Dentons sign Photo: Diego M. Radzinschi/ALM

As Dentons prepares to combine with a mid-sized South Korean firm, questions remain over the future of the global legal giant's six-year-old Seoul office.

Last week, Dentons announced it was combining with Lee International, a Seoul-based domestic firm with about 30 lawyers. Meanwhile, Dentons already operates in Seoul as a foreign law practice with the office it inherited from predecessor firm McKenna Long & Aldridge after the firms merged in 2015.

In a statement, Dentons said the combination will give it the ability to practise Korean law. Under Korean regulations, global firms can have access to the Korean market by opening a foreign legal consultant office in Seoul—which cannot offer Korean law advice—or through an alliance with a local firm. The only way a global firm can directly practise Korean law is by forming a joint venture with a local firm. Both Dentons and Lee International confirmed that the combination is not a joint venture.

So far, none of the 28 foreign firms in Korea have a joint venture, partially because it is too restrictive and unfavourable to them—the foreign firm would have to be solely responsible for 100% of the joint venture while only being able to own 49% of it.

According to Dentons' website, the Seoul office has two partners: Andrew Park and Song Jung. Both are intellectual property specialists who also spend time in Washington, D.C. Park opened the Seoul office in 2013 for McKenna Long as the legacy U.S. firm's first office in Asia and has since been managing the outpost. In December, Park advised Korean supermarket chain E-Mart Inc. on IP and technology matters on a $275 million acquisition of U.S. food retailer Good Food Holdings.

The representative attorney of Lee International, Park Sung-duck, said his firm will not be integrated with Dentons' Seoul office. Instead, Lee International is merely joining the Dentons group, he said, which is organised in a Swiss verein structure.

A Washington, D.C.-based spokesperson for Dentons said it intends to have only one office in Seoul. But the Lee International combination will give Dentons two offices: Lee International's and legacy McKenna Long's.

Dentons' spokesperson said the firm is in discussions with regulators about how to manage its foreign licence and local presence in Korea. Changes made to a foreign legal consultant office in Seoul require approval by the Korean authorities. An official at the international legal affairs division of the Korean Ministry of Justice, who manages the foreign legal consultant offices, said the government was not informed of the specifics of the combination between Dentons and Lee International.

Dentons' Park declined to comment on whether his Seoul office will close. Dentons' Washington, D.C.-based global chairman, Joseph Andrew, and global CEO, Elliott Portnoy, did not respond to requests for comment. The firm's spokesperson said the firm will not discuss future plans until the partner vote regarding the combination with Lee International is completed, which is expected to happen in the next few months.

At least two international firms opted to form alliances with Korean firms instead of opening an office in Seoul, as they get access to the Korean market without making a significant commitment on the ground. Bird & Bird has a non-exclusive partnership with HMP Law, while Taylor Wessing has an exclusive alliance with DR & AJU; both alliances were formed in 2014.

So far, two global firms have closed their Seoul offices. McDermott Will & Emery, which was among the first global firms to set up a Seoul office in 2012, withdrew from Korea last month. And last November, Simpson Thacher & Bartlett, which was also part of the 2012 wave, shuttered its Seoul office and relocated its Korea practice back to Hong Kong.

Asia's fourth-largest economy is still an attractive market for global firms. Two U.S. firms recently set up shop in Seoul. Arnold & Porter Kaye Scholer and Shearman & Sterling opened in February and November, respectively.

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