Ashurst has joined forces with technology-based legal services company Axiom in order to provide a wider range of advice to its banking clients.

It is the first time the technology company has announced a partnership with a law firm, and it is expected to agree further deals in future.

The move comes ahead of new European Union (EU) regulatory rules for banks, which are due to take effect next year.

The rules require banks to hold extra money to cover the risks of a host of different trading practices that they did not previously have to hold.

They were originally due to come into force in September, in line with regulators around the world, but earlier this month the introduction of the rules was delayed until March 2017.

The changes mean that banks will have to adjust the terms of their relationships with a range of counterparties. As a result, they need to amend the terms of existing contracts and put in place new contracts.

Axiom is advising banks on data extraction and handling the "repapering" exercise – filling out, signing and processing paperwork.

Ashurst will advise clients on writing new rules and signing new agreements. Ultimately, the firm will be responsible for confirming that the end product complies with the new rules.

Ashurst City finance partners James Coiley and Jonathan Haines are leading the project alongside London counsel Kerion Ball.

Coiley said: "The margin exercise is fairly unique in terms of its scale. It dwarfs, in terms of the number of financial institutions affected, other large-scale exercises like UK bank ringfencing. Across the globe, every one of these large institutions have multiple thousands of contracts which need to be amended."

Chris DeConti, executive vice president and global head of Axiom's banking practice, said: "Axiom is delighted to be working with Ashurst as our first partner in a new model for collaborating with law firms to deliver a comprehensive solution to our client spanning world-class legal advisory and legal execution capabilities. We look forward to announcing other partners in the future."

After discovering that it was pitching to many of Axiom's clients, the pair decided to join up and serve their shared clients.

Coiley added that Ashurst has a non-exclusive relationship with Axiom. "We also have our own new law capability [Ashurst Advance] which we deploy when we think it is the best tool for the job," he said.

"If a partnership approach works well for a particular client, it's one more model you've got in the armoury. We aim to create something which we think is compelling for a particular situation."

Ashurst launched Ashurst Advance in March. It is a new team focused on developing legal services innovations for clients.

The deal with Axiom follows Allen & Overy striking an agreement earlier this month with Deloitte, to create a new tech-driven system to help banks deal with the upcoming EU regulatory requirements.

Europe and the US are the largest jurisdictions for trading in the over-the-counter derivatives market, estimated at nearly $500trn (£353trn). The market is dominated by major banks that frequently trade with each other to hedge risks.