How Law Firms Can Scale to Take on International Client Work
CorporateLegalApril 27, 2021

How Law Firms Can Scale to Take on International Client Work

International trade and investment are big drivers of the global economy. Now more than ever businesses have some portion of activity that takes place internationally – whether they’re seeking a global presence or continuing to grow business operations outside their home country.

For the law firms who support these businesses, it can mean an uptick in legal work with a global component to it. This development brings new challenges including differences in laws and regulations, business culture, politics, and language – especially if there isn’t a local office in place.

With these differences in mind, it’s important to consider a firm’s bandwidth, availability of internal resources, time and budgeting constraints, and limited in-country expertise.

However, being able to address a client’s international legal needs can create major opportunities for growth, particularly if the firm has the support of an experienced global partner – with a local footprint throughout the world – who can act as an extension of its team and provide expert support when and where it’s needed.

In this article, we explore the opportunities and challenges of scaling for global work and how your law firm can efficiently take it on.

Global work is for large and small firms alike

When it comes to global work, there’s a perception that small firms can’t handle local matters – that’s not always the case. Larger firms may have a bigger footprint, often internationally, but that doesn’t always translate into experience or expertise in compliance matters in every country.

And while many small firms don’t advertise their global services, they may find themselves stumbling into it based on how the world operates and as their client’s business needs develop. For instance, a client may expand or start selling products in other regions or they may be involved in M&A work where due diligence in foreign countries is required.

Your firm may ask, is it worth taking on this work on our own? Consider the following:

  • Do you have expertise in the legal systems in these countries?
  • Do you know what local searches or document retrievals need to be done for due diligence in these countries?
  • Can you provide the client with a definitive timeline and budget at the beginning of the project?
  • Is it worth dedicating a team of paralegals to manage the orders?
  • Does your firm have the ability to hire internal resources for the project? What happens after the project is completed?
  • Do you have the time to deal with multiple vendors?

It’s a challenge for any law firm to effectively manage international work on its own, and scaling it's infrastructure and resources to provide additional client services often requires investment. One way to expand bandwidth efficiently and at scale is to work with an experienced global partner who understands jurisdictional requirements and has feet on the ground to obtain necessary information. A partner who provides a single point of contact for all your needs.

Assembling the right resources and expertise

Having the right expertise is critical to minimizing risk and ensuring success. Consider the due diligence process. Global deals and transactions can be scuttled by a single missing document, which can easily happen when U.S.-based attorneys take on global due diligence. A lack of familiarity with the local jurisdiction and a failure to identify the right documents or searches needed for the investigation can introduce risk.

An experienced partner can reduce that risk. With knowledge of the entire menu of searches or documents available in each jurisdiction they can ensure the investigation is comprehensive and accurate.

Here’s another use case where global work can get complex. If a client is looking to expand their business or sell products in other countries, it’s too easy for attorneys to hit roadblocks simply because the process differs from their local jurisdiction. Laws aren’t always clear, and there may be questions around establishing a legal operation.

Because it’s easy to underestimate the amount of work and nuances in requirements between countries, it’s important to work with a global partner who can provide clarity, advising on:

  • Common structures used in the jurisdiction to establish a foreign entity
  • The cost associated with each task and turnaround times
  • Whether local directors are required
  • The annual compliance requirements once established

Staying on top of regulatory and compliance updates

Staying informed of regulations in other countries has its own challenges. Most regulatory changes don’t make the news, and the sheer volume of legal and regulatory changes can be too much to process. Even if there aren’t changes to laws or new regulations, published guidance on certain laws can go unnoticed.

For these reasons, it’s critical that you have boots on the ground and a level of service in place to ensure that all compliance obligations are met.

Keep in mind that some countries treat missed compliance requirements very seriously. For example, in India, an entity can fall into non-compliance for something as simple as holding a late board meeting or AGM and go into what's known as “compounding status.” This can require months of legal work and a hearing in India before good standing is restored. Some countries also take a more punitive approach to non-compliance and arrest directors when they enter the country.

There are many things to consider. Capacity must be added to understand the implications that regulatory changes may have to your client or project. Given the volume of changes, there’s value in teaming with an expert that can help you stay abreast.

Understanding budget and timeline pressures

A big challenge of global work is staying on budget and sticking to a timeline. Therefore, it’s important to consider the true costs and time implications of doing global work – which can vary by country. While certain countries have costs similar to the United States, there are many countries that are high cost for standard services and impose more budgetary stress.  Even certain developing countries may have higher costs because there are only a handful of vendors, so negotiating power is limited, and rates are higher.

It’s safe to assume that, in general, most work done internationally takes on average more time to be completed. This means setting clear expectations with clients early on will help the project run more smoothly. For example, if you're setting up an LLC in UAE, it could easily take anywhere from two to four months due to the amount of work and time it takes to have signed documents legalized and ready for use.

Additionally, if you’re working with multiple vendors, it can be hard to establish a budget at the start of the process. Time can be lost in just obtaining fees from each vendor, let alone the time required to manage communication with everyone across the world.

Relying on foreign vendors also means that communication may suffer. Many vendors aren’t set to respond within a certain amount of time, especially considering differences in time zones. You can easily lose a day between emails.

Working with a global partner can help provide clarity at the onset of the project, so that you can ensure your clients are informed.

Conclusion

When it comes to global work, setting client expectations is imperative. It’s a misconception that international work can be completed in the same amount of time and with the same resources as the work you do in your local jurisdiction. It’s easy to take for granted the efficiencies that the U.S. system provides, whether it’s starting a company, obtaining documents from departments of state, or making electronic filings.

Expect to navigate some challenges such as slow response times from government offices and a lack of technology. Corporate registry websites may not always be user-friendly or may require credentials to access basic information. Many systems don’t have electronic filing options and rely on physical filings. Document translations could also be needed and navigating the UBO compliance requirements is difficult.

Global work can be fruitful for your law firm but take time to understand what is required in each jurisdiction and set client expectations. Think about how you’ll scale your firm and the risks involved.

Finally, get the right support. A trusted global service partner can help your firm scale quickly and get the reach and expertise it needs – with minimal investment.

About CT Corporation

Whether your firm has a small or large global due diligence project or has a client looking to expand globally, CT offers custom solutions for projects of any size, with the ability to scale up to meet your needs, instead of having the burden of dealing with multiple vendors. We offer an easy, single point of contact for global work, who manages your project from beginning to end. We have offices and partners in over 150 countries with the expert service and technology to help streamline your global work.

To learn more about how CT’s Global Transactional Services can help address your needs across the world through one central point of contact in the U.S., contact a CT representative at (855) 444-5358 (toll-free U.S.).

Additional resources
CT Expert Insights: How law firms can streamline and scale their global work

Robert McHugh
Global Sales Support Manager
Robert is a Global Sales Support Manager at CT Corporation, with extensive experience in international corporate compliance and governance. 
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