Legal Market Overview
Singapore’s status as a major legal hub has grown considerably in recent years. The State’s efforts to absorb more economic activity and investment has paid considerable dividends, encouraging a thriving local and internationallfacing legal profession. It now boasts one of the premier arbitration regimes in the world, and is quickly developing a highly sophisticated asset management industry and has put in place a world-class restructuring and insolvency regime. The country is at the forefront of new technologies and has become a recognised private wealth centre. Transactions slowed following the outbreak of Covid though picked up during the latter half of 2020 and remained steadfast throughout 2021. A few lawyers reported a decline in inward Chinese investment while others stated that there had been a general reluctance of some investors to commit. This was largely offset by a huge uptick in opportunistic M&A and influxes of private equity cash which had gone unspent during early-to-mid 2020. The pharmaceutical, healthcare, life sciences, edutech, and fintech sectors were said to have been particularly active and SPAC and de-SPAC transactions were increasingly prevalent and a developing field of expertise.
A considerable number of major international firms are active in Singapore’s corporate and M&A market, which generally serves as a hub for inbound investments into neighbouring ASEAN markets; they face competition from local firms, many of whom themselves have established offices or alliances in Indonesia, Vietnam, the Philippines and Myanmar. Demonstrating this, Singapore firms such as Rajah & Tann Singapore LLP and WongPartnership LLP have opened up a series of offices around Southeast Asia and beyond.
There remains a noticeable divide between the local and international professions in Singapore. International firms are prohibited from providing Singapore law advice unless they meet strict criteria and become a Qualifying Foreign Law Practice (QFLP); this demands that firms have a high percentage of Singapore qualified lawyers and is designed to support the growth of the Singapore profession and Singapore law itself. International firms have further options in being able to offer local law capabilities; a joint law venture (JLV) allows local and foreign firms to establish a financially integrated entity, and a Formal Law Alliance (FLA) enables foreign and local firms to collaborate but remain operationally and financially distinct. These approaches are increasingly widespread, although there is still a large cohort of international firms that are satisfied with informal collaborations with their local counterparts.