4 ASIAN LEGAL BUSINESS CHINA • 亚洲法律杂志-中国版 JUNE 2024 BIG STORY At the end of April, Shanghai Mayor Gong Zheng and Hong Kong Chief Executive John Lee witnessed the signing of 20 new cooperation agreements by relevant departments from both cities. These agreements span 15 areas, aiming to promote in-depth cooperation between Shanghai and Hong Kong from multiple aspects. The agreements have placed a spotlight on the legal services sector. In addition to supporting business cooperation in legal services between the two regions and fostering exchanges in professional services such as law, arbitration, and mediation, the agreements specifically propose several innovative initiatives. These include supporting joint ventures between Hong Kong and mainland law firms in Shanghai, allowing Hong Kong legal practitioners to serve as consultants in Shanghai law firms, and futher establishing branches of each region’s law firms in the other. The concept of joint ventures between Shanghai and Hong Kong law firms, as well as the hiring of Hong Kong consultants by Shanghai law firms, are relatively new ideas with limited existing practices in the market. According to the Law Society of Hong Kong’s website, only 13 Hong Kong local law firms currently have representative offices in Shanghai. Oldham, Li & Nie (OLN) is one of them. Tracy Yip, partner and head of the China practice at OLN, explains: At the sixth session of the Hong Kong/Shanghai Cooperation Conference held recently, Shanghai and Hong Kong signed a series of new agreements, marking a significant advancement in their collaboration. This strategic move is set to enhance business opportunities for law firms in both cities. 沪港合作会议第六次会议于近期举行，上海、香港共同签署多 份合作协议。这被视为沪港合作又一个重要里程碑，也必将为 两地律所带来更多业务机会。 By Hu Yangxiaoxiao 作者：胡阳潇潇 A WIN-WIN ARRANGEMENT 沪港合作再升级 “Our existing office in Shanghai is a representative office which is a networking and/ or marketing hub for our firm, that cannot be engaged in providing any legal services.” However, “the possible collaboration in the Shanghai Free Trade Zone would allow the joint venture parties to be engaged in providing income generating legal services and to further leverage local intelligence and enhance service offerings to clients,” elaborates Yip. New Cooperation Opportunities Given that large-sized law firms might not have the flexibility in entering into any joint ventures and small-sized law firms may not have the sufficient clientele and capacity to support the formation of such joint ventures, Yip believes that setting up joint ventures in Shanghai might be more appealing for medium-sized law firms in Hong Kong like OLN. “These firms mainly target corporate groups with a crossborder presence. They would likely be more responsive to such proposal as they tend to target in providing more personalized and instant legal services to their clients.” “The ease of communication and exchange of thoughts within the jointventured firm between HK qualified lawyers and PRC qualified lawyers would further enhance the achievement of their allrounded service goals to clients,” says Yip. Moreover, joint ventures could effectively help Hong Kong firms enlarge their client base. “On one hand, it will expose them to the existing clientele of the joint venture partner and to enhance the tapping of new PRC based clients by way of their existence in Shanghai. On the other hand, it will enable them to educate clients on the beauty of expanding their onshore businesses to offshore whilst having Hong Kong as a springboard to face the international arena,” Yip explains. Fundamentally, the premise and purpose of all these efforts are to promote exchanges in professional knowledge and cultural experiences between Shanghai and Hong Kong lawyers, which is of vital importance to support the one-stop legal services as required by cross-border corporate groups having their headquarters in Shanghai and subsidiaries in Hong Kong or vice versa. “It is beyond doubt that the collaboration shall widen up and solidify the practical expertise of both Shanghai and Hong Kong lawyers, which inevitably equips them in such a way to provide legal services involving both jurisdictions in a more efficient and pragmatic manner,” says Yip. The agreements also encourage more Shanghai law firms to establish branches in Hong Kong. Over the past two years, an increasing number of mainland law firms have entered the Hong Kong legal market. According to the Hong Kong Law Society, 14 mainland law firms’ Hong Kong offices have obtained local licenses, and 29 are registered as foreign law firms in Hong Kong, though only five of these are from Shanghai. In 2021, Shanghai-headquartered Llinks Law Offices obtained a local license in Hong Kong after six years of joint operations. Selena She, who splits her time between Shanghai and Hong Kong, admits, “True cooperation is not as simple as setting up an office; we have realized that lawyers from both regions need to visit and exchange more frequently.” She explains that, based on its strength in capital markets, Llinks Hong Kong’s next step is to further expand its capabilities in general corporate, financial asset management, and other areas. “With this ShanghaiHong Kong cooperation agreement, we now see new opportunities, especially in fields such as tech innovation, data, and
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