When and How Businesses Can Save on Legal Services
Under economic sanctions, businesses have switched to cost-saving mode. Many expenses on external consultants, including legal ones, are being cut. Moreover, prices for some services have even increased. For example, for legal support of business projects with China and building new logistics chains. In general, there are services that are better not to refuse, and those where you can save. The main thing is to distinguish between them.
Sanctions and the legal market: general trends
Among the main shocks is the exit of international law firms and foreign businesses. While some companies are leaving for good, others are changing owners or reformatting. Thus, many foreign law firms are transforming into domestic ones, often even retaining their teams. For example, ALUMNI Partners emerged from Bryan Cave Leighton Paisner, while Eversheds Sutherland became BIRCH LEGAL.
The number of clients for newly formed and long-existing Russian law firms has not decreased yet. Many actually have higher project workloads, emphasizes Ekaterina Kleimenova, founder of LegalBranding. However, she predicts that soon, due to the departure of foreign businesses, the situation will change and competition for clients between firms will intensify.
Russian law firms try to maintain relationships with regular clients because they provide work in the long term. After all, the crisis will pass, but connections will remain, emphasizes Sergey Pepeliaev, Managing Partner of Pepeliaev Group. He adds that sometimes it's important not to sell a specific service, but simply to listen to and reassure the client.
Currently, in-house legal department employees are busy 24/7 with urgent matters, notes Nikolay Voznesensky, Managing Partner of ALUMNI Partners (formerly Bryan Cave Leighton Paisner). Among the most common issues are sanctions and maintaining relationships with counterparties, finding new suppliers and restoring logistics, business restructuring, liability of management employees, and preparing foreign businesses for sale.
Demand creates supply. Therefore, law firms have begun developing new practices: sanctions law, serving private clients' interests, business relocation to neutral jurisdictions.
On the other hand, there are fewer inquiries from Western clients, says Maxim Kultikov, Managing Partner of Kultikov, Kolotilov & Partners. Many are cautious about litigating in foreign courts involving Russian companies, as some are under sanctions while others may fall under them.
New laws have also affected the legal market. For example, the bankruptcy sector is now heavily impacted by the introduced moratorium. Both clients and work for lawyers in this area have decreased, although bankruptcy practice was considered one of the most in-demand on the Russian legal market, and services were highly paid, notes Natalia Klein, head of NK Consulting.
Read the full material on Pravo.ru
