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Turnabout is fair play, at least that’s how the lawyers of the Beijing-based Jun He Law Offices saw it. While Americans and British law firms devised their strategies for invading the Chinese legal market, Jun He stole a march on Manhattan. The 50-lawyer firm, which also operates in Beijing, Shanghai, Shenzhen, and Hainan, opened its New York branch in 1994. The operation is still small, only three lawyers, but New York-based partner Xiaolin Zhou says it plays a key role in landing big Western clients who operate in China. When it formed in 1989, Jun He was one of China’s first private law firms. Previously, all firms were technically state enterprises, and the lawyers were paid by the government — a fact that limited (or in some cases enhanced) their appeal to private clients. Even today, many firms remain organs of the state, though the government has announced that it wants all firms to become private over the course of the next two years. Chinese law firms face special burdens. Because of the excesses of the Cultural Revolution there are few lawyers in China in the 45-to-60-year-old range, the bedrock group in most Western firms. And the new waves of lawyers being encouraged by the Ministry of Justice has yet to fill out the ranks. According to the ministry, about 100,000 lawyers practice in China today, though Zhou says the number is probably a little higher than that. Part of the problem facing lawyers in China is that they have always been lowly regarded. Even during imperial rule, the troublemaking intellectuals who helped people lodge complaints were disdained as song guen, meaning roughly “litigation tricksters.” “Our social standing is not so high,” admits Zhou. But he says that perception is changing, principally because of the profession’s new-found financial success. Indeed, lawyers have become so prosperous that they are drawing criticism from some circles in China, according to Giao Pe Ji, who helped run the C&C law firm in Beijing before joining the Hong Kong office of Clifford Chance Rogers & Wells last year. Although the number of lawyers in China is growing rapidly, those with a sophisticated international practice remain few and far between. Official estimates place the number at 4,000, but in reality only a handful of firms compete at the top. In addition to Jun He, a shortlist would include: Haiwen & Partners, which has carved out a lucrative niche in the securities practice; King & Wood, which has neither a King nor a Wood, but is widely respected for its work in the sophisticated capital markets and project finance fields; and Commerce & Finance, which often works with British firms on high-level transactions. All are based in Beijing. Even these elite firms struggle with issues of law firm management. In most firms “each partner operates like a store in a shopping mall,” says Handel Lee of the Beijing office of Houston’s Vinson & Elkins. “Their clients, associates, and staff are not available to other partners in the firm.” Despite these obstacles, some firms are trying to build institutions. Lee cites King & Wood as a firm that has adopted a U.S.-styled partnership structure. Jun He’s Zhou says his firm is also modeled on the big American firms where several of his partners worked stints. (Zhou, a Harvard Law School graduate, worked for two years at Boston’s Goodwin, Procter & Hoar.) Jun He has a partnership agreement, a rough partnership track of five to six years, and it uses time sheets for billing — at least on matters for foreign clients. “In China, people still struggle with the idea of paying for time,” he notes wryly. Hourly billing rates for partners range between $90 and $250, depending on the matter. As for competition on its home turf, Zhou says that it’s been a topic at recent partnership meetings, but he thinks Chinese firms would benefit from increased exposure to Western firms. “I tell them, ‘It’s open over here, so why not? There is enough work to go around.’ “

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