(Zazaa (T.Khurelbaatar))

Hogan Lovells is closing its outpost in Mongolia as local local managing partner Chris Melville prepares to leave the global legal giant and start a new local firm with other lawyers.

Melville was relocated by Hogan Lovells in 2012 from London to Ulaanbaatar, the capital of resource-rich Mongolia, which has enticed many foreign law firms to open offices in the country in recent years.

Hogan Lovells now plans to close its Ulaanbaatar office—one of several far-flung locales noted by The American Lawyer last year—by the end of November following a strategic review of its local operations. Melville is due to set up a new independent law firm that will have a cooperation agreement with Hogan Lovells.

“Following a review of the market and our investment priorities, we have taken the decision to close our Ulaanbaatar office,” said a statement by Hogan Lovells global CEO Stephen Immelt, who last month saw his leadership term extended until 2020. “[Melville] has been closely involved in the decision and together with other colleagues in Mongolia is proposing to set up a new independent law firm in Ulaanbaatar, with a cooperation relationship with Hogan Lovells. We are all very grateful to our team of 15 people in Ulaanbaatar for their hard work over the years.”

Besides Melville, a native of Scotland, Hogan Lovells’ office in Ulaanbaatar consists of 11 fee earners and three secretarial and support staff. It remains unclear how many members of the team will move to the new office. In a statement of his own, Melville said that he has a “good practice” and an “excellent team” that is poised to take advantage of Mongolian market opportunities from a different legal services platform.

“Hogan Lovells was the first global law firm to establish a permanent presence in Mongolia, and has operated there on high-profile transactions for both domestic and international clients,” he said. “Global and local markets and the strategic priorities of the firm have changed since then.”

Hogan Lovells first entered Mongolia in 2010 after striking a formal alliance with Ulaanbaatar-based GTs Advocates, a relationship that grew out of referral relationship between the latter and London-based legacy firm Lovells. GTs Advocates became an official branch of Hogan Lovells in 2011.

In April 2016, Hogan Lovells advised the Mongolian government on local law issues concerning its issuance of $500 million in sovereign bonds, the country’s first bond issuance since 2012. The only other global law firm with an office in Mongolia, a former client state of the Soviet Union that acted as a buffer with neighboring China, is leading Australian firm Minter Ellison. Clyde & Co, a top British firm, has an office in the country through an affiliation it forged win 2012 with Ulaanbaatar-based Khan Lex Advocates.

Other large firms that have done work in Mongolia, usually though local alliances, include top Australian firm Allens; DLA Piper; Gibson, Dunn & Crutcher; Milbank, Tweed, Hadley & McCloy; and Shearman & Sterling.