Thank you for sharing!

Your article was successfully shared with the contacts you provided.
It used to be so easy to pick a solicitor from an attorney, at least on M&A deals and securities offerings. One would wait for clients to call, limit advice strictly to the legal issues and then head out for celebratory drinks at around 6 p.m. The other would settle strategy at the board meeting, draft all the documents, check the figures and roll up to completion after an all-nighter. But since the demise of the Bowler Hat in London, significant cross-fertilization has occurred between British and American lawyers, reflecting the globalization of markets. Says one solicitor: “The days when a London lawyer could say ‘I wasn’t instructed to consider that’ are gone.” BEST OF BOTH WORLDS Yet differences remain. Although both sets of lawyers are sensitive about it, European clients are getting the best of both worlds. Pressed for staff, investment banks are “leveraging functions and issues” onto their lawyers: “And U.K. lawyers are stepping up to the plate,” says Tom Vita, head of Norton Rose’s U.S. law team. “A lot of the differences are driven by market practice. In the U.S., investment banks look at lawyers as quarterbacks … but European banks don’t take that view. They tend to see them as advisory support.” The result, as Vita sees it, is that U.S. attorneys are more pro-active. “They will roll up their sleeves and check the numbers and try to get a grasp on the business issues, because the banks expect it,” he says. Tom Kellerman, managing partner of Brobeck, Hale & Dorr in London, says that in the U.K. there is a tendency to view legal practice transactionally. To “do a deal” and then wait for the client to call. “We represent smaller companies — often introducing clients to each other. Our style is more relationship-oriented,” he says. “British lawyers are very flexible” says Maurice Allen, head of banking at White & Case in London. “This is partly due to the European environment and working with a number of jurisdictions. It’s also in the nature of the training.” STAFFING DEALS Another key difference is the way deals are staffed. Maurice Allen feels that the level of partner attention on a deal is driven by differences in partner compensation systems. “In a U.S. firm, power is driven by the ability to bring in business and retain clients, which means U.S. partners are incredibly loyal to clients. So the senior guys are still hands on,” he says. But the U.K.’s democratic adherence to the lockstep system of partner compensation means that – generally – you see less involvement by U.K. partners on deals. However, U.S. lawyers agree that British firms invest serious time in socializing with their clients. They are seen to be out there fostering personal relationships that U.S. attorneys accept develop gradually with time. That the business is driven by internal compensation systems can cut both ways: “The client in the U.S. doesn’t always want the senior partner, but sometimes clients in the U.K. feel they don’t get enough attention,” says Allen. So you might see more lawyers on a deal in London, each one working on more deals per year than their American counterparts. “In the U.K. the partner’s job is more supervisory … the leverage philosophy is slightly different,” says Allen. But Vita notes: “There is a noticeable shift going on in London as U.S. banks build their presence here.” BUY ENGLISH, SELL AMERICAN If we’re talking substantive differences on deals, the word on the street is “Buy English, sell American.” The standard level of protection for buyers of businesses in the U.K. is a lot higher than in the U.S. According to one lawyer who works in both markets: “The reps and warranties are far worse on sellers in the U.K. documentation. But in the U.S., due to an overheated M&A market, you can get away with a lot less. At auctions in the U.S., you can say to the buyer ‘Get over it — you’re getting a lot less protection over here’.” So lawyers are seeing “U.S. papers” chosen on deals for exactly those reasons – a phenomenon that highlights the benefits of dual U.S.-U.K. law capability. This issue of investor protection filters through in a number of ways. Vita, who worked Stateside with Davis Polk & Wardwell, says: “At the corporate level, Delaware has taken the view that it will leave a minimum of protection for shareholders — it is up to the people involved to structure the deal. The results are creative mechanics to protect companies from takeover.” David Schulman, London partner of the newly-merged firm Dechert, says: “The U.S. SEC is far more active in setting out guidelines for M&A and capital market transactions — those rules are more refined than dealing with the Takeover Panel here. This is good and bad. Sometimes the road is well lit in the U.S., and gives you a fair amount of comfort.” Although there is broad agreement that U.S. securities regulation is more complex, “The U.K. Takeover Code is not something one dabbles in” says Kellerman with a smile. In the U.S., where attorneys produce the prospectus, verification of the document is a more streamlined process than in the U.K.. Here, investment banks do the drafting, solicitors do the checking afterwards. “It’s to do with the up front involvement of lawyers in U.S. deals” says one attorney. DOCUMENTATION And which set of documents would you prefer to read? Maurice Allen says: “U.K. legal documents are easier to read, no doubt.” Tom Vita thinks it ironic that U.K. documents used to be seen as turgid. “Now U.S. documents are drafted in a more stilted fashion to address liability concerns.” But the SEC’s Plain English campaign to simplify public offering documents is forcing change, he says. Then there are different attitudes to the use of precedent documents to kick-start deals. Apparently Rogers & Wells was horrified by the amount of time Clifford Chance was spending on document development for transactions, favoring a less standardized, more bespoke method of documenting deals. THE FUTURE The question must now be where the future lies. Vita says: “The real thing going on here is not two sets of lawyers but a group of lawyers in large international transactions — M&A, securities — who are expected to provide the same level of service despite different choices of law.” “Over the next five to ten years, the differences between lawyers in international firms will become less pronounced,” says Vita. The verdict seems to be that as firms globalize, the legal system you are trained in is less important. Global business is forcing lawyers to be creative in whatever jurisdiction they are working in. Jeff Golden, head of Allen & Overy’s U.S. law practice, says: “Battles between law firms on jurisdictional issues are artificial. It’s time to put down the flags and look at the synergies. As globalization increases, comparative law skills become more important.”

This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.

To view this content, please continue to their sites.

Not a Lexis Advance® Subscriber?
Subscribe Now

Not a Bloomberg Law Subscriber?
Subscribe Now

Why am I seeing this?

LexisNexis® and Bloomberg Law are third party online distributors of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® and Bloomberg Law customers are able to access and use ALM's content, including content from the National Law Journal, The American Lawyer, Legaltech News, The New York Law Journal, and Corporate Counsel, as well as other sources of legal information.

For questions call 1-877-256-2472 or contact us at [email protected]


ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.