Four UK firms break into Asia 50 rankings as Chinese firms dominate
Addleshaws and CMS among UK firms to make ranking of largest firms in Asia by lawyer count
October 29, 2018 at 12:00 AM
9 minute read
The original version of this story was published on The American Lawyer
Four UK firms have made the cut in this year's list of the 50 global firms with the biggest presence in Asia, as firms attempt to keep up with Chinese players' breakneck growth.
Addleshaw Goddard, Ince & Co, CMS and Withers have joined this year's Asia 50 rankings, replacing four US firms. Addleshaws reported 36 lawyers in Hong Kong and two in Singapore in 2017; its headcount in Hong Kong more than doubled from 2016's 15.
In 2017, the 50 largest law firms based in Asia-Pacific countries comprised 56,739 lawyers in total, a 20% increase from 2016's 47,130. Twelve firms from China, plus Ashurst, reported a headcount of more than 1,000 lawyers globally.
CMS tripled its Asia practice to 51 lawyers in 2017 thanks to its three-way merger and a newly opened Hong Kong office. In Singapore, where the firm had 30 lawyers, it inherited legacy offices from Nabarro and Olswang and formed an alliance with local firm Holborn Law. In Hong Kong the firm's office, opened in late 2016, grew to 10 lawyers.
Baker McKenzie and Herbert Smith Freehills are the only global firms on this year's top 20. Norton Rose Fulbright, which reported 570 lawyers across the Asia-Pacific last year, a 16% drop year-over-year, fell out of the top 20 for the first time since 2011, when London-based Norton Rose was the eighth-biggest player in the region with 806 lawyers.
In 2017, Norton Rose Fulbright completed a second Australian merger – after the 2009 combination with Deacons Australia – by acquiring 180-lawyer local firm Henry Davis York. (Norton Rose Fulbright said the merger, which became effective in December 2017, was not taken into account in calculating its 570 Asia-Pacific headcount.)
Chinese firms continue to dominate the Asian legal market, at least by number of lawyers. In 2017, 27 out of the 50 largest Asia-Pacific law firms by headcount came from China, and the top 50 chart looks only slightly different when we include US and European firms' Asia-Pacific offices – 26 Chinese firms are on that list.
Dentons leads the Asia 50 chart for the third consecutive year with 8,658 lawyers in 2017, up 16.3% from 2016's 7,445. The global giant has held the top spot since its 2015 merger with China's Dacheng Law Offices. In 2017, the firm completed a series of Latin American combinations in Peru, Costa Rica, Panama and Guatemala. Dentons' expansion continued in 2018 with even more mergers and acquisitions in Southeast Asia and Australia.
To compile our rankings, we ask firms based in the Asia-Pacific region to provide full-time equivalents for 2017. We rely on information from the National Law Journal 500 for US firms' headcounts in the Asia-Pacific region and from Legal Week's UK Top 50 for those of British firms. We categorise a firm's nationality based on the market where it has the most lawyers. Dentons, therefore, despite its US and UK roots, is considered to be Chinese for purposes of this list, while Ashurst is an Australian firm.
Beijing-based Yingke Law Firm (7,438 lawyers) and Shanghai-based AllBright Law Offices (3,400) take second and third, respectively. The firms' relatively decentralised style has allowed them to expand quickly by absorbing teams or even smaller firms.
At number four, King & Wood Mallesons managed to add 365 lawyers in 2017 to reach 2,762, as the firm worked to rebuild a European presence after the collapse of SJ Berwin, which was formerly part of its verein structure.
Four Chinese firms – Duan & Duan, Jointide Law Firm, V&T Law Firm and Commerce & Finance Law Offices – and Australia's Mills Oakley are new to this year's Asia 50.
Shanghai-based Duan & Duan saw one of the largest growths in 2017, nearly tripling firmwide headcount to 868 lawyers from 2016's 300. As part of its effort to expand beyond Shanghai, the firm launched five new offices last year, including three in mainland China and outposts in Japan's Nagoya and Cambodia's Phnom Penh. Duan & Duan also expanded its existing offices, doubling the size of offices in eastern China's Xiamen and central China's Zhengzhou. Firm executive chair George Wang says the firm aims to cover most of the provincial capitals and add other noncapital cities in more developed regions along the country's coastline. "We are hoping to build a global Duan & Duan platform in the future," Wang says.
Outside China, leading firms remain largely unchanged in their respective markets: Australia's Ashurst (1,321 lawyers), MinterEllison (813), Clayton Utz (724) and Allens (632); Korea's Kim & Chang (920), Bae, Kim & Lee (625), Lee & Ko (616), Shin & Kim (395), Yulchon (368) and Yoon & Yang (367); Japan's so-called Big Four of Nishimura & Asahi (585), Mori Hamada & Matsumoto (482), Anderson Mori & Tomotsune (469) and Nagashima Ohno & Tsunematsu (397); and India's Cyril Amarchand Mangaldas (618), Khaitan & Co. (546), Shardul Amarchand Mangaldas & Co. (520) and AZB & Partners (388) all make the list.
Singapore's WongPartnership falls out of this year's top 50, leaving only two firms from the city-state – Rajah & Tann (602 lawyers) and Allen & Gledhill (359) – on the list. Also dropping off the list are India's Luthra & Luthra and Australia's Gadens, whose Sydney and Perth offices broke off to become part of Dentons in late 2016.
Meanwhile, Atlanta-based Troutman Sanders, which in 2018 closed offices in Hong Kong, Beijing and Shanghai, falls off the list, along with Hunton & Williams, King & Spalding and Gibson, Dunn & Crutcher. Other US firms, such as Orrick, Herrington & Sutcliffe and Ropes & Gray, managed to remain on the list but saw significant losses in Asia headcounts following partner exits.
One US firm, though, is bucking the trend: Philadelphia-based Morgan, Lewis & Bockius saw its 2017 Asia headcount grow nearly 60 percent to 148 after launching a Hong Kong office with more than a dozen ex-Orrick lawyers and expanding its China employment practice with a team hired from Simmons & Simmons.
But the stunning growth wasn't enough to earn Morgan Lewis a place on our Biggest Footprints chart, where indigenous firms and global firms are ranked together on their Asia-Pacific headcounts. In 2017, 16 of the top 20 law firms with the largest Asia-Pacific presence were from China; in 2011, the first year we collected data for the Asia 50 report, only nine out of the top 20 were Chinese firms.
The Chinese firms grew mostly at the expense of their Australian counterparts in the years since 2011. Back then, seven out of the 20 law firms with the highest Asia-Pacific headcounts were from Australia; but in 2017, MinterEllison was the only one. This is, in part, because many of Australia's largest law firms went through a wave of international mergers in 2012 and 2013. As a result, Mallesons Stephen Jaques is now King & Wood Mallesons, which we recognize as a firm from China. Freehills is today Herbert Smith Freehills, a U.K. firm under our methodology.
That said, the Chinese firms, fueled by the country's fast-paced economic growth, expanded much more aggressively during the past seven years than their Australian peers. In 2011, Mallesons Stephen Jaques had 1,012 lawyers in the Asia-Pacific region, while China's King & Wood had only 687; by 2017, King & Wood Mallesons reported over 1,500 lawyers in China and 960 in Australia. During the same period, Zhong Lun Law Firm grew from 467 lawyers to 1,386 in the region, and Grandall Law Firm increased its Asia headcount from 676 to 1,850.
By contrast, the Australian firms that have remained independent only saw shrinkage: MinterEllison went from 821 lawyers in the Asia-Pacific region in 2011 to 810 in 2017; Allens went from 746 to 632; and Clayton Utz dropped from 743 to 724.
Meanwhile, Asian firms continue their regional push. In 2017, Korea's Shin & Kim and Yoon & Yang both opened offices in Vietnam. Kim & Chang, the country's largest law firm, followed suit in Ho Chi Minh City in 2018. In Thailand, Japan's Mori Hamada merged with 45-lawyer Bangkok firm Chandler and Thong-ek Law Offices in 2017.
Others are pursuing more global ambitions. King & Wood Mallesons' China chair Zhang Yi says a new European and Middle Eastern unit under the firm's Chinese arm has been growing steadily. By August, the firm had 42 partners in Europe and the Middle East, up from 32 in early 2017 when the Chinese partnership took over. The SJ Berwin crisis was a lesson, Zhang says, "but so far we've been successful building our own overseas offices," as opposed to adding verein members.
As more Chinese investment now turns to Europe, the financial integration allows for more close collaboration between European and Chinese offices, Zhang says. "Morale is high," he adds.
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