Denied the ability to practise law within India, international law firms have created centres of legal excellence outside the country to serve their India-focused clients
By common sense standards, one would expect Delhi, Mumbai and Bangalore to be the major hubs for legal transactions involving Indian clients and multinational corporations investing in India. But they’re not – at least not for international law firms which undertake the lion’s share of cross-border deals.
Thanks to restrictive trade practices preventing non-Indian law firms from setting up local offices, major Indian cities are playing second fiddle to foreign financial and commercial centres.
Traditionally, London has dominated the Indian legal landscape, although its paramount position – at least until the US-led financial flux – has long been challenged by New York with its huge securities industry.
In addition, keen local firms and helpful regulators have enabled Singapore to court a significant share of Indian business. Meanwhile, Hong Kong’s strong banking industry has resonated with Indian investors and clients seeking to invest in South Asia.
Several smaller, but nevertheless vibrant jurisdictions have joined these key centres, aiming to grab a piece of the India pie. For example, Dubai (project finance and construction), Washington (regulation and intellectual property) and Houston (energy) occupy several niche practice areas.
Cities such as Abu Dhabi, Calgary, Leicester and Wilmington are less obvious choices that are also emerging as hubs for major India-related deals (see India goes global on page 42).
Law firms say a number of factors can contribute towards the creation of a hub, the most obvious being a jurisdiction’s geographical location. “Firms which have branches in Singapore particularly and Hong Kong use those cities as hubs for India-related work,” observes Sunil Sheth, partner and India group head at Fladgate, which has its only office in London. “This is obviously due to their proximity to the Indian subcontinent.”
However, that doesn’t explain the plethora of India practice groups that have proliferated in distant cities such as London and New York. As lawyers reveal, the growth of India-focused legal strongholds has also been largely influenced by access to talented professionals, infrastructure, convenience and client locality.
In search of India specialists
A number of India practice groups were founded through the vigour and determination of an individual or several practitioners. “If you have partners who have a passion for a particular area, the practice will be built around them, wherever they happen to be,” says Alex Pease, a partner and chair of the India group at Allen & Overy in London.
One example is Herbert Smith, where India practice head Nimi Patel has developed a strong relationship with Tata Group chairman Ratan Tata. Of course, personality-driven practice groups can have their downside. Before moving back to India to join local firm Khaitan & Co, Murali Neelakantan created India practice groups at the London offices of two international firms, Arnold & Porter and then Ashurst. The future of the groups at both firms remains unclear.
Some firms have actively tried to enhance their expertise with a wide network of India specialists across several jurisdictions. Early in 2008, Bird & Bird launched its India practice under partner Nipun Gupta. Although led from London, the firm also draws on lawyers in Hong Kong, Paris, Germany and Scandinavia. “Access to talent pools is the key to providing excellent legal advice,” says Gupta. “This is a number one priority.”
Many law firms have also boosted their India practices by hiring prominent Indian practitioners. Linklaters, for example, recently formed a tie-up with the former acting chairman of the Competition Commission of India, Vinod Dhall, who will lead its India antitrust unit. Clifford Chance, meanwhile, has recruited Rahul Guptan, a senior partner from top Indian firm Amarchand Mangaldas.
In contrast, firms like Herbert Smith have recognized the importance of fresh talent, actively snapping up top graduates in India. “We are recruiting from the national law schools in India, including Kolkata, Jodhpur, Hyderabad and Bangalore,” says Chris Parsons, a London-based partner.
Mike Edwards, who heads the Singapore office of Cains, an offshore law firm based in the Isle of Man, says London and Singapore have “significant pools of highly skilled Indian professionals and others with extensive experience of working with Indian clients”.
Closer to the action
Indian clients can be notably demanding, say many lawyers, and firms are expected to maximize convenience. “All clients appreciate when you are more accessible … being in the same or similar time zone and being able to attend face-to-face meetings at short notice is greatly valued and appreciated,” says Rohan Weerasinghe, senior partner and head of the India practice group at Shearman & Sterling in New York.
“Our US clients doing transactions in India find it very helpful for us to have a presence in a nearby time zone for executing deals,” agrees David Makarechian, a partner at O’Melveny & Myers in Singapore. “We can have someone on the ground in India in a matter of a few hours.”
“It’s all driven by client service,” says Glenn Gerstell, managing partner of Milbank Tweed Hadley & McCloy’s Washington office. “Given the impossibility of having an office in India, we have built up the capacity to cover our client base from three directions on a combined basis, for both onshore and offshore transactions.”
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According to Sunny Handa, who heads the rapidly growing India group at Canadian firm Blake Cassels & Graydon from Montreal, as long as client interaction is maintained, India practices can continue to thrive from anywhere in the world. “I do spend an inordinate time in the air – three to four months of the year – going to Toronto, London, New York, Delhi and Mumbai,” he says. “However, I don’t think it’s hampered Blakes that I’m not even in the Canadian hub, Toronto.”
Crispin Rapinet, head of the India group at Lovells in London, shares similar sentiments and believes location isn’t always paramount. “Singapore has the advantage of geographical proximity but there are so many flights out of London now that it doesn’t matter.”
While air travel has become a standard requirement for lawyers working on India deals, many have established excellent client relationships, overcoming the barriers of distance through the use of sophisticated technology. US law firm Duane Morris bases its India practice in Atlanta mainly because key client Dr Reddy’s Pharmaceutical a prominent manufacturer of generic drugs, has a major research and development centre in nearby Norcross.
As Alan Klein, a partner in Philadelphia, explains, the firm communicates with Hyderabad-based Dr Reddy’s via email and videoconference. “It works effectively,” he says. “We get an appreciation of body language. With patent work, it’s important to have face-to-face contact as the nuances don’t always show up in documents.”
While most firms have their India desks rooted in specific locations, globalization has prompted firms to become more nimble in their service strategy. “Our approach has been to support clients as they move into different regions,” explains John Nestel, a partner at Freehills in Sydney.
Once an exclusively Australian firm, Freehills now has several international offices to service its increasingly mobile client base.
Pease echoes this idea, emphasizing the need for perpetual awareness. “If clients are putting resources into Singapore and Hong Kong, we do too. It’s constantly changing.”
Following a client’s trail with the deployment of adequate resources on the ground also contributes positively towards the environment, which has become a recent concern. Allen & Overy is keen to reduce its carbon footprint by cutting down on unnecessary long-distance travel.
Pease points further to a consideration of pricing issues when servicing distant clients. “Singapore is preferable to London or Hong Kong” for cost reasons, he says. “However we try to smooth things for Indian clients. If, say, an Indian bank would like to base a deal in London, not Singapore, we try to arrange things so it’s not more expensive for the client.”
While client proximity is vital, lawyers also acknowledge the importance of ensuring that a transaction is handled by the most qualified professionals.
“Attorneys in our Dubai and Hong Kong offices are relatively closer in time and distance to India,” notes Jeremy Hushon, a Washington-based senior associate at Fulbright & Jaworski. Although, he adds, “our offices in financial centres like New York and London offer strategic advantages for major international transactions.”
Infrastructure and networking
Another important factor influencing a firm’s decision on where to situate their India practice relates to the existence of accessible India-related infrastructure. The availability of “hard” infrastructure, such as office space, communications and transport links offers obvious advantages, although less tangible conditions such as security and safety are equally imperative. “A hub must offer first-class facilities, such as infrastructure and telecoms, within a business-friendly framework and political and economic stability,” says Edwards.
An abundance of “soft” infrastructure, which includes the presence of both private sector institutions (such as banks and major companies) and official structures such as trade offices that can facilitate networking, is also vital. For example, Singapore banks drive Indian project finance, while Hong Kong investment banks are crucial to Indian corporate financing.
“Government and civic institutions such as IE Singapore [International Enterprise Singapore, formerly the Singapore Trade Development Board], the Singapore Indian Chamber of Commerce and Industry, and the Institute of South Asian Affairs, play a useful role,” says Leena Pinsler, head of the South Asia practice at Rajah & Tann in Singapore. “The Singapore Economic Development Board has also done a stellar job in attracting and enticing Indian businesses to locate here.”
Business and government groups in other countries have also provided networking opportunities for law firms seeking India work. “We have drawn on our connections and contacts with business associations such as the Australia-India Business Council and Austrade [the government-owned Australian Trade Commission], and industry associations such as the International Bar Association,” says Vishal Ahuja, a partner at Mallesons Stephen Jaques in Sydney.
At Toronto-based Torys – which actively pursues India deals – partner Sanjit “Sunny” Sodhi spent a month on an Ontario provincial trade mission to India in 2007 and accompanied a federal trade mission there in 2005. At Blakes, Handa is active within the Canada-India Business Council and the Indo-Canada Chamber of Commerce.
London’s bridge to India
The UK – as the former colonial ruler and hub of the Commonwealth – was the first great destination of post-World War II Indian emigration. Today, London’s position as a premier global financial centre has made it a major focus for both foreign investors in India and Indian corporations seeking foreign investment. “The most important hub for us to date has been London,” says Chris Parsons, a corporate finance partner at Herbert Smith.
Traditionally, firms such as Herbert Smith acted principally on inbound transactions into India. Now, with the growing clout of Indian corporations, the firm is acting on significant outbound deals. “We are fortunate to have acted on most of the cross-border Tata Group deals, including Tata Tea’s acquisition of Tetley Tea, Tata Steel’s acquisition of Corus, and Tata Motors’ acquisition of Jaguar and Land Rover,” says Parsons.
Several other English international law firms, including Allen & Overy, Berwin Leighton Paisner, Bird & Bird, Clifford Chance, Denton Wilde & Sapte, Eversheds, Fladgate, Freshfields Bruckhaus Deringer, Linklaters, Lovells and Norton Rose, also handle India-related work primarily from London.
Various US firms, such as Covington & Burling, Debevoise & Plimpton, Fulbright & Jaworski, Milbank, O’Melveny & Myers and Shearman & Sterling, also conduct India transactions from London. Howrey, a Washington firm and a relative newcomer to the Indian legal market, has also set up an office in the British capital.
“London is a perfect hub for India-related business,” says Melanie Willems, a partner who leads Howrey’s international arbitration practice from the firm’s City office, close to the Inns of Court. “It is a seat for international arbitrations, which are popular with those seeking to avoid the delays sometimes associated with courts.”
London also acquired a new sheen internationally after the passage in the US of the Public Company Accounting Reform and Investor Protection Act of 2002 (the Sarbanes-Oxley Act), the onerous reporting requirements of which discouraged many companies from listing in New York.
“London acquired more prominence for Indian clients after Sarbanes-Oxley,” says DK Singh, a corporate partner and head of the India practice at Denton Wilde Sapte in London.
Despite London’s advantages – a common-law system, language and a mature investment climate – firms are bracing for a possible downturn as the US-led meltdown spreads to Europe. “Financial centres are very keen to retain and grow their position and status, especially in these troubled times,” says Pease at Allen & Overy.
Law firms have taken a prominent role in representing London’s official face as it seeks to minimize the effects of the financial crisis. “London mayor Boris Johnson warned recently against any kind of regulatory backlash that could diminish the city’s position,” says Pease.
In September, Johnson appointed Allen & Overy senior partner David Morley to the International Business Advisory Council for London, which was set up to advise the mayor on how to maintain London’s position as a financial powerhouse.
Meanwhile, representatives from Cains accompanied David Lewis, the lord mayor of the City of London, on a recent promotional visit to India. Lewis, a former Hong Kong solicitor and chairman of Norton Rose, has spent his yearlong term working to improve financial and commercial ties between London and Asia, including India.
India goes global
Many law firms are proving that you don’t have to be located in a major international financial centre to attract India-related legal work
Washington DC – although not a preeminent financial centre – is a vital location for lobbying, regulatory work, international trade, antitrust, intellectual property and technology issues.
It is also a key location for firms such as Covington & Burling, Fulbright, Milbank, Patton Boggs, Wilmer Cutler Pickering Hale and Dorr and White & Case, all of which have India-focused lawyers based in the city. Fellow US firm Venable uses Washington as a base to represent the Indian government in negotiations with the US.
Even at Baker Donelson Bearman Caldwell & Berkowitz, a regional firm that primarily serves the US South, partner Sandhya Mehta leads the India practice from Washington.
Further north in Boston, McCarter & English soared into the India orbit this year by hiring India specialist Gaytri Kachroo from local rival Burns & Levinson. Frost Brown Todd, meanwhile, bases its India practice in Columbus, Ohio.
Another firm, Bifferato Gentilloti, hopes to enter the Indian market from Wilmington, Delaware, the site of many company registrations and a major centre for corporate law in the US.
“We recognize India as a growing force in the industrial and technology sectors, and Bifferato would very much like to be the bridge between the American market and the Indian corporate market,” says Connor Bifferato, the firm’s managing director.
North of the border, lawyers believe Calgary, with its vast potential energy deposits, could join Toronto as a key Canadian centre for India deals. “Calgary has seen huge growth,” says Sunny Handa, a Montreal partner with Blake Cassels & Graydon. “All the major Indian companies such as the Reliance and Tata groups have been to see the oil sands.”
Provincial UK cities are also getting in on the act. Birmingham-based Wragge & Co has undertaken some India transactions, while Leicester firm Nelsons recently co-hosted a trade conference in the Midlands city to draw Indian investment.
Further afield, firms in the Caribbean tax havens and offshore British jurisdictions are also taking an increasing interest in India. Cayman islands-based Walkers predicts a huge increase in India transactions, especially in private equity and venture capital. Lawyers in such remote locations don’t regard proximity to India, or its legal talent pool, as major factors in developing their India-related business.
“The India talent pool falls into three categories: lawyers with Indian qualifications practising in India, India-qualified lawyers with global law firms and international lawyers with substantial work experience in India,” says Chetan Nagendra, an associate at Harney Westwood & Riegels in Road Town, British Virgin Islands. “The first two categories are easy to obtain but the third category actually makes or breaks a firm’s India strategy,” he adds.
Meanwhile, Channel Islands firms are courting Indian business. In June 2008 Alan Stevens, a partner at Jersey-based Carey Olsen, visited Mumbai to scout out Indian companies looking for investments in Europe.
Jason Romer, a partner with Collas Day in St Peter Port, Guernsey, says Indian private equity clients have expressed keen interest in the area. “We’re seeing [deals] move away from the Cayman Islands and British Virgin Islands to the more European market models where there is greater comfort of jurisdiction.”
The Middle East is also gearing up for a greater role in India.
“We anticipate that our soon to be opened Abu Dhabi office will become another important hub for India-related transactions,” says Jonathan Morris, a partner and chair of the India group at Berwin Leighton Paisner in London.
Singapore’s relatively liberal economic climate, combined with strict supervision, predictable politics and efficient links, has made the city-state one of the most desirable locations for India-related transactions.
“I think Singapore is becoming increasingly important,” says Nish Shetty, who heads the India practice at WongPartnership, a top Singaporean firm. “Key Indian companies are moving their senior executives to Singapore with a view to managing their India business out of [the city].”
With a large ethnic-Indian community, Singapore is one of the most officially India-friendly countries in the world, especially since the signing of the Singapore-India Comprehensive Economic Cooperation Agreement in 2003. There are 3,000 Indian companies in Singapore and most of the major Indian banks have offices there.
“Singapore is centrally located and is thus well positioned for clients interested in operations within India and also for Indian-based corporations looking into the Asian region,” says Nestel at Freehills. He points to Tata Power’s acquisition of Indonesia’s Kaltim Prima Coal and Arutmin Indonesia as an example. “Using Singapore as a hub means we can have people on the ground in a few hours if necessary,” Nestel adds.
However, unlike in real estate, location is not everything. A familiar legal system also puts Indian clients at ease, lawyers point out.
“Singapore is ideally placed due to the fact that local laws are similar to Indian laws, both being, as part of their Commonwealth heritage, largely based on English law,” says Pinsler. “The Companies Act, Penal Code, Evidence Act and Criminal Procedure Code are examples of legislations that are strikingly similar to the equivalent legislation in India,” she adds.
Pinsler also points to the so-called “soft factors” that enhance the India-Singapore relationship.
“Indians like living in Singapore,” she says. “They like its first-world living standards, healthcare, education and connectivity to India. They contrast this with living standards in India, see that it is possible to run their Indian businesses or transplant their Indian businesses to Singapore, and raise capital here to do so.”
Many international firms such as Allen & Overy, Baker & McKenzie, Berwin Leighton Paisner, Clifford Chance, Dorsey & Whitney, Freehills, Linklaters, Lovells, Milbank, Norton Rose, O’Melveny & Myers, Shearman & Sterling and Skadden Arps Slate Meagher & Flom, have also taken advantage of Singapore’s status as natural hub to India.
“Our market experience tells us that Singapore is increasingly becoming a platform for companies to structure their India-related investments,” says David Jacobs, Asia-Pacific regional chairman at Baker & McKenzie in Hong Kong.
Foreign firms continue to arrive in Singapore. In February, White & Case moved partner Doug Peel, global head of the firm’s India practice, from London to Singapore to strengthen the India practice group. Cains meanwhile, launched its three-lawyer Singapore office in July to service work coming out of India, Hong Kong and Malaysia.
However, Singapore’s way of doing business is sometimes at odds with Indian attitudes, according to some lawyers. “The procedural aspects and the business styles in both these markets are different,” says Benoy Philip, who leads the India practice at Colin Ng & Partners in Singapore. “A presence in Singapore of more India-related companies and other stakeholders would result in better coordination and increased impetus for business transactions.”
New York weathering the storm
Despite its position in the very centre of the current financial crisis, New York continues to be a major player in Indian transactions. Baker & McKenzie, Cravath Swaine & Moore, Davis Polk & Wardwell, Debevoise & Plimpton, Fulbright & Jaworski, Hogan & Hartson, Kelley Drye & Warren, Shearman & Sterling and Skadden all undertake considerable India work in the Big Apple.
Non-US firms, such as Blake Cassels & Graydon and Lovells, also have significant India-related practices in New York.
The attraction, say lawyers, is that New York has maintained its position as a global banking and securities hub despite several recent crises such as the 1999-2000 technology meltdown, the 2001 terrorist attacks that devastated Wall Street and the current financial crisis that threatens to reverberate worldwide.
“With a Singapore hub, you still need New York securities input,” says Rapinet at Lovells.
The metropolitan New York area is also a centre for many Indian companies. Dr Reddy’s Pharmaceutical, has a major office in suburban Bridgewater, New Jersey, close to the Manhattan office of its law firm, Duane Morris.
Yet, New York may struggle to hold on to this position. Its main disadvantage, say lawyers, remains its location in relation to India itself. Although technology has improved communications, distance continues to be a handicap for New York and similarly placed cities – such as Boston, Washington and Philadelphia – where law firms are also trying to build up their India practices.
West Coast attractions
Other US firms have concentrated their Indian resources on the country’s West Coast to benefit from smaller time differences, especially in the greater San Francisco area, which includes the Bay Area and Silicon Valley, America’s technology hub where the pre-eminence of Indian professionals and companies cannot go unnoticed.
“This constitutes an enormous advantage vis-a-vis the East Coast of the United States where people are reduced, in essence, to dealing with India at very inconvenient times – necessarily before somebody’s breakfast and after somebody else’s dinner,” says Bob Nelson, a partner at Thelen in San Francisco.
The technology industry’s collaborative nature has also helped the San Francisco area to cement ties with key India-related support institutions. For example, The Indus Entrepreneurs, a private-sector business network, has its largest presence worldwide in Silicon Valley.
“The US-India Business Council has also become increasingly active on the West Coast over the past few years,” says Nelson. ”These and other organizations help to ensure the free flow of contacts and ties between Silicon Valley and the Bay Area and India.”
Akin Gump Strauss Hauer & Feld also concentrates a good deal of its India work in Silicon Valley. Senior counsel Abrar Hussain, a leading member of the firm’s India team and a former executive and general counsel at two California-based networking companies, is based in the San Francisco office.
Hong Kong’s financial might
Although still a major global business, financial and logistics centre, Hong Kong is handicapped by its association with India’s arch rival China, much less cultural affinity with India than Singapore, and a longer flight time to India.
Nevertheless, major firms such as Baker & McKenzie, Linklaters and Davis Polk & Wardwell consider Hong Kong an important centre for India-related transactions.
“Hong Kong now takes precedence,” says Kirtee Kapoor, a partner in Davis Polk & Wardwell’s Hong Kong office, who leads the firm’s India practice there after moving from New York in 2007. “Our other centres are London, Paris, Tokyo, New York and California.”
Some firms are counting on India’s growing trade relationship with China as a good reason to maintain a Hong Kong office, as well as a relatively convenient location. “Having major hubs in Asia is very important in terms of market knowledge, key relationships and real time accessibility,” says Jonathan Stone, a Hong Kong-based partner at Skadden.
Hong Kong partners David Hirsch and Filip Moerman handle a significant amount of Cleary Gottlieb Steen & Hamilton’s India work out of Hong Kong.
Vinson & Elkins also works on India transactions in Hong Kong with help from its Beijing and Shanghai offices.
Other firms with prominent India practices in Hong Kong include Allen & Overy, Bird & Bird, Debevoise & Plimpton, Herbert Smith, Lovells, Milbank, Shearman & Sterling and Slaughter and May.
“Working with India was one of many motivations for opening offices in Hong Kong and London,” says Geoffrey P Burgess, a partner at Debevoise & Plimpton in London.
Discovering Dubai’s potential
Although it is one of the most convenient locations – the city’s time zone is one-and-a-half hours behind India, while the Dubai-Delhi flying time is only two-and-a-half hours – Dubai has only recently established itself as a key legal stronghold for India transactions.
In November 2007, London-based firm Lawrence Graham opened a Dubai office, led by resident partner James Foster, to serve principally Indian, Middle Eastern and Southeast Asian clients.
Clyde & Co, Fulbright & Jaworski, Ince & Co, Lovells, Norton Rose, Simmons & Simmons and Vinson & Elkins consider Dubai an important centre, close to India.
Denton Wilde Sapte also keeps an eye on India from their Dubai offices. “Dubai could become a significant hub in the future subject to availability of resources,” says Singh.