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As a boy, Justin Chang remembers his attorney father advising Korean-based companies. Long before Hyundai and Samsung were household names here, Korean executives would visit Chang’s home near Los Angeles. His parents were passengers on the first Korean Air flight from Los Angeles to Seoul, just after the airline was privatized. Chang has grown up � he’s now an associate in the San Francisco office of Shearman & Sterling � and so has the Korean economy, now the 11th largest in the world. This week, Chang is flying to Korea, where he’ll spend two months inside the legal department of LG Electronics, one of the world’s largest makers of mobile handsets. He’s hoping to develop relationships there that can generate future business. And he and his firm aren’t alone. Though China grabs the headlines, Korea and its economy are increasingly in the sights of U.S. firms hoping to expand global practices. A half century after the Korean War, and eight years after the Asian economic meltdown, Korea is home to major global companies and a fast-growing IT industry, spurring U.S. and U.K. law firms to aggressively court Korea-based clients. A handful of firms are lobbying the government there to open the country up to foreign law offices, a step some say could happen as early as next year. “This was not my favorite place to go as a child because then it was not so developed,” says Chang, 32. “But I’ve begun to appreciate Korea’s position.” In recent years, U.S. firms have represented foreign investors and private equity-funds in large investments and acquisitions of Korean companies. They have also represented Korean companies in joint ventures, debt offerings and IPOs all over the world. There is also plenty of litigation and arbitration work. U.S. interest has grown since 2003, when, in response to lobbying trips from British emissaries, the South Korean government first submitted a proposal to the World Trade Organization to allow foreign firms to open offices in Seoul on a limited basis. “The English firms especially have been pushing quite hard,” said Richard Lincer, a partner at Cleary Gottlieb Steen & Hamilton, one of a handful of Wall Street and Magic Circle firms that started cultivating business in Seoul two decades ago. “They can’t seem to get over the urge to colonize.” South Korea didn’t open its legal market in 2005, as first predicted, and it probably won’t happen this year, either. But firms are standing by. “As the result of waiting at the door, U.S. and foreign firms have been going in and out of Korea to work on matters with the help of local counsel,” says Sy Kim, a special counsel in Sheppard, Mullin, Richter & Hampton’s New York office. “Most importantly for firms with a Hong Kong office, these have been the de facto Korean office.” Observers now believe Seoul may open the doors at the end of next year, pending the outcome of upcoming discussions between it and the U.S. over a trade pact. “There are stars that are lining up for it to happen in 2007,” says Gregory Nitzkowski, managing partner of Paul, Hastings, Janofsky & Walker. “We will open an office in Seoul as soon as we are able.” Last year, after, Korean regulators created corporate governance rules similar to the Sarbanes-Oxley Act, Paul, Hastings sent some of its leading corporate partners on a week-long tour of Korean companies. And in June, Orrick co-sponsored a patent litigation conference at Seoul National University Center on Law and Technology. Lawyers from White & Case; Sidley Austin Brown & Wood; and Quinn Emanuel Urquhart Oliver & Hedges also make frequent visits. But like the crowded China market, Korea can be hard to crack. “In the last five months, I have been using personal relationships to get in front of decision makers, and it has been a humbling experience, to be honest,” says Shearman counsel Kyungwon Lee, who in September relocated from New York to Hong Kong. It isn’t like New York, he says, where the firm is well known. “Out here, without that trust already built in, it is harder for newcomers.” Competitors are willing to offer steep discounts to undiscriminating general counsel. Face time with clients is vital. Lee says he travels to Korea twice a month for lunches and dinners. Even if Korea does open its doors to American firms next year, firm leaders don’t expect to see another China-like stampede. “China is off the freakin’ Richter scale, it is so hot right now,” says Quinn Emanuel’s William Urquhart. Still, he’s quick to point out that Korea is one of the drivers of the Chinese economy. And some say it won’t be long before Korean companies start gobbling up American ones, much in the same way that China’s Lenovo group bought a division of IBM over a year ago. While some American firms can’t wait to set up shop, others are taking a wait-and- see approach. Office or not, says Shearman partner John Wilson, his firm plans to service Korean clients. Much will depend upon the kind of access that foreign firms get in Korea. The government has proposed a gradual opening of the market, similar to what unfolded in Japan in recent years. In Japan, U.S. firms weren’t initially allowed to practice Japanese law nor form joint ventures and partnerships with Japanese firms. Now they can. In the meantime, Korean law firms may be preparing for an American onslaught. There’s been consolidation and an increase in lateral hiring between Korean firms. And the country’s largest firms, such as Kim & Chang, and Shin & Kim, are hiring more American and British lawyers. Chang, for example, spent the summer after his first year at Boalt Hall School of Law working at a Korean firm. “I do think that this period of ongoing protection of the market is in part to give the leading Korean firms an opportunity,” says Nitzkowski. For Korean-Americans like Chang, this might just be the time to visit.

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