Changing tack

The winds of change are constant in china’s legal market, and law firms must constantly adjust sail to keep their practices competitive, writes Felix Gao

For law firms, the past 12 months in China have not been quiet. More new lawyers and more legal service providers have joined the industry and competition rails unabated. The downturn of the international economy has also posed challenges for Chinese law firms, and many have chosen a high-end-oriented, professionalized and internationalized path to remain competitive.

China’s lawyers are increasing in number. At the end of March 2016, the country had more than 297,000 practising lawyers and more than 24,000 law firms, 38% and 20% higher than four years ago, respectively. David Yu, the managing partner of Llinks Law Offices in Shanghai, points out that Shanghai alone adds about 2,000 more practicing lawyers each year. Qin Wen, a Beijing-based partner at Run Ming Law Office, sees more Chinese lawyers returning from overseas law firms. “They brought [with them] some advanced experience and some have high professional competence. This has led to quite intense competition in the current legal market, even the high-end international business,” he says.

Xu Guojian, the managing partner of Boss & Young Attorneys at Law in Shanghai, says: “The Lawyers’ Law amended in 2012 has lowered the threshold of setting up law firms, so there will be more new law firms entering the market. Company legal divisions, government legal departments, foreign law firms’ China offices, debt collectors and consulting firms may also become alternatives to law firms and further carve up the legal market.”