Herbert Smith and Masons set to expand in China as Cameron McKenna pulls out

LICENCES GRANTED: eleven foreign firms given go-ahead to open second offices in China

City firms Herbert Smith and Masons are to open second offices in China - based in the commercial capital, Shanghai - following a glut of new licences issued to foreign firms last month, but CMS Cameron McKenna is pulling out of the country.

Herbert Smith and Masons currently have offices in China's administrative capital, Beijing, while Herbert Smith's German associate firm, Gleiss Lutz Hootz Hirsch, already has an office based in Shanghai.

The new licence will see Gleiss Lutz's Shanghai office staff move out of their premises and into a new office in Shanghai under Herbert Smith's name.

Michael Fosh, Herbert Smith's chief representative in Beijing, said the Shanghai office would largely be grown organically from the firm's Hong Kong office.

He said: 'A new office in Shanghai reflects the current needs and levels of activity.

We are busy in China with projects, foreign direct investment, securitisation and mergers and acquisitions.

'It also enables us to send a message to our clients that we're in both the commercial and political centres.'

The other firms granted licences for second offices in China were: US firms Baker & McKenzie, Jones Day, O'Melveny & Myers, Morrison & Foerster, Vinson & Elkins and Frederick W Hong; French firms Gide Loyrette Nouel and DS Avocats, and Italian firm Birindelli e Associati Studio Legale.

Meanwhile, CMS Cameron McKenna is retreating from the Chinese market, pulling the plug on its four-lawyer Beijing outfit.

The move comes alongside a drastic restructuring of Cameron's Hong Kong office, which saw 65 staff lose their jobs - including 40 lawyers.

The firm is retaining only a small insurance capability in the city.

Camerons' chief executive Robert Derry-Evans, said: 'Strategically, our focus is, and will continue to be, to build our network in Europe, but through the CMS Bureau Francis Lefebvre office in Shanghai [the French member of the firm's CMS network], we retain a presence in the emerging Chinese market.'

Jeremy Fleming