(As excerpted from our monthly Associate Newsletter - Asia Pacific)
Associate Newsletter – Asia Pacific is a monthly resource that reports current legal market news, trends, partner moves and active opportunities in the Asia Pacific legal markets.
Legal Market Summary
Law firms have been struggling with how to manage the capital markets business in Hong Kong and China, as fee rates continue to come under extreme pressure. China has also tightened controls on capital outflow to fund M&A by Chinese companies going outbound, so this has impacted law firm hiring. That said, firms are looking to diversify their regional offerings with private equity and dispute resolution, which is proving successful. Demand remains high as always for HK-qualified and J.D. candidates who have strong Mandarin language skills.
Southern Asia is stirring after the usual post-Christmas, post-Chinese New Year slumber. Corporate is waking up, and firms continue to consider best growth strategies. Energy and associated areas (infrastructure, projects, construction, etc.) continue to be strong in this market. Disputes and tech/fintech are a growing sector.
The elite U.S. and British law firms with significant cross-border M&A practices will face challenges in early 2017 with the foreign exchange controls and capital outflow restrictions by the PRC government. We foresee more activity with mid-market U.S. and U.K. law firms in China in the cross-border M&A space that target Chinese clients looking to do smaller M&A deals. We expect international law firms with China inbound practices focused on representing foreign MNCs in general corporate advisory work and other China-related legal services (FDI, JVs, divestitures, restructuring, FCPA/compliance, employment, etc.) to have steady business in 2017. The appetite for hiring in the China cross-border litigation and disputes space is expected to remain steady; this work is less fee sensitive, and foreign law firms that do not have an on-the-ground litigation and disputes practice in China will be looking to this area to balance out the slower corporate M&A activity expected for 2017.
The Japan legal market is relatively robust with Japanese companies engaging in quite a bit of cross-border deal activity. Succession concerns are driving some of the interest in lateral hiring. The associate hiring market in Japan remains steady for associates with strong credentials and business-level language skills.
The legal market in Australia has remained steady this month, with much the same hiring focus as last month. Sydney is still the most active market for mid- to senior-level lawyers. It is expected that hiring needs will remain steady over the next couple of months before it starts to slow in the lead up to the EOFY.