Understand Your Rights. Solve Your Legal Problems
As more and more executives strive to gain citizenship abroad, in particular by investment, Portia Vincent-Kirby at Hudson McKenzie explains how the future could look different when it comes to national and international citizenship.
With ‘passport shopping’ on the rise amongst international elites, how long will it be before the traditional concept of the nation-state becomes a shadow to the new developing sun of globalisation?
Accessorizing oneself is no longer a matter of designer handbags, luxury cars and yachts – the latest trend amongst the global wealthy is the accumulation of passports.
As an aid to this nationality-acquiring process, “Citizenship by Investment Programs” (CIPs) allow those with the funding to do so, to be able to proceed along a “golden visa” route.
This route allows high-net worth individual to obtain citizenship of a specific country, providing that they can economically invest to a substantial degree. For instance, in some countries, investors are rewarded with residence permits which can lead to citizenship after five years.
Thus, the birth of the “global citizen” is on the up-rise, as a fashionable status to be recognised worldwide. With economic citizenship becoming rapidly a popular pursuit, as if nationality was a commodity to be acquired in its numbers, many high-net worth individuals showcase their status as a ‘global citizen’ by being a citizen of several countries, rather than just their original country of birth.
However, could the rise of the global citizen lead to the eventual demise of the nation-state altogether?
For example, it could be questioned that if citizenship can be bought at ease based upon a price that a person is willing to invest, what integral foundations does the concept of being a ‘national citizen’ have? Is nationalism and the idea of being a ‘national citizen’ now only reserved for the poor?
With Citizenship-by-Investment programs booming, as nationality statuses continue to be bought at a price rather than inherited, global immigration is likely to face dramatic changes in times to come.
by Rolf Behrentin of Behrentin Rechtsanwälte
For most people, there comes a time in their lives when they think about having children. For those who have made this decision, if it turns out that they cannot have children naturally, this can be incredibly hard to accept. Once this difficult situation has been accepted, the question of alternatives arises. At this point, couples will be confronted with topics such as adoption or surrogacy. However, these routes to parenthood can be troublesome and emotionally challenging. This is often the case where proceedings take place abroad, and the law in the child’s country of birth does not correspond to the legal requirements in the country of origin of the intended parents.
Adoption in particular is an area that can hold many uncertainties on the road to legal parenthood of an adopted child. One parent may unlawfully refuse to agree to the adoption, or a responsible authority might give a negative prognosis that is unjustified. Whenever such legal difficulties arise, affected couples will almost inevitably seek the counsel of a specialised attorney. In the USA there is an abundance of specialised experts among lawyers and law firms. In Germany, on the other hand, there are a few renowned family law experts, but only one law firm specializes in adoption law and also covers further aspects of international family and reproductive law. Aside from counselling clients, this law firm is active in academic research, provides international assistance to clients, other law firms, public authorities and Courts, and prepares expert opinions. We spoke to the owner, Rechtsanwalt Rolf Behrentin, about adoption, reproductive law, his work and interesting cases in his day-to-day practice.
You have specialized in adoption law since 2002 and also in reproductive law since 2010. Please give us an overview on the legal situation and developments in Germany.
Adoption Law
Under German law, the provisions governing adoption comprise two large areas: the adoption of minors and the adoption of adults. The paramount principle governing the adoption of minors in Germany is that the adoption must be in the child’s best interests, which equates to international standards. Therefore, the process of adopting minors seeks to find suitable parents for a child, and not to find a suitable child for the parents. The majority of adoptions of minors in Germany concerns stepchildren, i. e. cases where a new partner adopts the child of the other spouse. The numbers in this area have been stable over the years and are very likely to grow in the future, due to constantly changing circumstances in family life.
In the other area of so-called “non-family adoptions” (Fremdadoptionen) there are more applicants in Germany than children available for adoption. As a result of this, the chances of applicants actually adopting a child will often be slim. It is also possible to adopt children from abroad. Often, these children are highly traumatized, or they are children with special needs, and to adopt them would be challenging. This discourages many applicants. As a result of these circumstances and the developments in reproductive medicine, in particular the developments in surrogacy in other countries, the number of successful adoptions from abroad has been constantly decreasing in Germany. As an attorney I have had to react and adapt to these developments, which is why I have been expanding my field of practice into reproductive law for some years now.
Reproductive law
In recent years, surrogacy has been at the heart of discussions about reproductive law in Germany. As opposed to the United States, German law prohibits both the medical procedure and facilitating a surrogate mother. Therefore, affected couples must go abroad to arrange a surrogacy, e. g. to California or to the Ukraine. German legislators continue to oppose surrogacy. From a German law perspective, the legal mother of a child is the woman who has given birth to the child. The legal father is either the mother’s husband, or the man who has acknowledged that he is the father, or the man who has been judicially declared to be the father. This leads to the frustrating situation that, while in the state of birth of the child the intended parents are viewed as the legal parents, under German law, there is initially no legal relationship between the intended parents and the child. If there is a parentage judgment/order (Abstammungsentscheidung), as in many States in the US, the legal parenthood of the intended parents can be determined with binding effect relatively simply through judicial recognition. In countries that do not provide for such a judgment, such as the Ukraine, it is more difficult. If the surrogate mother there is not married, the intended father can become the father by acknowledging his fatherhood, and the child will thus become a German national. However, if the surrogate mother is married, the intended father can only become the legal father – resulting in the status of German national for the child - by judicially contesting the husband’s fatherhood and having his own fatherhood determined. In these cases, the child will not be permitted entry into Germany prior to the close of these proceedings, which puts the affected couple in a difficult situation. The intended mother can then become the legal mother only by adopting the child by way of a stepchild adoption. These cases always involve difficult questions of international law. In the USA, this seems hardly conceivable, but in Germany it is the bitter reality. In these cases, I benefit from my experience as an attorney specialized in adoption law.
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"Our adoptions situation was extremely complex and we switched to Rolf after losing in the first instance. Rolf patiently worked through the situation and with his strong relationships, outstanding legal mind drove the situation to a wonderful resolution"
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Are there differences between the work of an adoption attorney in Germany and in the USA?
Yes, there is a considerable difference. In the United States, attorneys are permitted to arrange adoptions, whereas in Germany, this is not only impossible, but outright prohibited. In Germany, the matching procedure and the establishing of contact between the intended parents and the adoption agency responsible for the child, on both national and international level, may only be undertaken by public authorities or institutions accredited by such authorities. I am a Member of the Board of an accredited adoption agency operating internationally. However, this is only a side job, and I keep my work as an attorney strictly separate from these activities. Nevertheless, they provide me with important insights into the practice of matching procedures and the extrajudicial aspects of adoption and with valuable experience for my internationally active law firm.
Please share some of these experiences with us.
I also provide legal counsel to the association of accredited adoption agencies in Germany. This keeps me up to date, and I am well aware of the problems and worries of the accredited adoption agencies in Germany. Both activities have provided me with comprehensive experience in dealing with German and foreign public authorities. Dealing with German public authorities is not particularly exciting. In most of these cases, the public authority and the accredited institution have a different view of certain legal aspects, and the task then is to negotiate or achieve clarification in Court proceedings.
Dealing with public authorities abroad is much more exciting. It requires dealing with different cultural environments and different approaches to work, which greatly enriches my role. To win countries for adoption agencies, I have travelled a lot in Africa and also on other continents. I have had to negotiate agreements, conditions and procedures with Ministries and attorneys in those countries. I have also seen dramatic developments during adoptions, cases, in which the genetic parents of the child showed up and I then had to reverse the adoption. I have gained experience in over 50 countries worldwide.
Are there problems related to international adoption that we in the USA are not familiar with?
There are a few. Some German embassies abroad can be quite stubborn when it comes to problems in the country of origin of a child. Theoretically, German embassies and consulates would have to verify for themselves whether the adoption can be recognised under German law and whether the child has acquired German nationality through adoption and may therefore enter the country. Nevertheless, many German diplomatic missions instead require formal recognition proceedings before the German Courts. These proceedings will take at least six months. As a result of this, the adoptive parents, or one of them, must live with the child in the country of origin until the proceedings are closed, and the child may not enter Germany beforehand. I am involved with such cases quite often. To my knowledge, the US authorities are much more accommodating as these problems do not seem to occur for US nationals. On the whole, the recognition of an adoption from abroad is considerably less difficult in the United States than in Germany. In one of the worst cases I have had to deal with, it took four years to get the adopted child and the parents into Germany, because recognition was refused. We were forced to resort to a so-called “post adoption” (Nachadoption) to get the child here. Under these circumstances, it often proves difficult to get assistance from foreign public authorities, because they consider the adoption proceedings to be closed. On one occasion, I had to travel abroad and stay there for weeks, speaking daily with the central authority or to Courts or Ministries to make it happen. I spent an entire trip to India at CARA, and have experienced the same issues in some African and South American countries. The situation can be equally difficult if the country of origin suspends the international adoption, and the applicants are in the middle of the preparatory phase at that point. German authorities will not be of any assistance then, and so I have to pack my suitcases again. The US authorities provide much more support to their citizens in such cases.
A large area of your activities has not yet been mentioned: you are also involved in the adoption of adults. Please tell us more about it.
That does form a large part of my work. Unlike the other activities I engage in, the reason for the adoption of an adult is not usually the unfulfilled wish to have children; generally, the reasons are quite different. Under German law, the adoption of an adult will lead to positive tax benefits in succession cases. This means that succession tax will be considerably lower if the beneficiary was adopted prior to the testator’s death. If this was the only reason for the adoption, that would obviously be a problem, because the adoption of adults was not intended to be a tax saving device. Adoption of adults is also found in cases dealing with corporate succession, because it also brings tax advantages in that area. Another motive can be to facilitate the inheritance of family names or aristocratic titles. I have already been involved with some such cases in the European aristocracy. Of course, the German Courts are aware of the situation and will therefore take a close look at the reasons given for the adoption. Then my role is to bring the family-related adoption reasons more into the focus of both the Court and the client.
"They really do exist - books that we've been missing. [... An] excellent handbook on adoption law ..."
Dr. Claus-Henrik Horn, Fachanwalt für Erbrecht, Düsseldorf, in: ErbR 12/2017, to 1th. edition 2017
FIRM PROFILE
Behrentin Rechtsanwälte offers you comprehensive advice as well as judicial and extrajudicial representation in all matters of international adoption and reproductive law at the highest level. For more than a decade, the law firm Behrentin Rechtsanwälte has specialised in national and international adoption law with experience in more than 50 countries. A scientific approach and extensive practical experience unite in this law firm. Through many years of academic activity, longer periods spent abroad and the practical experience of the law firm owner, we are prepared for any kind of complex issues. A team of academic staff supports Behrentin Rechtsanwälte to ensure high scientific standards are maintained for the benefit of clients.
Behrentin Rechtsanwälte also prepares expert opinions on all questions of adoption and reproductive law. We also provide support and advice for other national and international law firms.
ABOUT ROLF BEHRENTIN
As an independent lawyer, Rolf Behrentin has specialised for many years in both German and international adoption law, with experience in more than 50 countries.
Activities:
PraxisKommentar BGB in the 7th edition.
Qualifications: Studied at the University of Cologne. Lawyer training in Cologne and Bangalore (India). Admitted as a lawyer since 2002. Successfully completed specialist family law and inheritance law courses.
AREAS OF EXPERTISE
Aspects
CONTACT BEHRENTIN RECHTSANWÄLTE
Rolf Behrentin, Im MediaPark 8, 50670 Cologne
Tel: +49 (0) 221/788 20 400
Fax: +49 (0) 221/788 20 401
Email: rb@behrentin.de
Web: www.behrentin.de
Recent research from Penningtons Manches reveals that British tech companies are enjoying unprecedented investment from West Coast-based US firms – last year, 74 deals contributed a total value of £1.08bn, the first time Silicon Valley investment into the UK has broken the billion-pound mark. This week Lawyer monthly benefits from top insight from James Klein, Partner at Penningtons Manches, who discusses ways to support clients in international investment and expansion.
For law firms representing Britain’s brightest and most innovative businesses, mounting interest from US investors in domestic companies offers significant opportunity; law firms can play a vital role in creating and developing critical relationships between US investors and British fast-growth businesses seeking to scale.
1. The investor landscape is changing
It is not just conventional venture capital firms that are seeking to invest or partner in a business. Increasingly, we are seeing the venture arms of larger corporates seeking to spread their risk appetite and enter into creative partnerships with UK businesses, usually in the form of a joint venture or other strategic arrangement that will provide them with an all-important foothold in Europe. For UK businesses, having a strategic cornerstone corporate on board can help them scale even quicker.
2. Strong relationships with investors are key
Demonstrating strong, long-term relationships with a diverse range of investors is crucial to gaining clients’ trust. Too often, we hear impressive and ambitious fast-growth companies telling us that their pitches to US investors have gone unanswered. As is so often the case in business, it isn’t just what you know that counts – it’s who you know. Assuming it makes sense at that point in its lifecycle for a UK business to consider approaching a US investor, the first point of contact is often key and this is where the existing relationships can be vital.
3. Clients need a winning pitch deck
For many companies, creating a winning pitch deck that will engage investors and communicate the elements and story of the business that individual investors care about is crucial. Many founders simply don’t have the requisite level of knowledge and expertise about the investors to whom they are approaching, and efforts to engage investors often fail at the first hurdle. The best advisers will tailor their clients’ pitch decks to specific investors, ensuring the deck has the right ‘tone’ for one particular investor, as well as identifying potential synergies within an investor’s current portfolio.
4. A base in Silicon Valley shows you’re serious
When we opened our office in San Francisco in late 2014, we were approached by a number of founders of UK businesses who wanted to get on-board with us because of our foothold in Silicon Valley. These businesses look to us to help them start creating long-term relationships with other businesses, influencers, decision-makers and investors on the ground in the US, which is a key ingredient for their growth. Having an office in San Francisco assures clients that you are much more likely to be able to offer stronger relationships with key stakeholders in Silicon Valley.
5. Not all clients are ready for Silicon Valley
Be prepared that not every business will be ready or suitable for an injection of West Coast capital. Founders can initially be very excited about the prospect of Silicon Valley investment only to realise they are not quite ready, usually for several reasons. They may come to realise that their business isn’t scalable, or they may not have any senior management situated in the US. Sometimes it’s simply the case that they lack a sufficiently robust US client base. Don’t be disheartened - businesses that pull out in the final stages are often laying the groundwork for a later, stronger return.
This is an exciting time to be in the technology industry – and an exciting time for law firms able to bridge the gap between ambitious UK tech businesses and possible West Coast investors. Our research shows West Coast investment into UK firms is at an all-time high and businesses seeking US investment need a trusted partner that can offer vital insight and help get them in front of the right investors. For law firms with one foot either side of the Atlantic, it’s a golden opportunity not to be missed.
On the 8th international Day of the Endangered Lawyer (last week), the Bar Council and the Bar Human Rights Committee of England and Wales (BHRC) together with lawyers’ organisations in Europe and around the world, stand in solidarity with those lawyers in Egypt who face persecution in furtherance of the protection of the rule of law. This is also the day to remember lawyers at risk across the world.
The Day of the Endangered Lawyer – 24th January – was founded and is organised by the Foundation for the Day of the Endangered Lawyer, based in Haarlem, the Netherlands. The date was chosen because on 24th January 1977, four lawyers and a co-worker were murdered at their office in Madrid, Spain. This was also known as the Massacre of Atocha.
For the protection these lawyers afford to others, they are often watched, tracked, falsely prosecuted, deprived of their liberty, or even killed. Each of those instances is a serious threat not only to those lawyers, but to the meaningful protection of the rights they seek to defend.
For 2018, the Day of the Endangered Lawyer is focused on Egypt, in light of widespread credible reports from human rights organisations that Egyptian authorities are “rapidly taking concrete steps to shut down the last critical voices in the country’s human rights community.”
Since 2013, fundamental human rights, including the right to a fair trial and freedom of expression and assembly, have been diminished on an ongoing basis by broad security legislation. In the last two years, there has been an increase in the number of arrests of lawyers who provide counsel and representation to human rights defenders, many of whom face extended pre-trial detention without a reasoned decision for refusing conditional release. There are widespread reports from international organisations that those in detention are at risk of torture and degrading treatment.
Kirsty Brimelow QC, Chair of BHRC, said: “In 2016, BHRC, called upon the President of Egypt to end the persecution against lawyers in Egypt. The Egyptian government continues to issue travel bans, freeze assets and detain human rights lawyers as part of an ongoing and sustained campaign to intimidate and undermine their work.
“Prominent figures currently facing persecution include Azza Soliman, a women’s rights lawyer and co-founder of the Centre for Egyptian Women’s Legal Assistance (CEWLA), Malek Adly, a human rights lawyer and director of Lawyers Network at the Egyptian Centre for Economic and Social Rights (ECESR), and Khalid Ali, a workers’ rights lawyer. . They have been subject travel bans, asset freezes, imprisonment with hallmarks of solitary confinement, beatings and denial of family and lawyer visitation.
“On this important day, BHRC condemns this campaign to intimidate and undermine the work of these lawyers and others like them in Egypt.”
Andrew Walker QC, Chair of the Bar Council, said: “Through the intimidation of lawyers, authorities dismantle and undermine the fundamental freedoms of their citizens. For the rule of law to exist, citizens (and others) must have a right of access to an independent lawyer who is able to defend their freedoms without fear or interference, and to ensure that their individual rights are protected against abuses and excesses of power by the state and by those acting in its name.
“On this Day of the Endangered Lawyer, the Bar Council along with BHRC stands in solidarity with those lawyers across the world, and in particular the lawyers of Egypt, who show courage and determination in striving to uphold the rule of law in the face of persecution.”
BHRC and Bar Council reiterate the call for the Egyptian government to take immediate steps to:
(Source: The Bar Council)
Dan Peachey is the Commercial Director at City Legal Translations - certified as the UK's fastest growing translation company in 2016 by the association of translation companies. Here Lawyer Monthly talks to Dan about what every good law firm should know about translation.
Q: How important is translation to the legal sector?
DAN: Legal translation accounts for five per cent of all translations and the legal translation sector is worth 2.3 billion US Dollars annually. Despite this, so many within the profession are unfamiliar with how to handle the foreign language elements of legal matters or treat them as an afterthought. The legal world relies on legal experts and for translation and interpreting, it should be no different.
Q: What are the consequences of not using a professional legal translator?
DAN: Inaccurate translations can cause a whole world of problems leading to wrongful convictions, damaged reputations, finances, transmitting liability or ownership to another party, businesses made or lost. There have been cases of properties being sold at the wrong price, or to the wrong person. These are not sensational examples; they are possible if legal documents are not translated correctly and professionally.
Q: What's the best approach to commissioning language services?
DAN: When it comes to commissioning language services, it pays to know about the different types available and where to source them. For example, do you know the difference between translation (dealing with the written word) and interpreting (dealing with the spoken word)?
Expert translation and interpreting should be provided by a Language Service Provider (LSP) affiliated to a professional trade body, such as the Association of Translation Companies or the Institute of Translation & Interpreting.
An LSP with specific experience of your sector will not only ensure accuracy and precision but also speed up the process. They will be familiar with terminology and styles of writing and will also have a wider knowledge of specific legal systems and areas of expertise.
Check the LSP uses experienced, mother tongue, legal expert translators.
You should also ensure the LSP can certify documents to the right level for legal use. There are a number of different levels, such as certified translation, notarised translation or sworn translation. It can be a bit of a minefield!
By working with an accredited translation company and you'll get the best results. City Legal works with more than 2000 legal translation experts and supports over 600 language combinations.
Q: What type of documents will need to be translated?
DAN: Anything and everything! We translate court judgments, witness statements, evidence, certificates such as marriage, birth, death as well as police checks, expert testimony and company formation documents such as Articles of Association and memoranda.
Q: What's involved with legal interpreting?
DAN: Legal interpreting needs to be carried out in a completely accurate and non-biased manner. We provide interpreters for a variety of reasons - in the court room or to take a witness statement, for example.
There are different types of interpreting including simultaneous or conference, consecutive and telephone interpreting, but a good LSP can guide you through this.
Q: How are translations costed?
The cost of the translation will depend on the length of the document, the content and the language combination required.
For example, countries with low levels of population such as Iceland or where the cost of living is high such as Scandinavia are generally more expensive. Before you compare LSPs, you should see what is included in the price, as some charge urgency fees, whilst some offer proofreading as part of a job automatically, whilst others charge this separately. Also, some companies offer Legal Aid rates in the relevant circumstances so make sure you tell the LSP upfront before they quote!
Q: Can't we just use Google Translate?
The world of automated or machine translation has been talked about so much lately, with Google Translate as the one everyone knows best! Such tools can be useful for translating large documents where there is a lot of repetition. However, translations for the legal sector need to be precise, accurate and exact, with confidentiality at the heart of the process. Therefore, legal documents do not naturally fit the profile for technology-based translations and often 'legalese' may not have precise equivalents in another language while a simple rephrasing of sentences may cause confusion and transmit liability or ownership to another party. Steer clear!
It covers the rules, policies and laws that oversee the tax process, which involves charges on estates, transactions, property, income, licenses and more by the government. Taxation also includes duties on imports from foreign countries and all compulsory levies imposed by the government upon individuals for benefit of the state.
The intricate body of tax law covers payment of taxes to a minimum of four levels of government, either directly or indirectly. Indirect taxes are assessed against products and services that are meant to be consumed, but are paid to an intermediary. For example, when you buy coffee at a local corner store, the retailer charges you tax on your coffee, which he/she subsequently pays to the government. Direct taxes are those you pay directly to the government and are imposed against things like land or real property, personal property, and income.
There is a seemingly endless list of entities that create and enforce tax laws and collect tax revenues. They range from the local government level, such as cities and other municipalities, townships, districts and counties to regional, state and federal levels. They include agencies, transit districts, utility companies, and schools, just to name a few.
The area of tax law is exceedingly complex and in constant flux largely due to two reasons. The first is that the tax code has been used increasingly more often for objectives other than raising revenue, such as meeting political, economic and social agendas. The second reason is the manner in which the tax code is amended.
The Federal tax law is administered primarily by the Internal Revenue Service, a bureau of the U.S. Treasury. The U.S. tax code is known as the Internal Revenue Code of 1986 as amended (Title 26 of the U.S. Code). Other federal tax laws are found in Title 26 of the Code of Federal Regulations; proposed regulations issued by the Internal Revenue Service (IRS); temporary regulations issued by the IRS; revenue rulings issued by the IRS; private letter rulings issued by the IRS; revenue procedures, policy statements, and technical information releases issued by the IRS; and federal tax court decisions. Tax law for state and local government is also contained in codes sections, regulations, administrative codes, procedures and statements issued by the respective government authorities, as well as state court decisions.
There is a special trial court which hears disputes between the IRS and taxpayers regarding federal income, estate and gift tax underpayments - the U.S. Tax Court. This federal court is based out of Washington, but its 19 presidentially appointed judges travel to preside over trials in courts located in several designated major cities. The Tax Courts’ decisions may be appealed to the Federal District Court of Appeals and final review is retained by the highest court in the land, the U.S. Supreme Court.
Tax attorneys serve many important functions in the complicated arena of tax law. They may represent you throughout the various stages of tax disputes, from an initial audit to IRS administrative appeals, Tax Court and final review by the Court of Appeals, or even the U.S. Supreme Court. They are also invaluable in helping you navigate the intricate and bewildering laws in this area of practice.
We have the pleasure of speaking with the General Counsel of MVF, the customer generation specialists who find large volumes of customers for some of the world's biggest brands, including Salesforce and WorldPay.
Currently Tom Worner’s role is widely diverse; a speciality of his is M&A and he has made the acquisition process easy and transparent for vendors, especially when they are not part of big corporate machines and are nervous about the sales process. He has developed M&A strategies for acquiring lots of businesses at once, whilst managing the challenges of a business with rapid growth; MVF is doubling in size each year, as well as constantly adding new markets, each with their own different challenges and so Tom speaks to us about how he keeps on top his demanding role. He also reveals tips on producing a good M&A strategy and his stance on technology replacing people in the M&A process.
As GC of a company that requires you to maintain a variety of tasks, what legal aspects are your favourite to deal with and why?
Probably the acquisitions we work on. Not only because M&A is a central part of our growth strategy (so the work is adding real value), but also because each deal is different, and comes with its own quirks and challenges.
Riding the highs and lows that any acquisition invariably throws at you, but reaching the finishing line (at whatever time of the day or night that may be!), is a tremendous feeling.
And it’s fortunate that I relish the work – because we’re looking to acquire at least 6 businesses a year!
Aside from M&A, I still enjoy getting on the phone and negotiating contracts from time to time; the bread and butter of every in-house lawyer.
How easy can it be to lose grasp of all the different international legal issues at hand and how do you overcome this to ensure it doesn’t happen?
Very easy, I would imagine! We have clients worldwide, and our marketing activity reaches over 120 countries, so different jurisdictions and cross-border matters often pose challenges, and particularly so as we’re growing at such a rapid rate.
It’s critical for us to have a clear grasp of the different legal and regulatory regimes affecting our business. For this reason, for example, we have in place a process for assessing new markets and products, and the legal team is involved in this process from an early stage.
It is also important to recognise what you don’t know, and bring in the right expertise when you need to. Over the past year, we’ve instructed regulatory lawyers in the US, Canada, Australia, South Africa, and Europe.
With technology ever-changing, how does this affect the legal side of things for you?
One of our core values is around innovation and challenging the status quo, so we’re often looking at how we can incorporate new technologies in our business, or use them to improve our systems and processes.
That extends to the legal team. For example, we recently looked at a contract review tool that uses artificial intelligence (AI).
I’m sure we’re going to see the continued rise of AI in law, and other innovations from the legal tech space. Any solution that can take on repetitive, routine work, freeing up lawyers’ time for more complex or impactful matters, has got to be beneficial.
What are key points to follow when developing an M&A strategy for acquiring lots of businesses at once?
Strategically, understand what types of businesses you want to acquire and why. You can’t buy – or even look at – everything. Also, understand and define what would constitute a good, successful deal for you.
From the outset, start to plan the integration. Don’t wait. If you’re able to speak with the employees of the target business ahead of time (and that isn’t always possible of course), then you should absolutely do this. Acquisitions can create uncertainty and nervousness among buyers and sellers alike, and so the more information you can share early on, the more invested and supportive both parties’ staff will be.
One size doesn’t fit all, and so tailor your approach to the target business, and the sellers. For example, buying from corporates can be very different from buying from entrepreneurial founders. Founders have built their businesses from the ground up, and generally have a more emotional attachment to them.
Goldman Sachs reported they are planning to use technology to improve M&A deals; can you comment on this? Do you think this would be something you would be open to adopting, or will it eliminate the important people behind a successful M&A transaction?
At a certain level, technology has a place, of course. I think one of the articles referred to technology reducing “grunt work”. Ultimately, however, it is people and the human touch, that get deals over the line, and get them off the ground in the first place. Technology can’t build trust and credibility between buyers and sellers, or replicate EQ and that all-important emotional connection.
As a tech and marketing company, how important is it to ensure you are cyber-secure; (without disclosing too much information, of course) do you have a protocol in place for when you are dealing with an important M&A process?
Traditionally, cyber-security was a bit of an esoteric topic for techies, and perhaps some lawyers with a particular interest in the subject. Now, partly due to the rise in high-profile data breaches, cyber-security is a recurring item on the Board agenda (for all businesses, not just tech and marketing companies), and that’s certainly the case in our business.
Because the threats and risks around cyber-security are ever-evolving, we keep our practices for the entire business (not just for our M&A activity) under constant review.
What piece of advice would you give to someone who is inspiring to be a successful GC?
Generally, substantive knowledge can be learned or bought, so focus on developing the right blend of soft skills.
I was at an event last year, and one of the presenters cited the following as the must-have attributes and skills of all in-house lawyers, but particularly GCs: commercial judgment, relationship building, communication, credibility, and leadership.
I agree with the list, but would also add humility. In entrepreneurial, high growth businesses, you need to be prepared to roll up your sleeves to get stuff done.
And consider a mentor, someone you admire, and who has been there and done it.
What are the challenges you face when managing a business with such a rapid rate of growth? How do you overcome this?
In a fast-paced, entrepreneurial environment, decisions are made quickly, and things move at speed, so the overarching challenge is staying apace with the rest of the business; it’s important that the legal team enable, and not unnecessarily slow, the business.
On the M&A side, we are often juggling a number of deals at once, although they’re usually at different stages.
In terms of our organic growth, ensuring that we understand the legal and regulatory environments of new markets, and operating within those environments is paramount. It’s important to understand where the real legal risks lie, and to ruthlessly prioritise accordingly.
I am the General Counsel and company secretary of MVF, one of the UK's fastest growing technology company with offices in London and Austin, and responsible for all legal, regulatory and compliance matters.
On the global stage, UK law firms have long been a force to be reckoned with. Our legal sector is one of relatively few sectors where the UK is a genuine world leader. But just how much of an export success story is it, and in what areas is there still further scope for greater international coverage and specific market penetration?
Daniel Watts, Managing Partner at Edward Drummond & Co, here gives Lawyer Monthly an insight into where opportunities lie and how law firms can make the most of these, while managing the risks involved.
Broadening UK law firms’ horizons – exploiting untapped opportunity in emerging markets
How great is the focus on western economies compared to emerging markets and how might this change in the years ahead? And what challenges and opportunities could this present for law firms, as well as for general counsel working for corporates in these locations?
To shine a spotlight onto what shape UK law firms’ international reach is taking and to identify where future growth opportunities lie, we conducted research into where Partners at top firms are based. As shared owners and leading fee-earners, their presence in particular markets demonstrates the level of managerial expertise and revenue-generating power firms are prepared to commit in a given jurisdiction. Our findings reveal several useful insights which could provide food for thought when it comes to strategic planning for the years ahead.
Risks vs rewards in developed and emerging markets
While UK law firms have a well-established reputation for international work, our study highlighted just how far their global coverage has grown. In fact, today nearly two-thirds (63%) of Partners at Top 20 firms are now based outside of the UK.
But although that’s an impressive figure, we also found that only 20% of Partners are based outside of Europe and North America. As they focus heavily on western economies, leading British law firms are underexposed to other markets – notably emerging markets – despite many of these economies seeing rapid growth in recent years.
The ‘gap’ is particularly evident in areas such as Asia Pacific and Latin America, which are home to 13% and 2% of Top 20 UK law firm Partners respectively. Given that they represent 32% and 7.9% of global GDP apiece, the potential opportunity value is significant. While firms have been working hard to close the gap in Asia in particular, it’s clear that the region still offers plenty of scope for greater market presence.
Africa is another potential hotspot that is also relatively untapped, with only 1% of UK Top 20 Partners based there, although the continent accounts for 3% of global GDP. Former Soviet states and the Middle East, where there are currently low concentrations of Partners, could also represent attractive investment opportunities in the future. They account for 1% and 2% of UK law firm Partners respectively, compared to a 2.8% and 4.3% share of global GDP.
Of course, western markets make strategic sense in terms of cultural, business and legal fit. They are comparatively ‘easy-win’ locations in which to establish new offices, thanks to familiar, stable business environments, similar legal frameworks and regulatory regimes, easily transferable skills deployment, and fewer language barriers.
But although these emerging economies may be more challenging, that’s not to say that the effort would not be well-rewarded. Emerging markets still offer considerable growth potential for the UK’s legal expertise, especially as their economies continue to expand at a faster rate than more mature western economies. Multinationals and other ‘western’ businesses are building up more extensive operational networks worldwide, with bases in these locations increasingly strategically important. With this in mind, UK law firms may want to boost their efforts to identify future target markets – or risk losing out.
Facing up to the challenges
For law firms who want to continue to increase their global footprint, and for corporate in-house general counsel deployed in overseas markets, the execution risks of business roll-out are many and varied. Each country will pose its own unique challenges, and regulatory requirements can make it hard for foreign firms to establish themselves in some overseas markets. Conducting extensive research and thorough due diligence is therefore vital prior to launching into a brand new region.
Some basic steps to consider include:
Performing these fundamental checks and taking the time to get to get to grips with the realities and nuances of doing business in a target location is essential groundwork to inform decision-making going forward.
If the UK’s top law firms are to maintain and enhance their standing worldwide, broadening their horizons could well boost their brand and act as an important competitive differentiator. With emerging markets offering such strong growth potential for law firms, identifying new areas which could present a logical strategic fit and taking an early lead could give them the edge. While European and North American markets in particular will remain a key source of revenue requiring extensive brand presence, forward-thinking law firms with truly global ambitions will want to be ahead of the curve in embracing new opportunities. Doing so in a well-considered, thoroughly researched way based on a sound analysis of the risks as well as the rewards will be critical as a foundation for success.
