India is first choice for referrals, say UK firms

India has emerged as the most important emerging market referral country for UK law firms, according to new research that highlights the differences between UK and US firms' approaches to key emerging economies. Legal Week Intelligence's 2008 Emerging Markets Report shows that while India is followed by Russia and the United Arab Emirates (UAE) as the biggest destination of referral work for UK firms, Brazil is deemed the biggest referral market for US firms. China, despite its increasingly powerful position in the world economy, was flagged by relatively few UK or US firms.

February 05, 2009 at 09:59 AM

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Emerging market report shows UK law firms target India and Middle East but US rivals refer more business

Legal Week Intelligence's 2008 Emerging Markets Report shows that while India is followed by Russia and the United Arab Emirates (UAE) as the biggest destination of referral work for UK firms, Brazil is deemed the biggest referral market for US firms.

China, despite its increasingly powerful position in the world economy, was flagged by relatively few UK or US firms.

Commenting on the findings, Freshfields Bruckhaus Deringer head of India Pratap Amin said: "There are historical ties between the UK and India. For the UK, Latin America is a bit more remote."

The 80-page report, which was created from interviews with 98 leading UK law firms and 68 US firms, also found that US practices are far more willing to send greater volumes and values of work to law firms in the emerging markets than their UK rivals.

The average annual value of work referred by US firms over the 12-month period leading up to the survey was just over $4m (£2.8m) compared with an average value of just over £1m for UK firms. More than half of US firms (56%) referred more than 30 pieces of work over the 12-month period, compared with only 27% of UK firms sending out the same number.

Corporate finance work was the most commonly-referred by firms from both the US and UK, with banking and finance, employment and pensions, general corporate work and litigation also frequently referred.

Despite the sharp market downturn, many firms expect they will increase the volume of work sent out to local firms in emerging markets. Forty-five percent of US respondents expect to refer more work during 2009, with 52% of UK respondents expecting an increase.

Linklaters head of emerging markets Nick Eastwell (pictured above right) said: "2009 will be a difficult year everywhere. However, I would suspect that by 2010 some of the emerging markets will begin to become fairly active again."

Doron Ezickson, London managing partner of McDermott Will & Emery, said: "We are seeing a greater interest from clients looking for local legal advice to maximise their efficiency. For example, we are managing multiple counsel in multiple jurisdictions and the work filters back to us before we go back to the client."

The survey also showed that more UK firms are thinking of opening offices in the UAE and India than any of the other emerging economies. By contrast, US firms favour China followed by India with Brazil and Russia less popular with both.

Additional reporting by Jeremy Hodges.

To read the summary of the report, please click here Emerging Markets Report 08-Summary