A study of partners at UK firms has discovered a potential legal-sector stampede to EU member states following Brexit. The survey of 50 partners at medium to large firms found 58% of them had plans to move ‘elements’ of their operations to countries which remain in the EU once the UK has formally left.
The survey, carried out regulatory risk advisers MLex, also polled 50 senior in-house lawyers at companies with more than 500 employees.
The majority (86%) said they were concerned that Brexit would have an impact on the size of the company’s future operations and headcount. One in five in-house lawyers also expressed concerns about their company’s ability to trade with other EU countries while Brexit negotiations are ongoing.
Overall, 61% of respondents said another city within the EU could emerge as a rival to London’s status as Europe’s leading legal centre, with a third of those nominating Hamburg as the leading candidate.
The relatively small sample size will cast doubt on whether this is a true reflection of feeling in the City about the prospect of departing the EU, but it adds to a growing body of opinion from lawyers that the sector is concerned about the ability to practise from the UK after Brexit is complete.
Robert McLeod, chief executive of MLex, said: ‘It is clear from these findings that law firms and corporate legal departments are making contingency plans that pre-empt international trade restrictions.
‘Post Brexit, lawyers could potentially lose their rights to EU professional legal privileges. In an attempt to protect these rights, several major law firms have already pre-emptively registered their lawyers in other jurisdictions. Our results highlight that many others may now follow suit, whether new agreements are negotiated before Britain formally leaves the EU or not.’
Meanwhile, magic circle firm Clifford Chance has hired international trade expert Dr Federico Ortino to add to its team of lawyers offering clients advice on Brexit issues.
The firm has a team of 60 lawyers working on international trade issues alongside its financial and commercial regulatory practices to help businesses and government understand the implications of Brexit.
Jessica Gladstone, Clifford Chance partner and international law specialist, said the UK has never faced an issue on this scale before. ‘For many in government and businesses, Brexit is the biggest black swan of their careers,’ she said. ‘Given the size of the coming job, it’s essential that advisers build existing capability and resources to give clients the advice and support they need to deal with the inevitable disruption that follows.’