World wide Companies problem Hong Kong Law Society’s Ideas to limit International Legal professionals
Quite a few worldwide regulation firms, including Davis polk & Wardwell and Kirkland & Ellis, are challenging a series of changes proposed by the Law Society of Hong Kong that could limit the practice of overseas legal professionals, warning that they could result in “colossal negative repercussions” for Hong Kong.
The group, which also includes Latham & Watkins, paul Hastings, Skadden, Arps, Slate, Meagher & Flom, and Linklaters, signed a letter to Legislation Society president Melissa pang warning that the proposed changes will have “colossal negative repercussions for the economy of Hong Kong and for Hong Kong’s status as an international financial center,” according to local newspaper the South China Morning post Robert P. WRIGHT.
Last week, pang informed members of the Legislation Society in a letter that the organization is considering changes to parts of the Legal practitioners Ordinance-the main legislation governing the legal profession in Hong Kong-that regulate overseas companies and international legal professionals in the city.
International lawyers and overseas regulation corporations in Hong Kong are required to register with the Law Society in order to advise on the regulation of their home jurisdiction or the laws of a third jurisdiction. Overseas attorneys are not permitted to practice or advise on Hong Kong law.
Among the proposed changes, the Law Society is seeking to require corporations to have two Hong Kong-qualified lawyers for every overseas lawyer they hire; the local-to-foreign ratio is currently 1:1. The professional body is also concerned with the misconduct where non-Hong Kong-qualified legal professionals advise on Hong Kong regulation matters without the supervision of a locally qualified partner.
The changes will most likely have a bigger impact on companies specializing in Hong Kong listings work, which usually involves a high volume of documentation work and often includes U.S. securities law opinions. Most global corporations practicing in the Hong Kong capital markets space give Hong Kong and U.S. legislation advice under one roof. The change of the local-to-foreign ratio, which could mean having two-thirds of the office’s legal professionals qualified in Hong Kong, could potentially lead to corporations sending attorneys away from Hong Kong.
Only a selected group of international firms were asked to comment during the first round of consultation, which was originally due to close on Nov. 1. Many lawyers were asked to give responses without first seeing what is being proposed, according to several sources that spoke with The Asian Lawyer, Regulation.com’s Asia-based publication.
In response, pang, who took over in June as the Regulation Society’s first-ever female president, agreed to expand the consultation to all members and extend the deadline to the end of this year.
pang promised that all Hong Kong solicitors, registered overseas attorneys and trainee solicitors will receive “a full set of consultation documentation which includes … an explanatory note summarizing the proposed amendments, the purposes and the rationale of the proposed amendments.”
A spokesperson for the Legislation Society said that if necessary, the organization will “meet members in person to exchange views and to keep a continuing dialogue.”
“We will collate all views of our members and consider them carefully in deciding the next step forward,” she said in an emailed statement.
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