Three foreign law firms will be allowed to set up branches in Korea, the Ministry of Justice said Sunday.
They are Ropes & Gray and Sheppard Mullin from the United States, and Clifford Chance from Britain.
It is the first time that the Korean government is to permit the establishment of foreign legal consultants.
“Those law firms registered their lawyers as foreign legal counsels about a month ago,” a ministry official said.
After finishing registration with the Korean Bar Association (KBA), the firms can open the branches and offer consulting services on foreign laws and international affairs, he said.
Lawyers William Yongkyun Kim of Ropes & Gray, Seth Kim of Sheppard Mullin and Brian Cassidy of Clifford Chance will head the three branches.
The ministry approved them as foreign legal counsels last month and the KBA also accepted them.
The London-based Clifford Chance is the world’s third-largest global law firm, while the US-based Ropes & Gray is ranked around 30th worldwide.
Since the Korea-EU free trade agreement (FTA) took effect last July and the Korea-US pact began in March, a dozen foreign law firms have applied for business licenses here.
A total of eight have registered with the ministry to gain licenses as advisers on foreign law. Another seven US firms and two British firms are undergoing screening.
Korea will open its legal services market in three stages and this is the first where foreign law consultants can open branches and offer advice on international affairs.
The second stage will begin in July next year and foreign law firms will be allowed to deal with Korean legal issues by forming business alliances with local law firms and sharing clients. In the final step starting July 2016, foreign firms will be able to establish joint ventures and hire Korean lawyers to deal with domestic lawsuits.
For the US, the second stage will begin in March 2014 and the final stage, in March 2017.
With the opening of the legal services market, Korean law firms are worrying about competition with large internationally-famous firms.
In a survey of the nation’s top 18 law firms in 2010, they were worried foreign firms may take financial and business counselling cases because they have more experience in those fields than their Korean counterparts.
About 35 percent of them are also concerned clients may heavily rely on large foreign law firms and Korean companies may become subcontractors for them.
“Korean law firms will have to improve their services to retain competitiveness. We’ll help them globalise their services to minimise the side effects of the market opening,” the ministry official said. -By Kim Rahn