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The first Hong Kong-funded law firm will be stationed in Wuhan in the near future?

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Hong Kong law firm: CEPA enters the third stage?

21st Century Business Herald Tang Bailu April 16, 2006 12:51

Reporter Tang Bailu reported from Beijing

From April 9th ??to 13th, Hong Kong Secretary for Justice Huang Yanlong went to Beijing. In many itineraries, Huang Yanlong's core topic is to reflect the demands of the Hong Kong legal profession to expand the market in the mainland.

When meeting with the Ministry of Justice, Huang Renlong specifically raised practical issues on joint ventures between lawyers from the two places, including relaxing regulatory measures and exploring new joint venture models. "Generally speaking, the Hong Kong legal community hopes to further expand the cooperation space for lawyer joint ventures between the two places under the CEPA framework, but it is still in the warm-up stage." Before visiting Beijing, Huang Renlong had many meetings with the Hong Kong Lawyers Association and the Bar Association. communication and sorted out a series of relevant opinions. Lawyers believe that as CEPA enters the third phase (January 1, 2006), the Guangdong-Hong Kong lawyer joint venture will be a matter of course, but how to explore new joint venture models has become a focus of attention.

"One-on-one model" Not long ago, Hong Kong Feng Yuan Yue Law Firm received the first Hong Kong and Guangdong lawyer joint venture license. In view of the previous 10-year cooperative relationship, the law firm's joint venture partners Guangdong Zhongyuan Law Firm was chosen. Zhongyuan Law Firm was founded in Zhongshan City, Guangdong Province in 1994. Its partner Huang Dongwei told reporters, "We have a one-to-one 'husband and wife relationship', so both parties feel that the responsibility is more important." In accordance with the relevant provisions of CEPA, establishments in the mainland The Hong Kong law firm that represents the institution can only associate with a mainland law firm in the location where it is located. In fact, the Guangdong-Hong Kong Lawyers Association has gone through a long process.

On January 1, 2004, the "Measures for the Management of Joint Ventures between Hong Kong, Macao Law Firms and Mainland Law Firms" came into effect, but this management method is relatively strict.

Since the "deep opening" of the legal market is one of the main contents of the opening of the service industry under CEPA, the relevant national departments have made adjustments to the overly strict provisions of the above-mentioned management measures.

The "CEPA Supplementary Agreement II" signed in October 2005 added two items in terms of legal services. One of them is to allow Hong Kong law firms to set up representative offices in the mainland, and to cooperate with the representative offices in the country where they are located. The province, autonomous region or municipality where the company is located is jointly operated with a mainland law firm.

After CEPA entered the third phase in 2006, supervision was further relaxed based on the "CEPA Supplementary Agreement II", stipulating that joint venture business can be expanded to the provinces and cities where the offices are located. For example, if a Hong Kong law firm has an office in Guangzhou, it can set up associate business in Zhongshan or other cities in the province.

Although this measure has greatly expanded the space for Hong Kong lawyers to develop in the Mainland, in terms of management, Hong Kong lawyers in joint ventures must accept dual management from the Mainland and Hong Kong. Huang Dongwei said, "If Hong Kong lawyers in our joint venture violate regulations, both the mainland and Hong Kong bar associations can punish them." Compared with the joint venture model, if Hong Kong lawyers enter the mainland as a separate business, they will face much greater difficulties. . This difficulty is multi-faceted, such as having to pass the Mainland Lawyer Qualification Examination; having to establish a file relationship with the public security and judicial departments; having to establish your own client base, etc.

It is understood that Hong Kong law firms began to enter the mainland market as early as the 1980s; due to unfamiliarity with the market, Hong Kong law firms operating in the mainland continued to withdraw in the 1990s.

Until the implementation of CEPA in 2004, Hong Kong law firms once again aroused enthusiasm and flocked to the mainland. Among the 650 law firms in Hong Kong, the number of law firms that have opened in the mainland has increased from 34 to 66, including about 18 in Guangdong.

Leung Pak-yin, director of the Hong Kong Economic and Trade Office in Guangdong, said that more than two years after CEPA was implemented, the number of offices established by Hong Kong law firms on the mainland has more than doubled. At the same time, Liang Bairen believes that in order to develop the mainland market, firstly, it is necessary to strengthen cooperation with local law firms and introduce clients through local law firms; secondly, it is necessary to strengthen cooperation with the Hong Kong Trade Development Council and the Hong Kong Government Office in Guangdong to develop clients through intermediaries. source.

“Leap across” Guangdong?

It is reported that three other Hong Kong law firms are applying to establish joint ventures with mainland law firms. But how do Hong Kong law firms plan to break away from the "Pearl River Delta" business district or big cities such as Beijing and Shanghai and expand to other cities?

Huang Renlong pointed out that the current problems include two types of Hong Kong law firms and Hong Kong barristers. As for law firms, Hong Kong law firms hope to further relax the number of years, number of people, and application procedures for joint ventures on the current basis. Regarding barristers, many mainland companies think that Hong Kong only has solicitors and are not aware that barristers are professional lawyers. Moreover, if Hong Kong barristers plan to join forces with mainland lawyers, they must first establish a firm in the mainland.

Nationally, there are 650 law firms in Hong Kong ***, only 10% of which have established offices in the mainland, and 90% of them have not yet seized the opportunity.

Currently, the Hong Kong Department of Justice and the Hong Kong Law Society have stepped up efforts to promote relevant law firms to enter central regional cities such as Wuhan and Chengdu. As early as November 2002, Hong Kong Wu Baiquan Law Firm established a representative office in Chengdu. This was the first time that the Hong Kong legal profession established a law firm representative office in the southwest region.

Following the signing of a framework cooperation agreement between the legal circles of Hubei and Hong Kong in 2002, the Hubei Lawyers Association and the Hong Kong Lawyers Association signed a series of personnel training, business exchanges and branch establishment agreements in Wuhan in December 2005. Cooperation program. The first Hong Kong-funded law firm will soon enter Wuhan.