‘Pretty immediate impact’ on business is reason for Simpson Thacher to move
One of the biggest law firms in the United States is to open its first office in the European Union after many years of being based in London, citing the challenges of Brexit as the main reason.
Founded in 1884, New-York based Simpson Thacher has worked with companies including Alibaba, Tesla and Facebook. It has 10 offices around the world, including in Beijing and Hong Kong.
Previously it had handled all its European affairs from London, but speaking to the Financial Times, Bill Doughtery, the company’s executive committee chairman, said the end of the Brexit transition period had a “pretty immediate impact “on business.
Clients would now face “continued challenges in navigating an evolving legal framework”, he added, because of the United Kingdom’s departure from the 27-nation bloc.
According to terms of the post-Brexit trade deal agreed between the UK and the EU just days before the end of the 11-month transition period, English-qualified solicitors can only give advice on UK and international law when they are in the bloc, a situation further complicated by some countries also having local rules and regulations.
Antonio Bavasso, who will head the Brussels office and is qualified as a lawyer both in Italy and England, said: “You need to be EU-qualified to provide (EU law) advice in Europe and that’s an issue that a number of firms have had to contend with.
“That old paradigm of lawyers being able to travel freely has some grit in it now,” he continued. “A number of firms have had to strengthen the EU-qualified contingent in their ranks and vice versa.”
In addition to practicalities of work having become harder, the fact that some commercial transactions will now need to be scrutinized by both European officials and the UK’s own Competition and Markets Authority, or CMA, means double the work, in contrast to Brexit supporters’ claims of how leaving the EU would reduce bureaucracy.
“Brexit means a duplication of the work, because there will now be parallel investigations in the UK and Brussels,” Bavasso continued, “and the CMA has already taken a very prominent role on the world stage”.
Despite the significance of the new European office, which will open in the summer, Dougherty insisted the importance of the London bureau, whose staff numbers grew by 17 percent last year, was not in any way being downgraded.
“The center of gravity for our European practice will remain in London,” he said. “It is our second-largest office and is growing at a faster rate than any other.”