Ties That Bind - Bay Area Council Economic Institute

More documents

Recommendations

Info

70 Ties That Bind Jones Day King & Wood Latham & Watkins Morgan, Lewis & Bockius Morrison Foerster O’Melveny & Myers Orrick, Herrington & Sutcliffe (acquired Coudert Bros. China practice) Paul Hastings Janofsky & Walker Perkins Coie Pillsbury Winthrop Preston Gates & Ellis Ropers Majeski Kohn & Bentley Sonnenschein Nath & Rosenthal Squire Sanders & Dempsey (acquired Graham & James) Thelen Reid & Priest White & Case Wilson Sonsini Goodrich & Rosati International Trade and Investment Specialization A select community of Asia-focused attorneys and law firms has grown up around the extensive international trade moving through the Bay Area for most of the 20th century. It should be noted that, until the advent of containerization in the 1960s, Northern California was the principal U.S. trade gateway to and from Asia nationwide. More recently, Silicon Valley law firms have followed tech industry companies to China, facilitating cross-border trade and investment. Bay Area attorneys serve on CIETAC panels, and some have of-counsel relationships with Chinese law firms. For example John Huang, founding partner of one of China’s largest law firms, AllBright Law, is a graduate of Hastings College of Law in San Francisco; and current AllBright managing partner Kevin Qian practiced law with Pillsbury, Madison & Sutro in San Francisco before returning to China. Many larger U.S. corporate law firms initially shied away from China because of government restrictions and relatively small deal sizes. A small number of entrepreneurial Valley lawyers carved out a niche in cross-border semiconductor, internet and other tech investment in Taiwan and mainland China—and have shared in the rewards of successful startups, rollups and IPOs. Further easing since 2004 of China’s investment rules has greatly increased the size and diversity of China deals. Howard Chao, head of O’Melveny and Myers’ Asia practice, says Bay Area attorneys are now in growing demand for their China expertise and connections, increasingly from clients outside Silicon Valley and the tech sector. O’Melveny, for example, has recently advised
Bay Area-China Trade: Behind the Numbers the lead investors in Focus Media’s $172 million IPO, represented Chinese medical device manufacturer Mindray Medical International in its $270 million NYSE IPO, represented a Japanese photovoltaic cell maker being acquired by Chinese photovoltaic cell producer Suntech Power, and represented a Morgan Stanley-led consortium purchasing $1.3 billion in non-performing loans. Foreign law firms are following their investor clients beyond Beijing, Shanghai and Guangzhou into northern China and the interior. Competition Intensifies At first glance, there would seem to be a glut of foreign lawyers flocking to China, but in terms of specific commercial expertise and relationships there may actually be a shortage. The August 2005 breakup of Coudert Bros. prompted a rush among firms to lock up the approximately 50 Hong Kong, Beijing and Shanghai lawyers comprising Coudert’s China practice. Orrick, Herrington & Sutcliffe eventually prevailed over rival bidder Baker & McKenzie in acquiring the three offices, with other firms pursuing specific Coudert lawyers. Wilson Sonsini Goodrich & Rosati, meanwhile, responded to pressure from major Chinese clients and lured back its lead China attorney, who had moved to a Wall Street firm in 2005, to head a new Shanghai office. Foreign and Chinese lawyers currently have a complex relationship of cooperation and competition. They frequently work together in situations where the foreign firm’s client is involved in a court proceeding or requires an opinion letter based on Chinese law. And, as the experience and skills gaps between foreign and Chinese attorneys have narrowed, they more often pursue some of the same China business. Cost pressures add to the tension. Chinese clients commonly demand fixed fees and discounts, and select law firms primarily on price. Experienced lawyers are in short supply and charge a premium. Office rental and staffing costs, particularly in Beijing and Shanghai, are high by global standards. These and other factors have prompted foreign firms to seek out higher-end client work in areas such as IPOs or intellectual property protection and licensing. To manage workload and control costs, many have recruited Chinese law school graduates and lawyers willing to surrender their Chinese law licenses in order to obtain global practice experience and enhance their resumes. Foreign firms may pay Chinese staffers one-third the salary of a home country counterpart, but that still amounts to three times the salary at a Chinese firm. A trade group of Chinese lawyers in Shanghai has publicly complained that these non-licensed Chinese lawyers are unofficially drafting contracts, rendering opinion letters, preparing applications and registrations with government agencies, and directing litigations and arbitrations— work reserved under current rules for Chinese lawyers. The government issued a warning to foreign firms but otherwise has yet to act on the complaint. Song Zhu, a Chinese-born, U.S.-educated attorney with Squire Sanders in San Francisco who also has an engineering background and specializes in patent law, sees continued opportunities to assist U.S. firms entering the China market with IP protection and licensing, regulatory compliance and meeting technical standards. Down the road he sees Chinese companies branching out 71
Page 2 and 3:
The Bay Area Economic Forum wishes
Page 4 and 5:
Bay Area Economic Forum 201 Califor
Page 7 and 8:
Table of Contents Introduction ....
Page 9 and 10:
Introduction About This Report The
Page 11 and 12:
Introduction dollar-denominated ass
Page 13 and 14:
Introduction practices of their sup
Page 15 and 16:
Executive Summary The San Francisco
Page 17 and 18:
Executive Summary As Silicon Valley
Page 19 and 20:
Executive Summary 8. Establish regi
Page 21 and 22:
1 A Rich History of Work and Reward
Page 23 and 24:
A Rich History of Work and Reward m
Page 25 and 26:
A Rich History of Work and Reward t
Page 27 and 28: A Rich History of Work and Reward T
Page 29 and 30: 2 New Networks Emerge The Bay Area
Page 31 and 32: New Networks Emerge With scholarshi
Page 33 and 34: New Networks Emerge nomic Law; the
Page 35 and 36: New Networks Emerge and academics f
Page 37 and 38: New Networks Emerge schools on the
Page 39 and 40: New Networks Emerge Hong Kong and T
Page 41 and 42: New Networks Emerge financing—ban
Page 43 and 44: New Networks Emerge Since the mid-1
Page 45 and 46: New Networks Emerge (R&D) innovatio
Page 47 and 48: Hong Kong Seeks Its Role New Networ
Page 49 and 50: New Networks Emerge In recent years
Page 51 and 52: New Networks Emerge savings rates a
Page 53 and 54: New Networks Emerge Two, featuring
Page 55 and 56: New Networks Emerge All of the abov
Page 57 and 58: 3 Bay Area-China Trade: Behind the
Page 59 and 60: Bay Area-China Trade: Behind the Nu
Page 77: Bay Area-China Trade: Behind the Nu
Page 81 and 82: An Electronic Public Square Bay Are
Page 83 and 84: %D\ $UHD &RQQH�WLRQV Bay Area-Chi
Page 113 and 114: 4 Investment: Building Global Busin
Page 115 and 116: Investment: Building Global Busines
Page 121 and 122: 14,000 12,000 10,000 8,000 6,000 4,
Page 129 and 130:
Investment: Building Global Busines
Page 131 and 132:
Page 133 and 134:
Page 135 and 136:
Page 137 and 138:
Page 139 and 140:
Page 141 and 142:
Page 143 and 144:
Page 145 and 146:
5 Building Bridges, Leveraging Asse
Page 147 and 148:
Building Bridges, Leveraging Assets
Page 149 and 150:
Building Bridges, Leveraging Assets
Page 151 and 152:
Acknowledgments This report was co-
Page 153 and 154:
Walter Reichert Hewlett-Packard Co.
Page 155 and 156:
Sources Introduction American Chamb
Page 157 and 158:
Sources Hicks, John D. “The Ameri
Page 159 and 160:
Financial Services Sources “A Gre
Page 161 and 162:
Sources Schmitt, Kellie, “Lost Ho
Page 163 and 164:
Sources “China-Based Worksoft Cre
Page 165 and 166:
Sources Guerin, Didier, “Human Ca
Page 167 and 168:
Sources Cooper, Chris, Ken DeWoskin
Page 169 and 170:
Sources Liou, Fu Tai, “How Taiwan
Page 172:
Bay Area Economic Forum 201 Califor
show all

Ties That Bind - Bay Area Council Economic Institute

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?