An interesting report in yesterday’s legal section of The Australian newspaper penned by legal editor Chris Merritt saying that ..
Asia’s purchase of legal services from Australian law firms has increased so much that growth was twice that in the rest of the world between 2004-05 and 2006-07.
The survey undertaken by the International Legal Services Advisory Council — an organisation within the Australian Attorney-General’s Department also highlights the fact that while the US and Canada are still Australia’s largest market for legal services, accounting for 28 per cent of the total, China and Hong Kong have now displaced Britain as the second largest market, accounting for 16 per cent of legal exports.
Here’s the report in full
Asia lures a growing band of keen legal eagles
Chris Merritt | March 20, 2009
http://www.theaustralian.news.com.au/business/story/0,28124,25212562-17044,00.html
THE nation’s exports of legal services have hit $675 million — an increase of more than 24 per cent over two years.
And the fastest growing market for Australian lawyers is Asia, where growth was twice that in the rest of the world between 2004-05 and 2006-07.
The export boom has been identified by a survey commissioned by the International Legal Services Advisory Council — an organisation within the Attorney-General’s Department.
While the survey period pre
dates the recent global economic turmoil, leading law firms said the Asian market had remained relatively robust until mid-2008.
ILSAC’s survey shows that legal exports to Asia grew by 56.4 per cent during the survey period compared to 25.5percent for exports to the rest of the world.
While the US and Canada are still Australia’s largest market for legal services, accounting for 28 per cent of the total, China and Hong Kong have displaced Britain as the second largest market, accounting for 16 per cent of legal exports.
The survey also shows that law firms that have established their own offices in Asia are gaining market share.
Permanent offshore offices of Australian firms now account for 22 per cent of income from overseas compared to 17.5 per cent for those firms that service foreign markets on a fly in, fly out basis.
The survey also reveals that the export market is dominated by 10 firms which together accounted for 79 per cent of all export earnings.
Jim Dunstan of Allens Arthur Robinson said that while the survey covered a period well before the economic downturn, Asian economies were likely to emerge from the recession faster than others.
He expected the Asian economies to be more resilient than others because they had also recently emerged from the Asian economic crisis.
"One of the consequences of that was that there was a very thorough cleaning out of the lower grade borrowers and a tightening of financial controls across the banking industry," he said.
"There is a much greater sense of resilience in Asia," said Mr Dunstan who is Allens’ executive partner for Asia.
"Asian businesses are more adept at coping with this. They are just buckling down," he said.
Mr Dunstan, who is based in Hong Kong, said there had been a huge drop in commercial activity in December and January as a result of the global crisis. "But there has been quite an uptick in transactions in the last three or four weeks."
Robert Milliner of Mallesons Stephen Jaques said the superior growth rates in Asian markets meant the region would continue to be important for Australian lawyers. He said Mallesons had increased its staffing levels in Shanghai and had no plans for reductions.
Mr Milliner, chief executive partner at Mallesons, said that while economic activity in north Asia had suffered, he expected a strong bounce-back.
"When Hong Kong comes out of a dip it tends to come out pretty strongly. I expect that when the US rebounds, north Asia will rebound."
