How Nonlawyer Ownership Abroad May Affect U.S. Firms

Impact on U.S. Market Generally

U.S. firms are being shortsighted if they assume that there will be no competitive impact in the United States just because equity investments as such are still contrary to (what some will argue are anticompetitive) U.S. bar regulations. Certainly those U.S. firms competing for international work inside the United States or those U.S. firms already operating or contemplating operating in international markets should seek to understand now how they will compete against firms that are ' pursuant to their jurisdiction's bar rules ' able to obtain external equity financing. For example, how will an AmLaw 50 firm compete in London, Europe, or Asia with a UK firm that has access to a significant war chest to hire talent and acquire local firms that provide expertise in focus areas? Or, an example that may be closer to home: Until now, UK firms (with a few exceptions at the top end of the market) have been too mismatched financially to enter the U.S. market on a large scale; this may change as UK firms gain access to outside capital, enabling UK firms to compete with U.S. firms in their own market, and this outlook will magnify if the current trend away from U.S. capital markets
continues.