their requirement for sophisticated legal services. This will further stratify the legal landscape in China,” says Haiwen’s Su. “PRC firms, having rich experience in large, complex and sophisticated cross-border M&A transactions, will reap a fine harvest from the growing size and value of M&A transactions.” ALB
“Domestic M&A work is picking up. We have seen and been involved in more M&A activity in the domestic market. The first quarter has proved to be busier than last year and we are also seeing a broader range of industries like manufacturing, pharmaceutical and retail” Xu Ping
King & Wood
“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.
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39
FEATURE | Offshore firms >>
Offshore fightback ►► Offshore jurisdictions: The grey and the white White-listed offshore jurisdictions
Grey-listed offshore jurisdictions
Bermuda
Andorra
British Virgin Islands
Anguilla
Cayman Islands
Antigua and Barbuda
Cyprus
Aruba
Guernsey
Bahamas
Ireland
Dominica
Isle of Man
Gibraltar
Hong Kong
Grenada
Jersey
Liechtenstein
Luxembourg
Monaco^
Mauritius
Montserrat
Seychelles
Singapore
US Virgin Islands
Switzerland
^ At the time of going to press, Monaco was in the final stages of concluding tax information exchange agreements with the 12 countries needed for ascension to the White List. Source: OECD
40
ISSUE 7.4
FEATURE | Offshore firms >>
While offshore financial centres have taken a battering throughout the financial crisis, there is light ahead. From G20-related fallout to political and economic victimisation, many have sought to place at least part of the blame for economic collapse on the shoulders of offshore financial centres. But those centres and the lawyers who ply their trade there remain unfazed, convinced of the important role that they will play in the world economy
I
n the long and drawn-out financial crisis post-mortem, the role of offshore financial centres has come under the microscope. Everyone from Barack Obama to UK prime minister Gordon Brown has sought to lay part of the blame for the financial collapse on the shoulders of the ‘shady dealings’ in places like the Cayman Islands, the British Virgin Islands (BVI) and Bermuda. “How much safer would everybody’s savings be if the whole world finally came together to outlaw shadowbanking systems and offshore tax havens? ” was the question asked by Brown to the US Congress earlier this year. What was casually omitted from the political sabre-rattling of Brown, Obama and others though, is the critically important role that offshore financial centres like Cayman, BVI, Bermuda, Mauritius and others play in the global financial system. In the Asia-Pacific region offshore centres act as a nexus through which international investors can access the growth markets of India, Singapore and Malaysia, as well as our own. This is not limited to international clients, however. Asia-based clients, who have long known the virtue of structuring investments through places like the
www.legalbusinessonline.com
BVI and Cayman will continue to use the offshore route, perhaps with greater frequency in calmer economic times.
Centre of finance
“Asia-based clients have been using offshore financial centres like BVI, Cayman and Bermuda for the best part of 20 years and are already familiar with what they can bring to their business,” says Michael Gagie, the partner-in-charge of Harneys’ Hong Kong office. “We would expect new incorporations in those jurisdictions to pick up again as the economy picks up, as it is generally when people are making money that they are looking to pay less tax on it,” he adds. But increased use by clients in Asia of offshore financial centres needn’t only be about tax minimisation. Regulatory changes and the relaxation of listing rules in onshore jurisdictions like Hong Kong and Singapore (which will permit companies incorporated in a number of offshore jurisdictions to list there) will also stimulate this process. Appleby’s Frances Woo explains how this works. “The stock exchanges of Singapore and Hong Kong already do allow the listing of Bermuda
“We do not believe that offshore law firms are anything close to ‘business as usual’. Not only do we have the continuing effect of the insolvencies and restructurings ... but our litigation departments are still very active as a result of the fallout that arose ... as well as [from] the significant market meltdown that took place” Frances Woo
Appleby
41
FEATURE | Offshore firms >>
“Asia-based clients have been using offshore financial centres like British Virgin Islands, Cayman and Bermuda for the best part of twenty years and are already familiar with what they can bring to their business. We would expect new incorporations in those jurisdictions to pick up again as the economy picks up” Michael Gagie
Harneys
and Cayman companies and those jurisdictions are already well established,” she notes. “If that is further opened up, to say BVI and/ or Seychelles – or there is more use of Isle of Man in Singapore – then that would increase both awareness and use.” Recent developments on Taiwan’s stock exchange will have a similar affect. “The recent opening up of Taiwan’s stock exchange to foreign companies, and in particular, Cayman Islands companies has assisted and broadened the use of Cayman Islands in Taiwan,” she says. Historically, many Taiwan entities were using Bermuda, Cayman and/or BVI for listing abroad (of which NASDAQ listings have been, so far, the most popular). In opening up, Taiwan is trying to attract both foreign groups to the nation (particularly in the technology space) as well as Asian groups who may find advantages to listing in their home region. Cayman-incorporated Array Networks became the first international company to list on Taiwan’s Gre Tai earlier this year with its US$79m IPO. On this occasion, Walkers were retained as counsel on Cayman law while K&L Gates acted as the issuer’s Taiwan legal advisor. Spencer Privett, joint managing partner with Maples and Calder in Hong Kong, says that Array’s IPO is the start of many more to come. Earlier this year, Maples acted for Want Want Holdings on its issuance of TDRs and Cowealth Medical Holdings on its Gre Tai listing and they are currently working on most of the other companies in the Taiwanese IPO pipeline.
Offshore leaders
Cayman, BVI and Bermuda remain the most widely-used offshore financial centres among Asiabased clients. The status quo is likely to remain unchanged in the future. According to lawyers ALB interviewed, Asia-based clients are 42
starting to use other jurisdictions with greater frequency. However, the location chosen will continue to be dictated by the nature and needs of the deals being transacted. “Cayman, BVI and Bermuda have always been considered among the top offshore jurisdictions in China and Asia,” notes Christopher Bickley, a partner with Conyers Dill & Pearman in Hong Kong. “Companies in these jurisdictions have the characteristics of being tax-neutral, [with] flexible but sound laws and are relatively easy to maintain.” This is not to say that other offshore jurisdictions will be used from time to time, it just means that when Asiabased clients choose to do so, it is more about seeking out somewhere that dovetails with the structuring needs of a particular deal than anything else. Two jurisdictions which are used in this way are Mauritius and Isle of Man (IOM). Both have made a name for themselves over the past five years – in particular, in the context of the high volume of India-bound investment that passes through these countries. Mauritius has a clear lead over other offshore jurisdictions in terms of access to India, ostensibly because it has a double taxation avoidance agreement (DTAA) with the country. The latest OECD statistics indicate that 44% of all foreign direct investment (FDI) into India passes through Mauritius. But the island isn’t all about focusing on India, as Harneys’ Gagie is quick to point out. “Mauritius is developing its profile in the PRC and has become very popular there,” he says. “Africa is also on its radar and here [Hong Kong], as well as with other BRIC countries, I expect its usage to increase.” Similarly, the IOM also enjoys a good reputation as on offshore jurisdiction that services India. However, where the focus for the Mauritius-India link is heavily inbound-focused, IOM is being used most commonly as an offshore centre through which IndiaISSUE 7.4
FEATURE | Offshore firms >>
based clients are channelling their own international investments. This is achieved most commonly through AIM listings as well as asset financing. Mike Edwards, a Singapore-based director with law firm Cains says that IOM has more to offer than just these legal areas – and not just to Indian clients. “With liquidity coming back to India, we expect to see deals not only in the capital markets and asset finance areas but also project financing,” Edwards explains. “We tip [there will be] more IOM involvement in India-related power and infrastructure projects, especially where there is a public sector element. In relation to non Indian-based clients, Singapore and other parts of SouthEast Asia will remain active.” Cain’s recent involvement as IOM counsel on Genting Singapore’s US$1.14bn rights issue seems to suggest this is the case. This is not to say that the positions of Mauritius and IOM as the premier offshore jurisdictions through which to access India will remain unchallenged. Offshore lawyers expect Cayman to put up more of a fight – particularly in the funds area. Earlier this year, Cayman overcame one of the major hurdles that investment funds domiciled there face when seeking to invest into India’s capital markets, after the admission of the Cayman Islands Monetary Authority (CIMA) as a full member of the IOSCO. CIMA’s admission to IOSCO means that the process for the registration of Cayman funds as Foreign Institutional Investors (FIIs) with India’s Securities and Exchange Board (SEBI) will become much less complicated. In the past SEBI would often conduct extensive due diligence investigations and inquiries before allowing a Cayman fund to register as an FII. As a result few Cayman funds sought registration with SEBI. It should be noted though, that Cayman does not currently have a DTAA with India. It is likely that funds from non-tax treaty www.legalbusinessonline.com
jurisdictions like Cayman will continue to use a structure via a wholly-owned Mauritius subsidiary. This is evidence, according to lawyers ALB interviewed, that the offshore game isn’t necessarily a zerosum proposition. “It’s not a question of IOM or Mauritius or Cayman taking work away from one another … each have their own unique offering,” Edwards says. He does concede that in the long run, some jurisdictions may slowly “chip away at others’ tax bases” through establishing DTAA’s with countries like India and China. But will these jurisdictions rise to challenge the positions of the likes of BVI, Cayman or Bermuda? Privett doesn’t believe that such a situation will eventuate. “The major offshore jurisdictions have advantages that the emerging ones do not,” he says. “In addition using BVI for holding companies and Cayman for funds and Hong Kong listings has a market acceptance element as well. All things being equal, I don’t think this will change anytime soon.” Woo says that the growth of so-called “emerging” offshore jurisdictions needn’t be a process that yields changes in the status quo. It can simply be about offering investors new opportunities, she says, citing Seychelles as an example. “Seychelles offers good opportunities to break new ground, given its network of DTAA treaties with certain Asian countries – for example China and Indonesia – [because of] its efficiency, speed, close time-zone proximity to Asia and lower cost,” she says. Yet just as critical for places such as Seychelles is carving out their own niche. “The so-called emerging jurisdictions, apart from developing their network of DTAAs, need to find a specialisation, their own niche,” says Gagie. “Much like the BVI has found its space with holding companies and incorporation, Cayman with funds and listings and Mauritius with India. The alternative approach is to find a
“With liquidity coming back to India, we expect to see deals not only in the capital markets and asset finance areas but also project financing. We tip more Isle of Man involvement in Indiarelated power and infrastructure projects, especially where there is a public sector element” Mike Edwards
Cains
43
FEATURE | Offshore firms >>
“While we may not be over with the financial crisis we are seeing a recovery in funds... what is promising though is that it’s not just coming from the same existing managers but also start-up managers. All bodes well for offshore law firms to move on from the crisis” Spencer Privett
Maples and Calder
44
political attraction or motivation for being favoured.” What niches remain in an already crowded offshore market remain to be seen, but the backlash emanating from the G20 summit may well fall under the ‘political reasons’ that Gagie notes above.
Black, white and G20
The offshore lawyers that ALB spoke to all note that, in the eyes of their Asia-based clients, there has been little fallout emanating out of the G20 summit earlier this year, where regulators pointed the finger at offshore financial centres. “Very few of our clients have expressed concerns about their use of offshore financial centres after G20,” says Privett. Gagie cites a similar experience, saying that he expects the fallout from the G20 to be minimal. “The jury’s still out on what the longer-term practical impact will be, but we hope that in Asia it won’t be too profound.” Regardless of these sentiments, there is no denying that there still may be a stigma attached to the use of offshore jurisdictions. But the ascendancy of both Cayman and the BVI to the OECD’s ‘white list’ earlier this year – as offshore jurisdictions that have substantially implemented the internationally agreed standards in respect of the effective exchange of information for tax purposes – has gone a long way to eroding such views. Christopher This is so even if their Bickley elevation to the list is Conyers Dill & mere confirmation of the Pearman transparency with which both nations have been operating for many years. “The recognition by the OECD of the Cayman Islands, BVI and Bermuda as tax-transparent and cooperative jurisdictions is a very significant milestone in the long-
standing efforts by these jurisdictions to cooperate with the various international initiatives by the OECD and other national and international agencies,” says Bickley.
Law firms
As the region’s equity markets are rebounding, there are new funds being formed in Cayman and multibillion dollar acquisition and asset financing deals returning to the deals pipeline. So is it correct to assume that the cycle is back to ‘business as usual’ for offshore law firms – have we worked through the full cycle of offshore disputes, insolvencies and restructurings? While Woo noted that activity has picked up across the region, she doesn’t agree with such assertions suggesting that there is plenty more recessionrelated work to be completed. “We do not believe that offshore law firms are anything close to ‘business as usual,’ she says. “Not only do we have the continuing effect of the insolvencies and restructurings … but our litigation departments are still very active. [This is] as a result of the fallout that arose, for example, out of the Maddoff issue as well as out of the significant market meltdown that took place, which created a number of substantial problems for funds incorporated in a number of our jurisdictions.” Woo says the pace of this type of work is declining, however. Privett says he is seeing a notable increase in investment funds work, and it is not necessarily coming from the usual suspects. “While we may not be over with the financial crisis we are seeing a recovery in funds, especially in the last two or three months in terms of new fund formations,” he says. “What is promising though is that it’s not just coming from the same existing managers but also start-up managers. All bodes well for offshore law firms to move on from the crisis.” ALB ISSUE 7.4
FEATURE | Offshore firms >>
www.legalbusinessonline.com
45
MARKETData DATE| M&A | M&A Market >>>>
In association with
M&A TRANSACTIONS AND STATISTICAL ANALYSIS Top 10 Announced Deals - Greater China (20 March, 2010 - 16 April, 2010) Announcement Date
Target Company
Target/Seller Legal Advisor
Bidder Company
Bidder Legal Advisor
12-Apr-10
Syncrude Canada Limited (9.03% stake)
Advising seller: Osler, Hoskin & Harcourt
Sinopec International Petroleum Exploration and Production Corporation
Blake, Cassels & Graydon
22-Mar-10
Arrow Energy Limited
Gilbert + Tobin
Consortium comprising Royal Dutch Shell and Petrochina
Allens Arthur Robinson; Blake Dawson
28-Mar-10
Sonangol Sinopec International Limited (55% stake)
China Petroleum & Chemical Corporation
Allen & Overy; Herbert Smith/ Gleiss Lutz/Stibbe; Skadden Arps Slate Meagher & Flom
China Petrochemical Corporation
2,457
28-Mar-10
Volvo Cars Corporation
Zhejiang Geely Holding Group Company Limited
Cederquist; Freshfields Bruckhaus Deringer
Ford Motor Company
1,800
23-Mar-10
CraFarms Limited (Certain assets)
Natural Dairy NZ Holdings Limited
Knight Coldicutt
CraFarms Limited
1,058
20-Mar-10
Yosun Industrial Group
WPG Holdings Company Limited
Jones Day
6-Apr-10
Jushi Group Co Ltd (49% stake)
China Fiberglass Company Limited
King & Wood
China National Building Material Company Limited; Pearl Success International Company Limited; Surest Finance Limited; and ZhenShi Holding Group Company Limited
430
6-Apr-10
HNA Airport Holding Group Company Limited (54.5% stake)
Hainan Meilan International Airport Company Limited
Grandall Legal Group
HNA Group Company Limited; and Kingward Investment Limited
322
22-Mar-10
Spring Vast Limited
FinTronics Holding Company Limited
Chiu & Partners; Clifford Chance; K&L Gates
Truffle Rich Holdings Limited
300
6-Apr-10
Gloucester Coal Limited (12.3% stake)
Noble Group Limited
Advising seller: Blake, Cassels & Graydon; Hogan & Hartson; Mannheimer Swartling
Seller Company
Deal Value (USDm)
ConocoPhillips Company
4,650
3,352
688
118
Notes: Based on announced deals, including lapsed and withdrawn bids, from 20 March 2010 to 16 April 2010•Based on geography of either target, bidder or seller company being China, Hong Kong, Macau or Taiwan•Includes all deals valued over USD 5m. Where deal value not disclosed, deal has been entered based on turnover of target exceeding USD 10m•Activities excluded from table include property transactions and restructurings where the ultimate shareholders' interests are not changed•League tables are ranked by volume•Q1 10 * = 1 January 2010 to 19 March 2010
League Table of Legal Advisors to Greater China M&A (Jan 01, 2010 - Apr 16, 2010) Rank
House
League Table of Financial Advisors to Greater China M&A (Jan 01, 2010 - Apr 16, 2010)
Value (USDm)
Deal Count
Rank
House
Value (USDm)
Deal Count
1
Slaughter and May
38,683
4
1
Goldman Sachs
44,238
4
2
Herbert Smith/Gleiss Lutz/Stibbe
37,957
2
2
Deutsche Bank
41,291
6
3
Cleary Gottlieb Steen & Hamilton
35,950
3
3
Credit Suisse
40,450
3
4
Simpson Thacher & Bartlett
35,744
3
4
Citigroup
37,374
5
5
Norton Rose
35,624
2
5=
Blackstone
35,500
1
6
Sullivan & Cromwell
35,950
2
5=
HSBC
35,500
1
7=
Cravath Swaine & Moore
35,500
1
5=
JPMorgan Cazenove
35,500
1
7=
Debevoise & Plimpton
35,500
1
5=
Lazard
35,500
1
7=
Weil Gotshal & Manges
35,500
1
9
Morgan Stanley
31,252
7
10
Davis Polk & Wardwell
35,500
1
10
China International Capital
8,164
6
Based on geography of either target, bidder or seller company being China, Hong Kong, Macau or Taiwan
Based on geography of either target, bidder or seller company being China, Hong Kong, Macau or Taiwan
Greater China M&A Activity - Quarterly Trends 350
70,000
300 250
40,000
200
30,000
150
20,000
100
10,000
50
0
46
Value (USDm) Volume
50,000
Q1 03
Q2 03
Q3 03
Q4 03
Q1 04
Q2 04
Q3 04
Q4 04
Q1 05
Q2 05
Q3 05
Q4 05
Q1 06
Q2 06
Q3 06
Q4 06
Q1 07
Q2 07
Q3 07
Q4 07
Q1 08
Q2 08
Q3 08
Q4 08
Q1 09
Q2 09
Q3 09
Q4 09
Q1 10
Q2 10*
Number of deals
Value (USDm)
60,000
0
Greater China Legal Business ISSUE 7.5 ISSUE 7.4
Market Data | capital markets >>
Equity Capital Markets TRANSACTIONS List China, Hong Kong Mar 28 - Apr 24 Issuer
Proceeds (USDm)
Issue Date
Currency
556.9 510.6 418.4 374.1 303.4 299.8 272.1 248.1 245.7 243.0 207.8 186.8 178.0 169.7 153.2 151.6 144.9 144.4 141.0 137.2 136.6 132.5 129.9 123.1 121.2 120.1 119.5 117.2 110.8 105.5 105.5 104.9 100.8 100.2 84.5 83.1 82.4 74.7 61.5 51.4 51.3 47.6 42.4 34.5 33.2 30.0
09/04/10 21/04/10 19/04/10 06/04/10 09/04/10 06/04/10 21/04/10 16/04/10 19/04/10 22/04/10 09/04/10 01/04/10 12/04/10 07/04/10 08/04/10 06/04/10 08/04/10 19/04/10 29/03/10 19/04/10 08/04/10 29/03/10 19/04/10 22/04/10 12/04/10 22/04/10 15/04/10 06/04/10 12/04/10 12/04/10 12/04/10 01/04/10 13/04/10 08/04/10 16/04/10 06/04/10 15/04/10 29/03/10 29/03/10 22/04/10 15/04/10 06/04/10 31/03/10 09/04/10 14/04/10 14/04/10
CNY HKD CNY CNY CNY CNY CNY CNY CNY CNY CNY CNY CNY SGD HKD CNY HKD CNY EURO HKD CNY CNY CNY CNY HKD CNY CNY CNY CNY CNY CNY CNY HKD HKD HKD CNY CNY CNY CNY CNY CNY CNY SGD USD CNY USD
128.9 116.0 97.6 91.1 69.8 53.6 52.3 39.4 39.4
12/04/10 13/04/10 31/03/10 15/04/10 21/04/10 21/04/10 23/04/10 14/04/10 15/04/10
HKD HKD HKD HKD HKD HKD USD HKD HKD
Bookrunner(s)
Sector
Orient Securities Co Ltd UBS Ltd; Morgan Stanley & Co. Intl plc Essence Securities Co Ltd First Capital Securities Bohai Securities Co Ltd Essence Securities Co Ltd Shenyin & Wanguo Securities China International Capital Co Guosen Securities Co Ltd China Jianyin Investment Ltd Minsheng Securities Everbright Securities Co First Capital Securities JP Morgan Securities Asia Pte JP Morgan NEW TIME SECURITIES CO LTD Goldman Sachs (Asia) Guosen Securities Co Ltd Macquarie Capital Partners LLC; China International Capital Co CLSA; Piper Jaffray Inc; Sun Hung Kai International Ltd; Tai Fook Securities Co Ltd China Jianyin Investment Ltd Guojin Securities Co Ltd Pingan Securities Co Ltd GF Securities Deutsche Bank AG Tebon Securities Guosen Securities Co Ltd Hongyuan Securities Co Ltd China Merchant Securities Co China Merchant Securities Co Pingan Securities Co Ltd Minsheng Securities Goldman Sachs (Asia) Morgan Stanley & Co Piper Jaffray Inc Pingan Securities Co Ltd Huatai United Securities Co Chinalion Securities Co Ltd China Merchant Securities Co Rising Securities Haitong Securities Southwestern Securities Co Kim Eng Corp Finance Pte Ltd; UOB Kay Hian Private Ltd Rodman & Renshaw Inc CITIC Securities Newbridge Securities; Brean Murray Carret & Co LLC
Materials Consumer Staples High Technology Materials Healthcare High Technology Industrials Energy and Power High Technology Healthcare Industrials Materials Consumer Staples Consumer Staples Industrials High Technology Materials High Technology Industrials High Technology Materials Consumer Staples High Technology Industrials Materials Media and Entertainment Consumer Staples Energy and Power High Technology High Technology Consumer Products and Services Healthcare Materials Retail Consumer Staples Materials Consumer Staples Financials High Technology High Technology Industrials Media and Entertainment Real Estate Materials Consumer Staples Industrials
Industrial & Comm Bank China CLSA Citigroup Inc Kingston Securities Limited; First Shanghai Sec Ltd Bank of America Merrill Lynch; CLSA Oriental Patron Securities Ltd; Cantor Fitzgerald Inc Oppenheimer & Co Inc Morgan Stanley & Co Morgan Stanley & Co. Intl plc
Industrials High Technology Consumer Staples Healthcare Consumer Staples Consumer Staples Telecommunications Energy and Power Energy and Power
China Xinjiang Zhongtai Chem Co Ltd China Yurun Food Group Ltd Nationz Technologies Inc Beijing Originwater Technology Tianjin Lisheng Pharm Co Ltd Zhejiang Narada Power Source Wanxiang Qianchao Co Ltd Xian Shaangu Power Co Ltd Sumavision Technologies Co Ltd Shenzhen Hepalink Pharm Co Ltd Beijing Lier High Temp Jiangsu Changqing Agri & Chem Jiangsu Lianfa Textile Co Ltd China Minzhong Food Corp Ltd Minth Group Ltd Zhejiang JinLiHua Electric Co Yingde Gases Group Co Ltd Hangzhou Century Co Ltd Joyou AG O-Net Communications Ltd AVIC Sanxin Co Ltd Blackcow Food Co Ltd Ningbo GQY Video & Telecom Xiamen Academy of Bldg China Vanadium Guangdong Advertising Co Ltd Hunan Mendale Hometextile Co Beijing SJ Envi Protection Beijing eGOVA Co Ltd AVCON Info Tech Co Ltd Beijing Easpring Material Tech Guizhou Xinbang Pharmaceutical Yingde Gases Group Co Ltd Intime Dept Store(Grp)Co Sijia Group Co Ltd Shanghai ANOKY Textile Chem Co Wuxi Double Elephant Micro Zhejiang Nanyang Tech Co Ltd Shenzhen Sunyes Electronic Shanghai Communications Tecj Weihai Huadong Automation Co Spearhead Integrated Marketing Debao Ppty Dvlp Co Ltd Lihua International Inc Xinjiang Tiankang Animal Sci Tri Tech Holding Inc
HONG KONG Brightoil Petroleum(Hldgs)Ltd Skyworth Digital Holdings Ltd Yue Yuen Industrial(Hldg)Ltd Hua Han Bio-Pharm Hldg Ltd Asian Citrus Hldg Ltd China Precious Metal Resources City Telecom(HK)Ltd Towngas China Co Ltd Enerchina Holdings Ltd
DEBT CAPITAL MARKETS TRANSACTIONS LIST China, Hong Kong Mar 28 - Apr 24 Issuer
Proceeds (USDm)
Issue Date
Bookrunner(s)
Sector
1,465.2 895.7 732.5 732.3 650.0 546.7 439.5 439.5 410.3 366.2 366.2 350.0 293.1 293.0 293.0 263.7 263.7 255.7 219.8 219.7 146.5 146.5 146.5 146.5 102.6 87.9 73.2 58.6 50.2
06/04/10 12/04/10 01/04/10 21/04/10 21/04/10 15/04/10 29/03/10 29/03/10 08/04/10 01/04/10 21/04/10 21/04/10 08/04/10 29/03/10 19/04/10 29/03/10 14/04/10 30/03/10 30/03/10 19/04/10 30/03/10 30/03/10 06/04/10 12/04/10 31/03/10 30/03/10 21/04/10 02/04/10 19/04/10
Currency CNY USD CNY CNY USD USD CNY CNY CNY CNY CNY USD CNY CNY CNY CNY CNY USD CNY CNY CNY CNY CNY CNY CNY CNY CNY CNY HKD
Goldman Sachs Gao Hua; Everbright Securities Co; CITIC Securities; China Galaxy Securities Co BOCI; Deutsche Bank Securities Corp; UBS Investment Bank China International Capital Co; China Construction Bank China International Capital Co; China Construction Bank Morgan Stanley; Bank of America Merrill Lynch; Deutsche Bank AG; Standard Chartered Bank PLC Goldman Sachs & Co; JP Morgan Industrial Bank Co Ltd; China Construction Bank Haitong Securities China Euro Securities; Minsheng Securities Industrial Bank Co Ltd Industrial & Comm Bank China Credit Suisse; Citi; UBS Investment Bank Industrial Bank Co Ltd; Hua Xia Bank China Construction Bank; Industrial & Comm Bank China China Construction Bank Agricultural Bank of China; China Development Bank Industrial & Comm Bank China; Agricultural Bank of China HSBC Holdings PLC; JP Morgan; Morgan Stanley China Merchants Bank Industrial Bank Co Ltd Minsheng Securities China Construction Bank Agricultural Bank of China China Citic Bank; Bank Communications (Shanghai) China International Capital Co; China Citic Bank Bank Communications (Shanghai) Agricultural Bank of China; Bank of China China Merchants Bank; China Development Bank Standard Chartered Bank (HK)
Energy and Power Financials Industrials Industrials Real Estate Real Estate Materials Financials Industrials Industrials Industrials Real Estate Energy and Power Materials Real Estate Financials Energy and Power Financials Industrials Energy and Power Industrials Financials Financials Industrials Materials Media and Entertainment High Technology Industrials Financials
439.5 64.4 64.4 38.6
01/04/10 22/04/10 23/04/10 21/04/10
CNY HKD HKD HKD
China Merchants Bank Hongkong & Shanghai Bank (HK) Hongkong & Shanghai Bank (HK) Hongkong & Shanghai Bank (HK)
Telecommunications Financials Financials Financials
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Flex Your Skills In A New Legal Position In-house Senior Legal Counsel (8+ yrs pqe) Beijing Excellent opportunity to join the dynamic legal team at one of the world’s leading telecom corporations. This position covers general corporate and commercial matters in North Asia and requires fluent Mandarin and English with an international background. Ref: 8355/CB Legal Compliance Leader (7-12 yrs pqe) Shanghai This Fortune 500 corporation needs you to help lead and develop their compliance program for the entire APac region. You must be comfortable in a multicultural environment and have the experience necessary to drive compliance programs that support business development. Excellent spoken and written English and Mandarin skills are a must. Ref: 8742/CB Chief Compliance Officer (5-8 yrs pqe) Shanghai Senior compliance professional needed for a high level position. You must have substantial experience in both securities and supervisory roles with at least five years in a financial institution and PRC Securities Company Senior Management Qualification. Junior candidates and those with little or no management experience should not apply. Fluent Mandarin and excellent English skills are a must. Ref: 8736/CB VP - Equity Capital Markets (5+ yrs pqe) Hong Kong Urgently seeking a US or UK qualified lawyer to handle IPOs and ICM deals worldwide for this leading investment bank. You must be ready to advise senior management and effectively manage outside counsel. Ability to train others and fluent English and Mandarin skills necessary. Ref: 8830/CB Assistant Counsel (5-10 yrs pqe) Hong Kong Take on a standalone role for a multinational insurance company. This position provides support for offices around the world, drafting contracts, negotiating agreements and providing general regulatory advice. Experience in insurance or reinsurance preferred but not required. Excellent written and oral English presentation skills needed, Chinese language skills would be an asset. Ref: 8824/CB
Private Practice Senior Associate (5-7 yrs pqe) Shanghai Join this top-tier US firm by working with a team recognized for its M&A and US capital markets work. The incumbent will be responsible for M&A and US securities and should be ready to take the lead on PRC-related transactions. JD graduates preferred, but PRC qualification and New York/California Bar holders will also be considered. Must have good English skills and native Mandarin. Ref: 8819/CB Corporate/M&A International Associate (3-5 yrs pqe) Shanghai A prestigious international law firm needs a driven professional to handle important PRC matters. The successful candidate is PRC qualified and has at least three years of hands-on experience in M&A and other general corporate/commercial matters. Commonwealth jurisdiction LLM is a plus. Fluent Mandarin and English required. Ref: 8825/CB Associate (3-4 yrs pqe) Shanghai Develop your career with this US law firm that is a world leader in M&A and securities deals. This position covers US capital markets and M&A. JD graduates preferred, but those with a LLM and PRC qualification may apply. Native Mandarin and excellent English a must. Ref: 8840/CB Marketing and BD Specialist (3+ yrs exp) Shanghai This prominent global law firm is seeking an experienced individual to support their marketing and business development activities. You should have general marketing knowledge and have worked in a professional business environment, ideally law firms or consulting companies. Native Mandarin and fluent English required. Ref: 8818/CB
HONG KONG Tel: (852) 2520 1168 Fax: (852) 2865 0925 Email: hughes@hughes-castell.com.hk SINGAPORE Tel: (65) 6220 2722 Fax: (65) 6220 7112 Email: hughes@hughes-castell.com.sg BEIJING Tel: (86) 10 6581 1781 Fax: (86) 10 6581 1773 Email: beijing@hughes-castell.com.hk SHANGHAI Tel: (86) 132 2996 6550 Email: shanghai@hughes-castell.com.hk
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Asiaâ&#x20AC;&#x2122;s most respected monthly legal magazine presents the: ALB In-House Legal Summit in Hong Kong, China and Singapore 2010. These special legal events are tailor-made to bring together leading private practice lawyers and senior in-house legal counsel from Asia. The Summits represent a fantastic opportunity to address and interact with some of the most active and influential corporate counsel and business leaders in the region today. The focused practice area workshops, plenary sessions and panel discussions provide a unique platform for the frank exchange of views, sharing of best practices and formulation of strategies to best deal with opportunities in 2010. Make a date in your diary and reserve your seat now as places are limited Please complete all details
FREE to In-House Counsel and Business Leaders. US$995 for any representatives from law firms and/or related legal service providers. I would like to attend the In-House Legal Summit:
In-House Counsel / Business Leader HONG KONG
25 June 2010 JW Marriott, Hong Kong
Law Firm / Service Provider Representative SINGAPORE
30 June 2010 TBA
SHANGHAI
14 October 2010 Sofitel Shanghai Jin Jiang Oriental Pudong Hotel
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BEIJING
25 November 2010 Swissotel Beijing Hong Kong Macau Center
Address: Tel:
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Please fax form to +852 2815 5225
Complimentary registration is open to and welcome from all In-house counsel and corporate business professionals. The organiser reserves the right to refuse registration from service providers, persons not officially invited or any privately practicing lawyer without explanation. For further information and registration (complimentary for in-house legal counsel), please contact Michelle: michelle@kmimail.com +852 2815 5988 +852 2815 5225 For sponsorship opportunities, please contact Claris Tam: claris@kmimail.com +852 2815 5988 +852 2815 5225 ALB enjoys alliances with the following organisations
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