UK: City firms prepare to drop Russian clients after Ukraine invasion says Law Society Gazette

The Law Gazette reports

Leading UK firms are considering dropping Russian clients as the war in Ukraine intensifies and the spotlight falls on the legal profession’s links to the country.

The Gazette is aware of at least three City firms who have initiated reviews of client relationships in the light of the ongoing conflict.

A number of UK firms have offices in Moscow and other Russian cities and – while there is no suggestion they have done anything wrong – pressure is mounting for professional services outfits to cut all ties with the country.

But the Law Society has supported firms representing Russian clients and in particular those working to ensure sanctions imposed by the UK government are lawful.

Society president I. Stephanie Boyce said: ‘It’s the job of solicitors to represent their clients, whoever they may be, so that the courts act fairly. This is how the public can be confident they live in a country that respects the rule of law – unlike Putin’s tyrannical regime.

‘Solicitors are highly regulated and are not allowed to bring spurious objections to processes – if they challenge the government’s actions, it’s because they think the government is at risk of breaking its own rules.’

Boyce added that if the government wished to change the rules on sanctions, this should be done democratically.

The Gazette has contacted firms with Russian clients or offices to ask if they plan to either leave the country or end relationships.

A White & Case spokesperson said: ‘We are reviewing our Russian and Belarusian client representations and taking steps to exit some representations in accordance with applicable rules of professional responsibility.

‘Our Moscow office is open and continues to operate. We are complying fully with all applicable sanctions, and we continue to closely monitor this rapidly evolving situation.’

A spokesperson for Baker McKenzie said: ‘With offices in Moscow and St Petersburg, we are reviewing and adjusting our Russia-related operations and client work to align with all applicable sanctions and comply with these fast-evolving laws.

‘We do not comment on the details of specific client relationships, but this will mean in some cases exiting relationships completely.’

A statement from Linklaters said: ‘The situation in Ukraine is deeply distressing and our immediate thoughts are with the Ukrainian people. We’re actively monitoring the situation and working to ensure the safety and support of colleagues and their families. We’re also reviewing all of the firm’s Russia-related work.’

Kennedys had already made the decision to wind down its Moscow office last autumn, and does not intend to renew its lease once it expires next year. Nick Thomas, global senior partner, said the firm was ‘uncomfortable with the direction the country was taking’ and is now working to identify Ukrainian and Polish charities to provide support where it is needed.

City of London Law Society chairman Edward Sparrow said: ‘The City of London Law Society condemns the Russian invasion of Ukraine as an egregious breach of international law and of the international rules-based system, both of which underpin our peace and prosperity. The CLLS stands ready to assist HM Government in its response to Russia’s actions. All sanctions applied by the UK and our international partners should be complied with in full.’

Law firms have been criticised by foreign secretary Liz Truss in a briefing to MPs for seeking to hold up the sanctions process. She said that the government had to make sure these measures were ‘legally watertight’.

It was also reported yesterday that prime minister Boris Johnson’s official spokesperson said Russia should be treated ‘like a pariah state’ and that City law firms, accountants and banks should not be supporting allies of the Russian regime.

However, Labour MP Justin Madders told Truss yesterday: ‘No matter how distasteful we might find it and how damaging it might be to those law firms’ reputations, even oligarchs are entitled to legal representation because that is part of what makes us a free and democratic society.’

He said that ‘the best way to deal with these issues is to ensure that the laws are watertight in the first place’, adding that the government needed to have ‘the best, most expert lawyers available to ensure that no loopholes can be exploited’.