As Europe's legal systems become increasingly harmonised, distinctions between East and West and local and international firms are blurring. Mark Smulian reports

The differences are dissolving. When the Berlin Wall fell, Europe's western and eastern halves barely knew each other and doing business across this divide was problematic. 

Today, eastern Europe's EU members have relatively harmonised legal systems and so offer a fairly predictable working environment. This marks them out from Russia and Ukraine, where English law is often preferred for governing contracts because of a lack of confidence in local systems. 

But even there, the ways of doing business are becoming more 'normal' for foreign lawyers and clients. Recession hit this part of Europe, although, with lower debt levels than Western Europe, it has recovered – if from a low base – somewhat more rapidly.

Growing popularity

Though M&A remains subdued, dispute resolution is growing, in particular in Russia and its neighbours. One effect of the dissolving differences has been a relative decline in the position of once-dominant international firms. Today, there are thriving domestic rivals – often run by those who once worked for international firms – which compete by offering local knowledge and lower prices.

Moscow-based Freshfields Bruckhaus Deringer partner Sebastian Lawson (pictured, below) explains: "Local firms have expanded, and both local and international clients are increasingly content to use local firms, and their charges will be less too. International firms' financial structures mean they find it difficult to promote