A recent study ranked Hong Kong, Singapore and Tokyo as having the best judicial systems in Asia. Richard Szabo investigates what overseas employment opportunities the Asian markets have to offer.

Lawyers who have contemplated, or even just fantasised about, working overseas may want to have a closer look at Hong Kong, Singapore and Tokyo. A recent poll by Hong Kong consulting firm PERC showed the three cities in question have the best Asian judicial systems, with respect to lawyer education standards, transparency, independence of judicial systems and IP protection.

Despite the financial market meltdown in New York and depressed London market, Hong Kong is showing good prospects. Herbert Smith partner Gareth Thomas says financial services regulatory work has doubled over the past two years, while insurance and employment work has increased by 20%.

There has been a general increase in work involving the energy sector, regulatory matters and project funding. "We are also seeing battles between telcos, since they are operating in one of two sectors that are subject to competition rules. We have seen telco work go up by about eight or 10 fold in the past year," he says.

Thomas adds there has recently been "unprecedented growth" in capital markets, IPOs and M&A, pointing to the firm's work for Goldman Sachs' and Morgan Stanley's HK$13.7bn (A$2.2bn) IPO, SAIF Partners,Hony Capital and IDG Technology Venture Partners' HK$2.7bn (A$437m) acquisition of Digital China Holdings, and BP on its A$2.5bn refinancing of SECCO.

Singapore: competition/tax hot spot

Law firms in Singapore have similarly observed increased work. Since the country's new Competition Act came into force two years ago, many law firms have increased their tax and competition work by as much as 100%.

There have recently been deals ranging from US$200m to US$1bn (A$249m to A$1.2bn) that involved a number of jurisdictions, including Thailand, Malaysia and India. Most M&A lawyers can expect to make at least four international trips a year.

The client base that foreign lawyers deal with would include investment bankers who are more often than not easy to deal with, as they are also expatriates who expect the same level of service they would receive in western countries.

Drew & Napier partner Manoj Sandrasegara says law firms are currently facing a shortage of lawyers in Singapore, since there are too few law graduates to meet demand and some lawyers opt to work overseas. "There is a shortage of lawyers with the skill levels required. We have, however, been fortunate that a number of capable lawyers who have worked in New York and Hong Kong have either joined or returned to us after a stint in those jurisdictions. These lawyers acquired new and improved skill sets while working overseas," he notes.

Tokyo: a shining star

Baker & McKenzie's managing partner Jeremy Pitts in Japan has seen large, complex cross-border deals, in the order of hundreds of millions of US dollars. He says some of this is reflected in financial, corporate and capital markets work, but includes outbound investment from Japanese corporations. "Financial institutions are looking to diversify and invest in utilities, while international power investment is quite hot at the moment," he explains. "Since the commencement of the credit crisis, Japanese financial institutions have been actively investing in US financial institutions and we're likely to see more of this."

Pitts says the firm recently acted for Nomura as the mezzanine lender in the debt financing of Marubeni/TEPCO's (A$287m) bid for Mirant's power assets in the Philippines (A$3.4bn). The firm also acted for Electric Power Development in constructing and operating two gas thermal power generation plants in Thailand (A$2.5bn).

Hays Recruitment director Mark Kadillak says there is a "massive" energy boom in Japan that has made law firms busier than they were in the past decade. "Japanese companies are cash rich and they are in better shape than their US counterparts, and US companies may be attractive targets, so there should be greater M&A activity," says Kadillak.

What employers want Kadillak says during the 23 years he has worked as a recruiter in Japan, he found the most attractive legal talent were those who understood the entertainment industry, music rights and intellectual property law.

Private practice does not require Japanese language skills but rather greater depth of expertise in the given area such as corporate transactions and M&A.

Pitts says he always looks for candidates who have a long-term interest in Japan. "In order to qualify to practise foreign law, you need to be registered and for that you must have three years' experience, of which, in principle, two years must be spent in your home jurisdiction," he states.

Thomas, on the other hand, believes that lawyers who are prepared to do a wider variety of work at a senior level have a better chance of finding work. "You need to be more of a generalist in Hong Kong; we consider ourselves to be doing a wider range of activities than lawyers in Sydney or Auckland might do," he explains.

Hughes-Castell managing director Doreen Jaeger-Soong says Australian lawyers with skills in M&A, private equity, financial services or intellectual property are highest in demand, particularly those who have a good command of business Mandarin or Korean.

"Ideal candidates are those with four to six years' experience with strong Chinese language abilities," she says.

In Singapore, many foreign lawyers join firms as an associate and work their way up to partnership. However, hiring a very senior lawyer or partner requires more than technical skill. He or she must have made a significant contribution to their firm's revenue.

Historically, in Japan, lateral partner recruitment has taken place with candidates from other foreign firms, says Kadillak. Expertise would not be enough for a senior level appointment, since a significant part of a partner's workload is also related to business development, namely clients, contacts and selling the service, he adds. ALB