Linklaters has become the first magic circle firm to secure Chinese law capability after receiving government approval for its joint operations in the Shanghai Free Trade Zone (FTZ).
The firm has secured a long-awaited official tie-up with best friend firm Zhao Sheng, a Shanghai-based boutique led by former Linklaters consultant Eric Liu, after approval was granted by the Shanghai Bureau of Justice.
In a statement, the magic circle firm said it would combine ”focused and high-quality PRC law capability with Linklaters’ longstanding international experience”.
Linklaters China head William Liu said: “Market shifts indicate that outbound work and high-end domestic transactions will become ever more important for our business. The joint operations will help us to protect our competitive advantage both in China and globally,”
The news marks the fifth time an international law firm has gained access to Chinese law via the four-year-old Shanghai FTZ scheme, which allows foreign and Chinese law firms to form joint offices and provide ‘one-stop shop’ legal services.
Linklaters follows Ashurst, Hogan Lovells, Holman Fenwick Willan and Baker McKenzie in launching similar operations.
The magic circle firm has been looking to gain Chinese law capability for several years, and entered into a best friend relationship with Zhao Sheng a year ago.
Linklaters had initially planned for a spin-off with a group of its lawyers launching a separate but affiliated Chinese firm. However, the regulations around joint operations require the Chinese firm to be in existence for three years or more, and so Linklaters then opted for Zhao Sheng and sent several of its own lawyers including Liu, senior lawyer Grace Yu and counsel Zhou Zhirong to be partners at the firm.
Linklaters managing partner Gideon Moore added: “Zhao Sheng shares Linklaters’ quality, culture and values – the aim to be best in class. We want to support our clients on both their inbound and outbound projects and the joint operations will provide the seamless Chinese and international advice required for this.”
William Liu was appointed as head of Linklaters’ China practice in January, succeeding Fang Jian, who left to join domestic firm Fangda Partners.
Major China roles for Linklaters in recent years have included advising on a $2bn (£1.5bn) debt issue last year that saw the Chinese Government sell dollar-denominated bonds for the first time since 2004. Liu led the firm’s team advising China’s Ministry of Finance.