Continuing its "backdoor strategy" to expansion in Southeast Asia, Duane Morris, through its joint venture with Singapore-based Selvam LLC, has opened an office in Yangon, Myanmar, the first U.S.-based law firm to do so.
According to a firm press release, the firm will serve international and domestic clients through two "closely integrated entities," Duane Morris & Selvam (Myanmar) and Selvam & Partners. The focus will be on investment and business matters, including tax, licensing, regulatory and market entry issues, as well as reporting requirements and U.S. Foreign Corrupt Practices Act and U.K. Bribery Act issues.
According to Duane Morris Chairman and CEO John Soroko, Duane Morris & Selvam will represent U.S. clients and Singapore clients in Myanmar, while Selvam & Partners will focus more on local matters. Yangon, the largest city in Myanmar, was until 1989 known as Rangoon. Myanmar was known until that time as Burma.
"Myanmar presents significant opportunities for foreign businesses, and our new presence there will allow us to provide on-the-ground, high-quality counsel to foreign and domestic businesses seeking to seize those opportunities while minimizing the inherent risks," Soroko said in a press release. "We're excited by Myanmar's potential, and look forward to working closely with clients to achieve great things there."
While Myanmar, which had until recently been the subject of decades of international isolation, might seem an odd place to open a law office, there is strong interest from some firms because of the economy opening up. According to a report from Tom Brennan of Legal affiliate The Asian Lawyer, the country is thought to be rich in mineral and resources and many expect a wave of foreign investment. A number of firms from Japan, Korea and Singapore have opened up in the country or announced intentions to open an office there.
Soroko said the decision to open an office in Myanmar was the product of both the firm's long-term strategy and a target of opportunity. The firm has offices in Singapore and Vietnam.
"When we did our joint venture in Singapore … it was a big hit … and we wanted to use Singapore as a base of expansion into Southeast Asia and use it to exploit our backdoor strategy to Asia," and look for other opportunities, Soroko said. "What really tipped the balance for us were the number of clients we had in Singapore who were doing business in Myanmar. Our attorneys in Singapore found themselves traveling regularly into the country. We wanted to capitalize on a stream of business we already have."
He said that opening the office is not a case of "build it and see if they come," because the work is already there.
According to the firm's press release, Krishna Ramachandra, managing director of Duane Morris & Selvam in Singapore, will serve as the managing partner of Selvam & Partners. Benjamin Kheng, an associate director of Duane Morris & Selvam in Singapore, will serve as a resident partner.
"Our launch in Yangon, the country's commercial center, is driven primarily by client interest, which has intensified significantly in recent years, as well as by the country's projected long-term economic outlook," Ramachandra said in the firm's press release. "In addition, our team has built a strong relationship with Myanmar and its government, as a result of working closely with the Attorney General's Office for many years. This is a natural next step for us. We intend to build a significant local contingent of experienced attorneys and consultants, supported by the infrastructure of an international law firm, to make our clients' Myanmar plans a reality."
The office will launch with 10 local senior and junior practitioners, "including multiple former judicial officers, practicing in a range of commercial and regulatory areas," the press release said.
Duane Morris entered Singapore in 2010 with the formation of its joint law venture with Selvam LLC, creating Duane Morris & Selvam.
Asked if there was any concern about opening an office in a country that had, until recently, been so isolated, Soroko said there wasn't.
"Myanmar wants to open itself up to economic and investment activity," he said. "We talked extensively with the Myanmar attorney general before [making this move] and it was done very much at his invitation. We're very comfortable there."
Asked whether Duane Morris relished its role of going against conventional Am Law 100 strategy in Asia — namely using China as a base of operations — Soroko said there was value, beyond strategy, in going against the norm. He said the firm's backdoor strategy "sure has worked for us," but added that "I'll never say we won't be in China someday."
"I don't know if we relish that role, but [if you talk to outside legal consultants] they will tell you the biggest failure of most firms is the failure to differentiate," Soroko said. "The practice we have in Asia is a nice differentiator," because it offers clients something other firms don't have.
If you're in all the same places where all the other firms are, Soroko asked, what are you offering the client that's different?
Asked to put a dollar figure on the new office, Soroko said he wasn't prepared to do that.
"But it's off to a solid start," he said.
Since the 2010 election of Myanmar's first quasi-civilian government, several measures have been enacted to help bring the country out of isolation. In November 2012, President U Thein Sein signed a new Foreign Investment Law, allowing overseas firms to fully own ventures, offering tax breaks and defining longer-than-typical land lease periods. According to Duane Morris' press release, Myanmar's economy grew approximately 6.5 percent in fiscal year 2012-13, and growth is expected to accelerate, according to an International Monetary Fund survey. Myanmar received a total of $810 million in foreign investment from 11 countries in the first quarter of 2013, the firm said in its press release.
The Myanmar office comes just a few months after Duane Morris expanded into Oman. In March, Duane Morris opened an office in Muscat, Oman, through a joint venture with Al Mashaikhi and Partners Law Firm.
Soroko told The Legal in March that any economist would say economic growth is occurring outside of the United States. For Duane Morris, he said at the time, the focus is "in the developing rather than the developed world."