Chambers Global Japan International Capabilities
Japan: International & Cross Border Capabilities
In the International & Cross Border Capabilities sections, Chambers highlights the law firms which are identified by clients as the best and most user-friendly to work with when matters involve international aspects that require the lawyers to consider, manage and advise on issues that are happening across different countries and jurisdictions.
All the firms listed in the Japan section offer strong capabilities to serve clients who are seeking a legal team with significant resources in Japan, but also the ability to excel in international work.
Frequently, the firms specified have been picked out by clients for their strength in some or all of the following:
• co-ordinating advice on connected transactions, court procedures or regulatory issues in different countries as a lead counsel;
• providing global reach and giving clients access to top-quality legal advice in all the markets in which they need help;
• providing seamless and integrated legal services to clients, which creates a user-friendly experience across borders; and
• helping clients in international matters through specific knowledge or experience of sector or industry practices worldwide.
Global Trends in the Japanese Market:
Recent activity in Japan has been dominated by outbound investment, sparking a trend towards globalisation within the Japanese legal market. "For a long time there has been a cultural misconception about Japanese companies being inward-looking, but now they are really becoming more global and their attitude has changed," says one market source, adding: "It’s easy to do business in the ASEAN region, as the businesses are very much pro-Japan."
The market shift from inbound to outbound investment has reshaped the Japanese legal community, creating opportunities for many. The strong flow of outbound work to the ASEAN region has been especially beneficial to the domestic firms, which quickly realised the potential to lead on international work, capitalising on their close relationships and cultural affinity with Japanese clients: "Trading houses’ and automotive clients' awareness is changing, and they have started to hire Japanese firms more in the lead-counsel roles, as they have strong relationships of trust with these firms," says one source, explaining the growing role of Japanese firms in co-ordinating cross-border work on mid-sized deals, particularly outbound matters into Southeast Asia. In the higher segment of the market, however, the US and UK firms are still often selected as international lead counsel based on the track record those firms hold in large international matters.
Following clients' activities across Asia, the traditional 'big four' Japanese firms, comprising Anderson Mori & Tomotsune, Mori Hamada & Matsumoto, Nagashima Ohno & Tsunematsu and Nishimura & Asahi, have taken the path of international expansion, opening offices in China and across Southeast Asia. Where those firms do not have offices, they can often call on partnerships with local firms. All of the large Japanese firms have become competitive for cross-border work in the region, achieving different degrees of success across different parts of the region, for instance Mori Hamada has especially stood out in Thailand, having merged with a large local firm there, whilst Nishimura & Asahi has been singled out for the strength of its Vietnam office. While the traditional big four firms in the local market continue to be front runners for international work emanating from Japan, other domestic firms are closely following suit, notably Atsumi & Sakai, which has taken considerable steps to globalise its practice.
The international law firms in Japan have followed different trajectories; some have downsized operations in Japan since the financial crisis, streamlining their practices into core, niche areas, whilst others have continued to invest in broad local operations.
Morrison & Foerster is amongst the most visible international firms in Japan due to its strong links to Japanese corporations and its integrated US and Japanese law capability. The firm plays at the top end of the market, securing international lead-counsel roles on landmark deals for Japanese corporations. Other global law firms, such as Baker McKenzie and White & Case, have performed well in supporting clients from Japan across many different jurisdictions, including the US, Europe and Asia, utilising expansive global networks. All these firms have developed the local law capability, which allows them to be the lead counsel for clients not just on outbound but also on inbound matters that are governed by Japanese law. Baker McKenzie is noted as having one of the largest teams of bengoshi lawyers on the ground amongst international firms, attracting clients in need of one-stop shop full-service support. However, the majority of international firms rely on partnerships with local law firms for domestic law advice.
Other international firms have approached the market by establishing close relationships and mutual referral networks. Shearman & Sterling and Herbert Smith have succeeded establishing a reputation as key players and generators of outbound work through their teams of foreign-registered lawyers, without having a local Japanese law practice. Shearman & Sterling remains popular with clients especially for its US-linked matters and Herbert Smith is noted for its top-tier practice on cross-border matters involving Europe and Asia.
Some of the UK-centred firms, such as Allen & Overy, Linklaters and Freshfields, have focused on core areas in Japan and have become important law firms within a particular niche, such as project finance and capital markets. These firms often attract clients on the basis of their strong integrated networks, co-leading cross-border matters in conjunction with their other offices. Clifford Chance has developed a notable domestic practice, which scores high rankings and receives positive market feedback on co-ordinating cross-border work, particularly into Europe.