US firm Shearman & Sterling has set up a German-based tax practice after poaching four lawyers from leading Frankfurt firm Punder Volhard Weber & Axster.

Punders tax partner Dr Hanno Berger will head Shearmans' new tax team, which will focus on international corporate transactions.

Three tax associates and three non-lawyer tax professionals will join him from Punders.

The new hirings bring the total number of Shearmans lawyers working in Frankfurt and Dusseldorf to 35.

Managing partner of Shearmans' German operations, Georg Thoma, said his firm had been looking for "quite a while" to establish a tax team in Germany, but said it was rare to get high-quality German lawyers willing to leave their firms.

However, Thoma said the position of German lawyers was gradually changing. He said the Punders tax team had been "looking around for a move" and had approached his firm over the proposed link-up.

He said this was part of a "very slow trend" in Germany. "There is concern within German firms about the future," he said.

"Lawyers are worried about the impact of the international Anglo-Saxon firms in the German market."

Thoma said the tax group was already proving very successful and was "desperately looking around for more partners".

He said the firm's German anti-trust group was also looking for new lawyers.

The new hirings cap a successful period for Shearman & Sterling, which recently advised Daimler/Benz on its merger with Chrysler.

Peter Naegele, co-managing partner at Punders, said his firm was "not very worried" by the departures.

"Hanno Berger was a lateral hire from the German tax authorities two years ago," he said.

"Most of the people who joined him have now left with him. They wanted to leave and we let them.
"We still have a very strong tax team."

While Naegele agreed that German lawyers were becoming "more mobile and more flexible", he argued that this would also allow German firms to recruit lawyers from Anglo-Saxon firms.

He insisted that his firm had not lost a single "home-grown" lawyer to a competitor.

Naegele also said his firm was in merger discussions with at least one firm from Continental Europe, although he insisted it was not talking to any UK or US firms – or other German firms.

He said his firm had terminated its membership of the Punder Group alliance of law firms last year because it realised merger, not association, was the best way forward in Europe.

Punders has also recruited a new general manager, Tjardo Siemens, from Arthur Andersen in Frankfurt.

Siemens has a full seat on the management committee.