As South Korea/US FTA ratified, Cleary and Paul Hastings confirm plans to open in region

Cleary Gottlieb Steen & Hamilton and Paul Hastings look set to be among the first law firms to launch in South Korea, with both firms confirming plans to open in Asia's fourth-largest economy.

The news comes after a free trade agreement (FTA) between South Korea and the US was ratified by both governments late last month, paving the way for the country's legal market to open up to US law firms for the first time.

Cleary has confirmed that it plans to open in South Korea in the first six months of next year, with Hong Kong partner Yong Guk Lee to head the office, which will initially be staffed with counsel Jay Hoon Choi and up to five associates drawn from the firm's 17-lawyer Korea team in Hong Kong. Lee said the firm plans to move "the bulk" of its Korea practice to Seoul within the next two to four years.

Meanwhile, Paul Hastings has confirmed that it also intends to open in the country as soon as possible next year.

Paul Hastings managing partner Greg Nitzkowski said: "We are discussing with our South Korean practice team their relocation sometime next year."

US firms will be allowed to apply to open representative offices in Korea from January, when they will be able to advise on US law, public international law and international arbitration. The firms will not be able to merge with Korean firms or hire local lawyers until 2017 according to the FTA; however, they will be able to enter co-operative agreements with domestic law firms from 2014.

Other US firms understood to be keen to enter the market include Baker & McKenzie and Simpson Thacher & Bartlett, both of which have Korean practices based in other offices in the region. Bakers Asia-Pacific regional chairman Jeremy Pitts commented: "We already have a substantial practice representing leading Korean companies on their transactions and other legal matters mainly outside Korea. We welcome steps to open the Korean legal service market to international law firms."

DLA Piper has the option of entering the market as either a US or UK firm, following the ratification of a FTA between South Korea and the European Union in July this year.

DLA Piper's Asia-Pacific managing partner Alistair Da Costa (pictured) said: "Korea is a big economy and if we want to reach our goal as being the largest commercial law firm in the world then it is a market we need to look at seriously.

"I don't know when we will enter the market but it is a jurisdiction that fits our international strategy."

Under the terms of the EU FTA and legislation set out by the South Korean Government, the market will open up in three stages: from July this year firms have been able to open representative offices to advise on non-Korean law, while from July 2013 they will be able to enter into co-operative agreements with Korean firms and advise on issues involving domestic and international law. By July 2016 EU firms will be able to invest in local firms and hire Korean lawyers.

While the market has technically been open to EU firms for some months, many lawyers in UK firms' Korean practices are US-qualified and therefore firms have not been able to act until now. Other firms hoping to launch in the country include Clifford Chance and Allen & Overy.