HSBC slapped with fine from Hong Kong securities regulator

Hong Kong’s Securities and Futures Commission has hit global banking group HSBC with a fine for regulatory misconduct dating back to 2014.


HSBC was fined HK$2.5 million ($322,294) for failing to put in place adequate internal controls to monitor its positions in Hong Kong Futures Exchange’s futures and options contracts to ensure compliance with the prescribed limit, the regulator said.

The breaches happened from May 26 to Aug 1 in 2014, said the Securities and Futures Commission in an e-mailed statement.

The SFC probe found there was a “lack of adequate knowledge within HSBC” regarding the bank’s position limits and its state of compliance with the relevant regulatory requirements, the statement said.

It, however, added HSBC had since taken steps to improve its internal controls on monitoring of position limits and cooperated with the Hong Kong regulator in resolving its concerns.

“HSBC apologizes for the breaches identified and reported to the Securities and Futures Commission in 2014,” the bank said in a statement.

“The Bank has cooperated fully with the SFC throughout this investigation and has taken actions to improve our internal controls regarding our compliance with the prescribed position limits in Hong Kong. No clients were impacted by these breaches,” it said.

SFC has been aggressively clamping down on operational and control failures in banks’ trading businesses over the past year.

Last month it fined the local securities unit of Morgan Stanley HK$18.5 million for internal control failures related to disclosure of short-selling orders and comprehensive documentation of electronic trading services.

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Gowling WLG revives annual pay review

Gowling WLG has regained confidence after the surprise EU referendum result and decided to lift its freeze on salaries.


The salary review, which was backdated to July 2016 was applicable to all staff excluding fixed share and equity partners. However bonus payments, for 2015/16 for those eligible were paid as usual in the July payroll and summer promotions had gone ahead as planned.

In August, Fennel said: ‘Like a lot of firms our annual pay review is effective the 1 of July, and it still will be. But given the significance of Brexit and the uncertainty and pandemonium in stock markets and the fall of the value of the pound immediately after that result it was prudent to pause and take stock and see how the markets and the economy reacted to Brexit. So that’s what we’ve done.’

The news came amidst a subdued year for the recently-merged Gowling WLG, which posted essentially flat revenue and profits for its UK arm for financial year 2015/16.

Revenue was up 2% from £180.4m to £184.7m, while profits per equity partner (PEP) remained static at £383,000. Although the Canadian arm of the firm does not report financials, according to Gowling WLG, the total revenue for both LLPs was £410m.

Construction and engineering which recorded a 23% increase, and IP which posted a 17% increase, were the highest preforming practice areas for the firm, alongside pensions, corporate and real estate.

According to Gowling WLG, the overseas offices also performed well, with the Munich office increasing by 38% while Guangzhou in China delivered a 16% increase. Paris, the firm’s largest overseas office, saw an increase of 3%.

Last month it was reported that Addleshaw Goddard had also frozen its August salary review as a result of Brexit.

The move followed Berwin Leighton Paisner’s decision to freeze pay and bonuses until November. In June managing partner Lisa Mayhew told staff in an email the reason was ‘political and financial uncertainty in the UK following the recent vote to leave the EU.’


Vedder Price opens doors in Singapore

US firm Vedder Price has opened its second international office, launching in Singapore this month.


The firm, which specialises in global transportation finance, has five offices in the US and one in London.

It will relocate partner Ji Woon Kim from New York and solicitor Lev Gantly from London to head up the new office.

A statement from the firm said the new base “satisfies client demand for a physical presence in Asia” and gives the firm “a foothold for future expansion in the epicentre of this expanding market”.

The office will not practise Singaporean law under local rules regarding international law firms, instead practising both US and English law.

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K&L Gates to replace Kalis with leadership duo

K&L Gates has unveiled the two partners who will succeed outgoing global chair and managing partner Peter Kalis, effective from 1 March next year.


Current vice chair for practice management Michael Caccese will take on the role of chairman of the firm’s management committee while James Segerdahl, currently vice chairman, becomes global managing partner and CEO of the firm.

Kalis said both men practised in two of K&L Gates’ strongest global practices, investment management and insurance coverage respectively, and understood the firm’s business, markets, practices and personnel.

“They have the firm’s compete confidence,” added Kalis.

Caccese and Segerdahl’s appointment followed a two-month process that began in early July. K&L Gates’ 75-partner global management committee unanimously recommended the duo during the period of partner consultation and then finalised the appointments through a unanimous vote.

Kalis is one of the global legal market’s longest serving managing partners, having served continuously as K&L Gates’ leader since 1997.

He told the firm’s management committee over the summer that he would not stand for a sixth term in 2017.

Kalis has led the firm’s growth from 400 lawyers in six offices in the US to 2,000 lawyers in 46 offices on five continents, with revenues mushrooming from $140m to in excess of $1bn. London is the firm’s biggest non-US base, with 53 partners in the UK.

Segerdahl, a commercial litigator whose client base includes corporate policy holders with insurance coverage disputes, is a K&L Gates lifer. He joined legacy Kirkpatrick & Lockhart in 1987 following his introduction to the firm the previous year as a summer associate.

Caccese joined the firm in 2001 in its Boston office. He had previously had a succession of in-house roles including latterly senior vice president and general counsel to the CFA Institute.


HSF launches new hub in Melbourne with 50-lawyer team

Herbert Smith Freehills (HSF) has launched its third major alternative legal services hub in Melbourne.


The new centre will be staffed by around 50 fee-earners and a further 15 support staff initially. The launch comes less than a month after HSF also extended its legal services business to China.

The 13-lawyer Shanghai alternative legal services centre is understood to be the first of its kind run by an international firm in the country.

Both the Melbourne and Shanghai centres will be run centrally from HSF’s 240-lawyer global alternative legal services base in Belfast, which launched last year.

HSF’s Melbourne play follows a significant team exit from the firm’s Asia and Australia offices. A group of 10 project finance partners left HSF to launch White & Case offices in Melbourne and Sydney earlier this month.

The departing partners are: HSF Asia head of finance Brendan Quinn, head of projects Andrew Clark, finance partners Alan Rosengarten, Josh Sgro, Tim Power, Jared Muller and Joanne Draper in Melbourne, Joel Rennie in Sydney, Fergus Smith in Hong Kong and Matthew Osborne in Singapore.

HSF launched its global alternative legal services centre from its Belfast office in June 2015 and has grown the team to have 350 legal and technology staff in Belfast, Brisbane, London, Perth, Sydney, Shanghai and now Melbourne.

HSF launched a legal services pop-up in Perth earlier this year to “test the potential for this type of business in Australia,” said global head of alternative legal services delivery, Libby Jackson. “The team really flew out of the trap. We built it out of a successful pitch on a large piece of work and we felt the business case for an on-shore Australian hub had been made.”

The permanent centre will be located in Melbourne due to its comparatively cheaper rents. Meanwhile the Perth centre will continue to operate from HSF’s office in the city.

“We tested all the same due diligence drivers that we did for Belfast,” Jackson continued. “Perth enabled us to build a full team of people who understand our business in Australia and who can deliver services to our clients, which are mostly HSF partners.”

Jackson added the firm’s global legal services business was built on the principle that it can offer due diligence, document review and other services for “half the cost” of running the same work from one of the firm’s core offices.

Last year, the team processed 63 million documents, reviewed more than three million documents and 5,000 property leases, and managed the administration of more than 500 funds.

It is also focusing on technology solutions to create a “value proposition for the client”. Jackson said the legal services hubs are “fully integrated” into the HSF network and are blending “human work with predictive coding and other software that relates particularly to transactional and corporate work.

“That’s where the really exciting tech stuff is happening,” she added.

HSF’s UK rivals Allen & Overy and Freshfields Bruckhaus Deringer also offer low-cost legal services from Belfast and Manchester respectively, although HSF is the first to extend such services to Asia Pacific.

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Ashurst Abu Dhabi head exits for US firm Curtis Mallet-Prevost

Ashurst Abu Dhabi managing partner Alastair Holland has exited the firm for US firm Curtis Mallet-Prevost Colt & Mosle

Holland was made up to partner at Ashurst in 2011 and was promoted to the role of Abu Dhabi managing partner just months later after energy partner David Wadham moved back to London.


He first joined Ashurst as an associate in 1999, subsequently working in London, Frankfurt and Dubai.

Corporate lawyer Holland will become a partner in Curtis Mallet-Prevost’s Dubai office, working on M&A and joint venture transactions in both the Middle East and North Africa.

Ashurst has two offices in the Middle East, as well as an associated office in Jeddah.

One partner is based permanently in Abu Dhabi, while Middle East head Joss Dare and dispute resolution head Dyfan Owen split their time between Abu Dhabi and Dubai.

Holland’s departure comes as Ashurst has witnessed a wave of departures in both London and Asia.

Finance partners Michael Smith, Diala Minott and Cameron Saylor are the latest to leave the firm, joining Paul Hastings in London earlier this month.

Other recent departures include: restructuring partner Simon Baskerville and financial regulatory partners Rob Moulton and Nicola Higgs for Latham & Watkins; litigation partner Mark Clarke and corporate partner Jonathan Parry for White & Case and financial regulatory partner James Perry for Gibson Dunn & Crutcher.

In Asia, Ashurst restructuring partner Bertie Mehigan is leaving the firm’s Hong Kong office with a team of three lawyers to join independent firm Howse Williams Bowers (HWB), while finance partner Doo-Soon Choi joined Mayer Brown’s Hong Kong office.


Norton Rose Fulbright acquires Vancouver firm Bull Housser

Norton Rose Fulbright has acquired Canadian firm Bull Housser, adding 54 partners and a base in Vancouver to its global network.


Bull Housser lawyers will be brought under the Norton Rose Fulbright name, with Bull Housser managing partner Janet Grove remaining managing partner of the Vancouver office.

She will report to Norton Rose Fulbright Canadian managing partner Charles Hurdon, based in Ottawa.

The move follows Norton Rose Fulbright’s launch in Northern California in June, after it hired seven lawyers from Sidley Austin’s San Francisco office. The team moved over as part of a group hire across the US, which saw Norton Rose Fulbright poach Sidley’s entire public finance team.

Norton Rose Fulbright chief executive Peter Martyr said the Bull Housser combination “reinforces our growing Pacific Rim practice”. Bull Housser specialises in projects and transactions work in the region.

Bull Housser is comprised of 54 partners, 32 associates and four counsel. It joins a firm that saw global revenue rise 3.4 per cent to £1.16bn for the 2015/16 financial year in its third financial year since the merger of legacy firms Norton Rose and Fulbright & Jaworski.

As well as turning the spotlight back on the US this year, Norton Rose Fulbright has also been pushing for greater efficiency across the business. The firm announced in May it would axe 170 global business services roles in favour of opening a back office function in Manila later this year


K&L Gates boss Kalis to step down after 20 years

K&L Gates chairman and managing partner Peter Kalis will step down after two decades at the firm when his term concludes next February.

Kalis, who has served continuously as the firm’s leader since 1997, told the firm’s management committee in the summer that he would not stand for a sixth term in 2017.


K&L Gates has grown from 400 lawyers in six offices in the US to 2,000 lawyers in 46 offices on five continents. It has also transformed from a $140m revenue firm to posting six consecutive years of revenue exceeding $1bn.

The firm announced that it has kickstarted the process to replace Kalis as chair.

Kalis said in a statement: “The firm is well-positioned for a smooth transition and to build on these values and on its current foundation, and to continue to serve clients seamlessly and efficiently into the future.”.

A steady stream of mergers over the past decade has resulted in the firm operating from 45 offices around the world, just over half of which are spread across the US. Pittsburgh remains K&L Gates’ largest office, with more than a third of its 93 partners in the litigation practice. Seattle has 80 partners and Washington DC has 79. Earlier this year, the firm launched in Munich with a team from King & Wood Mallesons.

London is the firm’s biggest non-US base, with 53 partners in the UK.

A 2013 merger with Australian firm Middletons gifted K&L Gates a solid book of Asia-Pacific business for the first time. It now has 75 partners across its four Australian offices.


Cadwalader hires Bird & Bird disputes head

Cadwalader Wickersham & Taft has hired Bird & Bird co-disputes head Steven Baker in London.


Baker’s appointment comes as the US firm is looking to boost its litigation and international arbitration offering.

Baker was previously head of commercial disputes at Olswang until 2011. He spent around 10 years at the firm.

His move to Cadwalader was first rumoured earlier this year when Baker stepped off the Property Alliance Group case against RBS, with fellow partner Michael Brown taking over the mandate.

Bird & Bird picked up the case from Cooke Young & Keidan, which came off the high-profile Libor case at the beginning of the year.

He is the second senior exit from Bird & Bird this year following the departure of transformational projects head Dominic Cook in June. Cook left after losing out on the firm’s management elections to David Kerr.

Cadwalader has been boosting headcount in the City in recent months, also taking King & Wood Mallesons Europe finance head Jeremy Cross. The firm’s London office now has 56 lawyers.


Hogan Lovells’ Asia Pacific looks to expand in Shanghai

Hogan Lovells, formed via a merger six years ago, is looking at forming an association with a Chinese firm in Shanghai’s free-trade zone (FTZ).

“China is a key market for us,” said Patrick Sherrington, regional managing partner for the Asia Pacific and Middle East regions at the firm. “We have certainly been considering the possibility of a permitted association in the Shanghai FTZ. That is something under active consideration at the moment.”

The Shanghai FTZ, the first Hong Kong-like trade area in mainland China, was launched in 2013 with the aim of testing liberalization of the Chinese market in key areas such as financial, legal and telecommunications. If Hogan Lovells in successful, it would be the second firm to obtain a license from Chinese regulators to establish a joint operation to practice local law in the area.

Baker & McKenzie was the firm global firm to strike such a deal, entering into an association with FenXun Partners in April 2015. The agreement is not exclusive and the two firms remain structurally separate. International firms have long faced restrictions in China. Foreign lawyers are prohibited from practice Chinese law and appearing in the country’s local courts, and the same applies to any Chinese lawyer hires at international firms.

Hogan Lovells first entered China more than 20 years ago, launching an office first in Beijing in the early 1990s and nearly a decade later opening in Shanghai. Overall, the firm has 55 partners in Asia and 61 in the Asia Pacific region. (Other global firms that have expressed an interest in working with a Chinese firm in the Shanghai FTZ include Dechert, Herbert Smith Freehills, Linklaters and Simmons & Simmons.)