India Business Law Journal presents its third annual survey of the international market for India-related legal expertise and reveals the top foreign firms of 2009. George W Russell reports from Bangalore
As international law firms continue to face difficult times, many are banking on India to help see them through the financial downturn. While lawyers hope that income in India can offset losses in other jurisdictions, clients depend disproportionately on foreign firms to guide them through India’s legal labyrinth. According to RSG Consulting, a London-based legal consultancy, nearly 80% by value of India-related work is undertaken by international law firms.
More than 200 firms worldwide have embarked on India-related deals, transactions, litigation, arbitration and cases over the past two years. Since the recession hit, a number of those firms have vanished, downsized or retreated into other niches or geographical areas. Nevertheless, India Business Law Journal has identified 100 law firms – from global giants to niche developed-economy practices and lesser-known emerging-market firms – that are the top international advisers for India-related legal work.
Firms eager to work on Indian purchases that match the scale of Tata Group’s acquisitions of steelmaker Corus and car manufacturers Jaguar and Land Rover have been disappointed in 2008 and 2009. “Inbound investment into India has slowed compared to the bumper years of 2006 to 2008,” says Paul Supramaniam, who heads the India practice at Berwin Leighton Paisner in London. “Similarly, Indian corporates are more circumspect about headline-grabbing acquisitions abroad.”
Nevertheless, many international firms have seen growth in India-related work even as capital markets and M&A deals have faded. “Equity capital market and financing work slowed down but this was offset by increased work in disputes and projects,” observes David Jacobs, Sydney-based head of the India practice at Baker & McKenzie.
Firms that previously relied on a steady stream of overseas listings and initial public offerings have had to look elsewhere for deals. “We’ve seen a sharp drop – to zero – in the number of flotations of Indian companies and funds and a slowdown in the number of funds launched to invest in the Indian markets,” says Christopher Jones, a partner at Mishcon de Reya in London. “On the other hand, there has been an increase in UK clients undertaking joint ventures with partners in India.”
Despite gloom in some specific practice areas, there is much about India that engenders optimism. Overall, Latham & Watkins says India revenues have risen 10% in the past 12 months, while Herbert Smith says its India practice has grown 900% in the past five years. Norton Rose estimates that 31% of the Singapore office’s revenue derives from India-related business, a 20% year-on-year increase.
Certain niches are also looking up as an expanding Indian economy seeks to increase access to essential resources. “We believe Indian companies will look outbound in the near future for acquisitions in the mining and resource sector, such as coking coal, oil and gas and uranium,” says Soma Choudhury, a partner at Ogilvy Renault in Toronto.
Local knowledge v international experience
As Indian corporate clients recover from the downturn and seek to resume growth, they will continue to look to foreign law firms for sophisticated advice on deal-making and international access. “Foreign law firms have better knowledge management modules and legal training,” acknowledges Savithri Parekh, head of legal and company secretary at VFS Global Services, a Mumbai-based diplomatic outsourcing specialist and a client of Canadian firm Heenan Blaikie.