MCI (P) 003/02/2023 issn 0219 – 6875 KDN PPS 1867/10/2015(025605) INDONESIA’S NEW CAPITAL GENERATES LEGAL WORK ASIA’S LARGEST, FASTEST-GROWING FIRMS SPOTLIGHTED OFFSHORE LAWYERS LOOK AHEAD TO THE NEXT YEAR THE LION CITY’S BEST AND BRIGHTEST
CONTACTS Warren Tan - (65) 6793 6264 warren.tan@thomsonreuters.com WEBSITE www.legalbusinessonline.com/BFC23 REGISTER www.gevme.com/BFC23 PRICING USD756 (inclusive of 8% GST) SPEAKER Srinath Keshavan Srinath Keshavan is a seasoned practitioner of Trade Finance. He is empanelled with a global bank to deliver training in Financial Crime Compliance related to Anti-Money Laundering & Sanctions Evasion Risk. He is also a long-standing presenter for Euromoney and World Bank Group of training programmes in Trade, Commodities & Supply-Chain Finance. Prior to his work with Trade Risk Consulting, he led the Finance and Risk functions at several large international trading firms in Singapore. He also received formal training in commercial banking, served as a lending officer with an international bank in Hong Kong. He collaborates with experts in topics allied to Trade Finance such as Derivatives, Regulatory matters, Cash Management, Bank Capital Management and Fintech for Trade Finance. OVERVIEW ALB Battling Financial Crime Masterclass 2023 is designed for compliance professionals and managers responsible for Financial Crime Prevention. It will deliver updates on current issues whilst illustrating breaches with real-life incidents. Participants will be encouraged to share experiences, recognise trends, and propose solutions for adoption. 6 Public CPD Points (3 Public CPD Points Per Day) Practice Area: Banking and Finance | Training Level: General Participants who wish to obtain CPD Points are reminded that they must comply strictly with the Attendance Policy set out in the CPD Guidelines. For this activity, this includes signing in on arrival and signing out at the conclusion of the activity in the manner required by the organizer, and not being absent from the entire activity for more than 15 minutes. Participants who do not comply with the Attendance Policy will not be able to obtain CPD Points for attending the activity. Please refer to http://www.sileCPDcentre. sg for more information. AGENDA • Perpetrators of Financial Crime – Environmental Factors • Digitally-executed Scams & Frauds • The vulnerability of Crypto • Are ESG-driven Supply-Chains presenting a new opportunity for criminals? • Surge In Trade-Related Financial Crime • Recent legal and regulatory moves • Cost of Compliance • Raising the effectiveness of Controls ALB Battling Financial Crime Masterclass 2023: Countering Anti-Money Laundering, Terrorist Financing, Bribery & Corruption and illicit Sanctions Evasion 30 November 2023, Thursday Registration: 8.30am to 9.00am (GMT +8) Event: 9.00am to 5.00pm (GMT +8) Venue: TBC, Singapore
1 ASIAN LEGAL BUSINESS – NOVEMBER 2023 WWW.LEGALBUSINESSONLINE.COM COVER STORY 18 ALB Singapore Rising Stars 2023 Asian Legal Business releases its second annual ranking of the emerging legal talent in Singapore. The list includes lawyers who have demonstrated exceptional potential and received praise from their clients. Plus: - CMS FEATURES 14 2024: The offshore view Offshore law firms have had a challenging 2023, with stiffer regulations, increased onshore competition from “Cayman-style” funds and slow M&A recovery holding back growth. Law firm leaders talk about some of their big themes for 2024, including the advent of financial technology and digital asset regulations, the rise in competition from “onshore” centres like Singapore and Hong Kong, and the potential for emerging areas like ESG and AI to grow in importance. 26 Moving to Nusantara In April 2017, the Indonesian government led by Joko Widodo (better known as Jokowi) announced its plan to move the country’s capital from Jakarta to a new city called Nusantara. With the inauguration set to happen in August next year, the government has laid out a plethora of incentives to attract investment to the new capital. There is, however, uncertainty over the country’s political and regulatory landscape, which keeps law firms in Indonesia busy. 30 ALB Fast 30: Asia’s Fastest Growing Firms 2023 Amidst the rapidly changing legal landscape in Asia, a select group of law firms are taking advantage of the region’s economic growth by adopting innovative technologies and strategic approaches to meet the changing demands of their clients in a more interconnected global environment. The ALB Fast 30 list, now in its third year, recognises 30 firms that have significantly contributed to shaping the legal industry’s future in Asia. 32 ALB Asia Top 50 2023 In a constantly evolving and dynamic legal landscape, law firms in Asia are always looking for ways to grow and expand. The annual list of Asia’s Top 50 Largest Law Firms by headcount, highlights the remarkable journey of these firms as they continue to adapt to the challenges and opportunities of the modern legal world. 36 ALB Hong Kong Law Awards 2023 Photos, quotes and more from the 22nd annual ALB Hong Kong Law Awards, held at the JW Marriott on Sept. 15. BRI EFS 3 The Briefing 4 Forum 5 Deals 6 Explainer 10 Appointments 13 Q&A Plus: - CIETAC CONTENTS 32 Moving to Nusantara Image: REUTERS/Edgar Su
2 ASIAN LEGAL BUSINESS – NOVEMBER 2023 WWW.LEGALBUSINESSONLINE.COM Asian Legal Business is available by subscription. Please visit www.legalbusinessonline.com for details. Asian Legal Business has an audited average circulation of 11,402 as of 30 September 2016.Copyright is reserved throughout. No part of this publication can be reproduced in whole or part without the express permission of the editor. Contributions are invited, but copies of work should be kept, as Asian Legal Business can accept no responsibility for loss. MCI (P) 003/02/2023 issn 0219 – 6875 KDN PPS 1867/10/2015(025605) Thomson Reuters 18 Science Park Drive Singapore 118229 / T (65) 6775 5088 / F (65) 6333 0900 10/F, Cityplaza 3, Taikoo Shing, Hong Kong / T (852) 3762 3269 www.thomsonreuters.com Eye on the future Tradition and expertise may have long been revered in the legal industry, which is being steadily reshaped by the dynamism of youth. As we turn our attention to Singapore’s exceptional young lawyers in our annual Rising Stars issue, it becomes evident that nurturing, engaging, and promoting the next generation of legal minds is not merely an altruistic endeavour; it is a strategic imperative for law firms looking to future-proof themselves. The legal profession is undergoing a profound transformation, marked by evolving client expectations, technological advancements, and global challenges. In this era of rapid change, law firms must recognise the invaluable contributions that emerging talents bring to the table. Young lawyers, often armed with a fresh perspective, technological acumen, and a hunger for innovation, are the architects of the legal future. By investing in the development of young legal professionals, law firms are not only securing their succession plans but also infusing their practices with the energy and adaptability required to thrive in an ever-shifting landscape. These Rising Stars represent not just individuals but the promise of a resilient and agile legal industry. Engaging younger lawyers goes beyond traditional mentorship; it involves creating an inclusive environment that fosters collaboration, encourages diversity of thought, and champions continuous learning. As the legal sector confronts the complexities of a digital era, firms that fail to harness the potential of their younger talent risk stagnation and irrelevance. Moreover, promoting diversity in leadership is paramount. Embracing the multifaceted perspectives of younger lawyers enriches decision-making within rms and enhances their capacity to navigate a globalised legal terrain. These Rising Stars are not just the future — they are the architects of a legal landscape that is more inclusive, dynamic, and responsive to the needs of the clients they serve. RANAJIT DAM Managing Editor, Asian Legal Business, Thomson Reuters HEAD OF LEGAL MEDIA BUSINESS, ASIA & EMERGING MARKETS Amantha Chia amantha.chia@thomsonreuters.com MANAGING EDITOR Ranajit Dam ranajit.dam@thomsonreuters.com ASIA JOURNALIST Sarah Wong sarah.wong@thomsonreuters.com ASIA WRITER Nimitt Dixit nimitt.dixit@thomsonreuters.com RANKINGS AND SPECIAL PROJECTS EDITOR Wang Bingqing bingqing.wang@thomsonreuters.com COPY & WEB EDITOR Rowena Muniz rowena.muniz@thomsonreuters.com SENIOR DESIGNER John Agra john.agra@thomsonreuters.com TRAFFIC/CIRCULATION MANAGER Rozidah Jambari rozidah.jambari@thomsonreuters.com SALES MANAGERS Hiroshi Kaneko Japan (81) 3 4520 1192 hiroshi.kaneko@thomsonreuters.com Jonathan Yap Indonesia, Singapore (65) 6973 8914 jonathan.yap@thomsonreuters.com Krupa Dalal India, Middle East, Singapore (91) 22 6189 7087 krupa.dalal@thomsonreuters.com Romulus Tham Southeast Asia (65) 6973 8248 romulus.tham@thomsonreuters.com Steffi Yang South and West China (86) 010 5669 2041 qifan.yang@thomsonreuters.com Steven Zhao China Key Accounts (86) 10 6627 1360 s.zhao@thomsonreuters.com Yvonne Cheung China Key Accounts, Hong Kong and Korea (852) 2847 2003 yvonne.cheung@thomsonreuters.com SENIOR EVENTS MANAGER Julian Chiew julian.chiew@thomsonreuters.com SENIOR EVENTS MANAGER, AWARDS Tracy Li tracy.li@thomsonreuters.com
3 ASIAN LEGAL BUSINESS – NOVEMBER 2023 WWW.LEGALBUSINESSONLINE.COM THE BRIEFING: YOUR MONTHLY NEED-TO-KNOW U.S. LAW FIRMS RETHINK CHINA Salary difference by which female GCs in multi-lawyer departments outearned their male counterparts, according to a survey of U.S. GCs conducted by the Association of Corporate Counsel. (Reuters) A hard-fought race by U.S. and global law firms to expand into China has turned into a retreat for many, thanks to growing pressures on foreign businesses and converging economic and geopolitical challenges, according to new data and interviews with lawyers and legal industry experts. Of the 73 largest U.S. law firms with a presence in China, 32 shrank their attorney presence in the last decade, according to a Reuters review of data from Leopard Solutions, which tracks law firm hiring. In Beijing, 26 of the 48 largest U.S. law firms drew down their presence since 2018. After rushing to gain market share during China’s decades-long economic boom, U.S.-based firms in China grew their headcounts there just 3 percent between June 2018 and June 2023, the data show. The regulatory environment has also shifted amid President Xi Jinping’s growing crackdown on perceived data privacy, national security and espionage risks. Other firms pulling back in China have pointed mainly to market conditions. 19.5% FUTURE AMID ECONOMIC WOES (Reuters) The legal artificial intelligence market is getting more crowded as new startups continue to woo investors. The latest entrant, Eve, launched recently with $14 million in seed funding led by venture capital firms Lightspeed Venture Partners and Menlo Ventures. Eve says it offers a “personalized” AI legal assistant to help automate and save time on tasks like document review and legal research. Jay Madheswaran, the San Franciscobased company’s CEO and co-founder, said Eve’s enterprise software comes with a set of “skills” for certain tasks, which law firm customers can then customize. Madheswaran has previously held roles as a partner at Lightspeed and head of product engineering at cybersecurity software company Rubrik. Eve co-founders Matt Noe and David Zeng also worked at Rubrik. Madheswaran said the now 15-person team has worked on Eve for a few years. LEGAL AI STARTUP, EVE, LAUNCHES WITH FUNDING FROM MENLO, LIGHTSPEED Proportion of lawyers who expect to integrate generative AI in their legal work within the next year, according to a Walters Kluwer survey, with 68 percent feeling prepared for its impact. 73% IN THE NEWS The Law Society of Singapore has elected Lisa Sam Hui Min, managing partner of local boutique Lisa Sam and Company, as its first female president in two decades. The previous female president was Arfat Selvam, who took on the role in 2003. “I THINK IT’S FRAUDULENT, THE DECISION. THE FRAUD IS ON THE COURT, NOT ON ME.” QUOTE UNQUOTE Herbert Smith Freehills will shut its Malaysian office at the end of April 2024, the firm has announced. Its exit from Malaysia means HSF will have closed two Asian offices in the span of about one year, having shut its Korea outpost earlier this year. While testifying at his civil fraud trial in New York, former U.S. president Donald Trump lashes out at the judge handling the case. IN THE NEWS
4 ASIAN LEGAL BUSINESS – NOVEMBER 2023 WWW.LEGALBUSINESSONLINE.COM BRI EFS RACHEL ENG, managing director, Eng & Co. The role of a lawyer has historically been to act as the interpreter of the law for lay clients, primarily to act as the client’s advocate before a court of law or to act as the client’s negotiation representative in the case of a corporate transaction. As the world begins to rely on technology and artificial intelligence to solve business and other problems, various aspects of legal practice are now being handled by technology. Combining one or more forms of deep learning, machine learning, natural language processing, speech and visual recognition software, numerous legal tech tools have been invented, whether to summarise cases, contracts or filings, to assist in contract drafting, to support contracting or legal research functions, and/or to provide classification and knowledge management. In recent times, with the advent of large language models and generative AI, lawyers will almost definitely be dependent on such tools for legal practice. I imagine that generative AI as a junior assistant will, at some point, be more reliable than a human associate as it will learn fast, it will recall with 100 percent accuracy, and it does not need to take annual leave. Law firms will, therefore, have to start hiring talent who are agile, keen to learn and willing to embrace this change. This means that lawyers might have to go beyond learning about the law and start to learn how to use prompt engineering. So far, generative AI is, at best, able to produce the first cut of a legal memorandum or advice. Thus, law firms will still require knowledgeable associates to review the draft and provide their judgment and comments. The good news is that junior lawyers will still have a job, but they will have to rise above the ability of the generative AI tool. CHARLES BUTCHER, Asia managing partner, Eversheds Sutherland The firm has a long and successful history of using AI and AI-led technology for our different practice areas. However, with the rapid advancement of AI and, more recently, generative AI, the importance of technological knowledge has significantly escalated for lawyers. In trying to get ahead of these changes, we have incorporated technological expertise into our talent strategies, such as hiring legal technologists to support our clients. By embracing these technological advancements, we can enhance our client advisory work and align our operations with the evolving landscape. In support of this is our newly established Global AI Task Force, comprising lawyers and business professionals from across the firm. This task force will evaluate the development and use of generative AI products, ensuring we stay at the forefront of legal, ethical, and regulatory considerations. We are also excited about our upcoming global generative AI skills development program, which will equip all our people with the necessary knowledge and readiness to embrace this transformative technology. By providing comprehensive training, we will empower our people to navigate the complexities of AI and offer innovative solutions to our clients. As an entrepreneurial firm, we’re looking to stay ahead of the competition in how we support our clients through the use of AI and generative AI. FORUM NEW AGE LAWYERS With emerging technologies driving demand for novel legal advisory, law firms are increasingly seeing a pressing need to strategise their teams accordingly. Leaders share with ALB how they are taking essential technological knowledge into consideration when making hires that enable their firms to come on top in client work. HOW CRITICAL HAS TECHNOLOGICAL KNOWLEDGE BECOME AS A SKILLSET FOR LAWYERS, AND HOW DOES THAT INFLUENCE YOUR FIRMS’ TALENT STRATEGIES? RACHEL ENG CHARLES BUTCHER BASIL HWANG
5 ASIAN LEGAL BUSINESS – NOVEMBER 2023 WWW.LEGALBUSINESSONLINE.COM BRI EFS BASIL HWANG, managing partner, Hauzen It is no secret that AI is increasingly a feature of daily life across the globe. I think it is inevitable that it will become a more important part of legal practice as well. Lawyers of today – and the future – will need to know how to harness AI in their work if they do not wish to be replaced by it. Another feature of the world we live in is the growing prevalence of blockchain technology and digital assets or digital currency. A huge proportion of our time is taken up in advising on cryptocurrency disputes, for example. Without a basic knowledge of the technology underlying it, a lawyer would find themselves at a serious disadvantage in understanding and arguing cases. We have found ourselves in situations in court where opposing counsel did not understand the technology underlying digital assets, which put them at a disadvantage. We will continue to hire the best legal talent based primarily on their competence in the law. We will expect our lawyers, however, to have some technological knowledge or have the aptitude to learn it – and we are very willing to teach it. Our practice is already very heavily weighted towards digital finance, with several knowledgeable and experienced lawyers in our Blockchain, Tokenisation and Web 3.0 practice, so our lawyers should have no shortage of learning resources in-house at our firm. DEALS $3.6 BLN Financing and development of the Hai Long Offshore Wind Power Project Deal Type: Project Finance Firms: Clifford Chance; Hogan Lovells; Jones Day; Lee and Li; Linklaters; Tsar & Tsai; White & Case Jurisdictions: Canada, Singapore, Taiwan $3 BLN Expansion of Ninoy Aquino International Airport in Manila Deal Type: Project Finance Firms: Pinsent Masons MPillay; PJS Law Jurisdiction: Philippines $1 BLN Midea Group’s planned listing on the HKEX Deal Type: IPO Firms: Freshfields Bruckhaus Deringer; Jia Yuan Law Offices; King & Wood Mallesons; Skadden, Arps, Slate, Meagher & Flom Jurisdictions: China, Hong Kong $642 MLN Mirvac Group’s acquisition of Serenitas from GIC, PEP, TCP Deal Type: M&A Firms: Ashurst; Baker McKenzie; Herbert Smith Freehills Jurisdictions: Australia, Singapore $501 MLN J&T Global Express’ listing on the HKEX Deal Type: IPO Firms: Commerce & Finance Law Offices; Dahui Lawyers; Han Kun Law Offices; Latham & Watkins; Skadden, Arps, Slate, Meagher & Flom Jurisdictions: China, Hong Kong $488 MLN Zurich Insurance’s acquisition of Kotak Mahindra General Insurance Deal Type: M&A Firms: AZB & Partners; Cyril Amarchand Mangaldas; Freshfields Bruckhaus Deringer Jurisdictions: India, Switzerland $477 MLN Kyowa Kirin’s acquisition of Orchard Therapeutics Deal Type: M&A Firms: Goodwin Procter; Morrison Foerster; Slaughter and May Jurisdictions: Japan, UK $317 MLN Doosan Robotics’ listing on the KSE Deal Type: IPO Firms: Cleary Gottlieb Steen & Hamilton; Kim & Chang; Paul Hastings Jurisdiction: South Korea
6 ASIAN LEGAL BUSINESS – NOVEMBER 2023 WWW.LEGALBUSINESSONLINE.COM BRI EFS Image: Rabanser/Shutterstock.com EXPLAINER HAS THE JPEX EXPLOSION KILLED HONG KONG’S CRYPTO DREAM? In September, Hong Kong’s reputation as a global financial hub took a battering following the news of highprofile arrests related to unlicensed crypto exchange Japan Exchange (JPEX). The Securities and Futures Commission (SFC) issued two public announcements warning investors that JPEX’s claims to be regulated were false, and that some of its activities, including offering high returns on various virtual asset products, were prohibited under the AntiMoney Laundering and Counter-Terrorist Financing Ordinance. Soon after, at least 20 people, including JPEX employees and online influencers, were arrested as upwards of 2,000 victims were uncovered, with claims totalling as much as HK$1.56 billion ($199 million). The platform allegedly imposed restrictions on withdrawal limits, making it extremely difficult for customers to withdraw their virtual assets. Crypto bulls are insisting that the JPEX fiasco hasn’t blunted Hong Kong’s ambitions to become a leading jurisdiction for the crypto assets industry, and more harm has been avoided because of the existing regulations on virtual asset trading platforms. On the other hand, sceptics argue that the incident has exposed weak links in a digital asset regulatory regime that has left too much leeway for advertising and retail investment without proper oversight. The incident could prompt the Hong Kong government to recalibrate its regulatory focus when it comes to digital assets. In a regulatory summit organised by Bloomberg, Financial Secretary Paul Chan emphasised information transparency and investor education as keys to ensuring robust supervision. “Regulations and market development are not against one another; rather, they go hand in hand,” says Chan. WHAT ARE THE ROOT CAUSES OF THE JPEX SAGA? Kelvin Low, a law professor who used to teach at the University of Hong Kong before joining the National University of Singapore, attributes one of the root causes of JPEX’s implosion to the Hong Kong government’s premature push into the retail investment space in the licensed virtual assets market. “The industry preyed on the government’s insecurity over Hong Kong’s crown as Asia’s financial centre, and this led to Hong Kong’s crypto pivot,” says Low. Low believes the authorities’ seemingly laissez-faire approach to advertising or access to retail trading of virtual assets has also contributed to JPEX’s downfall and proved the Achilles’ heels of Hong Kong’s crypto aspirations. “Hong Kong did not try to regulate either advertising or retail access via over-the-counter (OTC) stores. The lack of advertisement regulations meant that the average retail investor was easily misled by public advertisements, such as those by JPEX, that they were investing in a licensed platform, and the lack of regulation of OTCs meant that the regulators’ objective of keeping retail investors within the licensed market failed miserably since OTC stores (which JPEX also used for outreach) primarily served as on/off ramps for unlicensed exchanges/virtual assets,” Low adds. WHAT REPURCUSSIONS ARE LIKELY TO FOLLOW? In response, the Securities and Futures Commission (SFC) and the police have set up a task force to bolster detection of suspicious activity at crypto exchanges. u u
7 ASIAN LEGAL BUSINESS – NOVEMBER 2023 WWW.LEGALBUSINESSONLINE.COM BRI EFS Eddie Yue, chief executive of Hong Kong’s de-facto central bank, has laid out several priorities in the SAR’s regulatory approach moving forward, considering previous “high-profile failures.” At the Bloomberg forum, Yue spoke in favour of the continued strengthening of the credibility and status of licensed virtual asset exchanges. But Low thinks it will be difficult to convince retail investors to dip their toes back into trading cryptocurrencies following the JPEX episode in the short term. “I expect Hong Kong regulators to plug the various gaps in their regulation of virtual assets, particularly in advertising and the OTC space. This was not the first scandal in the industry, and it will not be the last. So long as they are regulated differently from traditional securities, there will be space for regulatory arbitrage, and bad actors will leverage that to target unsuspecting investors,” says Low. WHAT IS THE WAY FORWARD FOR HK’S CRYPTO DREAMS? From a broader perspective, although cryptocurrencies came to life with hopes of circumventing government regulations, Low is less convinced that the asset class would prove a substantive disrupting force to traditional finance. “Despite recriminations, there is insufficient reflection on the utter ineffectiveness of so-called virtual assets as a revolutionary ‘innovation,’” says Low. As regional jurisdictions, including Singapore and Dubai, have tightened their virtual assets regimes, Low suggests that the SAR should tread the regulatory tightrope more carefully. “It seems odd that no regulators have questioned the industry’s push for laxer regulation when crypto claims to be innovative. If so, shouldn’t it triumph on a level playing field?” asks Low. SOUTHEAST ASIA EYES HANDS-OFF AI RULES (Reuters) Southeast Asian countries are taking a business-friendly approach to artificial intelligence regulation in a setback to the European Union’s push for globally harmonised rules that align with its stringent framework. Reuters reviewed a confidential draft of the 10-member Association of Southeast Asian Nations’ (ASEAN) “guide to AI ethics and governance,” whose content has not previously been reported. Three sources told Reuters the draft is being circulated to technology companies for feedback and is expected to be finalised at the end of January 2024 during the ASEAN Digital Ministers Meeting. Companies that have received it include Meta, IBM, and Google. EU officials earlier this year toured Asian countries in a bid to convince governments in the region to follow its lead in adopting new AI rules for tech firms that include disclosure of copyrighted and AI-generated content. In contrast to the EU’s AI Act, the ASEAN “AI guide” asks companies to take countries’ cultural differences into consideration and does not prescribe unacceptable risk categories, according to the current version reviewed. Like all ASEAN policies, it is voluntary and is meant to guide domestic regulations. With almost 700 million people and over a thousand ethnic groups and cultures, Southeast Asian countries have widely divergent rules governing censorship, misinformation, public content and hate speech that would likely affect AI regulation. Thailand, for example, has laws against criticising its monarchy. Technology executives say ASEAN’s relatively hands-off approach is more business-friendly as it limits the compliance burden in a region where existing local laws are already complex and allows for more innovation. “We are also pleased to see this guide aligns closely with other leading AI frameworks, such as the United States’ NIST AI Risk Management Framework,” IBM Asia’s vice president of government affairs Stephen Braim said, referring to voluntary guidelines developed by the U.S. Department of Commerce’s National Institute of Standards and Technology. Meta and Google did not respond to requests for comment. The guide, which is meant to be periodically reviewed, urges governments to aid companies through research and development funding and sets up an ASEAN digital ministers working group on AI implementation. Senior officials in three ASEAN countries said they are bullish on the potential of AI for Southeast Asia and believe the EU has been too quick to push for regulation before the harms and benefits of the technology are fully understood. The ASEAN guide advises companies to put in place an AI risk assessment structure and AI governance training, but leaves specifics to companies and local regulators. “We see it as putting ‘guardrails’ for safer AI,” one official told Reuters. “We still want innovation.” The guide warns of the risks of AI being used for misinformation, “deepfakes”, and impersonation, but leaves it to individual countries to work out the best way to respond. Other Asian nations such as Japan and South Korea have flagged similarly relaxed approaches to AI regulation, casting doubts over the EU’s ambition to establish a global standard for AI governance based on the rules that would apply to its 27 member states. u
8 ASIAN LEGAL BUSINESS – NOVEMBER 2023 WWW.LEGALBUSINESSONLINE.COM BROUGHT TO YOU BY CIETAC The Central Asia Trial Center of CIETAC Officially Unveiled and Established in Urumchi, Xinjiang 贸仲中亚庭审中心在新疆乌鲁木齐正式揭牌设立 During the China-Central Asia Arbitration Forum held in November 1, 2023, the Central Asia Trial Center of China International Economic and Trade Arbitration Commission (“CIETAC”) was officially unveiled and established. Chen Jianan, Vice Chairman of the China Council for the Promotion of International Trade (“CCPIT”), Chen Mingguo, Vice Governor of the People’s Government of Xinjiang Uygur Autonomous Region and Director of Public Security Department, Wang Chengjie, Vice Chairman and Secretary General of CIETAC, Mo Weigang, Chairman of the CCPIT Xinjiang Committee, Zhou Zhihao, Vice President of the High People’s Court of Xinjiang Uygur Autonomous Region, Rana Sajjad, President of the Center for International Investment and Commercial Arbitration, Diana Bayzakova, Director of the Tashkent International Arbitration Centre, and Enkhtsetseg Sukhbaatar, President of the Mongolian International Arbitration Center unveiled the Central Asia Trial Center together. Central Asia is where the Belt and Road Initiative was firstly initiated. Over recent years, China and Central Asian countries have continuously bolstered their strategic partnership and maintained steady and rapid growth in economic and trade cooperation. Consequently, the demand for legal services has surged. Xinjiang, serving as a gateway to the west, possesses unique advantages in promoting China-Central Asia economic and trade cooperation and high-quality development of Belt and Road. To support this endeavor, CIETAC establishes the Central Asia Trial Center in Urumchi, Xinjiang, aiming to facilitate parties from Central Asia and neighboring counties involved in the Belt and Road cooperation, harness the vital role of arbitration in safeguarding the economic and trade cooperation and development of Belt and Road, continuously promote China-Central Asia commercial legal cooperation, and foster a closer China-Central Asia legal cooperation community. The Unveiling Ceremony （揭牌仪式现场）
9 ASIAN LEGAL BUSINESS – NOVEMBER 2023 WWW.LEGALBUSINESSONLINE.COM In recent years, there has been a consistent increase in the number of foreign-related cases accepted by CIETAC, highlighting the need for providing convenient arbitration services for parties around the world. Notably, the number of cases and the amount in dispute involving Central-Asian countries accepted by CIETAC has been on the rise recently, and the establishment of the Central Asia Trial Center is poised to effectively resolve commercial disputes involving relevant counties and promote the high-quality development of Belt and Road. In addition, CIETAC, being the earliest foreign-related arbitration institution established in China, boasts over six decades of practical experience in managing foreign-related commercial arbitration cases. With its rich history, CIETAC can fully leverage its strength to offer impartial, efficient, internationally-oriented, and professional arbitration services to parties from Central Asian countries. The establishment of the Central Asia Trial Center aims to offer accessible trial services for parties from Central Asia and neighboring countries. Additionally, it will build on established cooperation platforms including “The Cooperation Mechanism of the Beijing Joint Declaration of the Belt and Road Arbitration Institutions” and “The Cooperation Mechanism on Foreign Law Ascertainment of the Belt and Road Arbitration Institutions” involving various arbitration institutions from Central Asian countries, to actively promote China-Central Asia exchanges and cooperation in dispute resolution, continue to enhance the in-depth understanding and utilization of arbitration and other means of dispute resolution by the parties from Central Asian and neighboring countries involved in the Belt and Road cooperation, and create a friendly business environment and provide better support for the healthy and orderly development of China-Central Asia economic and trade cooperation. 在2023年11月1日举办的中国-中亚仲裁论坛上，中国国际 经济贸易仲裁委员会中亚庭审中心正式揭牌成立。中国国际 贸易促进委员会副会长陈建安，新疆维吾尔自治区人民政府 副主席、公安厅厅长陈明国，贸仲副主任兼秘书长王承杰，新 疆贸促会会长莫伟钢，新疆高院党组副书记、副院长周志豪， 巴基斯坦国际投资及商事仲裁中心主席Rana Sajjad,乌兹 别克斯坦塔什干国际仲裁中心主任Diana Bayzakova，蒙 古国际仲裁中心主席Enkhtsetseg Sukhbaatar共同为庭 审中心揭牌。 中亚是“一带一路”倡议的首倡之地。近年来，中国与中亚国 家持续提升战略伙伴关系水平，经贸合作保持稳步快速增 长。在此背景下，法律服务需求也相应增加。同时，新疆作为 我国向西开放的桥头堡，在促进中国-中亚经贸合作与“一带 一路”高质量发展方面具有独特优势。有鉴于此，贸仲在新 疆乌鲁木齐市设立贸仲中亚庭审中心，以期进一步为中亚 及周边共建“一带一路”国家当事人提供便利、发挥仲裁在 护航“一带一路”经贸合作与发展中的重要作用，不断提升 中国-中亚商事法律合作水平，助力打造更为紧密的中国-中 亚法律合作共同体。 近年来，贸仲受理的涉外案件数量不断增长，说明面向全球当 事人提供便利化的仲裁服务已经势在必行。尤其是近年来， 贸仲受理的涉及中亚国家的案件数量与争议金额不断增长， 设立贸仲中亚庭审中心将有效化解涉相关国家的商事纠纷， 促进“一带一路”高质量发展。此外，贸仲作为中国最早设立 的涉外仲裁机构，有60多年处理涉外商事仲裁的实践经验， 能够发挥自身优势，为中亚各国当事人提供公正高效、国际 化、专业化的仲裁服务。 庭审中心设立后，将为中亚及周边国家当事人提供便利化 的庭审服务，同时也将借助已建立的、有多家中亚国家仲裁 机构参与的《“一带一路”仲裁机构北京联合宣言合作机制》 及《“一带一路”仲裁机构法律查明合作机制》等合作平台， 积极推进中国-中亚在争议解决领域的交流与合作，持续促 进中亚及周边共建“一带一路”国家当事人对仲裁等争议解 决方式的深入认识和广泛运用，为区域内营造良好的营商环 境以及中国-中亚经贸合作健康有序发展提供更好的助力。
10 ASIAN LEGAL BUSINESS – NOVEMBER 2023 WWW.LEGALBUSINESSONLINE.COM BRI EFS APPOINTMENTS NOAH CARR LEAVING Latham & Watkins JOINING Freshfields Bruckhaus Deringer PRACTICE M&A LOCATION Tokyo LACHLAN CLANCY LEAVING King & Spalding JOINING Herbert Smith Freehills PRACTICE M&A LOCATION Tokyo JOHN KOH LEAVING FitzGerald Lawyers JOINING Georgiou Payne Stewien PRACTICE M&A LOCATION Hong Kong HAN MING HO LEAVING Sidley Austin JOINING Reed Smith PRACTICE Funds LOCATION Singapore PAUL HO LEAVING Ince & Co HK JOINING Stephenson Harwood PRACTICE Shipping LOCATION Hong Kong GORDON PALMQUIST LEAVING Mayer Brown JOINING Freshfields Bruckhaus Deringer PRACTICE M&A LOCATION Tokyo TOM VAN HOOF LEAVING DLA Piper JOINING Eversheds Sutherland PRACTICE Banking LOCATION Hong Kong NZ LAW FIRM K3 LEGAL TIES UP WITH HK FIRM New Zealand-based law firm K3 Legal has formed an association with Hong Kong law firm Fred Kan & Co to launch its first international office in the SAR, eyeing work on cross-border investment between China and New Zealand. Branded as K3 Legal Hong Kong, it will be led by director Margaret Chen, who has relocated to lead the new office. Chen’s practice areas include litigation, commercial law, and New Zealand immigration. The association will enable K3’s clients to “access new markets, including China, Hong Kong, and Japan, without the need to seek external counsel. And likewise, for clients in those markets, looking to enter New Zealand, our dual presence allows for a seamless experience,” Chen said in a statement. “K3 Hong Kong, in Association with Fred Kan & Co., now gives investors, private equity, family offices, ultra and high net worth individuals a means to invest in China, Japan and New Zealand through one entity,” Chen explained. “Other services offered include dispute resolution, litigation management, corporate and commercial, and employment among other services, and helping companies establish a foothold in each market.” Fred Kan has a presence in Beijing, Shanghai, the Greater Bay Area and Japan. Currently, the firm has teams practicing in the areas of arbitration and mediation, construction, litigation, corporate and corporate finance, intellectual property, employment, and real estate. China is now New Zealand’s largest trading partner, with two-way trade valued at over NZ$37 billion ($22 billion) in 2021, according to NZ’s Ministry of Foreign Affairs and Trade. The two countries even ramped up their free trade agreement during the pandemic. CINDY RISWANTYO LEAVING Ginting & Reksodiputro JOINING Witara Cakra Advocates PRACTICE Finance LOCATION Jakarta EVA SZURMINSKA-JAWORSKA LEAVING PwC Legal JOINING Dentons LuatViet PRACTICE M&A/Project Finance LOCATION Ho Chi Minh City
11 ASIAN LEGAL BUSINESS – NOVEMBER 2023 WWW.LEGALBUSINESSONLINE.COM BRI EFS For the longest time, Macau has been seen as a synonym for glitzy casinos and picturesque architecture. But in recent years, the former Portuguese colony has been pulling out all the stops to buttress its financial credentials. In fact, developing Macau’s financial industry has been a major administrative policy since 2019. In pursuit of its ambition to become an international financial hub, Macau’s Legislative Assembly in August passed new amendments to the Financial System Act in a bid to future-proof its financial system and keep its regulations on par with international standards. “Overall, these amendments demonstrate a commitment by the Macau government to strengthen its financial system and ensure it keeps pace with the evolving needs of the sector,” say Pedro Cortes, managing partner at Macaubased law firm Rato, Ling, Lei & Cortés, and Calvin Chui, a partner at the firm. “By establishing a regulatory environment that promotes transparency, accountability, and efficiency, Macau aims to enhance its competitiveness and attract financial innovation within the Greater Bay Area, the Guangdong-Macao In-depth Cooperation Zone, and further fosters its role as a platform between China and the Portuguese speaking countries,” add Cortes and Chui. Set to take effect from Nov. 1, one of the most notable new measures is the introduction of a more flexible and simplified licensing process for banks specialising in particular areas. Currently, both full-service banks and specialist banks are subject to the same application criteria when applying for a banking licence. Under the new rules, these “restricted license banks” will need a minimum registered capital of 100 million patacas ($12.4 million). The same for unrestricted banks, on the other hand, goes up from 100 million to 300 million patacas ($37.2 million). A temporary licensing system for non-financial institutions engaging in fintech-related activities was also heralded to encourage innovations in financial products and services, according to lawyers. “The inclusion of licensing procedures in the amendments is crucial as it ensures that financial institutions operating in Macau meet certain standards and requirements. This helps to safeguard the interests of consumers and maintain the integrity of the financial system,” say Cortes and Chui. Separately, in a move described as to raise governance standards, the amendments have raised the minimum number of directors for credit institutions in Macau from three to five while mandating the establishment of a supervisory board with enhanced suitability requirements. “Strengthening supervision helps to ensure that financial institutions comply with regulations and maintain sound financial practices. This contributes to the stability and resilience of the financial system,” note Cortes and Chui. Apart from enhancing oversights, the territory known as “Asia’s Las Vegas” also heightened penalties and fines for illegal financial activities while expediting enforcement. The Monetary Authority of Macau (AMCM) has also been given more power to supervise accountants and obtain urgent information from them upon request. In addition, the AMCM has become the body to register for bond issuance as the SAR is determined to build up its financial infrastructure across the board. Previously, publicly issuing bonds required the authorisation from Macau’s chief executive. “The registration of bond issuance is another significant aspect covered by the amendments. By implementing a registration process, the amendments aim to enhance transparency and accountability in the bond market. This allows investors to make informed decisions and promotes a fair and efficient market,” Cortes and Chui say. Lawyers believe the amendments provide clearer guidance on assessing licenses, streamline administrative procedures, bolster governance standards and align Macau with global regulatory practices. As the amendments take effect, it is expected that a broader range of financial institutions will be attracted to commence their business in Macau. However, Cortes and Chui say it would be challenging for the existing financial institutions to transition their operations and systems to comply with the new Act. “Following the enactment of the Act, additional regulations, as well as instructions and guidelines issued by the AMCM to enable the implementation of the legislation, are likely to be published. This may involve (financial institutions) reviewing internal policies and procedures, assessing governance and risk management practices, and ensuring compliance with the forthcoming regulatory requirements,” note Cortes and Chui. “What changes need to be made? What kind of internal procedures need to be enhanced? What areas and teams need to adapt? What are the priorities? These are what we are focusing on since the law as firstly announced,” they add. MACAU APPROVES LEGISLATION TO OVERHAUL FINANCIAL SECTOR Image: Tommy Alven/Shutterstock.com
12 ASIAN LEGAL BUSINESS – NOVEMBER 2023 WWW.LEGALBUSINESSONLINE.COM Indian law firms have traditionally taken a conservative stance on international expansion. But as the country’s financial clout spreads overseas, law firms are setting their sights on key international business hubs to support this wave of expansion. Dubai is the latest to see incoming law firm traffic from India, with at least five firms setting up shop in the United Arab Emirates’ capital in 2023. In August, Delhi-based disputes boutique AKS Partners became the latest Indian law firm to open an office in Dubai. Goswami & Nigam, Singularity Legal, Vidhisastras Advocates & Solicitors and Parin Legal have also opened offices in Dubai this year. Law firm leaders say UAE’s growing bilateral trade relations with India, pro-technology regulatory approach, and the capital city’s drive to become an international dispute resolution hub bring more Indian law firms to its shores. “The work we expect in Dubai will encompass a wide range of legal matters, such as handling international arbitration cases, providing expert advice on corporate and commercial issues, and offering guidance on technology and cryptocurrency law,” says AKS’ managing partner Sonal Kumar Singh. “We foresee significant business expansion in Dubai in the coming years, driven by the thriving trade between India and the UAE. Rising trade volumes will lead to increased demand for legal counsel in disputes and support for cross-border transactions, investments, and collaborations,” Singh adds. Bilateral trade between India and the UAE was $84.5 billion from April 2022 to March 2023. A Free Trade Agreement between the two countries that came into effect on May 1 seeks to increase trade to $100 billion. India is also the UAE’s top trading partner for non-oil exports, accounting for nearly 14 percent of the UAE’s total non-oil exports worldwide. According to data from India’s Directorate General of Commercial Intelligence and Statistics, India’s April to October exports to the UAE rose 17.6 percent to around $18 billion for FY22. Imports from the UAE during the same period increased by 33 percent to $32.3 billion. “The intensification of trade and investment activity between India and the UAE will further boost the demand for legal services in Dubai. This surge will encompass inquiries and requests for legal advice, contract negotiations, dispute resolution, and compliance matters. Our aim is to position ourselves as a trusted legal partner to meet these growing demands efficiently,” Singh says. The UAE’s regulation of cryptocurrency and general tech-forward policies also attract a lot of tech-focused Indian businesses to its shores, bringing more work to law firms. “We see technology as the driver of the next phase of growth, which will also spur growth in ancillary industries like real estate, financial services and hospitality,” say Himanshu Goswami and Nishant Nigam, managing partners of Goswami & Nigam. “These factors align well with the focus practice areas of our firm since we do a significant amount of work in cross border transactions, financial markets and new age tech like Ai, ML, NLP, Web 3.0 and the like,” Goswami and Nigam add. Singh agrees, adding that the firm “anticipates heightened demand for legal services in cutting-edge areas like technology and finance. Dubai has been a leader in technological and financial innovation, including blockchain, cryptocurrencies, and fintech. We are enthusiastic about the opportunities that the Dubai market offers.” Another chief reason to invest in Dubai is the city’s growing reputation as a global arbitration hub, says Singh. Indeed, the Dubai International Arbitration Centre’s annual report for 2022 found that 340 cases were registered in 2022, compared to 276 cases in 2021, and 231 in 2020, which represents upwards of 20 percent growth per year. The report also highlights the nature of the cases registered, with 44 percent of the cases involving international disputes – not involving a party from the UAE – involving parties from 48 countries. The UAE has also continuously sought to improve its arbitration procedure and enforcement mechanism to make it more attractive to businesses. In September, the country amended its laws to improve arbitrator impartiality, emphasize clear recognition of virtual arbitration proceedings and create a larger umbrella of confidentiality over arbitration hearings and proceedings. Singh also says that Dubai is only an entry point into a larger Middle Eastern market, and the firm is looking to launch offices across the oil-rich subcontinent as it looks to diversify. “We anticipate a growing demand for legal services in Dubai and surrounding regions such as Saudi Arabia, Jordan, and Oman, driven by the region’s economic diversification and the increasing complexity of business transactions. These factors offer numerous opportunities for us to effectively assist clients and open exciting prospects for us in emerging fields.” “Having inaugurated our new branch in Dubai, the firm is also actively considering opportunities to expand into neighbouring regions like Saudi Arabia, Jordan, Oman, Abu Dhabi, and others,” Singh adds. AS TRADE TIES STRENGTHEN, INDIAN LAW FIRMS HEAD TO DUBAI BRI EFS Image: Sarath maroli/Shutterstock.com
13 ASIAN LEGAL BUSINESS – NOVEMBER 2023 WWW.LEGALBUSINESSONLINE.COM BRI EFS Q&A ‘LLMs HAVE THE POTENTIAL TO CHANGE THE WAY WE PRACTICE’ Yeong Zee Kin became the chief executive of the Singapore Academy of Law in April, following a career geared towards technology regulation and data protection in both public and private sectors. The former deputy personal data protection commissioner shares his thoughts on AI, and how Singapore’s legal profession can evolve, making the best use of it. ALB: How will your experience in the Singapore government contribute to your new role? Yeong Zee Kin: Each job prepares you for the next. The Singapore Academy of Law plays important roles in the legal sector. These may broadly be categorised as professional development, development of Singapore law and provision of trust services. These are not dissimilar to functions of government in capabilities and capacity building, industry development and provision of public services. My experience in the government encompassed these areas and will, therefore, be directly relevant to my new role as Chief Executive of the Academy. In my previous role at the Infocomm Media Development Authority and Personal Data Protection Commission, I focused on data innovation, protection, and AI ethics. My responsibilities included developing governance for responsible AI and data-driven technology policies and positioning Singapore as a thought leader in these areas. Having implemented AI projects and been intimately involved in internal proof-of-concept projects involving large language models, I am also able to bring these experiences into my current role. ALB: With your experience in AI ethics and data privacy issues, what are your predictions of Singapore’s legal market direction and what role is SAL planning to play along the way? Yeong: We already know that generative AI, such as large language models (LLMs), can produce legal documents. Given the right training dataset, the quality of the draft that LLMs can produce will improve. We can expect that as the market starts discovering how to make use of LLMs, there will be finetuned versions for the legal domain. When these appear, the average person on the street will have access to a tool that can help generate legal documents. This will have an impact on lawyers in at least two areas. First, lawyers must be familiar with and start using such tools. Only by doing so will we know their limits and discover how lawyers, too, can benefit from using them appropriately and responsibly. For example, when we use services like ChatGPT, we know how it can help provide a draft when we have writer’s block so that we can get some inspiration. We also discover that the way the service operates involves sending content in our prompts to the service provider, who may choose to use them for further training of their models. Equipped with this knowledge, we are better able to safeguard confidential client information (don’t send them with your prompts) and advise our clients. Second, we are cognizant that the proliferation of AI will affect how we plan the professional development of junior lawyers. If LLMs make obtaining a non-disclosure agreement for clients much easier, we can expect that clients’ expectations of their legal service providers will be elevated. In a commercial world where such tools are accessible to clients, we need to review how we train our junior lawyers and help them move up the value chain. And to do so in a much shorter period than before. The impact is not limited to junior lawyers. The availability of such tools will put pressure on seniors of the profession to rethink how legal services ought to be delivered. ALB: What are the opportunities generative AI offers the legal profession? Yeong: There is currently a frisson of innovative energy, as the market discovers how to make use of LLMs. I am supporting a research project using LLMs to interrogate a repository of documents and am also aware of legal tech startups in Singapore developing this as a feature for their products. This can help lawyers looking for quick answers but does not replace the need for lawyers to be familiar with their case files and documentary evidence. We expect the questionand-answer user experience to replace the keyword searches that the current generation of lawyers has grown accustomed to. But just as search engines are tools to help with legal research, innovative solutions that provide a Q&A approach to legal research cannot replace the fundamental need for lawyers to know their law, be familiar with the authorities that they intend to rely on and (equally) those cases that are not favourable to their case. I was also involved in research that used an LLM in conjunction with a trusted repository to check draft contracts. So, instead of just using LLMs to generate, we can use them to verify. As you can see, there is a green field ahead of us. LLMs have the potential to change the way we practise. Lawyers should try to understand, experiment, and discover how we might benefit. YEONG ZEE KIN
legalbusinessonline.comRkJQdWJsaXNoZXIy MjA0NzE4Mw==