Doing Business : U.S. Law Firms Chasing New Clients in Brussels : They hope to cash in on the European Community’s quiet revolution in the way businesses on the Continent do business.
In 1988 there were only nine. In 1989 another six arrived. And this year 10 more U.S. law firms flocked to Brussels, hoping to cash in as the European Community directs a quiet revolution in the way businesses can do business in Europe.
Propelling the rush is the long experience of American law firms in helping corporate clients cope with government regulation. The U.S. regulatory burden, long thought to blunt American business’ competitive edge overseas, has actually helped American law firms position themselves for the market that is developing here. They are attracting clients not only from back home but also from Europe and Asia.
To many of the 3,000 Belgian lawyers practicing here, the competition is anything but welcome. “Many lawyers feel they are being invaded by foreigners who are playing by different rules,” said a Belgian lawyer who asked not to be identified. The Brussels bar sharply limits advertising--local law firms cannot even widely distribute informational brochures about themselves--and it prohibits lawyers from lobbying.
By contrast, lobbying on behalf of their corporate clients is precisely the reason that many of the 25 American law firms are here--although few will admit it in so many words.
“Lobbying is something we do here, but what it really amounts to is just effective advocacy,” said Turner T. Smith Jr., head of the year-old Brussels office of Hunton & Williams of Richmond, Va. “Aggressive, ‘U.S.-style’ lobbying is not regarded highly here. If you go in and shout at people, it doesn’t work here--or, usually, in the United States. Carefully prepared, factual arguments frequently do work.”
The newcomers are also handling standard corporate legal matters, such as mergers and acquisitions, for their clients. But this they could do in London or Paris, where many of them already have offices.
What distinguishes Brussels is that it is the headquarters city of the European Community, which is trying to standardize the conduct of business in its 12 member countries by the end of 1992. New regulations pouring from the EC will govern everything from the price of goat’s milk to the terms of corporate mergers. And most of the American law firms here have corporate clients seeking to monitor and influence the rule-making process.
Law firms are also flocking here from London--30 at last count--and other European capitals as well. Many law firms are taking on the same sort of multinational character as their corporate clients, with no respect for national borders.
“Everybody’s getting excited and saying, ‘There’s gold in them thar hills,’ ” said Joseph P. Griffin, since last year the Brussels-based partner of the Philadelphia firm Morgan, Lewis & Bockius.
But whether there is enough gold to support 25 American firms is not so obvious. After a smaller-scale rush to Brussels after the European Community was founded in 1957, several American firms pulled back.
“The need for services is growing fast, but it may not be growing as fast as the supply,” said Richard Webster, one of the veterans of the U.S. legal community in Brussels. Webster joined the Brussels office of Cleary, Gottlieb, Steen & Hamilton, a New York firm, four years after the office opened in 1960.
Another U.S. lawyer in Brussels, who asked not to be named, said many law firms have come for defensive reasons, after a move by their competitors. “They felt they couldn’t afford not to come,” he said.
The newcomers include mostly heavy hitters--”mega-firms,” in the words of Carl Bevernage, a member of De Bandt, Van Hecke & Lagae, Brussels’ largest law firm. The American firms pay double the local going rate for starting attorneys, said Bevernage, who is also president of Brussels’ Dutch-language bar.
Skadden, Arps, Slate, Meagher & Flom of New York, by most measures America’s largest, opened in Brussels this year. From Washington has come Akin, Gump, Strauss, Hauer & Feld, renowned for its lobbying.
Also in the field are two Los Angeles-based giants--Gibson, Dunn & Crutcher and O’Melveny & Myers.
Many of the firms are buying up or combining with European law practices. Others are stocking their Brussels offices with European lawyers. “We try to present as European a face as possible,” said Howard M. Liebman, a partner in the 20-year-old Brussels office of Oppenheimer Wolff & Donnelly of St. Paul, Minn.
Xavier Magnee, president of Brussels’ French-speaking bar, said there was no way the city’s law firms could close the rapidly developing market in regulatory law here to experienced American firms. Acknowledging the growing number of joint ventures between U.S. and European law firms, he shrugged his shoulders and said, “If you can’t lick ‘em, join ‘em.”
The American law firms’ clients also have an international cast. They include not only American corporations but also European and Asian.
Thus, for example, when the Barcelona, Spain, unit of Britain’s Cadbury Schweppes recently needed to know about the outlook for EC antitrust policy, it turned to Akin Gump of Washington for help.
“American firms are better trained for that kind of work than most European firms,” explained Chris Van Steenbergen, vice president for legal affairs of Cadbury Schweppes Beverages Europe. “There is more experience in America with government regulation.”
All the newcomers to Brussels claim their own, unique strategy for developing the Brussels market.
“Everybody has come in with a different approach,” said Timothy L. Dickinson, the partner in the Brussels office of Gibson, Dunn & Crutcher. “Only time will tell which ones succeed.”
Akin Gump bought a Brussels firm with 11 European lawyers and promptly added another 14. That means that, unlike most of the others from the United States, the local Akin Gump office must abide by the rules of the Brussels bar.
Cleveland’s Jones, Day, Reavis & Pogue absorbed a practice headed by Italian lawyer Aurelio Pappalardo, a 26-year veteran of the EC bureaucracy, and acquired the services of German lawyer Norbert Koch, who recently left the EC after 30 years.
“Lots of firms came here as a knee-jerk reaction to EC-92, without a clear sense of purpose,” said Joseph F. Winterscheid, the partner in charge of Jones Day’s Brussels office, in a reference to the goal of an economically border-less European Community by 1992.
“We intend to be a full-service operation for corporate clients,” able to represent them before the EC and also to handle their corporate transactions and trade problems, he said.
Other U.S. firms have found different ways to join forces with European lawyers. The two Los Angeles firms provide cases in point.
Gibson, Dunn & Crutcher formed a loose working relationship with the Brussels firm of Van Bael & Bellis. “What we can do that a lot of other U.S. firms cannot do is offer joint services,” Dickinson said.
O’Melveny & Myers formed a much closer joint venture with the Paris firm Simeon & Associates and the London firm Macfarlanes. Geoffrey Oliver, the O’Melveny & Myers attorney in the Brussels office, said the three firms complement each other. “European law is at a point where it is impossible for any one person to have expertise in all aspects,” he said.
“We work here like we were one law firm,” said Eric Morgan de Rivery, the partner from Simeon who is in charge of the Brussels office. “We’ve all abandoned some of our sovereignty.”
Other Brussels offices have deliberately stayed small and narrow. Terry Broderick, the only lawyer in the local office of Crummy, Del Deo, Dolan, Griffinger & Vecchione of Newark, N.J., says he has five to 10 clients whose interests include antitrust issues, international trade and expansion into Eastern Europe. “I actually do all that stuff myself,” Broderick said.
Hunton & Williams staffed its Brussels office with two American lawyers who specialize in energy and environmental regulation and two Europeans who focus on commercial transactions.
“Hunton & Williams has a national reputation in the field of environmental regulation, and we expect an explosion of interest in this area,” said Gerald L. Baliles, the former governor of Virginia who heads the firm’s international division.
Most U.S. firms sent their own lawyers to Brussels. But Dorsey & Whitney’s only American lawyer here is James K. Lockett, whom it hired away from the London firm Clifford Chance.
“Clients are not going to be deceived by somebody who hangs out a shingle and says he’s an expert in trade law,” said Lockett, a six-year veteran of Brussels trade law who brought with him such major clients as Samsung, a Korean electronics company.
Newly arrived lawyers find practicing in Brussels quite different from operating in the United States, where proposed federal regulations must go through a formal process of public comment before they can take effect. The EC has no such formal procedure.
“The EC is open to comments from industry,” said Oliver of O’Melveny & Myers, “but the lack of a formal procedure makes it particularly important for us to know and work with the relevant EC officials on an ongoing basis.”
Just getting the paperwork is not enough. “You have to know the case handlers personally,” said Lockett, “where you can push and where you can’t.”
L.A. Law in Brussels
The Los Angeles-based law firm O’Melveny & Myers is just one of more than 20 American legal firms that have opened offices in Brussels in the last few years. Gibson, Dunn and Crutcher, another major Los Angeles firm, also has offices there. A partial list includes:
Name Year Lawyers Home American European office Dobson, Sinisi & 1986 2 6 New York Associates LeBoeuf, Lamb, Leiby 1987 0 3 New York & MacRae Crummy, Del Deo, Dolan, 1988 1 0 Newark, N.J. Griffinger & Vecchione Akin, Gump, Strauss, 1989 4 25 Washington Hauer & Feld Gibson, Dunn & Crutcher 1989 2 2 Los Angeles Hunton & Williams 1989 2 2 Richmond, Va. Jones, Day, Reavis & 1989 3 11 Cleveland Pogue Morgan, Lewis & Bockius 1989 1 0 Philadelphia Wilmer, Cutler & 1989 4 4 Washington Pickering Covington & Burling 1990 1 3 Washington Dorsey & Whitney 1990 1 3 Minneapolis Kelley, Drye & Warren 1990 2 2 New York Mayer, Brown & Platt 1990 2 1 Chicago McKenna, Conner & Cuneo 1990 0 2 Washington Mitchell, Friedlander & 1990 1 6 Washington Gittleman O’Melveny & Myers 1990 1 5 Los Angeles Seyfarth, Shaw, 1990 2 1 Chicago. Fairweather & Geraldson, Skadden, Arps, Slate, 1990 3 1 New York Meagher & Flom Winthrop, Stimson, 1990 1 0 New York Putnam & Roberts Hogan & Hartson* 1991 1 3-4 Washington
* planned
