With EU-Korea FTA taking effect from 1 July 2011, the legal market has been opened in three stages and it will be fully opened by 2017. There are three UK law firms which are under registration process or acquired a license to set up an office here.
South Korea is the fourth largest economy in Asia and 12th in the world. It has a population of 50 million and a GDP growth of 4.5 per cent in 2011. It is one of the G-20 major economies and a member of OECD. Korea is UK’s 6th largest export market in Asia. UK exports more goods and services to Korea than any EU country bar Germany. There are already 200 Korean companies with a presence in the UK, and 15 listed on the London Stock Exchange.
There are about 12,000 lawyers and 7,000 of them are based in Seoul. Over 600 law firms (including one man offices) in South Korea and top 10 have about 2,000 lawyers. The number of lawyers is expected to double in the next six to seven years as the Korean Government liberalises legal services.
However, about 44 percent of 1,000 trainee lawyers last year remained unemployed when they completed a two-year mandatory training programme. These figures show that the domestic legal services market has little room to embrace newcomers. Adding to woes of these unemployed, there will be more than two thousand law school graduate who will enter the market, mostly as lawyers, from next year.
Experts and lawyers said Korean firms lack expertise in large international deals, in particular to compete against European giants, who have decades of legal service history. According to the leading local newspaper’s survey, the top 10 Korean law firms admitted they were weak in energy deals, mergers and acquisitions and corporate finance cases. And yet, the fields are some of the most lucrative in the fast-growing markets, they noted. The Korean firms said they are more confident in domestic litigation, real estate development, fair trade law, labour issues and information and technology cases.
Korea’s legal service market is worth about US$ 2-3 billion. Last year alone, Korean companies and government paid 1.27 trillion won (approx. US$ 1.1 billion) to foreign law firms for their services up 11.6% from previous year, while Korean law firms earned only 705 billion won (US$689 million) from foreign clients. This will be the case further after EU-Korea FTA. In a means to survival, some Korean law firms are seeking to establish partnerships with European law firms. Among the 10 law firms, five said they are willing to jointly handle cases with European firms and share profits. Such a trend is stronger for smaller law firms.
About 13 UK and US law firms are under process of setting up an office here or completed their registration. From UK, Clifford Chance and DLA Pipers are among those names.
The European Union and Korea signed the Free Trade Agreement (FTA) on 6 October resulting in the removal of 97 per cent of all tariffs cutting €1.6bn of duties annually for EU exporters from July 1, 2011.
The legal services element of the FTA identifies a three stage process for opening up the Korean legal system. The stages are time based and will be implemented after ratification:
First Stage: Solicitors and other EU law firms will have the right to establish a branch office to offer advice in foreign and international law. Foreign lawyers are permitted to use their home country titles in their home country language. By using their home country titles domestic and foreign clients can be confident that they are receiving advice from an attorney legally registered in a specific jurisdiction.
Second stage: This will begin no later than two years after the agreement enters into force and permits a foreign law firm to fee share with a Korean law firm, either on a project by project basis or on an ongoing basis.
Third stage: This will begin no later than five years after the agreement enters into force, will permit Korean and foreign lawyers to go into partnership together and allow foreign law firms to employ Korean lawyers.
Getting into the market
To enter into the market, you should register yourself as a foreign legal consultant with the Ministry of Justice. Then you should also with the Korea Bar Association. The requirements to become foreign legal consultants:
Overseas legal qualification
Not less than 3 years experience in their “home country of license”
”home country of license” must be contracting party of FTAS or other trade treaties signed by Korea.
Postal address in Korea.
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Jiwon Hahn, British Embassy Seoul. Tel: +82 (0)2 3210 5603 or email: Jiwon.firstname.lastname@example.org
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None at present.
Countries: South Korea
Topics: Legislation & Regulation