First PwC Legal announce their plans to become a major global player in the law business, now Ernst & Young have made their move with the purchase of the Chinese law firm Chen & Co.
The Ernst & Young move marks a continuing shift among the accounting and audit firms to take on the legal business. The four major accounting firms have all merged with Chinese accounting practices to create stronger Chinese footprints, but it is only the second time in China that a move into the legal market has been made.
The first was by Deloitte’s, who established a law firm last year, Qin Li, which is based in Shanghai as is Chen & Co. Qin Li is promoted as part of the Deloitte brand.
There are other major moves in the Chinese market as well. Two of China’s largest domestic firms, Jun He and Zhong Lun, have proposed a merger deal that will see them become the largest Chinese law practice.
Along with King & Wood, whose own merger with Mallesons took place just two years ago, these firms made up the “Big Three” law practices in mainland China.
The King & Wood Mallesons firm went a step further last year by swallowing up SJ Berwin to create the first China-Asia practice. That firm now has 2,700 lawyers across 30 offices in Asia, signifying the shift of commerce and accompanying professional services to the Asian region.
The Jun He / Zhong Lun merger brings together complimentary services. Jun He specializes in foreign investment and capital markets, while Zhong Lun focus their expertise in real estate, projects and domestic M&A deals, creating a healthy mix of international MNC’s and large Chinese corporates. Both have also opened up offices overseas. Jun He became the first Chinese firm to open an office outside China in 1993, when it established a presence in New York. In 2010, it opened another American office in Silicon Valley. Zhong Lun opened in Tokyo in 2006, followed by a London office in 2012 and a New York office last year.
This makes the Ernst & Young legal acquisition of a domestic Chinese law practice the first time a law firm has been acquired in China by a non-legal practice.
Along with its Shanghai office, Chen & Co commands a staff of over 40 lawyers throughout China, including a branch office in Beijing and a liaison office in Hong Kong. Under the deal, Chen & Co will join EY’s Global Network and will retain their China law license. The firm has built a reputation for advising privately owned Chinese companies during the IPO process, both within China and overseas.
Read more at China Briefing