Contributed by Tan Jee Tjun and Kevin Kam
The third and final day of the International Malaysia Law Conference (“IMLC”) 2012 started off with a topic that has garnered so much attention in the Malaysian legal sphere lately.
The moderator, Christopher Leong, Vice-President of the Malaysian Bar, started the session with an introduction of the speakers and their impeccable résumés.
Embracing a World of Opportunity
The first speaker, Chew Seng Kok, Regional Managing Partner of ZICOlaw, talked about embracing, what was to him, a world of opportunity.
”A global shift, a tectonic and permanent shift, from West to East,” Chew said. Chew then highlighted the global shift of the world economy towards the Asian region in the last few years and how the service industries, including the legal services industry, must follow suit.
The third and final day of the International Malaysia Law Conference (“IMLC”) 2012 started off with a topic that has garnered so much attention in the Malaysian legal sphere lately.
The moderator, Christopher Leong, Vice-President of the Malaysian Bar, started the session with an introduction of the speakers and their impeccable résumés.
Embracing a World of Opportunity
The first speaker, Chew Seng Kok, Regional Managing Partner of ZICOlaw, talked about embracing, what was to him, a world of opportunity.
”A global shift, a tectonic and permanent shift, from West to East,” Chew said. Chew then highlighted the global shift of the world economy towards the Asian region in the last few years and how the service industries, including the legal services industry, must follow suit.
“Legal services cannot exist in the vacuum,” he said. “With the Asian economy taking the lead, there is no reason why the Asian legal industry cannot do the same,” he felt.
Chew explained that traditionally, Asian law firms are shy and very comfortable in their own positions, adopting a “jaguh kampong” (village hero) mentality. International firms, on the other hand, have the resources and experience and also deep pockets, to poach the local lawyers and provide them with irresistible offers.
According to Chew, the liberalisation of the legal services market in Malaysia will be more beneficial than detrimental to the Malaysian legal services market. “Statistics indicate that about 98% of the law firms in Malaysia have less than five lawyers and are mainly in the practice areas of conveyancing and litigation. So most of the firms here need not worry about the competition that would be brought about by the liberalisation of the legal services market,” he said.
“Lawyers must look for opportunities to expand. Liberalisation will happen; it is irreversible. Why are we taking a back seat?” he added.
He concluded by pointing out three matters that Malaysian law firms have to do to embrace liberalisation: Firstly, change of mindset, to be more competitive; secondly, adopt the market as outside and don’t be a “jaguh kampong”; and thirdly, prepare to invest to match the international lawyers and, if that is not possible, cooperate and share.
The Far Eastern Experience
The second speaker, Masaakira Kitazawa, Senior Partner of Anderson Mori & Tomotsune, one of the largest law firms in Japan, provided the audience with an insight into Japan’s experience with liberalisation of its legal services market, which would be useful to Malaysia in light of the impending liberalisation here.
He started off with a history of the process in Japan, highlighting that Japan took 18 years to liberalise its legal services market. Kitazawa was quick to point that liberalisation was only in respect of the practice of foreign laws; foreign lawyers cannot provide legal advice on Japanese laws and present lawsuits before the Japanese Courts of Law.
He then discussed the nature of the liberalisation and its effect on the Japanese legal scene.
“In terms of competition, it is not necessary that foreign law firms will overwhelm the local firms; Japanese law firms have an advantage when it comes to language and culture,” Kitazawa said. Referring to some statistics, he explained that the market liberalisation of legal services in Japan and involvement of foreign law firms brought about an increase of Japanese lawyers.
Kitazawa concluded that from Japan’s experience, we learn that liberalisation of the legal services market is the first step in the bigger expansion of legal business.
Across the Causeway
The third speaker, Jimmy Yim SC, Managing Director of the Litigation & Dispute Resolution Department of Drew & Napier LLC, Singapore, shared Singapore’s experience, which was very pertinent to Malaysian lawyers, in view of the proximity and similarities between both legal jurisdictions.
Yim said that Singapore took 12 years to achieve liberalisation. Just like Malaysian lawyers, Singaporean lawyers were initially worried about the competition anticipated by market liberalisation.
“But statistics indicate that the market liberalisation of legal services is actually beneficial to the financial aspects of the legal business. The legal services sector’s contribution to Singapore GDP grew by S$400m in just 4 years.”
He added that the Singaporean Government even went as far as allowing ad hoc admission of Queen’s Counsel, or lawyers of equivalent distinction, from any jurisdiction, even though Singapore herself had about 65 Senior Counsel.
Liberalisation will open up the market, providing the opportunity for local lawyers to participate in the foreign law firms. However, he notes that, unlike Japan, there is a larger proportion of foreign lawyers to local lawyers in Singapore.
“Do we feel the overcrowding of foreign lawyers? No. Liberalisation will present opportunities and options for local young lawyers as well as for the local law firms; they have more talent to draw from,” Yim said.
“Liberalisation is in line with the view of the Government to promote Singapore as a vibrant legal hub to complement its status as financial hub.”
Yim said that local Singaporean law firms have risen up to meet this challenge by getting involved in tie-ups with foreign law firms, increasing their litigation and arbitration departments and hiring foreign lawyers.
“The legal market is no longer a ‘sacred cow’. It will liberalise and move with freer competition. What we can do is to raise our standards to meet the competition.”
Down Under and the Orient
The final speaker, Stuart Fuller, Global Managing Partner of King & Wood Mallesons in Hong Kong, which can be called the first Asia Pacific law firm.
Since King & Wood Mallesons is a recently-merged legal firm between the Chinese firm of King & Wood and the Australian firm of Mallesons, Fuller shared the process of the merger which resulted in King & Wood Mallesons.
“Unlike most Asian countries, Australia has a long history of an open market. However, there is now a shifting of the centre of gravity for the legal services market toward Asia.”
Fuller explained that present market demands caused the legal services sector to open up, and if Mallesons had stayed local only, they would become less relevant. The answer for Mallesons was, he said, to integrate.
“With the integration, the benefit of working together would be better deals and better clients, and we believe we will become the best global firm in Asia,” he said.
Chew explained that traditionally, Asian law firms are shy and very comfortable in their own positions, adopting a “jaguh kampong” (village hero) mentality. International firms, on the other hand, have the resources and experience and also deep pockets, to poach the local lawyers and provide them with irresistible offers.
According to Chew, the liberalisation of the legal services market in Malaysia will be more beneficial than detrimental to the Malaysian legal services market. “Statistics indicate that about 98% of the law firms in Malaysia have less than five lawyers and are mainly in the practice areas of conveyancing and litigation. So most of the firms here need not worry about the competition that would be brought about by the liberalisation of the legal services market,” he said.
“Lawyers must look for opportunities to expand. Liberalisation will happen; it is irreversible. Why are we taking a back seat?” he added.
He concluded by pointing out three matters that Malaysian law firms have to do to embrace liberalisation: Firstly, change of mindset, to be more competitive; secondly, adopt the market as outside and don’t be a “jaguh kampong”; and thirdly, prepare to invest to match the international lawyers and, if that is not possible, cooperate and share.
The Far Eastern Experience
The second speaker, Masaakira Kitazawa, Senior Partner of Anderson Mori & Tomotsune, one of the largest law firms in Japan, provided the audience with an insight into Japan’s experience with liberalisation of its legal services market, which would be useful to Malaysia in light of the impending liberalisation here.
He started off with a history of the process in Japan, highlighting that Japan took 18 years to liberalise its legal services market. Kitazawa was quick to point that liberalisation was only in respect of the practice of foreign laws; foreign lawyers cannot provide legal advice on Japanese laws and present lawsuits before the Japanese Courts of Law.
He then discussed the nature of the liberalisation and its effect on the Japanese legal scene.
“In terms of competition, it is not necessary that foreign law firms will overwhelm the local firms; Japanese law firms have an advantage when it comes to language and culture,” Kitazawa said. Referring to some statistics, he explained that the market liberalisation of legal services in Japan and involvement of foreign law firms brought about an increase of Japanese lawyers.
Kitazawa concluded that from Japan’s experience, we learn that liberalisation of the legal services market is the first step in the bigger expansion of legal business.
Across the Causeway
The third speaker, Jimmy Yim SC, Managing Director of the Litigation & Dispute Resolution Department of Drew & Napier LLC, Singapore, shared Singapore’s experience, which was very pertinent to Malaysian lawyers, in view of the proximity and similarities between both legal jurisdictions.
Yim said that Singapore took 12 years to achieve liberalisation. Just like Malaysian lawyers, Singaporean lawyers were initially worried about the competition anticipated by market liberalisation.
“But statistics indicate that the market liberalisation of legal services is actually beneficial to the financial aspects of the legal business. The legal services sector’s contribution to Singapore GDP grew by S$400m in just 4 years.”
He added that the Singaporean Government even went as far as allowing ad hoc admission of Queen’s Counsel, or lawyers of equivalent distinction, from any jurisdiction, even though Singapore herself had about 65 Senior Counsel.
Liberalisation will open up the market, providing the opportunity for local lawyers to participate in the foreign law firms. However, he notes that, unlike Japan, there is a larger proportion of foreign lawyers to local lawyers in Singapore.
“Do we feel the overcrowding of foreign lawyers? No. Liberalisation will present opportunities and options for local young lawyers as well as for the local law firms; they have more talent to draw from,” Yim said.
“Liberalisation is in line with the view of the Government to promote Singapore as a vibrant legal hub to complement its status as financial hub.”
Yim said that local Singaporean law firms have risen up to meet this challenge by getting involved in tie-ups with foreign law firms, increasing their litigation and arbitration departments and hiring foreign lawyers.
“The legal market is no longer a ‘sacred cow’. It will liberalise and move with freer competition. What we can do is to raise our standards to meet the competition.”
Down Under and the Orient
The final speaker, Stuart Fuller, Global Managing Partner of King & Wood Mallesons in Hong Kong, which can be called the first Asia Pacific law firm.
Since King & Wood Mallesons is a recently-merged legal firm between the Chinese firm of King & Wood and the Australian firm of Mallesons, Fuller shared the process of the merger which resulted in King & Wood Mallesons.
“Unlike most Asian countries, Australia has a long history of an open market. However, there is now a shifting of the centre of gravity for the legal services market toward Asia.”
Fuller explained that present market demands caused the legal services sector to open up, and if Mallesons had stayed local only, they would become less relevant. The answer for Mallesons was, he said, to integrate.
“With the integration, the benefit of working together would be better deals and better clients, and we believe we will become the best global firm in Asia,” he said.