Legal Market Overview
Whilst Hong Kong, as with other countries, has had to weather challenges in the past couple of years, the first half of 2021 saw renewed economy growth. It is thought that such growth will be assisted with the mutual recognition of assistance on bankruptcy/insolvency proceedings between Hong Kong and Mainland China. The new regime, which is still in its pilot phase, is a long awaited development that is designed to enhance the administration and implementation of cross-border insolvencies and restructurings.
China’s trade and political tensions with the US, as well as increased internal regulations, is the most noteworthy development over the past year and has resulted in a significant downturn in Sino-American transactions. This has, in turn, generated a large amount of divestment, restructuring and repositioning work for Greater China practices and has been largely offset by a greater focus on domestic and regional transactions, as well as a boom of activity in the TMT, biomedical, pharmaceutical and healthcare sectors. Instructions from Europe were generally observed to have remained steadfast though a handful of interviewees noted a decline. A number of firms also reported that Hong Kong’s restrictions on international travel had themselves led to the falling through of deals though the most frequently recurring form of feedback was that, despite political uncertainties and a global pandemic, both the public and private M&A markets had remained incredibly busy. As a tax-efficient international hub with many large US companies and law firms, it seems that the city is in a good position to weather the effects of the global pandemic.
In the legal market, as a general rule, Hong Kong serves as a hub for international firms active in the ‘Greater China’ market. The work is frequently led locally with support from the Beijing and Shanghai offices, as well as alliances with PRC law firms. Among the active firms in this highly competitive market, Milbank has been making significant moves, including the recent hire of Davide Mencacci and John Bona from Linklaters, which saw the firm enter the banking and finance table at tier three. The firm also acquired Andrew Whan and Neeraj Budhwani from Clifford Chance’s private equity team, which saw the firm enter the table in tier four. CMS continues to strengthen its presence in the region, and this year enters the intellectual property table at tier four. Local firm Howse Williams bolstered its corporate capabilities with the addition of Veronica Chow and a team of corporate lawyers from local rivals ONC Lawyers. In September 2021, Mishcon de Reya LLP became the latest firm to enter the Hong Kong market by establishing an association with a local law firm Karas LLP with a team of over 20 locally qualified professionals; the firm will concentrate on litigation and dispute resolution, investigations and private wealth advice.