Listings boom spurs demand for lawyers
Hong Kong is in the middle of a recruitment drive for more lawyers, as new stock market listings and tougher compliance and regulatory requirements boost demand for legal professionals.
The number of overseas lawyers admitted this year has risen more than 40 per cent.
Caroline Lim, executive vice-president in Asia of the legal and compliance division at headhunting firm DHR International, said the significant number of initial public offerings, mergers and acquisitions and stiffer regulatory requirements had led to big demand for legal professionals.
'More of our clients - both law firms and corporations, particularly in the health care, manufacturing and renewable energy industries, are hiring lawyers,' Lim said.
Growth on the mainland was a key factor in the need for lawyers, with overseas investors requiring legal advisers on mainland deals and Chinese companies wanting legal advice when they invested overseas.
Last year, 420 new solicitors were admitted to practise in Hong Kong. Among them, 105 were overseas qualified lawyers allowed to practise locally. In addition, there were 261 new applications to register as foreign lawyers in Hong Kong. This year, initial figures from the Hong Kong Law Society estimate that 148 overseas qualified lawyers were admitted to practice in the first 10 months of the year, a 41 per cent increase from last year.
Overseas qualified lawyers admitted in Hong Kong are allowed to advise on Hong Kong laws if they have at least two years' experience in a common law jurisdiction and have passed a local examination, but foreign registered lawyers are only allowed to advise on laws of their own jurisdiction.
Lim said companies needed lawyers with international networks and experience to provide legal advice on cross-border transactions and disputes.
'We are certainly receiving more applications from overseas candidates looking for law firm or in-house legal positions at multinational corporations and financial institutions here,' she said.
'However, most organisations have scaled back on expatriate terms in Asia, and it has become rarer for new hires to be offered substantial benefits packages, except for senior executive and leadership positions. This has affected the number of candidates hired from overseas.
'It is becoming more difficult for overseas lawyers to work in Asia, if they do not have Asian language skills or do not have transaction experience in Asia. Adding to these obstacles is the lack of expatriate packages. We are seeing relatively fewer new hires of foreign lawyers especially for in-house positions.'
There are 70 foreign law firms in Hong Kong. Eleven new foreign law firms were established in Hong Kong last year. This year Lim anticipates roughly the same number will register. 'Some will staff their offices through internal transfers, but it is more common to hire lawyers already in the region,' she said.
Secretary for Justice Wong Yan-lung said in Guangzhou last week that demand for legal professionals in the city was rising.
In Guangzhou, Wong visited a court and government offices to discuss the development of arbitration services and mutual assistance on legal matters between Hong Kong and Guangzhou.
'Demand for legal services from individuals and enterprises has been growing because of the close trading and commercial ties between Hong Kong and Guangdong,' he said.
Wong believed co-operation with mainland arbitration practitioners would enhance the legal process in both places. It would also be beneficial in providing quality arbitration services for the international business community.
Poh Lee Tan, managing partner of international legal firm Baker & McKenzie's Hong Kong, Beijing, Shanghai and Vietnam offices, said her firm was looking for more people.
'There is definitely buoyancy in the market and we are seeing a lot more activity across the board. There has been a spurt of IPOs and mergers and acquisitions over the last quarter, given the strong market sentiment, and we have been involved in some of the larger transactions,' Tan said.
'We look for top talent - energetic and bright lawyers with commercial acumen as well as language skills. Over the past few months, we have been investing in a number of growth areas including corporate and securities; regulatory and compliance; dispute resolution; anti-monopoly and competition; pharmaceutical and healthcare and natural resources.'
Baker & McKenzie, the largest international law firm in Hong Kong, has been in the city and on the mainland for nearly 40 years.
David Stannard, partner at law firm Norton Rose Hong Kong and also its head of Asia, said his firm also had experienced substantial growth in the past year.
'We've doubled in size over the past 15 months, certainly in terms of physical space, but also in terms of staff numbers,' Stannard said.
The Hong Kong office now had more than 90 lawyers and 30 legal support staff. The firm planned to hire at least 15 more in the coming months, he said.
'This growth has been driven by the needs of our clients for legal services. Principally this has come from our clients in China, but we also have a substantial Hong Kong-based and cross-border practice, all of which have been firing on all cylinders,' Stannard said.
Norton Rose completed four listings last month.
'We did not make any redundancies in the downturn, and we kept all our people working,' Stannard said. This was in contrast to some other law firms which cut down headcounts.
'This meant we were more ready for the upturn that started in autumn last year,' Stannard added.
Some of the expansion included the hiring of more than 25 lawyers and legal staff in corporate finance, nine in intellectual property, 20 in banking and seven in competition law. Some of these lawyers were newly hired from the market, but the firm also transferred partners from the Middle East, Australia and Britain.
Lim said besides deal-making, lawyers were also in demand because of the increasing compliance requirements of the Hong Kong Monetary Authority, the Securities and Futures Commission and other industry regulatory bodies.
In addition, multinational corporations listed overseas needed legal professionals in Hong Kong to ensure their firms met new US and British compliance requirements, such as the US Foreign Corrupt Practices Act and the British Bribery Act. Both laws required companies to ensure their overseas operations had proper internal control measures to crack down on corruption.
Lim said the rising demand for legal professionals had added to salary pressure, particularly for compliance professionals. 'There is a big shortage of compliance professionals across all industries, and I can foresee salary levels will increase significantly in the short to medium term,' she said.
In the first 10 months of the year, this number of overseas qualified lawyers was admitted to practise here: 148