When taking stock of the markets over the last 12 months, it is safe to argue that tougher times must inevitably be afoot. While upheavals wrought by the pandemic may have largely receded into the rearview mirror, the volatility that has come to characterise recent times shows no sign of abating, with the Ukraine war leading to energy insecurity and the cost of living crisis, the need to navigate ever-changing Russian sanctions, as well as the looming threat of a global recession.

However, even in this tumultuous environment, offshore law firms continue to defy the odds, with 2022 only building on the growth seen by many in previous years. ‘Despite expecting a challenging economic environment, income has been up across service lines and sectors, without exception,’ states Edward Mackereth, global managing partner at Ogier, echoing the sentiment of many offshore law firm leaders.

Stephen Leontsinis, Collas Crill’s Cayman Islands managing partner, agrees: ‘2022 was a good year for Collas Crill. We comfortably hit our target of double-digit revenue growth and experienced a real Covid bounce-back across many of our markets.’ Jonathan Green, global managing partner of Maples, is equally bullish: ‘The Maples Group, including our global law firm, enjoyed another strong year in 2022 across essentially all practice areas and service lines.’

For Harneys’ new global managing partner William Peake, who stepped into the role in January 2023, the year exemplified the firm’s focus on ‘sustainable growth’, while Ingrid Pierce, global managing partner of Walkers, highlights the ‘flight to quality’ which has led to a strong year for the firm. Meanwhile, Jonathan Rigby, Mourant’s global managing partner, showcases the firm’s ‘excellent progress’. Christian Luthi, chair of Conyers, is also sanguine, describing an active year for the firm with ‘busy-ness levels remaining high’.

It has not all been smooth sailing though, with 2023 clearly off to a slower start due to trepidation in transactional markets. As Green notes: ‘By comparison, the first half of 2023 saw a softer start to the year for some of our transaction-focused legal service lines as clients and markets adjusted to a higher inflationary and interest rate environment.’

Leontsinis agrees: ‘2023 has started tentatively but various local changes to legislation are providing us with good opportunities and new clients.’ Mackereth adds: ‘The equity market remains weaker and IPO activity therefore remains down, with many companies and investors taking a wait-and-see approach to their listing plans.’

Unpicking the tangled ball

Given rising interest rates and turbulent financial markets resulting from the war in Ukraine, the impact on the work handled by law firms can be felt across the board.

‘The war, and the inflation that has sprung from the war, are undoubtedly having an impact on the level of economic activity,’ comments Mackereth. ‘We continue to work with businesses and governments on the disentanglement of Russian interests in western investment areas. On a macro level and since the Russian invasion of Ukraine, the last 15 months have involved a continental-scale unpicking of investment threads from the tangled ball of western economies.’

Skyrocketing interest rates in particular stand out as a key driver of market trends, with multiple firms reporting a significant impact on various strands of work. Whether it be the collapse of the SPAC market or a substantial decline in bank lending, its effects can be felt in all elements of practice.

‘The high interest rates across the globe in the second half of 2022 and in 2023 to date have had an inevitable impact on our lender side finance work,’ notes George Weston, a corporate partner in Harneys’ BVI office. ‘Interest rates have also led to a decline in stock market valuations, which has a chilling impact on both initial and secondary offerings (helped sadly by an interventionist approach from US regulators).’

‘The war, and the inflation that has sprung from the war, are undoubtedly having an impact on the level of economic activity.’
Edward Mackereth, Ogier

Leontsinis agrees: ‘It would be fair to say that lending activity is still slow across all our regions due to global interest rates, and this is impacting our banking and finance, and local property practices. On a recent trip to the US to meet clients, where the federal rate is even higher than it is in the UK, the lack of appetite for financing transactions was noted both on the private equity and borrower sides. Thus our outlook this year is cautious.’

However, in some circumstances, private capital is stepping in to take the place of the reluctant banks. ‘What we’ve seen is a lot of private capital flooding into the markets and that’s affecting a bunch of different practice areas,’ states Pierce, ‘so it’s probably fair to say that there’s been a bit of a change in the number of private capital and private equity houses that are now essentially functioning as non-banks in the lending space. That’s fuelling quite a lot of activity.’

Insurance work is also seeing a notable uptick, particularly in Bermuda and Cayman, with Luthi commenting, ‘A positive confluence of various factors continues to drive growth in the Cayman Islands insurance and reinsurance market. It’s an exciting time for the jurisdiction.’

Boom and bust

Interest rates have also helped to continue the increase in restructuring and insolvency work, which initially sprang up as a result of the pandemic.

As Peake remarks: ‘Global interest rates have led to a surge in insolvency and restructuring work and, noting my track record as a poor man’s Nostradamus, we see the continued squeeze on credit availability driving this further.’

Mackereth adds: ‘Globally, the steadiest flow of restructuring work post-Covid so far has been from the Asian markets, primarily impacting teams in Cayman, BVI and Hong Kong (in respect of BVI/Cayman work originating from Asian markets). We continue to see investors, investment managers and credit institutions, who are showing less tolerance for liquidity excuses, starting to take strategic steps to address these.’

Firms are also seeing an increase in Cayman structuring work involving Latin American funds generally, whether that be investing out of Latin America or into it, and the introduction of the new Jersey insolvency regime in early 2022, which created an additional winding up procedure and also adapted the processes and eligibility criteria for appointing a liquidator, has also catalysed the market.

That being said, the contentious restructuring work that has been anticipated to follow in the wake of the offshore market’s post-Covid insolvency and restructuring boom, has still yet to materialise.

From a Caribbean perspective, the crypto boom of recent years hit a bump in the road following the dramatic, large-scale collapse of Bahamas-based crypto exchange FTX in late 2022, fanning the flames of increasing scepticism surrounding digital assets and cryptocurrencies, and their legitimacy. For offshore jurisdictions, the fallout was largely avoided thanks, in part, to the Virtual Asset Service Providers (VASP) regulatory regimes enacted in 2022 and 2023. The regulations implemented require all VASP entities registered in the various jurisdictions to comply with anti-money laundering, counter-terrorist financing and anti-proliferation finance legislation.

Notes Mackereth: ‘We’ve already seen a wave of VASP regulation which has been largely welcomed and the recent collapse of FTX and other VASP-related companies, in part due to a lack of effective regulatory oversight, will bring more regulatory scrutiny, and ultimately, supervision of businesses operating in the digital asset space.’

‘Data security has been on clients’ minds over the last several years and it’s really coming to the fore now.’
Ingrid Pierce, Walkers

However, as highlighted by Pierce, which jurisdiction comes out on top is still in play: ‘We do see the VASP regimes in different jurisdictions becoming more relevant and the different jurisdictions are jockeying for position to become a leading player in the field, while users and providers of digital asset services are looking for consistency and clarity of regime and regulation.’

Recent uncertainties aside, activity in the crypto and digital asset space continues apace. Pierce comments: ‘It’s just going to keep expanding and developing. We’ve seen from our own client base and also onshore users with interest in the digital asset space that they are setting up arms that focus almost exclusively on digital assets, even if it’s not their main focus. Everybody wants to have a foot in the door. While it’s just another asset class for some, for others it’s the whole raison d’être of the business.’

Some approach the topic with more scepticism: ‘With the large-scale collapse of FTX in the Bahamas, extensive insolvency litigation is likely to flow from this, mostly in the UK and the Caribbean. The VASP-related Three Arrows Capital insolvency, where we act for the liquidators in the BVI, is also probably a sign of things to come,’ says Mackereth.

Not to be left out, the Channel Island bases are also moving into that market, as Ellie Crespi, managing partner of Collas Crill’s BVI office explains: ‘Guernsey’s new regulations regarding VASPs have made clear the types and shapes of crypto-structure that the island is willing to engage with. It is likely to be only a matter of time before the first disputes start to arise around this but as our legislation is relatively forward-thinking, we expect these to be easier in the Channel Islands than in some other jurisdictions where the application of new issues to antiquated legislation is likely to make matters more challenging.’

‘While ESG continues to grow in importance and is increasingly pervasive across our advisory work, we’ve yet to see ESG-related disputes take off in the way they have onshore.’
Ellie Crespi, Collas Crill

Expanding into technology more generally, firms are also seeing a notable uptick in data protection and cyber security work with digital technologies, AI (including ChatGPT) and various platforms for communication becoming increasing prevalent in the workplace. ‘Data security has been on clients’ minds over the last several years and it’s really coming to the fore now,’ comments Pierce. ‘This has focused professionals’ minds much more on questions like: What are we doing? What are we allowing our people to do? Should we do that? How do we regulate that internally and make sure that our clients’ data is safe and secure?’

Regulation and reputation

The move in recent years to clean up the reputation of the offshore markets following a spate of criticisms has placed regulatory advice at the forefront of law firm offerings. Says Luthi: ‘Our regulatory teams in all jurisdictions have been busier over this past year. The Cayman Islands and BVI are now enhancing their regulatory frameworks too, and this will continue to be a source of increased regulatory work.’

Mackereth adds: ‘There has been a relentless rise of regulatory burden on businesses as countries try and ensure they pass through Moneyval’s assessments unscathed. That is a mixed blessing. As a regulated business we are facing ever higher regulatory burdens and costs, but as an adviser to businesses on regulatory issues, we are part of that ecosystem. For us, our regulatory specialists of all descriptions have been busier than ever, and we don’t expect that to stop.’

Moneyval, a Council of Europe committee which evaluates compliance with anti-money laundering measures and efforts to counter the financing of terrorism, is lining up its next inspection of Guernsey for 2024, while the previous inspection of the Isle of Man led to what ultimately amounted to a ‘good progress, but could do better’ report card in 2022.

Similarly, the introduction of economic substance rules throughout various offshore jurisdictions in 2019 started a wave of regulatory change, although the initial confusion surrounding the rules has now abated. ‘There were lots of debates around what it means to have substance. Was it true substance in terms of boots on the ground or was it economic substance, and if it was economic, was that going to be a real sea change for users of the jurisdictions or not?’ states Pierce. ‘The noise has really gone out of that discussion now. I think people have found the regime palatable, they understand it and can comply with it, so other discussions have come to the fore.’

For those in the Cayman Islands, these discussions have recently focused on the jurisdiction’s position on the Financial Action Task Force (FATF)’s grey list, to which Cayman was added in early 2021. It identifies countries working with FATF to address issues with their anti-money laundering and combating the financing of terrorism (AML/CFT) regimes. FATF announced in June 2023 that Cayman had largely fulfilled its plan regarding the watchdog’s recommended actions and, pending an on-site visit, should soon be eligible to be removed from the grey list.

As Green remarks: ‘This confirmation recognises that the jurisdiction has a robust and effective AML/CFT regime, and we anticipate this removal will also trigger the jurisdiction’s removal from the EU’s AML/CFT blacklist. While few transactions in the jurisdiction have an EU nexus, this recognition of the Cayman Islands’ standing may see additional transactions favour Cayman.’

All of these demands have in turn led to offshore firms notably adding to their regulatory capability, with many creating stand-alone teams. As Pierce observes: ‘We’ve seen a real attempt by everybody to beef up their compliance departments and their legal and regulatory teams. Those people are like gold dust at the moment. I don’t want to say we had any great foresight in terms of spotting this trend, it was probably quite an obvious one, but we did take the plunge and invested quite heavily in it a few years ago, and we now have specialist regulatory teams in every single office. We will continue to invest in it as, while finance, corporate finance and restructuring have traditionally been our core practice areas, regulatory work is quickly catching up.’

Ogier has also followed suit and in 2023 launched its new regulatory consulting business to support Jersey and Cayman-based financial services clients.

While the majority of the regulatory changes affecting the offshore markets have focused on different aspects of the financial sector, an increasing amount of work is arising from a raft of new ESG regulations, building on well-established work in the sustainable finance and transactional sectors.

‘The role of the offshore lawyer continues to evolve. Our unique position allows us to play both the black-letter lawyer as well as the trusted adviser.’
William Peake, Harneys

Green highlights the Sustainable Finance Disclosures Regulation (SFDR), a European regulation imposing ESG disclosure obligations on financial market participants to improve transparency in sustainable investments, as a key focus of attention. ‘We expect that demand for ESG legal advice will continue to grow as we help clients navigate these obligations.’ Maples also recently launched its SFDR Impact Analysis assessment, aimed at tracking the state of ESG integration in Europe.

Mackereth also sees the ESG regulatory environment as an increasing source of work. ‘There’s a growing swell of ESG regulations across the EU, UK and US. All international finance centres are doing a lot of work to ensure they stay ahead of the regulatory curve, and we don’t see it slowing down. It’s ultimately a good thing for our jurisdictions as long as the regulators have the resources to implement new regulation in a co-ordinated and rational way, and as long as the cost of doing business remains competitive.’

Pierce also emphasises how ESG responsibilities are playing out in every aspect of a deal. ‘It’s been interesting from a deal perspective, whether that’s financing deals or investing in projects, or whether its non-carbon or something that’s more neutral. There’s a real focus on stakeholder interests and the ESG aspects of each element of the deal – people want to know who they do business with and who their vendors do business with.’

Crespi adds: ‘We continue to see ESG play an important role in the investment strategies adopted by both fund managers and family offices.’ She does also note, however, that: ‘While ESG continues to grow in importance and is increasingly pervasive across our advisory work, we’ve yet to see ESG-related disputes take off in the way they have onshore.’

The sustainability piece is also something that firms are looking at outside the scope of fee-earning, turning the gaze inward on what can be done in their own practices to be more ESG friendly. Mourant has been particularly proactive in this regard as the first law firm to enrol in the ESI Monitor Environmental Business Operations Award scheme, which helps businesses improve their operational environmental footprint. The firm also developed its ocean pledge, which engages in marine conservation activities.’

Adapt and invest

Given the unpredictable nature of recent years, trying to anticipate what is next may seem like a thankless task, but the general outlook midway through 2023 is a tentatively optimistic one.

‘Early signs are that the market is returning’, says Mackereth, ‘although we anticipate that it will be a relatively quiet summer leading to a busier autumn. Generally, people are talking up the second half of the year, and we’ve noticed things starting to get busier and clients asking us to dust off projects which have been mothballed for the last 9-12 months. Whether we’ll have to cancel Christmas as some US firms are saying in London – well, let’s see.’

Green agrees, noting that corporates are beginning to prepare the ground for transactions that they hope to launch later in the year, should market conditions become more favourable, and Luthi predicts that the active 2023 corporate restructuring market in both the North American and Asian markets will remain strong in 2024.

The months and years ahead are not without their worries though, with Pierce noting the inevitable concerns for businesses and law firms alike. ‘The challenges have been, and this isn’t uncommon to all other businesses, the growing cost of doing business and the costs which are unavoidable. If you want to have good robust infrastructure and sound management systems, you have to invest in those things and it’s not just a one off.’

And for Peake, adaptability of those in the legal industry will be even more vital. ‘The role of the offshore lawyer continues to evolve at a rapid pace. Our unique position allows us to play both the black-letter lawyer as well as the trusted adviser.’

Appleby

Across its Cayman Islands and Channel Islands offices, Appleby’s finance practice has seen a strong year, with the Cayman business acting on 40% of the jurisdiction’s collateralised loan obligations (CLOs), while the Jersey office oversaw more than 20 such deals in the last year. M&A transactions have continued to be a mainstay of the firm’s operations, with financing arrangements for the $5.8bn acquisition by Permira of Mimecast among the firm’s headline deals.

Appleby also expanded its presence in Asia, with the August opening of its Shanghai office, offering an extensive range of services, including corporate, banking and finance, private clients and funds advice. Hannah Yao, who is dual-qualified in China and the US, has joined the Shanghai office, focusing predominantly on transactions in the TMT sector.

Contentious work remains a core pillar of Appleby’s global practice, with matters ranging from multinational shareholder disputes valued in the billions of dollars to complex trust disputes where a range of assets and jurisdictions are at play.

May 2023 saw Jeremy Berchem step down as Guernsey managing group partner, with employment specialist Richard Sheldon stepping into the breach. Jersey’s Kevin McQuillan was made up to partner in April of 2022 and the team was further strengthened with the June 2023 arrival from Ogier of Simon Felton, whose transactional and asset structuring expertise adds another dimension to the firm’s corporate practice.

Lawyers: 200, including 73 partners

Offices: Ten (Bermuda, BVI, Cayman Islands, Guernsey, Hong Kong, Isle of Man, Jersey, Mauritius, Seychelles, Shanghai)

Group managing partner: Malcolm Moller (Mauritius)

Focus: Corporate, dispute resolution, private client/trusts, property, technology and innovation, and regulatory

Recent standout work: Advising Atrium European Real Estate on the completion of its €1.5bn take private by Gazit Globe; advising Blackstone in relation to the funding arrangements on Permira’s $5.8bn acquisition of Mimecast; acting for Pakistan Airlines in defeating an attempt to enforce a $5bn arbitral award over its BVI assets

Bedell Cristin

Bedell Cristin combines offerings in the corporate/M&A, banking and finance, dispute resolution and private client sectors to provide full-service advice to a range of clients, with notable expertise in real estate transactions, counting leading investment funds and private equity houses among its roster.

The Jersey office acted for the management of Theramex on its sale by CVC Capital Partners to Carlyle Group and PAI Partners, a deal valued at around $1.5bn, while in Guernsey the firm assisted Menora Mivtachim on its £112m investment in the real estate investor Brockton Everlast.

John Scanlan’s January 2023 arrival in the Guernsey financial services team from Carey Olsen saw the addition of an experienced funds specialist who also handles M&A transactions and IPOs. The private client team in Jersey also saw reinforcements in the form of Sevyn Kalsi, who joined from Walkers in April 2023, and advises high-net-worth individuals on the establishment of family offices and private funds while working alongside the firm’s disputes team when necessary. The disputes team divides its work between commercial and trusts disputes, notably handling an appeal brought in Guernsey by Jersey Telecom against an adverse regulatory and competition finding in relation to its 5G rollout.

Lawyers: 82, including 32 partners

Offices: Six (BVI, Cayman, Guernsey, Jersey, London, Singapore)

Group managing partner: Tim Pearce (Jersey)

Focus: Banking and finance, corporate and commercial, employment, funds, insolvency and restructuring, international private client, litigation, pensions, regulatory and compliance, wills and probate

Recent standout work: Acting for the liquidators on the collapse of the online gambling platform Football Index; advising Buckthorn Partners on the acquisition of Amey; advising Atos on its acquisition of Cloudreach

Carey Olsen

Carey Olsen’s London, Singapore and Bermuda offices have enjoyed double-digit revenue growth in 2022, with standout matters including a Bermuda team acting on RenaissanceRe’s $3bn acquisition of AIG’s reinsurance arm.

2023 has seen refinancings, restructuring and insolvency, litigation and regulatory advice come to the fore as corporate and transactional matters suffer from a global slowdown following interest rate rises and the war in Ukraine. The Guernsey office’s advice to the liquidators of Cypriot construction giant Joannou & Paraskevaides, one of Guernsey’s largest ever trading insolvencies totalling in excess of $1bn, is an indicator of the challenges wrought by the global economic downturn.

The firm’s growth is evidenced by four lateral hires in the year, with litigators Tim Haynes joining the Hong Kong office from Kobre & Kim in May 2023 and Matthew Watson moving from Bermuda’s Cox Hallett Wilkinson in June 2023.

Formerly of Clifford Chance, Matthew Grigg arrived in the Bermuda office in July 2022, bringing with him a wealth of corporate expertise, while Jersey non-contentious trusts specialist Robert Dobbyn, who advises on the laws of trusts, foundations and trust company structures, made the move from Walkers in January 2023.

A raft of internal partner promotions also signals success, with Jersey benefiting from three promotions, with funds specialist Claire Le Quesne, employment expert Huw Thomas and Will Whitehead, a commercial property and regulatory lawyer, joining the partnership ranks.

The Guernsey office made up Patricia Montgomery, who acts for private clients and fiduciaries on trust structures, while the newly-minted Simon Hall handles corporate disputes out of the BVI office. The promotion of commercial litigator Helen Wang in the Singapore office also demonstrates the firm’s continued investment in the Asia market.

Lawyers: 300, including 74 partners

Offices: Nine (Bermuda, BVI, Cape Town, Cayman, Guernsey, Hong Kong, Jersey, London, Singapore)

Group managing partner: Alex Ohlsson (Jersey)

Global chair: John Kelleher (Jersey)

Focus: Banking and finance, corporate and commercial, investment funds and private equity, listing services, dispute resolution, restructuring and insolvency, private client, trusts and private wealth, property, employment, regulatory and insurance

Recent standout work: Advising Nordic Capital on one of the largest and fastest private equity funds to be raised in Europe in the year to date, closing at a hard cap of €9bn; acting for Babel Holding, a Cayman Islands crypto-asset trading and management company, on the restructuring of its debt; advising senior managers of the Renova Group in the long running $1bn litigation in the case of Renova & Ors v Emmerson & Ors in relation to a dispute over a joint venture

Collas Crill

The banking and finance and corporate practices are credited for a strong 2022 for Collas Crill, most notably with an instruction on the Cayman Island’s largest-ever section 238 merger claim, that of 58.com, while the dispute resolution team has led on a $5bn claim against Standard & Poor’s. While soaring interest rates have slowed transactional work in 2023, a strong litigation practice, together with a private client team that was strengthened with the November 2022 arrival from Ogier of Victoria Grogan in Jersey has seen the firm maintain a strong position in the offshore market. Indeed, Cayman Islands managing partner Stephen Leontsinis notes that legislative changes across the firm’s jurisdictions are ‘providing us with good opportunities and new clients’.

Other developments include the June 2023 election of Guernsey property specialist Jason Green to senior partner following Nuno Santos-Costa’s decision to step down from the role. Greg Boyd’s arrival from Harneys in June 2023 augmented the firm’s corporate and financing practice in the BVI, in a move that sees him reunited with former colleague Ellie Crespi, while the Cayman Islands funds team has benefited from the expertise of consultant Fawaz Elmalki.

The firm has seen substantial growth in the alternative asset space, with digital assets and medicinal cannabis being particular drivers of this trend. Asset managers and VC funds have sought the firm out for assistance with the structuring of complex assets across offshore jurisdictions as they seek to diversify beyond traditional technology sector investments. Regulatory issues have also given rise to new opportunities for Collas Crill, and with Guernsey set to codify crypto-asset regulations in 2023 and also potentially overhaul the island’s cannabis laws, work is expected to continue to flow.

Lawyers: 131, including 40 partners

Offices: Five (BVI, Cayman, Guernsey, Jersey, London)

Group managing partner: Jason Romer (Jersey)

Global chair: Simon Beswick

Focus: International wealth and private client, dispute resolution, risk and regulatory, commercial property, corporate, banking and finance, funds.

Recent standout work: Acting for Royal Park Investments in a $5bn claim against Standard & Poor’s entities for losses suffered as a result of fraudulent credit ratings being ascribed to certain collateralised debt obligations (CDOs); advising the Lazari family group in its £451m acquisition and financing of the Fenwick store in London for redevelopment; acting for a group of private equity funds in the largest merger appraisal case in Cayman history against 58.com

Conyers

Conyers’ asset finance and insurance practices have hedged against weaker M&A and capital markets activity, with shipping, aviation and oil and gas matters dominating out of the Cayman office, while the London office, celebrating its 25th anniversary in 2023, has also given a solid performance across the firm’s service lines. The Bermuda corporate practice saw Marcello Ausenda, who is also Conyers’ global head of shipping, take the helm in January 2023, with Charles Collis continuing as head of the insurance and reinsurance group. Insurance work in Bermuda has increased as a result of the introduction of the Bermudian Code of Insurance Conduct, while the Cayman insurance team has been bolstered by the promotion of counsel Róisín Liddy-Murphy to head the firm’s regulatory and risk advisory team, which represented between 60% and 70% of new insurance licensees between 2022 and 2023. One standout is the firm’s advice to Sixth Street, which in January 2023 launched Talcott Life and Annuity Re in the Cayman Islands, where Conyers handled all aspects of the licensing and launch and advised on the new company’s reinsurance liabilities, totalling $25bn.

Restructuring and insolvency, closely tied with the firm’s dispute resolution practice, has seen a sharp uptick in instructions, reflected by a number of promotions across the team, with Cayman-based Spencer Vickers and Alex Davies promoted to partner in April 2023, and Matthew Brown also joining the partnership in the BVI. Debt restructuring, including that of Seadrill, which in February 2023 emerged from Chapter 11 bankruptcy proceedings following the reorganisation of $6bn of debt obligations, has formed a mainstay of Conyers’ work over the last year.

Trusts instructions, in particular multinational contentious trust matters, have also stayed strong, with the Hong Kong and Singapore offices attracting a number of new clients over the past year. In addition to advising on the structuring of trusts, creation of family offices and succession planning, Conyers’ private client teams have acted for high-net-worth individuals and professional trustees on major cross-border trusts disputes, covering tax, probate and restructuring issues.

Lawyers: 149, including 66 partners

Offices: Six (Bermuda, BVI, Cayman, Hong Kong, London, Singapore)

Chair: Christian Luthi (Bermuda)

Focus: Corporate (including aviation, banking and finance, capital markets, investment funds, insurance, M&A, private equity/venture capital and shipping), litigation and restructuring, private client and trust

Recent standout work: Advising The Flexi Group Holdings on its merger with TG Venture Acquisition Corp; advising OSM Maritime Group on its merger with the Thome Group; acting as Bermuda counsel to Fidelis Insurance Holdings on its IPO on the New York Stock Exchange

Harneys

2023 represents another year of change at Harneys, with William Peake taking over as global managing partner following Ross Munro’s transition to Harneys Fiduciary in January 2023, where he is chief executive and chair. Paul Sephton took over from Ian Mann as head of the firm’s Hong Kong office in May 2023, while Andrew Johnstone assumed leadership of the firm’s Cayman Islands litigation, restructuring and insolvency practice, relocating from the Hong Kong office in September 2022.

The firm has seen sustained success in its private wealth practice, with Peake noting that the former had seen ‘a surge in activity’ over 2022 and 2023. Head of trusts Henry Mander concurs, adding that ‘periods of economic uncertainty make global business-owning families think about business continuity and succession planning’. Rising interest rates and a global economic slowdown have given rise to an uptick in the firm’s restructuring and insolvency work, including assisting Chinese coffee shop chain Luckin Coffee in settling a class action lawsuit and advising on its restructuring.

In the face of a challenging market, Harneys has supported several clients in London, the US and Asia in achieving successful listings, with a special emphasis on SPACs, where it has acted for ACG in its acquisition of mining rights in Brazil for $1bn with the support of some of the automotive sector’s biggest names. Partners at the firm expect the technology sector to buck the trend of an otherwise slow M&A market that largely favours buyers, while corporate partner George Weston notes that ‘tech and AI remain relatively buoyant’. Regulatory work in crypto-assets is expected to yield more instructions, especially in the wake of several high-profile collapses in 2022 and 2023. Distressed M&A, including deals occurring as a result of insolvencies, are also expected to provide a growing workstream for Harneys in 2023 and beyond.

Lawyers: 177, including 57 partners

Offices: 11 (Bermuda, BVI, Cayman, Cyprus, Hong Kong, London, Luxembourg, Montevideo, São Paulo, Shanghai, Singapore)

Global managing partner: William Peake (London)

Focus: Litigation and insolvency, restructuring, corporate and commercial, private wealth and trusts, investment funds, regulatory and tax, banking and finance, international arbitration

Recent standout work: Advising ACG on the $1bn acquisition of mining rights in Brazil; assisting Maxpro Capital Acquisition Corp on a business combination, via a reverse merger, with Apollomics; advising Laekna on its HK$790m (US$101m) IPO.

Maples

A combination of restructuring and insolvency instructions, alongside significant growth in the firm’s litigation practice, has seen Maples build upon several senior appointments made in the 2021-22 financial year. There is optimism that the subdued M&A market will rebalance towards the end of 2023: ‘We are seeing corporates beginning to prepare the ground for transactions,’ states global managing partner Jonathan Green.

March 2023 saw Cayman Islands-based James Eldridge and Caroline Moran take over from the retiring Aristos Galatopoulos as co-heads of the firm’s dispute resolution and insolvency practice, with both handling high-value, cross-border disputes. In Dublin, transactions specialist Jordan O’Brien and ESG financing expert Vanessa Lawlor were made up to partner in February 2023, while the addition of London-based Joanna Russell to the partnership at the end of 2022 enhanced the firm’s finance offering.

The firm’s funds practice has seen a strong year, strengthening its ranks with the January 2023 addition of Norton Rose Fulbright’s Manfred Dietrich in Luxembourg, along with the promotion of Frances Hamilton in Dublin. It also launched a new ESG solutions platform in August 2022, dovetailing with the 2023 entry into force of the EU’s Sustainable Finance Disclosure Regulation (SFDR). Maples continues to be the firm of choice for CLOs, having assisted in excess of 50 managers on more than 140 such deals between March 2022 and March 2023, while the February 2023 addition of Carey Olsen’s David Allen has added additional firepower to the firm’s CLO practice.

Maples’ Cayman office has seen substantial growth over the course of 2022, continuing into 2023, as demonstrated by Kerry Ann Phillips, Alex Howard, Ian Kirwan and James Meehan joining the partnership. The Financial Action Task Force (FATF)’s confirmation in June 2023 that the Cayman Islands have met all of its recommendations may pave the way for additional transactional activity.

Lawyers: 368, including 141 partners

Offices: Nine (BVI, Cayman Islands, Dubai, Dublin, Hong Kong, Jersey, London, Luxembourg, Singapore)

Global managing partner: Jonathan Green (Cayman Islands)

Focus: Disputes, corporate, finance, funds, insolvency and corporate restructuring, insurance, IP/technology/telecoms, private equity, property/construction, regulatory/financial services, sports/media/entertainment, tax and trusts

Recent standout work: Advising Liberty Costa Rica Senior Secured Finance on its digital infrastructure sustainability-linked bond; advising IQEQ Fund Management (Ireland) on the launch of Daiwa Blackstone Private Credit Fund, structured as a Cayman Islands unit trust and authorised for public offering in Japan; acting as Cayman Islands counsel to Modern Land (China) Co on the restructuring of its $1.34bn bondholder debt

Mourant

Mourant’s stellar 2022 saw it increase revenue year-on-year by 11% while also adding 11 new partners amid a total of 61 promotions, of which 63% were women, demonstrating a key commitment to ‘[leading] our markets in equity, diversity and inclusion (EDI)’, says global managing partner Jonathan Rigby. The firm has compounded this success by entering the Luxembourg market, having completed the acquisition of boutique law firm LexField and its corporate services arm FideField in June 2023, building upon the expansion of its consultancy service, which opened offices in Guernsey and the Cayman Islands in 2022. This has fed growth in the firm’s instructions from clients ranging from banks and fund managers to governments and regulatory agencies.

The firm’s revenue growth has been driven in large part by its M&A practice, which has remained steady in the face of challenging market conditions, and August 2023 saw the promotion of Guernsey’s James Cousins to partner. The same office acted for CSC on its $2bn acquisition of the Intertrust Group, which brought together two of the world’s largest players in the corporate services market, while the Cayman office took the lead on the business combination between X Energy Reactor Co and Ares Acquisition Corp, with the resultant publicly traded company being valued at $2bn.

Mourant’s funds practice also played a key role in the firm’s strong performance in 2022 and 2023, advising the likes of Ardian and UBS Asset Management on the formation and launch of funds ranging from several hundred million to billions of dollars, with a particular focus on real estate assets in London and the wider UK. Here there is overlap with the firm’s private client work, which has seen Sandra Duerden in Guernsey and Will Burnell in Jersey promoted to partner in February and August 2023 respectively. The team has handled a range of contentious and non-contentious trust matters concerning the structuring of assets ranging from entire companies to real estate and more, while continuing to act on high-profile disputes such as that concerning the Tchenguiz Discretionary Trust.

Further to its commitment to EDI, the firm has placed a strong emphasis on protecting the environment, maintaining close ties with organisations including Blue Marine Foundation, Ocean Culture Life and Plastic Free Cayman, while encouraging its employees to partake in conservation activities.

Lawyers: 265, including 74 partners

Offices: Eight (BVI, Cayman, Guernsey, Hong Kong, Jersey, London, Luxembourg and Mauritius)

Group managing partner: Jonathan Rigby (Jersey)

Global senior partner: Jonathan Speck (Jersey)

Focus: Corporate; banking and finance; regulatory; investment funds; restructuring and insolvency; dispute resolution; and international trust and private client

Recent standout work: Acting for the largest dissenting party, Oasis Management, on the highly-contested $2.6bn take-private of SINA Corporation; advising the National Pension Service of Korea on its indirect acquisition via a fund administered by Stonecutter Investment, of 5 Broadgate in London for £2.4bn; advising Butterfield on its acquisition of Credit Suisse’s global trusts business

Ogier

The private wealth, regulatory, disputes and insolvency and restructuring practices have been the key pillars of Ogier’s work throughout 2022 and 2023, with funds and banking and finance teams also continuing to see strong returns despite economic turmoil tied to rising interest rates and the war in Ukraine.

Managing partner Edward Mackereth notes that where traditional M&A deals have seen a marked decrease, there is scope for optimism, with private equity expected to bounce back towards the end of 2023.

Ogier’s dispute resolution practice has experienced an uptick and a range of disputes are being handled across the firm’s offices. Its Caribbean office anticipates that the collapse of FTX will herald instructions on the crypto-asset front, especially in the wake of the collapse of the Singapore-based Three Arrows Fund, where the firm acted for the liquidators. The launch of Ogier Regulatory Consulting in 2022 has assisted the firm’s lawyers in that respect, while last December trusts and insolvency litigators Rebecca McNulty and Christopher Levers were made up to partner in Jersey and Cayman respectively, demonstrating confidence in the future of the disputes practice.

Ogier also distinguishes itself with its Cayman-based IP team, which covers traditional intellectual property matters, in particular trade mark prosecutions, as well as digital assets, advising clients on the status of assets such as NFTs in relation to existing IP law.

Lawyers: 360, including 110 partners

Offices: Twelve (BVI, Cayman, Guernsey, Hong Kong, Ireland, Jersey, London, Luxembourg, plus representative offices in Beijing, Shanghai, Singapore and Tokyo)

Group managing partner: Edward Mackereth (Jersey)

Global senior partner: Rachael Reynolds KC (Cayman)

Focus: Corporate, dispute resolution, investment funds, restructuring and insolvency, private wealth, family office and regulatory

Recent standout work: Acting for Fund IV’s conflict director, litigation committee and the investors’ council in relation to numerous contentious aspects of the fallout from the collapse of the Abraaj Group; advising Atairos in a landmark $580m take private of Ocean Outdoor by way of a BVI statutory merger; acting as Cayman Islands counsel to the International Finance Corporation on the launch of a $100m ten-year social bond, the first ever healthcare social bond in the Philippines

Walkers

Global managing partner Ingrid Pierce points to non-traditional lenders as being key to Walkers’ thriving finance practice, as banks have become reluctant to lend in the face of flagging economies around the globe. The firm has focused on strengthening its regulatory, insolvency and disputes practices, as demonstrated by the arrival of several partners in various offices.

Jan Golaszewski joined from Carey Olsen in July 2023 to lead the firm’s London insolvency and disputes practice, while Ian Mason, previously of Gowling WLG, joined the Cayman Islands’ risk and regulatory team in January 2023. In Bermuda, trusts and commercial disputes specialist Steven White arrived from Appleby in August 2022. The teams in London and Guernsey have now completed their moves to new premises and the latter in particular has seen significant headcount growth over the course of 2022-23, with more than 200 staff now working in Guernsey.

The firm is advising on the Cayman Islands’ first ever restructuring plan under the new Restructuring Officer Regime (acting for the appointed officers overseeing Rockley Photonics Holdings’ restructuring following insolvency) described by Pierce as a ‘big deal’ and evidence that investment in insolvency and restructuring is paying off. Walkers’ corporate practice has not sat by idly either, acting on several notable transactions, including on the $4.6bn takeover of Diversey Holdings by Solenis and its parent company, the private equity house Platinum Equity. The funds practice has sailed a steady course over 2022-23, with larger players increasing their market share while at the same time facing increasing regulatory scrutiny. Those funds that invest in alternative assets such as cryptocurrency have provided work for the firm’s regulatory practice.

Lawyers: 467, including 151 partners

Offices: Ten (Bermuda, BVI, Cayman Islands, Dubai, Hong Kong, Guernsey, Ireland, Jersey, London, Singapore)

Global managing partner: Ingrid Pierce (Cayman Islands)

Focus: Investment funds, banking and finance, asset finance, fund finance, corporate, insolvency and dispute resolution, regulatory and risk advisory, fintech, insurance, tax (Ireland), private capital and trusts, employment, real estate, professional services, including corporate, listing and fiduciary services

Recent standout work: Advising Platinum Equity and Solenis on the latter’s $4.6bn acquisition of Diversey Holdings; acting on the $1.3bn acquisition of Cowen Inc. by TD Bank Group; advising lenders to SMBC Aviation Capital on a $1.7bn syndicated financing LB

The post Offshore report: Tempering against the tempest appeared first on Legal Business.

While 2022 began with renewed hope as the world began to bounce back after two unprecedented years of upheaval, it took just a few short weeks for that bubble to burst, with Russia’s invasion of Ukraine shaking the markets and raising the spectre of a global recession.

However, law firms throughout the Cayman Islands (Cayman), the British Virgin Islands (BVI) and Bermuda have risen to the challenge, enjoying a year of growth and landmark transactions.
‘Storm clouds are beginning to gather, but we have seen a notable uptick in distressed scenarios where a credit crunch is causing companies to seek urgent legal advice,’ states William Peake, newly-elected global managing partner of Harneys.

Insurance policies

Caribbean law firms demonstrated their resilience throughout the pandemic, and they have continued to thrive in unrelentingly challenging markets for businesses. ‘Although activity was lower this past year, the case for offshore structures in all sectors remains strong,’ states Christian Luthi, chair of Conyers. ‘Demand, in particular by multinational groups, institutional investors and private equity, remains robust.’ Brad Adderley, managing partner of Appleby’s Bermuda office, agrees: ‘It’s been a busy year – a very good year.’

‘Storm clouds are beginning to gather, but we have seen a notable uptick in distressed scenarios where a credit crunch is causing companies to seek urgent legal advice.’
William Peake, Harneys

Jonathan Green, global managing partner of Maples Group, says: ‘With the pressures in the markets, we are seeing capital being allocated towards private equity funds and longer-term opportunities, and have seen some significant fund raises in recent times.’

The insurance sector has stood out as a notable area of activity, with firms reporting strong years for their practices throughout all the Caribbean jurisdictions. Adderley highlights how Bermuda’s position as a leading insurance and reinsurance location has benefited firms active in the jurisdiction: ‘The insurance and reinsurance industries have been very vibrant and active. From new formations to interesting products to renewals, catastrophe bonds to other insurance-linked securities, we really can’t complain.’

Luthi concurs: ‘Insurance work is particularly strong for both the Bermuda and Cayman offices. As insurance rates have hardened, we’ve seen renewed interest in captives. Some of our larger groups are looking at how they can structure their affairs to take on some of that risk and lower the impact of very high rates.’

Recent highlights for firms in the insurance space include Conyers acting for Athene Holding on the reorganisation of its Bermuda subsidiaries following Apollo Global Management’s $7.2bn acquisition of a 65% stake in Athene, and Appleby acting as Bermuda counsel to Integral ILS on its increase of total investor commitments to over $1.4bn.

The strength of the insurance sector over the last 12 months has also led to new areas of work in the market, as Adderley comments: ‘The active insurance market has led to more insurtech, which has been great, which has in turn led to more general technology companies, including crypto companies, bringing work.’

Practices in the spotlight

The Caribbean has been at the centre of the crypto storm in 2022 with the collapse of the cryptocurrency exchange FTX drawing attention to the Bahamas and the region more generally. In the offshore world, Bermuda has led the way on crypto regulations for the last few years. Adderley notes: ‘Bermuda is one of the few jurisdictions which has proper regulation for crypto companies and, for crypto businesses doing insurance work of some sort, it is a natural place to be.’

The BVI has also seen its fair share of crypto-related work, particularly a recent spate of crypto fund registrations, with the BVI Financial Services Commission creating the Virtual Asset Service Providers (VASP) Act, which requires all BVI-registered VASP entities to comply with the jurisdiction’s anti-money laundering, counter-terrorist financing and anti-proliferation finance legislation, collectively known as the BVI AML regulations. Tanya Cassie-Parker, managing partner of Harneys’ BVI office, highlights the team’s work handling the first BVI freezing order against hackers concerning crypto fraud. This move reflects the team’s observations that the market is seeing an increase in contentious crypto mandates and digital asset tracing work.

‘We are seeing many investors and managers looking beyond the near term and focusing on the challenges of addressing longer-term environmental and social changes.’
Jonathan Green, Maples Group

While M&A transactions and capital markets work have slowed in comparison to previous years, the market has still seen some stand-out work, particularly connected to restructuring mandates. Firms in Cayman have also adapted to the new restructuring regime, which came into force in mid-2022, which aimed to streamline restructuring processes by introducing the restructuring officer role to the system, allowing companies to avoid the islands’ liquidation framework being invoked.

Examples of recent transactional, capital markets and restructuring work include Conyers assisting Teekay with its internal restructuring to facilitate the $6.2bn merger of Teekay LNG Partners with investment vehicles managed by Stonepeak Infrastructure Partners, and the firm’s work advising Digicel Group Holdings on its $1.6bn sale of Digicel Pacific to Telstra. On the capital markets front, Harneys has been notably active, advising KE Holdings on its dual primary listing of class A ordinary shares on the Hong Kong Stock Exchange (HKSE) and acting as Cayman counsel for the Zibuyu Group on its Hong Kong IPO.

In the transactional space, real estate work has picked up following the return of tourists to the region. Peake comments: ‘On the M&A front, we have seen a revival of interest in sectors which were badly impacted by the pandemic such as leisure and tourism, with buyers sensing that, even in an inflated market, there is value in assets that have not rebounded to pre-pandemic levels.’ One example saw Appleby recently advising Lacovia strata on a redevelopment project in Cayman comprising 100 new condominiums and assisted with the development of ONE|GT, a first-of-its kind development in the Cayman capital.

At the other end of the property spectrum, firms have also felt the impact of the property crash in China with all firms reporting increases in work stemming from the region. ‘There has been a marked increase in pre-insolvency restructuring advisory work, particularly in relation to debt issued by China real estate companies, many of which are Cayman incorporated vehicles listed on the HKSE,’ states Peake. ‘This growth is a direct consequence of the well-publicised distress in the China property market.’ As an example, Harneys recently acted as BVI and Cayman counsel to Kaisa Group Holdings on its $2.77bn debt restructuring via schemes of arrangement in Cayman and Hong Kong, as well as Chapter 15 US bankruptcy recognition. The firm also advised a group of debt holders in property developer Evergrande Group on potential enforcement action and a possible debt restructuring package.

‘The insurance and reinsurance industries have been very vibrant and active. From new formations to interesting products to renewals, catastrophe bonds to other insurance-linked securities, we really can’t complain.’
Brad Adderley, Appleby

Other international trends have also had an impact on the Caribbean market; the fallout from the Ukraine war can be seen in workstreams, in which clients have had to adapt to new sanctions and the increasing international pressure to drop Russian clients. ‘Russia sanctions affected offshore markets quite significantly and we’ve now all become quite expert on sanctions analyses,’ states Luthi. ‘There were significant questions around assets – especially during restructuring deals – regarding whether they were “good” or “bad” assets that have been frozen. Resolving these issues will occupy professional time for many years in the Caribbean, especially given the number of Russian interests involved in structures in the BVI.’ Private client and regulatory teams have been dealing with the repercussions of sanctions against Russian individuals and assets, and Ogier’s Cayman team has advised a large number of investment funds, investment managers, fund administrators and other financial service providers on the Russian sanctions.

Regulatory concerns also remain a constant in the offshore world, with new legislation serving as an ever-present element of all work handled by firms throughout the Caribbean. As Nick Hoffman, managing partner of Harneys’ Cayman office remarks: ‘The same global headwinds that were present in 2022 will be evident in 2023. Continual pressures on the offshore market through increased scrutiny and regulation are not going away.’ This was evident in early 2022 when Cayman was added to the EU’s anti-money laundering blacklist, a list of countries deemed high risk under the AML Directive, which saw a flow of CLO work out of Cayman to other jurisdictions, and can also be seen in the increasing focus on crypto legislation. Consequently, firms have been expanding their expertise in this area in line with this demand and several teams have seen notable expansion through recruitment and partner promotions.

Maples’ Green points to the Cayman Islands, Delaware and Jersey finance teams supporting the first CLO migrations to Jersey. Another first-of-its kind deal saw the Cayman Islands and BVI corporate teams advise on the first Middle East unicorn company to trade on NASDAQ. Led by Chris Newton, a corporate partner based in the firm’s BVI office, the transaction resulted in a business combination with Queen’s Gambit Growth, a Cayman Islands special purpose acquisition company founded and led entirely by women.

Remote control

While law firms have had a successful year, questions remain around the shift in work practices stemming from the pandemic. ‘Do any of us think the workplace is ever going back to what it was?’ asks Adderley. ‘Are we ever going to get back to a 9-5, suit and tie community where everyone’s going to work and everyone’s commuting? I personally don’t think so.’ Firms across the region have taken differing approaches to the ‘new normal’, ranging from mandated office working, to hybrid working and working from home models.

‘Russia sanctions affected offshore markets quite significantly and we’ve now all become quite expert on sanctions analyses.’
Christian Luthi, Conyers

Adderley continues: ‘I like to take the view that if you had a good year during Covid when you didn’t actually see each other every day, why do I now have to treat someone differently as a result of the “now we can get back to the office” mentality?’ Adderley also questions the value of office spaces and their necessity in the future: ‘Does someone need to have a new office when you’re not in the office every day and do you want that expense, to have a proper bricks and mortar office compared to something else which can be smaller, more efficient and more modern, which maybe helps the culture?’

Navigating this new need for flexible working with business culture and employee connection is a tricky balancing act. Adderley notes: ‘I think we all agree that loyalty to your employer, or loyalty generally, is not as high as it used to be in the past. If you don’t see your boss, or you’re not in the office, does that mean people are more likely to change jobs, as you don’t really associate yourself as a member of a group?’

The issue is further compounded by the impact of the pandemic on the ability of firms to attract lawyers to the region. As Luthi states: ‘One of the new challenges for offshore firms is attracting staff to the region and retaining those that do move. In BVI and Cayman, where the lawyers are largely expats, it became a big issue that the pandemic led to fewer flights and made it harder for people to see family. Flight options are still down, especially in BVI, and that has definitely been a challenge for recruiting.’

The offshore world does, however, remain a highly competitive field and a challenging one for those who haven’t futureproofed, as Luthi points out: ‘There is significant competition in the space – those firms that have over-extended or paid too much for talent will no doubt suffer. It’s also likely the smaller firms will struggle.’

Easy as ESG

Elsewhere, diversity and ESG are increasingly hot topics and, as boardrooms focus more and more on governance initiatives, Caribbean firms are adapting their advice to the global stage. ‘Simply put, a law firm cannot succeed as an echo chamber,’ states Peake. ‘A coterie of “yes people” is dangerous to any business. Clients demand more than just top-class lawyering; that is a given. They demand ingenuity and initiative, and diversity drives [are] responses to those needs.’

Luthi adds, ‘As is often the case, once an idea gains currency, companies can’t afford to ignore it, even if the hard regulatory requirements aren’t there yet. If you’re in extraction, energy, shipping or aircraft, you absolutely have to grapple with the ‘environmental’ part of ESG. In terms of the social and governance pieces, we’ve been developing our ability to serve our clients on other soft regulatory and policy issues.’

‘The same global headwinds that were present in 2022 will be evident in 2023. Continual pressures on the offshore market through increased scrutiny and regulation are not going away.’
Nick Hoffman, Harneys

Green notes: ‘We are seeing many investors and managers looking beyond the near term and focusing on the challenges of addressing longer-term environmental and social changes. We are proud to work with a broad range of clients who are directing private capital towards sustainable and ESG-focused initiatives to mitigate these types of issues.’ Green points to a number of ESG-related mandates, including Maples’ Japanese fund practice, led by funds and investment management partner Nick Harrold providing Cayman Islands counsel to longstanding client, CFIM, on the launch of a new green fund in Japan. The publicly offered fund enables retail investors to obtain a broad and diversified exposure to global assets, and the ability to participate in the financing of projects that contribute towards climate change and promote sustainable infrastructure.

Beyond the world of legal policy and advice, firms are also increasingly having to adapt their own practices to live up to the ESG expectations of the market and the workforce alongside the new working practices stemming from the pandemic. According to Adderley, the two are inextricably linked: ‘Working from home and the flexibility that allows directly addresses ESG. I would find it disingenuous to, on the one hand, be saying I believe you should be in the office 24/7, five days a week and working on the weekend, but on the other to say I’m also ESG-friendly.’

Looking into 2023, the ability to adapt remains a key challenge for offshore firms. Says Peake: ‘We are excited about the year ahead. There’s a certain amount of hubris attached to predicting trends accurately and, to some extent, the key is adaptation, which takes so many forms in a global firm.’ Luthi agrees: ‘The year ahead will be one of caution. After two years of Covid, we were all budgeting quite aggressively for 2022 but that was set back by the war and unanticipated high rates of inflation. However, we still have our strategic objectives, and commercial and political changes could be a very positive development.’ LB

The post Caribbean Offshore Report: Light behind the cloud appeared first on Legal Business.

In our 2022 offshore feature, firm leaders were relatively sanguine when scanning the horizon for the upcoming year’s challenges. Having ridden out almost two years of Covid-19 lockdowns, global economies – with the notable exception of China – had largely reopened, including the Crown Dependencies themselves, which had ended travel restrictions at the same time as their key clients in London.

Then, almost to the day, as readers removed the cellophane from their copies of the January/February 2022 issue of Legal Business, Russia invaded Ukraine – and the world’s economic prospects changed immeasurably. However, as material as these challenges undoubtedly are, they have yet to fully arrive on the desks of the lawyers of Jersey, Guernsey and the Isle of Man.

‘The perfect storm of a pandemic, a European war, Brexit, inflation and higher interest rates should, one would imagine, cause a fairly sizeable recession, with the consequences that usually follow, says Appleby’s Isle of Man managing partner Mark Holligon. That said, he continues: ‘Thus far, there has been little impact on the types of work we are seeing, save for high street failures.’

In several conversations with firm leaders across Jersey, Guernsey and the Isle of Man – the three Crown Dependencies – many share this degree of caution on the global economic climate, coupled with confidence at a firm and jurisdictional level of the ability to not just survive but thrive in a harsh environment. Asked about his firm’s bottom line, Jonathan Rigby, global managing partner of Mourant, says: ‘We’ve seen another year of strong revenue growth; in the last three years, we’ve grown revenue by over 30%, reaching our target revenue range for 2025 three years earlier than planned.’

Decoupling and de-risking

The Russian invasion of Ukraine meant that early 2022 saw an upheaval as many corporates – including onshore law firms – bowed out of the Russian market as economic sanctions were imposed and the country became a pariah, at least where Europe and the US were concerned. The Crown Dependencies – whose sanctions law is a home-brewed implementation of a shared foreign policy with the United Kingdom – are no exception.

‘The perfect storm of a pandemic, a European war, Brexit, inflation and higher interest rates should, one would imagine, cause a fairly sizeable recession, with the consequences that usually follow.’ Mark Holligon, Appleby

Managing partners report that offshore firms have been able to cut these connections as in many other jurisdictions. ‘We began de-risking in 2014, following Russia’s unlawful invasion of Crimea, and stepped that up at intervals including in 2018 [at the time of the Salisbury Novichok attacks],’ notes Mourant’s Rigby. Meanwhile, Jonathan Heaney, managing partner of Walkers in Jersey, credits governments onshore and offshore for making the process smooth and the legislation unambiguous: ‘The impact has been minimal – the changes to the international sanctions regime have been clear and well-communicated, and the industry has understood precisely what has been expected from it, and we have been advising fiduciary clients in particular on this point.’ Holligon echoes: ‘We have seen a number of sanctions instructions coming in from local corporate service providers who have found themselves managing structures affected by sanctions.’

Whatever these geopolitical challenges, law firm leaders are ostensibly bullish about workflow. Real estate and M&A work continue to be core areas for offshore law firms and those practice areas have proved buoyant. Walkers’ Heaney says that ‘the Jersey real estate group has been particularly busy with financings and acquisition’, while on the Isle of Man, Holligon adds: ‘M&A activity remains strong, particularly in the online gambling sector over the past six months or so, illustrating the growing maturity of that industry.’

Looking to the future, Nick Evans, managing partner of Maples Group’s Jersey office – the firm’s only presence in the Crown Dependencies – states: ‘Despite considerable uncertainty over the landscape for 2023, we are seeing record levels of activity, particularly in the PE/infrastructure and real estate spaces.’ Meanwhile, according to Rigby, Mourant has ‘continued to work on mandates for the top ten private equity and real estate managers during the year’.

Debt capital markets is another active sector, albeit one not immune to market forces. Holligon says: ‘Corporate and government bond issuances were very active in 2021/22, particularly if they had an ESG purpose, but that has cooled off slightly in the last six months; inflation and interest rate increases have posed challenges in that area but this may well return as the UK looks to bring inflation under control.’

Meanwhile, Evans comments: ‘Notable transactions include advising on the first CLO migrations to Jersey and more recently, the team advised on the first Jersey LLC to be incorporated and registered in the jurisdiction.’

Matt Sanders, managing partner of Walkers’ Guernsey office, says the firm has had a ‘stream of instructions relating to trust structures for DAOs [decentralised autonomous organisations] as a bridge between the online and offline economies’, while his Jersey counterpart Heaney has had ‘some interesting instructions advising on crypto funds using corporate structures, which have some benefits for Singaporean managers because of the islands’ array of double taxation agreements.’ He also points to ‘interesting fintech instructions flowing into [Walkers’] corporate, funds and regulatory teams’.

‘Despite considerable uncertainty over the landscape for 2023, we are seeing record levels of activity, particularly in the PE/infrastructure and real estate spaces.’
Nick Evans, Maples Group

More traditional investment funds practices have been thriving too. As Rigby observes: ‘From a private capital funds perspective, we’ve seen a significant increase in liquidity solutions – advising open-ended fund clients on redemption gates; an increase in fund secondary transaction activity – whether manager or investor led; fund extensions; and the continued expansion of the fund financing market, particularly subscription line and NAV facilities, notwithstanding the altered interest rate environment.’

‘Dispute resolution teams also remain busy and regulatory and employment have also performed well,’ according to Holligon – two significant mandates for those being the insolvency work surrounding the demises of retailers Arcadia Group and M&Co. Rounding out the other sectors, Sanders in Guernsey reports that the firm’s ‘Guernsey private capital and trusts team, now led by three partners, has had an impressive year, and that the arrival of David Cooney has opened a rich seam of work in the Swiss market, where he practiced as a partner for a number of years’.

Domestic work has also proved lucrative. Rigby comments: ‘The Jersey and Guernsey economies are in relatively good shape. They recovered well from the pandemic and are well-placed to weather further global shocks. The size of both economies and the number of jobs have returned to pre-pandemic levels, vacancy rates are high and unemployment low.’ Heaney observes that ‘the local markets have weathered the storms of Brexit, Covid-19 and the inflation spike’.

Tooling up

All this activity means that firms have been investing in talent, even in transactional practices which have slowed. Evans says: ‘I’m pleased to report that we’ve grown significantly over the past year, increasing our headcount by 45% to meet the requirements of our expanding client base. Among our recent notable hires was the addition of David Allen who joins [Maples] as a corporate partner.’

‘There has been some hesitancy in doing deals in relation to higher interest rates, but it doesn’t really change the nature of the work, and it tends to involve deals being delayed or repriced, rather than put off entirely.’
Jonathan Heaney, Walkers

At the junior levels, even if there is scant evidence on the ground of a City-style recruitment war, there is certainly a desire to attract talent, and not exclusively in the time-honoured way of offshore firms recruiting senior associates, associates and junior to mid-level barristers. Referring to a programme that trains English solicitors, rather than the separate Jersey Bar exams, Evans adds: ‘A key priority for us has been developing and investing in our people at all levels across the firm. In late 2022, we were delighted to launch our new Jersey Trainee Solicitor Programme which has been carefully developed to be comparable to that of London law firms.’

Evans is not the only leader in recruitment mode. Sanders observes: ‘The real challenge for us is recruitment, and continuing to grow our numbers. It is a tough recruitment market, but we have consistently been able to make a compelling career proposition, and have recently moved to new, expanded offices [in St Peter Port] as a result.’

So what does this mean when hazarding market predictions? Rigby is sanguine that private equity players are still sitting on dry powder from easier periods of fundraising: ‘The opportunity for investment into targets with more attractive valuations and inflation-busting characteristics will support selective deal activity. Investment in energy transition, food security, infrastructure and the re-mapping of supply chains to enhance resilience through diversification will all see significant new commitments. And while banks may be more demanding on terms and covenants, this will open new space for private credit to occupy.’

‘We are very interested in Singapore as a jurisdiction where wealth holdings work might open up. Channel Islands law firms have anticipated that and indeed the trust companies too.’
Kathryn Purkis, Serle Court

Acknowledging that his view is more contrarian than that of some market observers, Rigby notes: ‘If central banks manage the transition to conventional monetary policy without significant market disruption, we see alternatives providing enhanced returns and a diversification play for public market investors. Private equity has developed tools that will cushion write-downs in values that will occur for some existing assets, and continuation funds provide a valuable means to address market timing and liquidity issues, providing the opportunity to safeguard high-performing trophy assets from untimely disposal.’

On the impact of high inflation and interest rates, Heaney adds: ‘There has been some hesitancy in doing deals in relation to higher interest rates, but it doesn’t really change the nature of the work, and it tends to involve deals being delayed or repriced, rather than put off entirely.’

International conversation about decoupling of the West – or at least the US – and China has affected offshore firms in the Caribbean more than the Crown Dependencies. Walkers’ Heaney says that Asian clients ‘tend to look to BVI, Cayman or Bermuda in terms of offshore work, and while there are Jersey and Guernsey structures involving Asian clients and investors, it is not a key focus’.

Kathryn Purkis, chambers director of Serle Court, a top-tier set in The Legal 500’s The English Bar Offshore, expresses a vote of confidence in the Channel Islands’ role in the trusts space in Asia: ‘European financial services providers are being looked to in order to assist families from the East, either Middle or Far, on their wealth holding and we are very interested in Singapore as a jurisdiction where that kind of work might open up, particularly after what’s been happening in Hong Kong. I think that the Channel Islands law firms have anticipated that and indeed the trust companies too.’

‘The global economic downturn will bring greater scrutiny of IFCs as onshore governments look to shore up their economies – but any restraint of IFC activity will be misguided.’
Jonathan Rigby, Mourant

Others take a glass half-full view of the Asian market. ‘It’s been a very hard time for our colleagues and clients in Hong Kong, and the wider region, but difficult times are a great opportunity to build and strengthen client and intermediary relationships and we’ve certainly been doing that,’ observes Mourant’s Rigby. ‘Despite the obvious challenges, we’ve generated significant growth in our Asia revenue since 2020, driven largely by our transactional practice. With China opening up again, post-pandemic, and the economy in recovery, IFCs will continue to play a key role in facilitating inbound and outbound Chinese investment.’

Downturn brewing

An impending recession seems sure to bring on distressed situations that have been a long time coming. Says Walkers’ Heaney: ‘Higher interest rates will pile up the pressure on leveraged businesses and investments and will create difficulties as financing terms expire. This has been forecast at the beginning of every year since 2019, but the interest rates could potentially be a game changer. My own view is that consensual restructuring will be favoured – it is not always in anyone’s interests to press the insolvency button.’

Sanders in Guernsey observes: ‘People have been predicting insolvency wave and recession for years, and we have not really seen it come to pass. The potential – and I stress potential – difference this year is the higher interest rate environment, which will have an impact on extending or restructuring existing lending.’

Jonathan Hilliard KC, a member of Wilberforce Chambers who has worked with firms in the Crown Dependencies on litigation, notes: ‘Well set-up fiduciary firms may have quite sophisticated investment structures in place and in practice if that’s the case then it can be quite difficult to challenge in investment decisions because by their nature legitimate decisions can cause assets to go up or down.’

Instead, he identifies an alternative potential source of work for trusts litigators: ‘It’s probably more been driven by some of the trusts set up decades ago, having now come into their second and third generations and people in those generations having their own views as to how the trust should work, and that spawns quite a lot of the removal work.’

Many observers point out the growing focus on ESG factors. Heaney notes: ‘ESG has filtered through to work, and interestingly it has been driven by investor demand and behaviour and not by managers or regulators.’ Notwithstanding its buzzword status, a definitive answer on what ESG actually encompasses escapes most. As such, offshore lawyers see an opportunity for governments to provide the market with clarity. ‘ESG is an increasingly complex area creating advisory opportunities for ESG experts but crying out for harmonisation of global standards,’ states Rigby.

‘The pending Moneyval inspections also pose a challenge in the sense that legislative change in the run-up to the inspections has created significant demand for our regulatory team.’
Matt Sanders, Walkers

Sanders adds: ‘The big moment in my view will be the development of a global or EU taxonomy or framework for ESG and sustainable finance. There may be more of this work going on than people realise, but because of differences in codification and how the work is described, there is no universal benchmark.’ The absence of standards, according to Rigby, is posing challenges to asset managers ‘trying to coherently assimilate into their investment and reporting policies and procedures, the disparate ESG regulations and taxonomies created by global regulators to address green-washing concerns and meeting specific investor ESG requirements in relation to investment strategies and reporting policies and procedures’.

Anti-money laundering measures and combating terrorist finance present their own challenges. Referring to the European Union’s FATF implementation body, Sanders warns: ‘The pending Moneyval inspections also pose a challenge in the sense that legislative change in the run-up to the inspections has created significant demand for our regulatory team.’

As far as ethical scrutiny of the firms themselves is concerned, Holligon at Appleby in the Isle of Man shares a fairly relaxed view: ‘What was patently clear from the politically motivated scrutiny of five years ago is that offshore firms take great care over the type of work they undertake and the clients for which they act.’ Setting out the stall for his jurisdiction, Rigby observes: ‘The global economic downturn will bring greater scrutiny of IFCs as onshore governments look to shore up their economies – but any restraint of IFC activity will be misguided. IFCs, and the capital flows they facilitate and support, have an important role to play in the global economic recovery. We’ll need to continue to make this case in the face of the inevitable political posturing.’ LB

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If market commentators thought the world was ready to get back on an even keel after two years of global pandemic, events of recent months have very much put paid to that notion. But while law firms and their clients still have much volatility to contend with, the 2022 financial results season has once again underlined the resilience of the global legal market, with a steady stream of firms posting more than healthy revenue and profit hikes.

And the leading offshore law firms are no exception, with booming deal markets, post-pandemic restructuring work and emerging trends such as environmental, social and governance (ESG) contributing to a landmark year for many.

‘We’ve been doing well – we’ve surprised ourselves, although maybe we shouldn’t be surprised.’ So states Christian Hay, head of dispute resolution and Guernsey managing partner of Collas Crill. ‘As a firm with a strong emphasis on litigation, when the world is in trouble, we do well.’

Maples managing partner Jonathan Green concurs: ‘We had an extremely strong year. Notwithstanding the challenges posed by the continuing pandemic, our clients have showed considerable resilience and were able to call on our expertise to complete complex transactions. Almost all our core practice areas and business lines experienced significant growth.’

For Carey Olsen, the latest financial year also proved particularly fruitful: ‘All of our offices and practice areas had a very busy second half to last year and first six months of 2022, culminating in a record year of revenue for the financial year,’ comments Russell Clark, managing partner of the firm’s Guernsey office.

‘The Cayman team has grown 30% in two years – our focus on litigation, insolvency and restructuring means we’ve been really busy coming out of the pandemic.’
Stephen Leontsinis, Collas Crill

Picking up the pieces

One of the main drivers behind this success is the inevitable restructuring and insolvency boom coming out of the pandemic. Christian Luthi, chair of Conyers, notes: ‘Given current macroeconomic growth headwinds, we expect an increase in the need for restructuring and corporate recovery, and we are well positioned to meet these needs across our jurisdictions.’

Stephen Leontsinis, managing partner of the Collas Crill Cayman office, agrees: ‘The Cayman team has grown 30% in two years – our focus on litigation, insolvency and restructuring means we’ve been really busy coming out of the pandemic.’

Ogier’s managing partner Edward Mackereth flags the likely impact of spiralling inflation on this trend: ‘Over the past 12 months we have been seeing more restructuring work (out of court) and initially fewer formal insolvencies due to the level of liquidity in the market. This is now changing with inflation and interest rates rising in the UK and the US, putting pressure on corporate groups with a lot of debt.’

For the team at Harneys, while this trend is indeed global in nature, work coming out of China is another key driver. Phillip Kite, co-head of litigation, insolvency and restructuring, comments: ‘Over the last 12 months, there has been an increase in restructuring and insolvency work for the BVI, Cayman and Bermuda as companies struggle. We have also seen work from companies in these jurisdictions affected by solvency issues in the PRC.’ Paul Sephton, co-head of the banking and finance and corporate groups, adds: ‘There has been a marked increase in pre-insolvency restructuring advisory work, particularly in relation to debt issued by China real estate companies, many of which are Cayman incorporated vehicles listed on the Hong Kong stock exchange, which is a direct consequence of the distress in the China property market.’

‘Over the last 12 months, there has been an increase in restructuring and insolvency work for the BVI, Cayman and Bermuda as companies struggle.’
Phillip Kite, Harneys

Sustainable growth

One trend making more headlines than most is of course ESG, an area which has been steadily moving up the agenda for offshore firms for some time. As Green highlights, firms with established expertise in ESG issues, particularly sustainable finance work, have thrived in this arena: ‘We were an early adopter in the ESG space and sustainable finance has been a core part of our strategic plan over the past few years and will continue to be for the next decade and beyond.’ With particular expertise in ESG financing work, Maples’ recent mandates include advising on green bond issuances, assisting with a new climate growth fund, and advising on ‘blue bonds’, a comparatively new form of debt instrument supporting investments into ocean sustainability.

Mackereth agrees: ESG is a consistent topic for our lender clients. While the number of ESG-linked loans is currently relatively small, this is growing steadily. One lender we work with is predicting that within a few years ESG will soon become standard and banks will look to move away from lending to any clients that aren’t ESG compliant – for example, oil and gas-focused clients.’

Clark and the team at Carey Olsen have also seen a similar trend: ‘We already had a solid transactional record in ESG-related matters before Covid-19 with many of our clients wanting their investments and products to create positive change as well as profit. As the regulatory environment for ESG criteria and sustainability reporting continues to evolve, we are seeing activity across all our core practice areas supporting this developing area.’

Tales from the crypto

The offshore markets also remain a key vantage point from which to view the ever-changing world of digital assets and cryptocurrencies, with several offshore jurisdictions attracting cryptocurrency investors and firms expanding on their fintech knowledge to cover NFTs and other innovative financial technologies. Harneys is particularly active in the space, with managing partner Ross Munro noting: ‘The boom in crypto provided new opportunities for our digital assets practice, which is probably the largest in the offshore markets. Our regulatory, funds and corporate practices were kept busy with fund vehicles and NFTs targeting this space.’

‘All of our offices and practice areas had a very busy second half to last year and first six months of 2022.’
Russell Clark, Carey Olsen

Walkers has also seen an uptick in activity in mandates involving digital assets, as global managing partner Ingrid Pierce explains: ‘Instructions relating to virtual assets touch most of our practices. Our London insolvency and disputes group is seeing interesting work arising out of the drop in cryptocurrency values, while our Jersey teams have worked on a succession of crypto funds and our private capital and trusts groups have worked on some novel deals.’

Caribbean jurisdictions have also actively carved out niches in the global market for fintech and crypto work, with the BVI attracting notable NFT mandates and Bermuda becoming a hub for crypto financial services clients.

Playing by the rules

The watchful eyes of regulators are, as ever, a consistent source of work for those operating in the offshore markets, with the initial wave of economic substance advice and the move towards increased transparency bringing with them further waves of regulatory change.

Clark comments: ‘We are seeing an increase in new offshore regulations coming into effect. This has obviously led to an increased need for offshore legal services and, for us at least, has seen the firm expand its spectrum of regulatory practices to cope with demand. As offshore jurisdictions continue to revise legislation to adhere to global best practices and increase transparency, we expect to see a continued growth in the need for offshore regulatory advice.’

Green says this is an area in which Maples has invested heavily: ‘Maples clients operate in heavily regulated sectors and have been facing increased compliance, risk and reporting burdens – we have hired a number of senior lawyers to enhance our global regulatory offering.’

Beyond borders

The increasingly global nature of the offshore market has also led to new collaborations and increased activity stemming from less traditional origins. As Pierce comments: ‘We are seeing increased interest from US-based clients in our Guernsey and Jersey law offering, often in parallel with the Cayman, BVI and Bermuda law products with which US clients are more familiar.’

Carey Olsen’s Caribbean teams have also been notably involved in a changing landscape, as Clark notes: ‘In the Caribbean, we have been at the forefront of the Cayman Islands’ burgeoning reputation as the premier jurisdiction for Latin America start-ups and venture capital firms’ financing and structuring needs, advising start-ups from Chile, Brazil and Mexico, among others.’

Maples’ Green adds: ‘Demand for our multi-jurisdictional capabilities continues to set us apart from other firms. Our European legal practices in Luxembourg, Jersey and Ireland play an integral role on cross-border transactions and this year, the team has acted in a number of first-of-its-kind transactions.’

Below are snapshots of the ten largest offshore firms in 2022 and how they’ve fared in the last 12 months.

Appleby

Continuing the trend of the previous 12 months, Appleby has excelled in corporate and finance work in 2022, handling a broad range of mandates for financial services clients. The team has acted on a large volume of CLO matters and has led on over 50% of the SPAC deals involving Cayman vehicles. The firm’s global network, including offices in all three Crown Dependencies, has also allowed for involvement in notable international insolvency and restructuring matters.

In team news, Ulrich Payne joined the firm’s Cayman office in June 2022, adding to the team’s litigation expertise. In the month prior, the Cayman office also saw Sailaja Alla announced as head of funds and investment services, leveraging her experience in offshore hedge funds and private equity matters. Further partner changes also saw Richard Grasby join the firm’s Hong Kong office to lead the private client and trusts practice, Duncan Card adding to the Bermuda office’s commercial capabilities, and Faye Moffett stepping down as managing partner of the Isle of Man office with Mark Holligon subsequently taking up the mantle.

The firm leverages its Appleby Global Services offering; the specialist corporate and trust services provider assists clients, including high-net-worth individuals and multinational corporates, with administration, reporting and fiduciary services mandates.

Lawyers: 200, including 73 partners
Offices: Ten (Bermuda, BVI, Cayman Islands, Guernsey, Hong Kong, Isle of Man, Jersey, Mauritius, Seychelles, Shanghai)
Group managing partner: Malcolm Moller (Mauritius)
Focus: Corporate, dispute resolution, private client/trusts, property, technology and innovation, and regulatory
Recent standout work: Advising Artisan Acquisition Corp on its de-SPAC business combination with Prenetics Group, creating Hong Kong’s first unicorn to list on NASDAQ; advising Atrium European Real Estate on the issuance of a €350m deeply subordinated hybrid green bond; assisting S&P Global with its merger with IHS Markit.

Bedell Cristin

With a strong offering across its core areas of banking and finance, corporate and M&A, disputes, funds and private client, Bedell Cristin has enjoyed another solid year. Key mandates have included providing Guernsey advice to PGIM, the $1.5trn global investment management business of Prudential Financial, on its acquisition of Montana Capital Partners; advising Blackstone on more than £2.5bn of corporate real estate acquisitions and sales and accompanying financings and re-financings; and acting for KPMG on the acquisition of its Cayman Islands and BVI restructuring business by Teneo.

After moving into new offices in the Cayman Islands in early 2021, the firm also took a larger base in Singapore in late 2021, a move that global managing partner Tim Pearce said was in preface to the firm’s plans to ‘recruit more locally based lawyers with an international focus’. Corporate finance and real estate transactions specialist Pearce, who has now spent almost 20 years at the firm, is closing in on three years as global managing partner after succeeding David Cadin, who remains at the firm as Jersey managing partner.

Recent partner hires have included the June 2021 appointment of experienced private client and offshore litigation specialist Joanne Verbiesen, who joined the firm’s Singapore office from HSBC in Hong Kong, and wealth planning expert Elena Gogh, who joined the international private client team from Babbé in Guernsey.

Lawyers: 82, including 32 partners
Offices: Six (BVI, Cayman, Guernsey, Jersey, London, Singapore)
Group managing partner: Tim Pearce (Jersey)
Focus: Banking and finance, corporate and commercial, employment, funds, insolvency and restructuring, international private client, litigation, pensions, regulatory and compliance, wills and probate
Recent standout work: Advising a group of investors on the Jersey aspects of a $62m debt facility to develop sustainable energy use in Africa; acting as British Virgin Islands counsel to investment vehicle Gopher Investments on its $250m acquisition of Finalto, the financial trading division of Playtech; advising Ocorian Services Ltd as lead counsel on its acquisition of Trust Corporation, one of the most significant M&A transactions in Guernsey in 2021.

Carey Olsen

Carey Olsen enjoyed a record-breaking year in 2021-22, with revenues rising to a new high. While core practice areas such as investment funds and listings remained strong, the firm also saw increased activity relating to regulatory matters and environmental, social and governance (ESG), including advising RBS International on a €1.455bn ESG-linked financing for European investment firm Triton Partners.

The firm also recently became the first offshore law firm to join the United Nations Global Compact, committing to provide an annual report on its progress in the organisation’s principles, which cover human rights, labour, environment, anti-corruption and sustainable development.

This positive trajectory was also underlined by the firm’s recent promotions round, which saw five new partners made up and a further 16 senior promotions – the firm’s largest ever. The promotions include London funds partner Matthew Brehaut, formerly of RBS and Clifford Chance, as well as a trio of new partners in the firm’s fast-growing Bermuda base, which was established at the end of 2017.

Guernsey managing partner Russell Clark says: ‘The Bermuda promotions are particularly significant as all three are Bermudians who we were able to persuade to join us soon after opening our office there. Having Bermuda law capabilities not only in Bermuda but also on the ground in Asia and London is a real differentiator for us as a firm and vindicates our decision to open there.’

Other jurisdictions of focus for the firm include the key Asia offshore markets, where the firm is building up in both Hong Kong and Singapore, with trusts and private wealth earmarked as a priority.

The firm’s efforts in this are now led by Rachel Yao, who joined at the start of 2022 from Taylor Wessing, where she led the Greater China international private wealth team.

Lawyers: 292, including 68 partners
Offices: Nine (Bermuda, BVI, Cape Town, Cayman, Guernsey, Hong Kong, Jersey, London, Singapore)
Group managing partner: Alex Ohlsson (Jersey)
Global senior partner: John Kelleher (Jersey)
Focus: Banking and finance, corporate and commercial, investment funds and private equity, listing services, dispute resolution, restructuring and insolvency, private client, trusts and private wealth, property, employment, regulatory and insurance
Recent standout work: Advising Permira funds on the take-private of Mimecast, which valued the company at $5.8bn; advising the Jersey government on its £500m bond issuance; advising Guernsey-incorporated special purpose acquisition company (SPAC) Hambro Perks Acquisition Company Ltd, the first SPAC to list in London under the UK’s new listing rules.

Collas Crill

Collas Crill has also been benefiting from booming activity levels over the past year, with revenues up 17% on 2020. As global disputes head Christian Hay says the upside is not only in litigation: ‘Corporate is also coming to the party – we’re benefiting from pent-up demand as the market is getting more confident.’

Key recent hires include BVI managing partner Ellie Crespi, who joined in March 2021 from Harneys, and former Osborne Clarke chief executive Simon Beswick, who joined the firm’s strategy board as chair in May 2021.

While in the past Collas has made a point of choosing non-lawyers as non-exec chairs to offer a fresh perspective, the firm decided that, given its international ambitions, the time was right to bring in a law firm veteran with the credentials of Beswick to offer first-hand experience of major international expansion. A 12-year tenure at OC saw Beswick spearhead significant growth across Europe and Asia. On the expansion point, a number of options are on the table, with Collas potentially looking to extend its footprint to mid-shore locations.

‘The market has become much more fluid – people are moving a lot more than they would have in the past, but we think we’ve got the right culture.’
Christian Hay, Collas Crill

In Cayman, the team under the leadership of managing partner Stephen Leontsinis has grown 30% in two years, with a focus on litigation, insolvency and restructuring ensuring the base has been busy coming out of the pandemic.

On the recruitment front, while Leontsinis says potential recruits are ‘banging down doors’ to come to Cayman, pointing to a string of recent hires, Hay acknowledges that offshore firms face new challenges, given that onshore firms are increasingly taking work/life balance more seriously.

However, Hay – who has been part of a working group which is aiming to galvanise the firm’s flexible working policies drawn up during the pandemic – is sanguine: ‘The market has become much more fluid – people are moving a lot more than they would have in the past, but we think we’ve got the right culture. We have a one-firm feel across our offices.’

Lawyers: 88, including 38 partners
Offices: Five (BVI, Cayman, Guernsey, Jersey, London)
Group managing partner: Jason Romer (Jersey)
Global chair: Simon Beswick
Focus: International wealth and private client, dispute resolution (particularly trust litigation and insolvency), risk and regulatory, commercial property, corporate, banking and finance and funds
Recent standout work: Advising former Nissan chief executive Carlos Ghosn in defence of tracing and other claims for fraud and breach of fiduciary duty valued at over $35m brought by Nissan; acting for a claimant in the American Arbitration Association against two large audit firms, seeking $300m damages for auditor’s negligence; acting for the US SEC receiver of the TCA Group of Companies, which were placed in receivership as a result of a fraud on investors perpetrated by its principal founding member.

Conyers

In a stable year for Conyers’ team, 2021 and early 2022 ensured a high level of deal volume across the board, with key practice areas particularly thriving. As noted by Christian Luthi, the firm’s global chair: ‘Our insurance teams in both Bermuda and Cayman have been particularly busy with Conyers handling almost 70% of Cayman insurance licences issued in the first half of 2022. Structured finance and asset finance transactions have also notably increased over the course of the year.’

The capital markets growth seen in previous years has slowed, with deal volumes decreasing in the second quarter of 2022 thanks to the influence of global economic uncertainty. However, Luthi sees the silver lining: ‘This slowing of global economic activity is usually said to give rise to an increase in corporate restructuring and insolvency work, and we have seen this across the firm. In particular, fintech insolvencies have been a busy area and, earlier in the year, we completed several energy industry restructurings in Bermuda and several cross-border matters for Bermuda and Cayman companies in Hong Kong.’ The firm’s BVI office has remained a key location for private client and trust disputes alongside a steady flow of security enforcement exercises.

At a personnel level, the firm announced two promotions in early 2022: Robert Alexander in Bermuda and Anna Lin in Hong Kong were promoted to the partnership as members of the corporate and litigation teams respectively.

‘This slowing of global economic activity is usually said to give rise to an increase in corporate restructuring and insolvency work, and we have seen this across the firm.’
Christian Luthi, Conyers

Anna-Lise Wisdom was also recruited into the Cayman fund finance team, adding her experience in finance, fund and corporate mandates.

Lawyers: 150, including 67 partners
Offices: Six (Bermuda, BVI, Cayman, Hong Kong, London, Singapore)
Chair: Christian Luthi (Bermuda)
Focus: Corporate (including aviation, banking and finance, capital markets, investment funds, insurance, M&A, private equity/venture capital and shipping), litigation and restructuring, private client and trust
Recent standout work: Advising IHS Markit on its merger with a subsidiary of S&P Global, creating an information services provider with an enterprise value of $140bn; acting for Recruit Holdings as part of a consortium of investors on the take-private of 51job Inc; advising Sogou on its $2.1bn privatisation; handling the corporate restructuring of All Year Holdings.

Harneys

Early 2022 saw a changing of the guard at Harneys, with a raft of management changes and partner promotions across the board and substantial shifts in the focus and diversity of the firm’s global offices; six of the firm’s nine offices are now managed by female partners. Ross Munro took over as global managing partner, with former head Peter Tarn continuing as a partner in the firm’s BVI office. Vanessa Molloy and Rachel Graham were appointed managing partners of the Luxembourg and London offices respectively, while Peter Nagle became chief executive of Harneys Fiduciary, the firm’s independent fiduciary services provider.

Felice Swapp (group COO) and Maria Pia Buchi (managing director for the Americas) become the first non-practising lawyers to become partners, while Ian Clark in Hong Kong, Francesca Gibbons in London, Joshua Mangeot in BVI and Charles Moore and James Smith in Cayman were also promoted to the partnership. The firm also expanded its presence in Shanghai with the recruitment of corporate partner Calamus Huang and litigation partner Wenhao Han into the office.

The firm has also extended its global footprint by reinstating its physical presence in Bermuda and entering an arrangement with independently owned and controlled Jersey law firm Harneys (Jersey), allowing the firm to directly provide Jersey legal advice.

‘The past two years have been exceptionally strong for the firm. On the litigation, insolvency and restructuring side, they were the best years we have had.’
Ross Munro, Harneys

Reflective of the expansion, the firm has gone from strength to strength in terms of mandates. As Munro notes: ‘The past two years have been exceptionally strong for the firm. On the litigation, insolvency and restructuring side, they were the best years we have had. There was no slowdown in cases as clients generally needed to pursue their matters with vigour, and we saw a higher than average number of new matters.’

Work stemming from China has also enhanced the firm’s corporate practice with Hong Kong-based corporate partner Raymond Ng commenting on the increased volume of homecoming IPOs of Chinese companies seeking to list or relist in Asia. BVI-based corporate partner George Weston adds: ‘The firm set up a dedicated practice group and gave a significant marketing push that has led to a number of de-SPACs.’

While the firm can easily demonstrate its strength in traditional areas of legal practice, it is also increasingly involved in innovation and has recently been notably active in digital asset work, including advising on fund vehicles and NFTs targeting the digital asset space and increasingly handling contentious crypto work and digital asset tracing mandates.

Lawyers: 173, including 59 partners
Offices: 11 (Bermuda, BVI, Cayman, Cyprus, Hong Kong, London, Luxembourg, Montevideo, São Paulo, Shanghai, Singapore)
Global managing partner: Ross Munro (London)
Focus: Litigation, insolvency and restructuring, commercial and corporate, private wealth/trusts, investment funds, tax and regulatory, banking and finance, international arbitration
Recent standout work: Acting for an ad hoc group of bondholders in the Evergrande Group on various potential enforcement actions and a possible debt restructuring package; advising the Kaisa Group on an issuance of US dollar denominated high-yield bonds, raising a total of $3.6bn; represented Convoy Collateral in a multijurisdictional fraud claim against a former director who was alleged to have misappropriated assets at the parent company level; assisting XPeng and Chaoju Eye Care Holdings on their listings on the Hong Kong Stock Exchange, raising HK$14bn and HK$1.4bn respectively.

Maples

For Maples, 2022 is a year for celebration, with the firm recognising the 25th anniversary of its London office, the tenth anniversary of the Singapore base and the 55th anniversary of its presence in the Cayman Islands.

The group has also seen a generational shift, with the retirement of Nicholas Butcher leading to Peter Stapleton being appointed managing partner of the Dublin office. Kieran Walsh and Matthew Gardner have taken over as joint global practice group leaders for the corporate group following Edward Miller’s retirement, and the recently retired Jon Fowler has been succeeded by Michael Richardson as head of the funds global practice group. Further changes include Nick Evans being appointed head of the Jersey office and Dan Beckett relocating to Maples’ London office to expand the UK-based Cayman fund expertise.

‘We had an extremely strong year globally across the Maples Group. Almost all our core practice areas and business lines experienced significant growth.’
Jonathan Green, Maples

The firm’s Luxembourg office has also been a focal point of growth with lateral hires into the tax team, investment fund and management practice and corporate group, reflecting an increased demand for Luxembourg legal advice.

The firm has also had a successful year workwise with several departments reporting strong activity throughout 2021 and 2022. According to Jonathan Green, global managing partner, based in Cayman: ‘We had an extremely strong year globally across the Maples Group. Almost all our core practice areas and business lines experienced significant growth. Financial services was a particularly active sector followed closely by a boom in corporate, M&A and IPO activity.’

The group has also expanded its expertise in ESG transactions and sustainable finance work with recent mandates spanning green bond issuances, advising on a climate growth fund, and assisting with the issuance of blue bonds, which contribute towards marine conservation.

Lawyers: 371, including 142 partners
Offices: Nine (BVI, Cayman Islands, Dubai, Dublin, Hong Kong, Jersey, London, Luxembourg, Singapore)
Global managing partner: Jonathan Green (Cayman Islands)
Focus: Disputes, corporate, finance, funds, insolvency and corporate restructuring, insurance, IP/technology/telecoms, private equity, property/construction, regulatory/financial services, sports/media/entertainment, tax and trusts
Recent standout work: Advising GOGOX Holdings on its IPO and listing on the Hong Kong Stock Exchange; acting on the first ever SPAC to be listed in Hong Kong; advising on the first Middle East unicorn company to trade on NASDAQ; assisting NIO Inc with its listing of Class A ordinary shares on the main board of the Singapore Exchange Securities Trading Limited, making it the first Cayman Islands company to be listed on three stock exchanges.

Mourant

Mourant further added to the general sense of buoyancy across the offshore markets by setting new records for promotions in 2022, with seven new partners made up in February and 58 further global promotions in May. The partner promotions were spread across Jersey, Hong Kong and the Cayman Islands, strengthening the firm’s capabilities in funds, corporate, litigation, insolvency, regulatory, banking and finance.

The Hong Kong base, which is now ten years old, has recently been involved in an eye-catching matter advising Prenetics Group, the first Hong Kong unicorn to list on NASDAQ. A Hong Kong team led by corporate and funds partner Jessica Lee and Hong Kong managing partner Paul Christopher worked alongside Cayman-based colleagues to advise on the listing, which gave the company an enterprise value of $1.25bn, after previously advising on its merger with a special purpose acquisition company which facilitated the listing.

Elsewhere, the firm’s Jersey corporate and litigation teams have recently been busy advising Mimecast in relation to its acquisition by funds advised by Permira, a deal which valued the company at around $5.8bn and is thought to be the first time a NASDAQ listed target has been acquired using a Jersey scheme of arrangement.

Recent partner hires have included Michael Popkin, who joined the firm’s Hong Kong litigation team in April 2022 from fellow offshore firm Campbells; Ian Montgomery, who returned to the firm to head up its BVI corporate team after four years at Harneys, where he was managing partner of the BVI office; and disputes specialist Jenni Jenkins, who joined from Memery Crystal in London.

Last year the firm also took on its first inclusion manager, recruiting Jennifer Watson from Eversheds Sutherland in London to help drive a new strategy to create ‘an authentically inclusive workplace’ and lead the way among offshore firms.

Lawyers: 248, including 68 partners
Offices: Six (BVI, Cayman, Guernsey, Hong Kong, Jersey, London)
Group managing partner: Jonathan Rigby (Jersey)
Global senior partner: Jonathan Speck (Jersey)
Focus: Corporate; banking and finance; regulatory; investment funds; restructuring and insolvency; dispute resolution; and international trust and private client
Recent standout work: Providing Guernsey law advice to Sequoia Economic Infrastructure Income Fund on the refinancing of a sustainably linked £325m revolving credit facility with a margin premium linked to the ESG score; advising Astorg, a global private equity firm with €15bn assets under management, on its acquisition of IQ-EQ; advising Apex Group on the £1.51bn acquisition of Sanne, a global provider of outsourced alternative asset and corporate business services.

Ogier

The last 12 months have been a period of dramatic expansion for Ogier, with headline developments including a major merger in Ireland, 23% year-on-year headcount growth, and launches in both Singapore and Beijing.

According to the firm, all of its existing bases are expanding, with Cayman a notable standout, where the firm has seen 25% headcount growth on the back of an uptick in both contentious and transactional work. This year also saw the firm’s partnership reach the 100 mark with the hire of former King & Wood Mallesons lawyer Sophie Peat as head of its global intellectual property group.

‘We believe we can better serve our existing clients by offering Irish law expertise, and that the combined offering will be accretive to our Luxembourg offering as well.’
Edward Mackereth, Ogier

The Beijing and Singapore launches, which build on the firm’s established Asia presence across Hong Kong, Tokyo and Shanghai, were motivated in part by increasing client demand for support in Asia time zones. The Singapore launch last August was followed by the February launch of a BD-led base in Beijing, a move which makes it the first firm with a significant offshore footprint to open an office in the Chinese capital.

And in March 2022, Ogier sealed a merger with Dublin-based commercial firm Leman Solicitors – the firm’s first tie-up in 16 years.

The combined Irish practice, which now operates as Ogier Leman, has a 52-strong team led by eight partners, covering practices including corporate, real estate, dispute resolution and employment.

Global managing partner Edward Mackereth says a key driver for the merger was the significant levels of investment into Europe channelled through the Irish market: ‘We believe we can better serve our existing clients by offering Irish law expertise, and that the combined offering will be accretive to our Luxembourg offering as well – in fact the very first request for Irish law advice which came from the Ogier network came from our Luxembourg office. The asset managers, corporate service providers and finance clients we serve from Cayman, Hong Kong and the Channel Islands all have Irish-related work, so we are just joining the dots.’

Lawyers: 331, including 100 partners
Offices: Twelve (BVI, Cayman, Guernsey, Hong Kong, Ireland, Jersey, London, Luxembourg, plus representative offices in Beijing, Shanghai, Singapore and Tokyo)
Group managing partner: Edward Mackereth (Jersey)
Global senior partner: Rachael Reynolds (Cayman)
Focus: Corporate, dispute resolution, investment funds and restructuring and insolvency
Recent standout work: Acting for Invesco as adviser to the issuer on its launch of the Invesco Physical Bitcoin exchange traded notes (ETN) programme; Invesco’s first issuance of a physically backed ETN linked to cryptocurrency; acting as BVI and Cayman counsel for Beijing Deep Glint Technology on its IPO on the Shanghai Stock Exchange STAR Market; advising on one of the largest current trust restructurings in the world by value, with contentious and non-contentious teams in Cayman and Jersey submitting multibillion-dollar momentous blessing applications to Cayman and Jersey courts, co-ordinating tax advice in Switzerland and managing the tax position of US-domiciled family members.

Walkers

Walkers’ 2021 and 2022 continued the previous trends of growth at both a workload and team level, with the firm seeing its largest ever round of promotions in early 2022. In total, 47 practitioners were promoted, with 26 of those promoted to the partnership. The firm has also added resources to its regulatory teams in Asia and the Middle East and expanded its Walkers Professional Services offices with the appointment of Andrew Gibson as head of legal, while Jonathan Sheehan was made managing partner of the firm’s Ireland office in late 2021. The teams in Guernsey and London are also in the process of moving to larger premises to accommodate growing headcount, which includes David Cooney’s recruitment into the Guernsey private capital and trusts team, adding to the firm’s opportunities in the Swiss market.

Ingrid Pierce, global managing partner, says: ‘We are fortunate enough to have had another strong year. We are in an excellent position heading into the back end of 2022.’ The raft of recruitments and expansion have afforded the firm additional capacity for instructions in its cornerstone practices of corporate and finance, investment funds, insolvency and dispute resolution. Beyond the cross-firm growth in its key specialist fields, specific offices and practice areas have also seen notable activity. Pierce adds: ‘Our CLO practice and the re-emerging European CMBS space in Ireland have been key areas in the last 12 months, along with our Cayman Islands investment funds, corporate, private capital and regulatory teams and our London and Jersey finance practices as well as the Channel Islands investment funds and corporate groups.’

‘We are fortunate enough to have had another strong year. We are in an excellent position heading into the back end of 2022.’
Ingrid Pierce, Walkers

The global nature of the firm’s work has also benefited from the new presence of Bermuda-registered associates in the firm’s Hong Kong and Singapore offices, enhancing the capacity for Caribbean advice in the European and APAC time zones beyond the already existing BVI and Cayman expertise.

The Walkers Professional Services offering has also had a notable year, expanding into the BVI market and launching myriad compliance products, specifically relating to AML and ATF compliance.

Lawyers: 445, including 139 partners
Offices: Ten (Bermuda, BVI, Cayman, Dubai, Hong Kong, Guernsey, Ireland, Jersey, London, Singapore)
Global managing partner: Ingrid Pierce (Cayman)
Focus: Banking and finance, corporate, funds, insolvency and dispute resolution, listing services, private capital and trusts, private equity, real estate, regulatory and compliance, re/insurance, structured products/capital markets and taxation (Ireland).
Recent standout work: Advising crypto financial services company BlockFi on its Class F Digital Assets Business Licence for its Bermuda subsidiary; acting for Queen’s Gambit Growth Capital on its combination with Swvl; assisting Athene Holding on the Bermuda law aspects of its merger under Apollo Global Management; acting for Pfizer on its proposed $11.6bn acquisition of Biohaven Pharmaceuticals. LB

The post Ports in a storm – the offshore leaders thriving in turbulent times appeared first on Legal Business.

In our 2021 offshore report, law firm pundits placed their bets on the market drivers they predicted would define the coming year. Notwithstanding some unsurprising volatility, the outlook has proved far brighter than many had dared to hope.

‘There was a sense that revenues were going to drop last year, the courts were going to close and strategic decisions would go on hold’, says Jason Romer, group managing partner of Collas Crill, ‘but that never happened. Revenues have continued to increase, the costs are down and we continue to get busier.’

In numerous discussions with partners across the self-governing islands of the British Crown – the Bailiwicks of Guernsey and Jersey, and the Isle of Man, also known as the Crown Dependencies – many echoed the sentiments of Romer. Musing on the Guernsey and Jersey market, he asserts: ‘The offshore legal sector has been fortunate to buck the overall economic trend and our islands have been incredibly resilient throughout Covid-19.’

‘There was a sense that revenues were going to drop last year, the courts were going to close and strategic decisions would go on hold but that never happened.’
Jason Romer, Collas Crill

Indeed, not all trends were unforeseen, with litigation accounting for a significant share of firms’ billable hours, as had been broadly predicted last year.

As Stephen Baker, senior partner of Baker & Partners, notes: ‘Commercial and trusts litigation continues to go from strength to strength in Jersey.’ Meanwhile, specialist litigation and dispute resolution firms are not the only ones who have been kept busy with contentious matters. Ogier’s global managing partner, Edward Mackereth, concurs: ‘In the Channel Islands, we have seen a range of disputes, a number of breaches of director duty claims and proceeds of crime work, which results in civil action against the bank, acting for both banks and customers.’

Elsewhere in the Guernsey and Jersey markets, Tim Pearce, global managing partner of Bedell Cristin, believes that people are generally more confident in the market returning to relative normality. This growing bullishness is reflected in the private equity sector, as the firm recently advised JT Group, the Jersey-based global telecommunications company, on an agreed sale of a majority stake in its Internet of Things (IoT) division to Perwyn, an international private and growth equity investor.

Special purpose acquisition company (SPAC) transactions are also on the rise, with Ogier’s Guernsey team advising Disruptive Capital Acquisition Company on its £125m listing, the first SPAC on Euronext Amsterdam to be listed and traded in pounds sterling. Mackereth is sanguine: ‘The US SPAC market is slowing but growing steadily in Europe, and we expect to see an increasing number of SPACs headed to Guernsey in the short term – the jurisdiction has the right flexible corporate and regulatory framework for SPAC launches. The only difficulty we see is the market’s general ability to cope with the volume of new vehicles.’

New tricks

Elsewhere, Maples’ corporate, finance, and funds and investment management practices in Jersey acted on the migration of an investment fund structured as a foreign limited partnership into Jersey. ‘The transaction, being the first of its type following the introduction of a statutory regime to permit such migrations in mid-2020, also involved the migration of the fund’s general partner, as well as the, registration of the fund as a Jersey private fund,’ says Nick Evans, head of office at Maples in Jersey.

Meanwhile, of the private wealth sector, Romer observes: ‘many have stopped, reflected, and assessed their personal affairs. There has been a spike in instructions relating to wills, lasting powers of attorney, post-nuptial agreements, reassessing and consolidating trust and company structures and advising on new private trust companies.’ To keep up with the increasing demand in this area, Bedell Cristin recently strengthened its Guernsey international private client team with the recruitment of Elena Gogh as a partner.

‘With the world being more flexible, many are taking the opportunity to live elsewhere. The focus has therefore been to make the jurisdictions more suitable for people to live and work.’
Tim Pearce, Bedell Cristin

While Collas Crill and Bedell Cristin have experienced an increasing workflow in the private wealth sector, John Rimmer, sole practitioner of private client boutique Advocate John Rimmer, has seen a continued decline in outsourcing legal work to law firms in this area, with trust companies, ever-expanding with private equity ownership, tending to use in-house lawyers. Rimmer asserts: ‘Larger firms are probably thriving more strongly. I suspect that this is because they are able to spread the basic costs of doing business more widely.’

Rimmer’s observations resonate with many: ‘It is likely all major offshore firms will survive. They have broad practices and either own their own financial services businesses such as trust and corporate service providers or fund administrators or have the closest of connections to such businesses. They are part and parcel of the offshore financial services industry which thrives.’

Elsewhere, the Channel Islands property market continues to boom, as evidenced by Jason Morgan, head of Carey Olsen’s property group in Guernsey, in the firm’s recent article on the surge in activity and increase in the number of sales across the local and open markets.

Romer similarly notes: ‘In Guernsey, nearly £1bn worth of property changed hands in 2021, the highest value conveyed since statistics were recorded. I’d estimate it to be over a third more for freehold transactions alone in Jersey.’

Bedell Cristin’s Pearce observes that there has been an increased trend towards relocation, specifically to Guernsey and Jersey. ‘People are thinking long-term. They do not need to be at their desk in London. With the world being more flexible, many are taking the opportunity to live elsewhere. This has resulted in more homes being built, an increased demand for commercial property and for local business services. The focus has therefore been to make the jurisdictions more suitable for people to live and work.’

This development will ignite further interest in other areas. An extension of Guernsey’s discrimination law is set to take place this year. The first tranche will provide protection against discrimination on the grounds of race, disability, carer status, sexual orientation, and religious belief.

Elsewhere, many bemoan an absence of restructurings and insolvencies. ‘In terms of what’s quieter, it’s fair to say that everyone expected a wave of insolvencies, but this hasn’t happened yet. We’re anticipating it in the year ahead and are starting to see Asian insolvencies coming out of China due to the debt crisis there,’ Collas Crill’s Romer asserts, adding that the cessation of government-backed financial support in different parts of the world will further increase the number of such mandates, not just for offshore firms, but globally.

Weathering the storm

Many are alive to the threat of global economic hardship and the collapse of certain industries, with offshore firms expecting further trials and tribulations along the way. ‘This is inevitable and part and parcel of practice offshore. It is always easy to blame a neighbour or someone outside your own jurisdiction for economic hardship or other woes. A challenge for offshore firms is to keep the debate properly informed,’ says Baker.

‘Given the continued strength and resilience of the finance sector both Guernsey and Jersey are in much stronger positions than we’re seeing in other jurisdictions across the globe.’
Edward Mackereth, Ogier

Pearce adds: ‘If you have multiple jurisdictions and multiple business lines, you will do well and you can weather the storm. If litigation is down, corporate will be up and vice versa. It is rare that they will be performing at the same level at the same time, and that is the beauty of having a full-service law firm. You also need an appetite for change and willingness to embrace the changes we have been forced to implement.’

Initially of course, there was no option but to work remotely and spend more time at our computer screens, inevitably changing our traditional method of interaction. This has had its advantages, from eliminating travel times and costs to an improved work-life balance. While many firms continue to embrace these changes there will inevitably be a need to reintroduce more traditional modes of operating.

Says Mackereth: ‘One of the main challenges of this period is the fact that we’ve been busier than ever from a workflow perspective, while continuing to deal with dislocation of people during the pandemic, so looking after the wellbeing of our existing employee base and integrating new joiners who may have been working almost entirely remotely has been a big focus.’

Romer identifies a drawback in the dislocation of potential new joiners: ‘There’s a squeeze globally on professionals and real competition to attract top talent, with onshore firms having a similar challenge, and restrictions on travel have hampered progress for lawyers considering relocation to an offshore jurisdiction.’

Rimmer notes another downside: ‘The greatest problems arising from the pandemic have been the difficulty in holding personal, face-to-face, meetings with clients. These are most important when dealing with private clients.’

Romer raises the age-old issue: ‘Technology is also key to the client experience – firms need to be investing in their systems and processes, this isn’t something that can be kicked down the road. Clients expect a slick service, automated processes and protection in terms of cyber security. But it’s not just about meeting growing client demands and expectations – it’s also about helping the whole firm work more effectively and, through automation and smoother processes, freeing people up to focus on more rewarding, value-add work.’

Mackereth says things could be worse: ‘Both local economies are recovering, with Guernsey quicker to bounce back to 2019 levels of growth. Given the continued strength and resilience of the finance sector (the central pillar of both jurisdictions’ economies) both Guernsey and Jersey are in much stronger positions than we’re seeing in other jurisdictions across the globe.’

However, Guernsey’s hospitality and transport industries witnessed the biggest financial impact, as well as retail, and firms are starting to see restructurings in these sectors. The financial services sector only shrank by 2%, while neighbour Jersey contracted by 9% in the same period. Furthermore, ‘there is a thriving jobs market in both Guernsey and Jersey at the moment which should hopefully draw more talent to the islands as we emerge into this phase of de-escalation of lockdown restrictions’, notes Mackereth.

‘Jersey has been widely promoted as an alternative jurisdiction solution for US CLO issuers that are looking to market new deals to Europe.’
Nick Evans, Maples

Rimmer also provides an upbeat view on the Manx economy. ‘Most of the population of the Isle of Man remains comfortable and young people are thriving compared with their peers in other places. The businesses driving this success have changed, moving away from the financial sector, and into tech, biomedical and online trading businesses.’ Following two years of struggle, the tourism and hospitality sectors will deservingly benefit from The Isle of Man TT event, the island’s annual motorcycle racing event, set to take place in May and June this year.

Horizon scanning

There is little doubt that the last two years have been turbulent. It does, however, feel that many are beginning to see the light at the end of the tunnel. ‘Firms with the ability and vision to evolve their business strategy will thrive. Business planning cannot remain static, particularly in turbulent times. Thriving firms will have strong leadership and focus,’ asserts Baker.

Some challenges are more localised. Says Pearce: ‘The main challenge, which has been accentuated by the pandemic, is keeping the business afloat. Every business needs to plan for the worst. One area of difficulty continues to be people paying their bills late, meaning you must have a keen eye on prudent cash management in the business. As we return to normal, people will start paying their debts quicker and we will return to a more normalised cycle.’

Nevertheless, it is fair to say that fresh, business-critical challenges are never too far away.

Pearce speaks to the now ubiquitous theme of environmental, social and governance: ‘ESG has never been off the agenda. People think it is a new phenomenon, however, it is simply an extension of what firms have been doing for some time. It embraces the corporate and social responsibilities we have been taking and making sure whatever we do is good for the environment and society. It has become mainstream, and people are starting to understand it more.’

ESG is increasingly becoming part of the narrative and offshore firms have been active in relaying this message to their clients. According to Evans, Maples has been ‘working with investment managers and institutional investors in Europe, America and Asia to help implement ESG policies and frameworks into their various fund and other operational infrastructures.’

Mackereth agrees: ‘One of the challenges for law firms is the knowledge gap on sustainability advising – lawyers now need to be in a position to spot and advise on issues relating to climate change and ESG. Therefore, we have also focused heavily on delivering ESG training and knowhow to lawyers. This doesn’t make them ESG experts overnight, but it does help build expertise over time, and we’ve seen how beneficial it is to clients when our lawyers are not just technical specialists but also knowledgeable in sustainable investing and finance.’

It feels inevitable that changes relating to Brexit and its impact on the offshore legal community will continue to make the worry-lists of law firm decision-makers.

‘The UK is already launching consultations to reform areas of UK regulation, in respect of asset-holding structures and funds where typically an offshore structure would have been used,’ notes Romer. He also speaks to more universal challenges: ‘Leaders and management teams will also have a keen eye on the rising cost of doing business at the moment, irrespective of their sector – inflationary pressures, cost of living, supply chain disruption brought on by Covid and Brexit, record-high energy prices and so on. All firms should be factoring these into their budgets and forecasts right now, and we’re no exception.’

In Jersey, Evans acknowledges the increased interest in the jurisdiction from arrangers and managers of structured finance products and expects the Jersey securitisation market to continue to thrive throughout 2022. ‘In particular, Jersey has been widely promoted as an alternative jurisdiction solution for US CLO issuers that are looking to market new deals to Europe,’ he says.

Mackereth looks to the bigger picture. ‘The year 2022 could well be an inflexion year for geopolitics. With questions waiting to be answered in relation to relationships between the west and both Russia and China, to the shape of US policy abroad, to what Britain’s longer-term relationship with Europe might look like, as well as whether the global economy has entered a new sustained inflationary phase and, if so, how that impacts political activity.’

Whatever the concerns since Covid struck, most are in agreement that firms in the Crown Dependencies have rebounded admirably and are preparing themselves for what they hope will be a vibrant year.

Notes Romer: ‘I’m convinced that law firm partners will emerge from the pandemic as more empathetic leaders which will be a good thing for the profession as a whole. Great leadership isn’t just about providing excellent client service and managing operations, it’s about helping, guiding, and inspiring people, being mentors, coaches and confidantes. Covid has reinforced that we don’t lead for ourselves, but for each and every individual who wants to follow – every partner and leader must strive to live by this, and the pandemic has given us all plenty of opportunity to practice.’

Mackereth concludes: ‘change is afoot. It will come with both opportunity and risk, and we need to be ready for both.’ LB

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Driven by different dynamics, the Cayman Islands, the British Virgin Islands (BVI) and Bermuda have each experienced their own problems in the Covid era – much like the rest of the world – but collectively and individually these sophisticated legal jurisdictions have continued to fare well. Driven by experienced and talented lawyers, strong commercial nous and a well-honed judicial system, the leading global players in the Caribbean can take whatever is thrown at them.

As all jurisdictions were forced to adapt quickly to the coronavirus pandemic, the Caribbean was no exception, with working from home and reduced contact due to social distancing swiftly becoming the norm. The climate has not been without its challenges as multiple lockdowns forced local businesses to suffer and caused substantial disruption to many in the hospitality sector. Indeed, the region’s once-thriving tourism industry continues to stall as travel levels remain low compared to pre-pandemic times – an inevitable blow for Bermuda, the BVI and Cayman – given their significant reliance on international cash injections into the local economy.

However, there is a guarded sense of optimism as offshore firms enter into 2022, with law firms such as Conyers expecting to see local business come back with a bang. ‘With financial services and tourism being core industries, in each of Bermuda, the British Virgin Islands and the Cayman Islands, there is a significant reliance on international business in the local economy. We fully expect the local industries to rebound once the pandemic dissipates,’ says Christian Luthi, chair of Conyers.

‘We fully expect the local industries to rebound once the pandemic dissipates.’
Christian Luthi, Conyers

The vital signs are all there, with the British Virgin Islands already having experienced an increase in visitors, particularly for those on sailing holidays, while in Bermuda, the government has enjoyed the continued success of its ‘digital nomads’ programme, one-year work-from-Bermuda permits, which allows workers and students to work remotely from Bermuda for a year. The venture has seen some 900 relocations to the island in 2021 and is now being rolled over for an additional year.

Similarly, in the Cayman Islands, the government extended its global citizen programme – launched in 2020 – until November 2024, allowing eligible professionals and their families to live and work remotely from the island for up to 24 months. These resourceful initiatives have doubtless been instrumental in lessening the financial shock of the pandemic and hastening economic recovery.

Show of strength

Whatever reversals the pandemic may have wrought, firms in the Caribbean’s offshore markets have behaved true to form, proving resilient amid high levels of deal activity across the board.

Luthi is sanguine: ‘2021 was a good year for Conyers, and for the offshore legal market generally. Despite the disruption of Covid, all of our offices experienced growth.’

Ingrid Pierce, global managing partner of Walkers, asserts: ‘Firms that have adaptable operating styles, are responsive to client demands and have the established technology infrastructure to work in an agile way can grow and develop their businesses. Those with globally integrated corporate and fiduciary businesses have done well. Clients are global and need global solutions with all aspects of their business.’

She adds: ‘We have never been busier across our Bermuda, BVI and Cayman offices. Deal flow hasn’t stopped at all over the past 12 to 18 months.’

Luthi strikes a similar note: ‘Law firms that are well diversified, both in terms of their range of practices as well as their jurisdictional offering, and exposure to different markets, have fared well. This diversity not only facilitates cross-border business and investments, which is key to offshore firms, but it also limits exposure and reliance on any one market or particular practice.’

Indeed, as increased levels of regulation and compliance requirements across the globe make themselves felt, firms with a broad global footprint are proving better able to effectively handle these issues directly.

Notes Pierce: ‘Our regulatory and risk advisory practice has seen significant global growth. It comprises 20+ dedicated regulatory lawyers in total across the Americas, Asia and Europe offering specialist regulatory advice throughout our jurisdictions. The size of the team enables Walkers to effectively and efficiently handle large, urgent and highly complex matters. As regulation increases and becomes more complex, the firm’s ability to handle such matters becomes ever more important.’

Throughout 2021, the cryptocurrency market experienced a record year, with digital assets like non-fungible tokens (NFTs) surging in popularity. This global trend infiltrated all markets and with the financial services industry being a core area of focus for the Caribbean islands, it is unsurprising that law firms saw significant growth in the fintech space. Pierce observes: ‘Bermuda is emerging as a fintech hub and, with that, we are seeing more innovative financial products and services, including NFTs and tokenised funds. We have noted a lot of interest in the digital asset space for different types of segregated vehicles; we expect this trend to continue.’

Luthi agrees: ‘We saw an increase in fund enquires for Bermuda fund launches after a relatively quiet few years. The activity was particularly strong in the crypto space using fund structures to invest in blockchain technology.’

The ubiquitous special purpose acquisition company (SPAC) trend has also taken hold, although how long the boom is likely to last is hard to say.

In spite of gloomy predictions of that market going bust, local firms have continued to see a significant share of SPAC work, with the Cayman Islands being the domicile of choice for around one third of all SPACs globally.

Global managing partner of the Maples Group, Jonathan Green, says: ‘SPACs continue to be a predominant source of work for our corporate teams globally and particularly in the Cayman and BVI practices. This has been an extremely strong area for us.’

‘There has been a significant increase in SPAC IPOs from 56 SPAC IPOs globally in 2019 to more than 500 in 2021,’ adds Luthi. ‘Conyers’ BVI and Cayman offices acted on a number of significant SPAC IPOs in 2021, notably advising ALSP Orchid Acquisition Corp I on its $172.5m IPO on the Nasdaq Global Market,’ Luthi says.

Pierce observes that the Cayman Islands continues to see a significant share of SPACs, ‘appearing as domicile of choice for around one third of all SPACs globally. There is now a lot of work on the deSPAC side – M&A deals and downstream transactions’.

M&A has universally prevailed as a key market driver for offshore firms as well as globally. Luthi points to a list of standout mandates: in BVI the $2bn business combination of Perimeter Solutions and EverArc, and the $860m business combination of APWireless and Landscape Acquisition; in Bermuda, advising Moody’s Corporation on its $2bn bid to acquire RMS, the leading global provider of climate and natural disaster risk modelling and analytics.

The Cayman Islands team advised lithium metal battery supplier SES Holdings on its $3.6bn proposed business combination with NYSE-listed SPAC Ivanhoe Capital Acquisition Corp and Deep Green on its $2.9bn proposed business combination with Sustainable Opportunities Acquisition Corporation. Meanwhile, in Hong Kong, the firm advised electric vehicle company Faraday Future on its $1bn merger with Property Solutions Acquisition Corp, with proceeds from the deal expected to fully finance the launch of the flagship FF 91 production vehicle into the market, realising Faraday’s vision to help drivers and stockholders contribute to the greening of motoring.

Elsewhere, the insurance industry experienced significant M&A activity, with Conyers acting for large US healthcare systems on the amalgamations of their insurance subsidies in the Cayman Islands. Over the last 12 months the insurance industry has been generally busy, with firm leaders noticing an increased demand for debt products.

In Bermuda, Walkers’ Pierce observes: ‘We also saw a noticeable increase in demand for debt products across certain industries. Most notably, in reinsurance, where a number of asset managers – whose investment focus is in insurance-linked securities or collateralised reinsurance – found themselves seeking alternative sources of capital and using debt to help fund renewals in this space.’

‘We have never been busier across our Bermuda, BVI and Cayman offices. Deal flow hasn’t stopped at all over the past 12 to 18 months.’
Ingrid Pierce, Walkers

Conyers advised Sirius International Insurance Group on its merger with Third Point Reinsurance to create a $3.3bn company, SiriusPoint. In addition to direct Bermuda M&A, it saw many non-Bermuda insurance groups around the world being acquired through new Bermuda holding companies, and the firm was involved in several of these transactions.

The pandemic has been unpredictable, and it continues to be so with the cruise ship sector in Bermuda surprisingly materialising as one of Conyers’ busiest focus areas within ship financing – it has advised Viking Cruises on a $700m two-part unsecured, secured notes offering with $350m aggregate principal amount of 7% senior notes due in 2029.

According to Pierce, the region has proven to be ‘robust and flexible’ in response to challenges faced by the cruise ship industry, ‘with more than $15bn in debt and equity raised by key operators through capital market issuances and by Bermuda issuers, with many of the issuances listed on the Bermuda Stock Exchange (BSX)’. She further anticipates that the BSX will ‘serve as a preferred exchange for future debt and equity listings by the industry’. Firms have also seen the return of aircraft asset-backed security (ABS) deals sooner than expected; the aviation industry was another sector hit hard by the pandemic, but its recovery has seen Maples assisting Stonepeak, a leading alternative investment firm, in its inaugural aircraft loan securitisation transaction, SALT 2021-1 – an industry first – as well as Sky Leasing’s debut ABS transaction. Pierce predicts that this trend will continue, with a number of deals already in the pipeline for first quarter 2022 issuances.

Firms in the Cayman Islands continue to see increased activity in corporate insolvency and restructuring work, with no signs of this slowing down in 2022. This is partly due to the impact of the pandemic but also the highly anticipated reforms to the insolvency legislation that are expected to come into force later this year. For distressed companies, the amendments to Part V of the Companies Act specify a new restructuring regime that abandons the prerequisite of presenting a winding-up petition. The reforms are potentially good news for such companies, as winding-up petitions were thought to have adverse reputational or commercial consequences. In addition, Pierce notes that other key benefits include ‘the immediate statutory and worldwide moratorium which will take effect on the filing of the application seeking the appointment of restructuring officers with the Grand Court, similar to a US Chapter 11 or UK administration stay’, therefore increasing the enforcement of Cayman’s restructuring regime in other jurisdictions.

In the British Virgin Islands there is a similar winding-up process, but in situations where this may not be appropriate, Pierce observes that a significant development over the past year was the placing of injunctions in support of claims overseas on a statutory basis. ‘We have already seen these provisions being successfully used to obtain injunctions and expect this to continue to be a feature in 2022,’ she says.

Conyers’ BVI office has already ‘seen a steady upturn in applications to the courts to enforce overseas judgments and arbitral awards, as well as interim applications connected to fraud and asset tracing’. From a litigation perspective, Luthi notes ‘an increase in matters involving licensed segregated accounts companies’ in Bermuda, and more generally, cases concerning trust litigation, insolvency issues and regulatory matters.

Futureproofing

Issues of climate change and sustainability are at the forefront of everyone’s minds following COP26, with environmental, social, and governance (ESG) concerns ‘becoming an increasingly important and integral part of the conversation between managers and investors’, observes Green. ‘We are currently working with leading investment managers and institutional investors in Europe, America and Asia to help implement ESG policies and frameworks into their various fund and other operational infrastructures,’ he says. ‘This provides us with a 360-degree perspective as to how industry leaders are approaching ESG. In many offices we are now recognised as industry leaders and we expect this area to continue to grow strongly over the coming years.’

In September 2021, the Cayman Islands government announced a new climate growth fund in collaboration with the Commonwealth Enterprise and Investment Council – Maples’ Cayman funds and investment management team is advising on this initiative that focuses on businesses and technologies that deliver climate mitigation and adaptation throughout the 54 Commonwealth countries.

ESG has become such a crucial area of consideration that, according to Pierce, it is ‘steering business decisions in a way never before seen as the market increasingly sees both reputational and financial dimensions to ESG risk’. She continues: ‘The growth in investor demand for ESG product offerings, coupled with a global societal push to implement measures to promote sustainable finance, has focused the minds of institutions and legislators alike to ensure that deals, funds, platforms and products are available that strive for returns measured by both monetary and societal KPIs.’

‘SPACs continue to be a predominant source of work for our corporate teams globally and particularly in the Cayman and BVI practices. This has been an extremely strong area for us.’
Jonathan Green, Maples Group

Walkers has advised MPower Partners on the launch of MPower Partners Funds, Japan’s first ESG-focused global venture capital fund, but beyond this, the firm has made internal transformations to further its agenda through its Walkers’ Eco Warriors committee. The initiative focuses on environmental and sustainability issues ‘dedicated to identifying and implementing strategies to reduce our carbon footprint and eliminate any unnecessary waste’. For Conyers, its Bermuda office has seen the consideration of climate change for funds in the insurance-linked securities space. Luthi notes: ‘Bermuda has been positioning itself at the forefront in this market and as such, insurance-linked securities are already recognised by the United Nations as a sustainable development investment class.’

Looking ahead, the Caribbean offshore market faces other issues beyond the pandemic. In addition to environmental considerations remaining a top priority for firms, the Cayman Islands is currently on the EU’s grey list which is under review by the European Council and European Parliament. A potential EU AML listing would result in greater due diligence on transactions involving the region and establish new securitisation vehicles that will create further regulatory questions for clients. Furthermore, at the end of 2021, the OECD introduced rules ‘to assist with the implementation of a landmark reform to the international tax system, which will ensure multinational enterprises (MNEs) will be subject to a minimum 15% tax rate from 2023’.

However, despite the political and economic headwinds thrown at Caribbean firms like the tropical storms that frequently hit the region, ‘business as usual’ is the mantra that keeps coming from management figures at the key offshore firms. Adaptability is key and these nimble outfits are well versed in handling adversity, even Covid.

Luthi sums up the mood: ‘Offshore jurisdictions have a substantial role to play in asset management, financial services, transportation and insurance markets. While it is too early to assess the potential implications, we are confident that offshore financial centres will remain relevant and will continue to adapt and grow for many years to come’. LB

The post Caribbean Offshore Report: The vital signs appeared first on Legal Business.

In what will undoubtedly be remembered as an unpredictable year in more ways than one, offshore firms across the globe leveraged their resilience and diverse practice offerings to weather the storm that 2020 brought. The US-China trade wars and the uncertainty around the EU/UK divorce gave way to the devastation of the global coronavirus pandemic, plummeting oil prices and markets in freefall, and the final throes of Brexit negotiations.

However, the offshore legal sector seemingly managed to duck every blow and avoid every collapse, with 2020 and early 2021 proving to be highly successful years across the offshore market. For Edward Mackereth, global managing partner of Ogier, ‘unprecedented was the word of 2020’, while Christian Luthi, chair of Conyers, states: ‘2020/21 has certainly tested the adaptability of the firm, and Conyers has come through extremely well’. Jonathan Green, global managing partner of Maples, adds: ‘2020 and early 2021 have been very active periods for us, setting new high-water marks in many of our practice areas. Our global teams have delivered without missing a beat, pandemic notwithstanding.’

The all-encompassing nature of the pandemic had a notable impact across the full breadth of practice areas, with almost all teams seeing notable shifts in the nature of work being handled. According to Jonathan Rigby, global managing partner at Mourant, the equity capital markets arena was particularly affected: ‘Equity capital markets faced a tumultuous 2020, although we’re expecting IPO levels to pick up this year as vaccination programmes reach critical mass, driving a recovery in corporate earnings and share prices. We also saw an uptick in private equity M&A through the second half of 2020 and expect to see that sustained throughout 2021.’

‘As acquisition activity intensified in the latter part of 2020 and early 2021, there followed a significant uptick in the number of “new money” deals.’
Ingrid Pierce, Walkers

The stratospheric levels of private wealth held offshore, and the related legal market, was seemingly the least affected. As Rigby explains: ‘It would be overstating it to say that the market has been redefined by the pandemic, though there has been some impact. We have seen a noticeable increase in clients’ awareness of their own mortality, which has led to a focus on estate and wealth planning arrangements.’

Funds practices and debt teams also thrived in 2020. Ingrid Pierce, Walkers’ global managing partner, comments: ‘The rush to access liquidity during the early stages of the pandemic was closely followed by a wave of debt restructurings as market participants across multiple sectors sought to traverse the economic turmoil. In particular, our investment funds and debt capital markets team have been extremely busy. However, as acquisition activity intensified in the latter part of 2020 and early 2021, there followed a significant uptick in the number of “new money” deals, with clients utilising debt financing to take advantage of investment opportunities.’

Asia also remains a highly active region for firms with offices there. According to group managing partner at Collas Crill, Jason Romer: ‘In Cayman, we have seen a lot of restructuring work come out of Asia in the form of squeeze-out mergers and creditor-driven restructurings’.

Rigby continues: ‘The fact that the Asia-Pacific region has grown from 10% of global private equity assets under management in 2010 to 25% in 2020 is testament to the fast pace at which the region has evolved over the past decade and the future opportunities of doing business there’.

Peter Tarn, Harneys’ chair also notes: ‘The IPO market has remained especially hot in Asia and we expect homecoming listings of China concept stocks to continue.’ While Pierce concludes: ‘The majority of our clients in Asia-Pacific remain largely unaffected with a robust pipeline of business requiring offshore legal advice’.

‘If ever there was going to be a decade of regulatory work, this is the decade.’
Ed Mackereth, Ogier

Looking at future predictions for the offshore legal sector in the post-pandemic cycle, Mackereth suggests: ‘There will be significant opportunities in the contentious world with an uptick in insolvencies, a sharp increase in solutions involving restructurings and shareholder disputes stemming from lost value.’

And looking beyond Covid-19? ‘If ever there was going to be a decade of regulatory work, this is the decade,’ Mackereth contends. ‘I predict a steady increase in the amount of complexity of regulation throughout the financial world, interspersed with periods of significantly sharper increases in regulatory burdens, and that will play out in how we advise and help our clients navigate their markets.’

Below are snapshots of the ten largest offshore firms in 2021 and an analysis of how they fared over a unique year.

***

Appleby

Lawyers: 184, including 70 partners
Offices: Ten (Bermuda, BVI, Cayman Islands, Guernsey, Hong Kong, Isle of Man, Jersey, Mauritius, Seychelles, Shanghai)
Group managing partner: Malcolm Moller (Mauritius)
Focus: Corporate, dispute resolution, private client/trusts, property, technology and innovation, and regulatory
Recent standout work: Acting as Cayman counsel for AMTD International on the secondary listing of its class A ordinary shares on the main board of the Singapore Exchange; acting for the joint administrators on the administrations of Monsoon and Accessorize

With a substantial presence across the global offshore market including offices in all three Crown Dependencies, Appleby has been notably active with corporate and dispute resolution work, with financial services mandates, M&A and insolvency work being particularly busy. The firm is particularly recognised for its strength in advising finance sector clients, with notable expertise across banking, finance, insurance and regulatory matters.

In team news, the firm’s Bermuda office expanded its compliance offering with the return of Jarion Richardson, a specialist compliance adviser, who previously served as compliance manager between 2012 and 2016, and the firm also saw a raft of partner and of counsel promotions across its Caribbean offices and Jersey base.

Firm group managing partner Malcolm Moller continues to lead the firm from its base in Mauritius, and the firm also has key expertise in Asia with practitioners in Hong Kong and Shanghai. The firm also added to its network in early 2020 with the establishment of its office in The Seychelles.

The firm leverages its Appleby Global Services offering, which celebrated its second year in 2020; the specialist corporate and trust services provider assists clients, including high-net-worth individuals and multinational corporates, with administration, reporting and fiduciary services mandates.

Bedell Cristin

Lawyers: 82, including 32 partners
Offices: Six (BVI, Cayman, Guernsey, Jersey, London, Singapore)
Group managing partner: Tim Pearce (Jersey)
Focus: Banking and finance, corporate and commercial, employment, funds, insolvency and restructuring, international private client, litigation, pensions, regulatory and compliance, wills and probate
Recent standout work: Acting for Atlantic Leaf Properties on its £152m acquisition by South Downs Investment, a wholly-owned subsidiary of investment funds managed by Apollo Global Management, by means of a members’ scheme of arrangement; acting for Tullow Oil on its offering of $1.8bn senior secured notes and $600m super senior revolving credit facility; acting for Ocorian on its acquisition of Platinum Compliance; acting as lead counsel for the vendor shareholders in the sale of Robus Group to Ardonagh Group

Bedell Cristin was one firm to lead the way in terms of conduct and protocol innovations amid the jostle to seamlessly adjust to the nascent world of virtual court proceedings arising from Covid-19. As far back as early 2020, Jersey’s managing partner David Cadin and commercial litigation partner Edward Drummond were early adopters of virtual affidavits, which in turn became the mechanism du jour for the Bailiff of Jersey and competitor firms.

Bedell’s Jersey dispute resolution bench also enjoyed a period of growth, having hired Robert Christie from Dickinson Gleeson, whose reputation for trust litigation continues to expand. In the BVI, the commercial and insolvency offering was bolstered by numerous hires and promotions, including Lisa Walmisley becoming partner. In Singapore, Joanne Verbiesen, an experienced private wealth partner, joined from a leading international bank.

Cayman is also a growth jurisdiction; early 2021 saw the relocation to larger offices in order to facilitate a growing team. Tim Pearce, global managing partner, notes: ‘Our presence in Cayman is a key part of our international strategy and has enabled us to broaden our reach within key markets where our clients do business, particularly those in Asia and the Middle East who are especially familiar with using Cayman structures. The move to these new premises is the next step in our international growth plan and underpins our long-term investment in Cayman.’

The onset of Covid-19 proved not to be a hindrance to breaking ground in innovative, zeitgeist sectors; Jersey’s desk secured high-profile fundraising mandates in the medicinal cannabis sector. And given Bermuda’s ongoing push for liberalisation (encompassed by the tabled Bermuda Cannabis Licensing Act 2020), it is possible that the firm might leverage this knowledge in the Caribbean going forward, despite a modest yet growing presence in the region.

Carey Olsen

Lawyers: 265, including 59 partners
Offices: Nine (Bermuda, BVI, Cape Town, Cayman, Guernsey, Hong Kong, Jersey, London, Singapore)
Group managing partner: Alex Ohlsson
Global senior partner: John Kelleher (Jersey)
Focus: Banking and finance, corporate and commercial, investment funds and private equity, TISE listings, dispute resolution, trusts/private wealth, property, employment and insurance
Recent standout work: Acting for the creditors of PizzaExpress Group on its £1.1bn debt-for-equity restructuring; advising the Government of Jersey, the States of Guernsey and the Isle of Man government on the establishment of the Crown Dependencies’ £140m Covid-19 business interruption loan guarantee schemes; acting for the debt holders in Luckin Coffee’s restructuring; advised Nordic Capital on the launch of Nordic Capital Fund X, which held a €6.1bn close in less than six months

Responding to increasing demand for fraud, asset tracing and shareholder litigation, Carey Olsen’s long-term strategy seeks to bolster the dispute resolution partner bench in the Caribbean. Indicatively, the BVI office welcomed esteemed QC Alex Hall Taylor, while Tim Wright came full circle, rejoining the team after an 18-month stint heading Bedell Cristin’s outfit.

Steven Rees Davies from Appleby is a notable addition to the fairly young Bermuda office. His strong technology practice adds another dimension to the corporate and commercial offering, which now stands at four partners from zero less than four years ago.

‘Jersey and Guernsey are being used for increasingly sophisticated corporate transactions.’
Alex Ohlsson, Carey Olsen

Asia is also a key growth region, following a clear market trend for global offshore firms. ‘We were one of the later firms to start (in Asia), but the practice is growing pretty rapidly on both the corporate and litigation side, both in Hong Kong and Singapore,’ according to managing partner Alex Ohlsson.

One region where Carey Olsen maintains clear market dominance is the Channel Islands. ‘Jersey and Guernsey are being used for increasingly sophisticated corporate transactions,’ notes Ohlsson. ‘The financial services sector has been very strong, particularly investment funds, so we continue to grow in those areas.’

The firm not only sustained positive growth in headcount and annual turnover, but also secured prolific work arising from the pandemic, most notably on the Crown Dependencies’ revolving credit facilities to finance their successful business remedies.

If nothing else, the fact that four branches – Bermuda, BVI, Singapore and Hong Kong – relocated to larger premises throughout 2020/21 represents healthy growth in the face of pandemic pressures.

‘The team has been fantastic,’ reflects Jersey investment funds co-head James Mulholland. ‘And that’s not just our fee-earners but support staff too. They’ve all pulled through to make Carey Olsen really thrive in what have been challenging conditions.’

Collas Crill

Lawyers: 79, including 37 partners
Offices: Five (BVI, Cayman, Guernsey, Jersey, London)
Group managing partner: Jason Romer
Global chair: Simon Beswick
Focus: International wealth and private client, dispute resolution (particularly trust litigation and insolvency), risk and regulatory, commercial property, corporate, banking and finance and funds
Recent standout work: Acting for Curaleaf on its acquisition of EMMAC Life Sciences; advising TEAM on a placing of shares and successful admission to trading on AIM; acting for Mail.ru Group on its $200m equity fundraising and $400m debt offering – one of the largest security issues by a BVI-domiciled company in 2020; assisting Alfa Bank in obtaining urgent freezing injunctions and receivership orders in support of its global $150m claims against former Russian minister Mikhail Abyzov

‘Our people have adapted brilliantly to the challenges brought on by the pandemic,’ states Collas Crill’s global managing partner Jason Romer. ‘Last year we launched a new flexible working approach to help us support work/life balance in a pragmatic and adaptable way across the firm, recognising that there is no one-size-fits-all solution.’

However, the year also saw some major changes at the board level. Following the departure of chair Nigel Vooght, the firm welcomed Simon Beswick to take the reins. Reflecting on the move, Romer states: ‘Simon brings an abundance of experience of growing law firms and has had huge success at Osborne Clarke where he has been international CEO for the past 12 years and UK managing partner for nine years prior to that. He is a great fit for Collas Crill’s entrepreneurial and dynamic culture, and joins the firm at an exciting time as we begin to emerge from the Covid-19 pandemic.’

Elsewhere, Stephen Leontsinis was promoted to Cayman managing partner following successes in growing the dispute resolution team over the past six years. Meanwhile, Ellie Crespi joined from Harneys as the BVI’s managing partner and head of corporate finance and funds, while the Channel Islands gained a number of new partners and consultants in the private client, funds and risk and regulatory teams.

Discussing robust growth in Cayman, Romer states: ‘Our investment in that office is really starting to deliver. The traditional areas of corporate, funds and our deep insolvency practice continue to thrive. We have also recruited Gina Berry who has really kickstarted the growth of our property practice there. The merger appraisal practice, led by Rocco Cecere, has also ballooned in the last year or so.’

Conyers

Lawyers: 143, including 66 partners
Offices: Six (Bermuda, BVI, Cayman, Hong Kong, London, Singapore)
Chair: Christian Luthi (Bermuda)
Focus: Corporate (including aviation, banking and finance, capital markets, investment funds, insurance, M&A, private equity/venture capital and shipping), litigation and restructuring, private client and trust
Recent standout work: Acting for Digicel on its $7bn debt restructuring, which involved an innovative Bermuda scheme of arrangement; acting for AquaVenture Holdings on its $1.1bn acquisition by Culligan, one of the largest takeovers of a publicly listed BVI company by transaction value; acting for DeepGreen Metals on its proposed $2.9bn merger with Sustainable Opportunities Acquisition Corporation, a Cayman SPAC; acting for Semiconductor Manufacturing International Corporation on its $6.6bn IPO

For Conyers, 2020 and early 2021 saw a growth in demand for services across the firm’s entire global network, with the firm’s traditional areas of strength being notably consistent. Christian Luthi, the firm’s global chair, states: ‘The growth we have seen is, to some extent, a function of the disruption caused by the pandemic and the stress it has imposed on a number of business sectors. However, our business model has proved to be diverse enough geographically and in terms of services to be resilient to the economic impact of the virus.’

‘The growth we have seen is, to some extent, a function of the disruption caused by the pandemic and the stress it has imposed on a number of business sectors.’
Christian Luthi, Conyers

The firm’s growth was also evident within the team, with former Carey Olsen partner Michael Makridakis joining the firm’s Hong Kong office in early 2021 as a litigation partner from Delta Capital Partners Management, with another litigation partner soon to be added. ‘Their recruitment is part of our investment in new senior talent in Hong Kong to meet client demand,’ states Luthi. ‘This fast-paced, growing region has been creating unprecedented opportunities for our clients and our firm.’ The firm’s Cayman office has also continued on its growth trajectory, with the demand for services increasing at a steady pace.

‘We have seen a great deal of activity in the debt markets and have handled a number of major financing deals,’ says Luthi of the dominant areas of the last 12 months. ‘Our fund finance practice in Cayman has been very active, and we have also worked on several major restructurings and handled a significant number of privatisations of Bermuda, Cayman and BVI entities using private vehicles.’ While the firm has also remained strong in the insurance, investment funds, shipping and aviation sectors, the type of work handled within these industries has changed: ‘Our major industry sectors are as busy as ever. However, the nature of the work we have been doing for clients has shifted somewhat as businesses either tackle liquidity/debt challenges or seek to make the most of opportunities in disrupted markets.’

The group also recently handled some innovative and novel work, with the firm’s Asia offices advising Semiconductor Manufacturing International Corporation on its record-breaking $6.6bn IPO, which was the first dual listing of a Cayman company on both the Stock Exchange of Hong Kong and the SSE STAR Market.

Harneys

Lawyers: 164, including 54 partners
Offices: 11 (BVI, Cayman, Cyprus, Hong Kong, London, Luxembourg, Montevideo, São Paulo, Shanghai, Singapore, Vancouver)
Executive committee chair: Peter Tarn (BVI)
Focus: Litigation, insolvency and restructuring, commercial and corporate, private wealth/trusts, investment funds, tax and regulatory, banking and finance, international arbitration
Recent standout work: Acting for JTrust Asia in a complex international fraud case in the BVI and Cyprus in which a Japanese individual fraudulently misappropriated a sum of $210m; acting for Virgin Group on the BVI elements of Virgin Atlantic’s £1.2bn private-only solvent recapitalisation of the airline and holiday business; acting as Cayman counsel for Xpeng Motors on its pre-IPO series financing and $1.5bn listing on the New York Stock Exchange; acting for ArcelorMittal USA, which is seeking to enforce a $1.5bn ICC arbitration award against Essar Group following its failure to perform an iron ore pellet supply contract

Harneys’ 2020 continued the trend of previous years with team promotions across the firm’s offices; in July 2020, Nick Hoffman was appointed managing partner of the Cayman office, Henry Mander was made global head of trusts and private client in January 2021, and Peter Ferrer was promoted to co-head of litigation, insolvency and restructuring in May 2021, leading the team alongside Phillip Kite.

The practice also expanded its legal tech offering through its development of a reporting solution to assist trust companies with their BVI economic substance reporting, which launched in October 2020. The firm also established its Tech Accelerator Program in November 2020, which is designed to support technology innovators and professionals with free legal advice and trust company services as they prepare to launch a company or fund.

According to chair Peter Tarn: ‘2020 was a pretty good year with the second half being incredibly busy, and the first quarter of 2021 has continued that trajectory.’ New statutory requirements in both the BVI and Cayman led to a strong year for the firm’s global investment funds and regulatory team, with the China and private wealth practice also showing notable growth. Tarn also adds: ‘Litigation and insolvency had one of its strongest years as the pandemic created situations where shareholders fell out or money ran out. The increase in insolvency and restructuring instructions is likely more related to Covid insolvency issues for corporates.’

Prominent areas of expertise also remained consistent for the firm. ‘Transparent, tax-efficient fund structures remain critical plumbing to the global financial infrastructure and show no sign of losing their importance,’ states Tarn. ‘There is also no doubt that as the use of offshore vehicles requires more and more substance, being able to offer a far wider selection of services will be vital to any law or other professional services firm.’

Other key areas of activity include the IPO market in Asia, particularly homecoming listings of China concept stocks, and succession planning mandates. Says Tarn: ‘Covid has prompted high-net-worth individuals to contemplate their own mortality and what they prioritise in life, which has led to the implementation of a large number of succession planning vehicles due to the increased focus by high-net-worth clients on asset protection and estate planning issues.’

Maples

Lawyers: 372, including 143 partners
Offices: Nine (BVI, Cayman Islands, Dubai, Dublin, Hong Kong, Jersey, London, Luxembourg, Singapore)
Global managing partner: Jonathan Green (Cayman Islands)
Focus: Disputes, corporate, finance, funds, insolvency and corporate restructuring, insurance, IP/technology/telecoms, private equity, property/construction, regulatory/financial services, sports/media/entertainment, tax and trusts
Recent standout work: Acting for United MileagePlus, United Airlines’ loyalty programme, on the Cayman aspects of its $3.8bn bond offering and its concurrent $3bn term loan; acting for Delta Air Lines and its indirect, wholly-owned subsidiary, SkyMiles IP, on the Cayman elements of its $3bn term loan facility and its $6bn offering of senior secured notes; acting for the senior lenders to the Constellation Group on its global restructuring, which was valued at $1.5bn

For Maples, the defining characteristic of 2020 was growth: the firm welcomed several new lateral hires to the group and saw a notable number of promotions, totalling 15 new partners and nine of counsel. Key changes include Manuela Belmontes and Philip Ireland being appointed as joint managing partners of the Dubai office, Michael Gagie taking on the role of regional managing partner in Asia, Nick Evans becoming the head of the firm’s Jersey office, and Clare Kennedy and Owen Brookman being appointed as global chief operating officer and group general counsel respectively.

According to Jonathan Green, global managing partner of the firm: ‘The group is keen to build on what we have learnt during the recent periods, having successfully adapted to a changing work environment. We find that clients really like our one-group approach and the efficiencies that come with that. Those synergies are generating growth across all areas of the firm as a whole, as well as our core areas of corporate, finance, funds, dispute resolution, insolvency and private client work.’

‘The group is keen to build on what we have learnt during the recent periods, having successfully adapted to a changing work environment.’
Jonathan Green, Maples

The firm’s dispute resolution and insolvency practice saw an increase in the volume of section 238 fair value disputes, while the corporate practice handled increasing numbers of IPOs and Cayman SPAC deals. Other key areas of activity included the funds and investment management group and the regulatory practice.

The firm also leveraged its asset finance team to handle several large loyalty scheme fundraising transactions and subsequently launched its new Irish asset finance practice in its Singapore office, which will help the firm assist its aviation clients with multi-jurisdictional and time-zone sensitive legal advice on the ground in Asia.

Mourant

Lawyers: 246, including 61 partners
Offices: Six (BVI, Cayman, Guernsey, Hong Kong, Jersey, London)
Group managing partner: Jonathan Rigby (Jersey)
Global senior partner: Jonathan Speck (Jersey)
Focus: Corporate; banking and finance; regulatory; investment funds; restructuring and insolvency; dispute resolution; and international trust and private client.
Recent standout work: Advising BorgWarner on its acquisition of Delphi Technologies via a Jersey scheme of arrangement; advising MaiCapital on the launch of a tokenised investment fund and formation of a related SPV; assisting Ardian with its eighth-generation secondaries fund, attracting $19bn of commitments from global investors; acting on Tailored Brands’ Chapter 11 restructuring

Reflecting on Mourant’s newly adopted five-year business strategy, global managing partner Jonathan Rigby outlines: ‘We see significant opportunities to continue to grow our market share for offshore legal work originating in North America and Asia, and will be investing further in the growth and development of our Cayman and BVI practices. We continue to be one of the fastest-growing offshore firms in the Asia region.’

‘We see significant opportunities to continue to grow our market share for offshore legal work originating in North America and Asia.’
Jonathan Rigby, Mourant

Evidently, contentious mandates are driving this strong growth in the east. ‘BVI insolvency and restructuring matters continue to account for a large share of our work in Asia,’ states Rigby. ‘Much of the remainder comprises shareholder disputes, often with an asset-tracing element. Contentious trusts are also increasing steadily.’

The imminent launch of Mourant Consulting, a specialist regulatory consulting business, aims to deepen the client services on offer. Mike Jones, who acted as the director of the Jersey Financial Services Commission until his recent hire, is spearheading the project. In other lateral hires, the BVI office gained an impressive corporate practice head in Ian Montgomery, formerly the managing partner at Collas Crill.

Mourant was quick to capitalise on the ‘SPAC boom’ which was propelled by the pandemic and ‘has continued at full pace during the first quarter of 2021’, according to Rigby. ‘Our Cayman team has been very busy advising on these transactions with many still in the pipeline. Interestingly, we’re now seeing demand from our clients in Asia with a number of highly regarded private equity sponsors looking at launching SPACs in the near term.’

With a positive outlook, Rigby contends that ‘the pandemic has helped us to identify more efficient and sustainable working practices. Our focus now is on embedding these in the organisation going forward.’

Ogier

Lawyers: 270, including 80 partners
Offices: Eight (BVI, Cayman, Guernsey, Hong Kong, Jersey, Luxembourg, plus presences in Shanghai and Tokyo)
Group managing partner: Edward Mackereth
Global senior partner: Rachael Reynolds (Cayman)
Focus: Corporate, dispute resolution, investment funds and restructuring and insolvency
Recent standout work: Advising Atotech on its $498m IPO on the NYSE; advising WH Smith on its £327m bond offering to finance 100 store openings across North America; handling high-profile restructurings for PizzaExpress Group and Virgin Atlantic

Ogier executed hires and promotions across the breadth of jurisdictions and service lines in the past year. In particular, Cayman, BVI and Hong Kong showed strong partner headcount gains, while funds, dispute resolution, corporate and banking and finance were the true growth areas.

In a drive to reinforce the Channel Islands’ private wealth offering, partner Matt Guthrie was brought over from Mourant to head up the Guernsey private wealth team. The BVI team welcomed qualified barrister David Welford from Maples to strengthen the commercial and financial disputes bench, whereas corporate teams across the board benefited from notable hires.

‘Ogier’s inclusive culture means we continue to attract the best people, and it is with our talented and energetic people that our true success lies.’ Rachael Reynolds, Ogier

Commenting on highlights in the funds space, global managing partner Edward Mackereth observes: ‘We have seen significant activity this year with a number of new fund launches kicking off and new enquiries coming in. A big development for us is impact and sustainable investment funds, to which we are now providing legal and advisory services. The pandemic accelerated and highlighted the importance of sustainability and ESG factors and we don’t expect this momentum to slow.’

Following her successes as head of the Cayman litigation outfit, Rachael Reynolds was appointed as the firm’s global senior partner, taking up the mantle from Jersey’s Steve Meiklejohn. Reynolds regularly deals with globe-spanning contentious insolvencies, and comes to the role on a platform of diversity and inclusion.

‘Ogier’s priorities of fostering a culture of inclusion, investing in people, and helping them to thrive, are close to my heart. I’m proud that these aspects of our vision are lived, day to day, at all levels within Ogier. This inclusive culture means we continue to attract the best people, and it is with our talented and energetic people that our true success lies,’ she says.

Walkers

Lawyers: 410, including 120 partners
Offices: Ten (Bermuda, BVI, Cayman, Dubai, Hong Kong, Guernsey, Ireland, Jersey, London, Singapore)
Global managing partner: Ingrid Pierce (Cayman)
Focus: Banking and finance, corporate, funds, insolvency and dispute resolution, listing services, private capital and trusts, private equity, real estate, regulatory and compliance, re/insurance, structured products/capital markets and taxation (Ireland).
Recent standout work: Acting on the multimillion-pound restructuring of Travelex; acting as Cayman counsel to Queen’s Gambit SPAC on its $300m IPO on Nasdaq; acting as Cayman counsel to Goldman Sachs Lending Partners on a first-of-its-kind $6.8bn financing comprising $3.8bn of senior secured high-yield bonds and $3bn of senior secured terms loans to MileagePlus Holdings; acting as Bermuda counsel for Barclays Pension Funds Trustees on the £5bn longevity swap transaction between Barclays Bank UK Retirement Fund and Reinsurance Group of America

Walkers had a stable 2020 and expanded its product offering with the establishment of a Bermuda practice from its Hong Kong office and the launch of an e-learning, anti-money laundering training portal.

The firm’s work levels also remained consistent with the firm’s offices in Asia and the Middle East maintaining their substantial operations. In the UK offshore, Ireland and London offices, the firm had a notable year for transactional work and litigation proceedings; the Ireland-based investment funds and debt capital markets teams were also very busy and the banking and finance group in London saw an uptick in matters relating to accessing liquidity, debt restructurings, financial covenant waiver processes and rescue financings.

Global managing partner Ingrid Pierce comments: ‘Globally, work levels remained strong across the firm, largely due to our reputation in the market, scale and practice group coverage. We managed the transition into and out of working from home while maintaining our high levels of client service. 2020 and early 2021 have been successful years for Walkers.’

When asked about the prominence of practice areas over the last 12 months, Pierce adds: ‘Undoubtedly the economic effects of Covid-19 have pushed our insolvency and dispute resolution group to the fore with our restructuring and insolvency experts working closely with members of our banking, finance and corporate and investment funds group in formulating structures and techniques to assist distressed companies.’

The past year has also brought in a raft of regulatory work for the firm globally, with new registrations and regulatory filings arising from the recent introduction of economic substance and beneficial ownership requirements, among others. The Cayman office has also seen an increase in instructions advising on Cayman-domiciled SPACs with listings in the US fuelling substantial levels of IPOs, business combinations and acquisitions for the Cayman office as well as the Asia and London teams. Pierce also highlights the firm’s private client work. ‘Our global private capital and trusts teams have expanded to meet increasing client demand, and this area intersects with almost every other practice area,’ she says.

2021 looks to be a notable year for Walkers, with the firm celebrating the 20th anniversary of its London office, the 15th anniversary of its Jersey office and the five-year anniversary of the opening of its Bermuda and Guernsey offices. LB

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‘Anyone who says they’re not struggling would be lying,’ says Tim Pearce, global managing partner of Bedell Cristin, referring to the Jersey market. ‘Every sector of the economy and every business has struggled or suffered as a result of Covid, though businesses have struggled in different ways. Some financially, others socially. Others are struggling in terms of pure management. But for us, and indeed for the offshore industry as a whole, we’ve weathered the storm OK so far.’

Pearce’s cautiously optimistic outlook reverberates throughout the discussions with partners across the Bailiwicks of Jersey and Guernsey in the Channel Islands archipelago and the Isle of Man in the Irish Sea to the north – the jurisdictions collectively known as the Crown Dependencies. Unlike the UK, domestic property is booming, buoyed by numerous factors. ‘In times of crisis, people invest in what they know,’ says Pearce. ‘People are looking for safe havens right now and property in all of our offshore jurisdictions is benefiting from that.’

Guernsey in particular, due to low Covid death rates (16 at the time of writing), is being viewed as a safe haven for those in the market for a second home, further enticed by generous outdoor spaces and greater room for home working than typically found in London. Novel instances of property deals being signed off over WhatsApp have even been witnessed.

‘The local market went absolutely crazy,’ according to Collas Crill’s head of Guernsey property Jason Green. ‘Guernsey’s open market, availed to UK and EU citizens, has become much busier, with people seeing that Guernsey is a safe place to live. Once they started opening restricted business tunnels, people started coming over, viewing houses. It’s been far busier than we ever could have predicted.’

The construction sector is also reaping the benefits of the residential property boom, however commercial property hasn’t quite experienced the same windfall. Transactions are still happening though, with numerous commercial deals being signed off for over £500,000 above the asking price.

But although things are not as rosy for those practices focusing on international property deals, and corporate M&A took an inevitable hit across the board, certain core verticals are managing to sufficiently bolster full-service firm revenues. Litigation is showing no signs of slowing down, even if Covid-specific disputes are yet to arise. Somewhat surprisingly, upticks in insolvency procedures are yet to be witnessed, though partners are expecting this to change down the line.

‘Anyone who says they’re not struggling would be lying. Every sector of the economy and every business has struggled or suffered as a result of Covid.’
Tim Pearce, Bedell Cristin

Trust litigation continues to exceed expectations, according to Christian Hay, Collas Crill’s Guernsey managing partner and dispute resolution head. ‘Trust disputes have been on the up in recent years due to the transfer of wealth between generations, but now it just seems to have gone into overdrive. During lockdown, beneficiaries have perhaps had more time on their hands to assess their circumstances and the options available to them, as well to perceive unfairnesses in their situation.’

Despite the downturn in private M&A origination, corporate lawyers are not simply twiddling their thumbs waiting for things to pick up again, with maintenance work and facility amendments keeping them busy. A number of funds, including Blackstone, Legal & General and Aviva, remain acquisitive, owing to the long-term investment strategies of pension and insurance policies. Speculative money from South-East Asia and the US is also flowing in; working in tandem with Latham & Watkins, Bedell Cristin recently advised CPA Global – a portfolio technology company of US buyout firm Leonard Green & Partners – on its combination with Clarivate for an enterprise value of $6.8bn.

Further trends include an increasing interest in public takeovers, predominantly due to deflated valuations, and a relatively usual Q4 in terms of financing activity. ‘In the early stages of the pandemic, it was difficult to assess the true impact of Covid on the market,’ notes Katrina Edge, Ogier’s European head of banking and finance. ‘During the first lockdown some deals fell through, however as the year progressed and the markets remain uncertain, we are seeing some new-money deals in addition to loan extensions and covenant waivers. We expect this to continue in the near future although we are preparing for an increase in restructuring and insolvency-type work in the next 12 months.’

‘The most affluent people, those dealing in private wealth, are not touched by the current circumstances so much.’
Stephen Baker, Baker & Partners

Christopher Jones, also in Ogier’s banking and finance team, adds that ‘there is a lot of pressure on the banks at the moment not to enforce. There have been a lot of waivers on covenants, but at some point the banks will want to be repaid’.

Headline capital markets deals are also being secured, such as Guernsey-based legal finance firm Burford Capital’s listing on the New York and London exchanges; the first dual listing of its kind as handled by Ogier’s Bryon Rees and Charlotte Brown.

Local versus international

That the Crown Dependencies are a major benefactor of significant international wealth has been another saving grace. As Stephen Baker, senior partner of Jersey dispute resolution specialist Baker & Partners, simply puts it: ‘The most affluent people, those dealing in private wealth, are not touched by the current circumstances so much.’ This evidently has negative implications for firms without a significant international network to draw from, he adds. ‘I would say that the high-street solicitors have been hit very hard. Firms with a local focus will be suffering when those dealing with international money flows such as corporate, funds or banking work – or indeed litigation – are going alright.’

However Clare Nicolle, head of estate planning at Jersey-centric outfit Voisin Law, offers a similarly positive outlook, pointing to redundancy rates in fact lower than certain global firms, an employment team that saw a 100% increase in instructions this year and a booming private wealth practice spurred on as ‘everyone started facing up to their own mortality’.

Despite international money flows continuing unabated, and the local population taking advantage of looser lockdown restrictions, foreign footfall has drastically declined, which has also inevitably harmed the hotel industry. The uptick of staycationing has had a beneficial knock-on effect for Guernsey’s neighbouring island of Alderney, which ‘has had a difficult few years,’ according to Jason Green. ‘But in the past few months since lockdown, the property market has seen a bit of an upsurge, due to people looking to buy holiday homes there. And that will continue to happen in the short term.’

The Isle of Man similarly took advantage of an open airbridge between itself and Guernsey to sustain a degree of tourism revenue, made possible by similarly low infection rates. Legal market activity on the island appears to be largely positive and business as usual, according to John Aycock, contentious employment expert and director of local firm M&P Legal. ‘Our experience is that overall the market has not suffered material adverse effects from the pandemic. Some sectors have experienced growth while others have seen a slowdown. The island itself currently has no internal restrictions so domestically it is business as usual.’

The diversified Manx economy has been another driving factor behind the generally positive outlook, specifically the substantial local agricultural sector and a lower reliance on financial services than its Channel Islands cousins. Unfortunately the famous Isle of Man TT, a major source of revenue for the tourism and hospitality sectors, was inevitably cancelled in 2020 and also, just recently, the 2021 event.

Much like the Channel Islands, Manx corporate activity closely follows London trends, so there was an inevitable dip during the first lockdown, followed by a post-lockdown surge. The same can be said for the property market, with a number of high-value transactions having been signed off over the past months, driven by local demand as much as international buyers. Headline deals include the famous £6m local landmark Bishopscourt, which sold to a US couple purportedly via Skype.

Contemplating the current state of the Manx legal market, John Rimmer, sole practitioner of private client boutique Advocate John Rimmer, contemplates: ‘One would think that those most likely to get hit would be the big commercial firms like Cains and Appleby, and that’s if there’s going to be a big downturn. There are a number of smaller firms which are fairly well positioned because they handle a broad spectrum of work. Firms like Callin Wild and Long & Humphrey will likely have done pretty well because they have a good spread of different service lines.’

Largely due to Guernsey’s substantially more draconian lockdown measures, including a compulsory 14-day quarantine period for new arrivals, firms have routinely expressed frustration when it comes to sustaining quality recruitment throughout the pandemic. Nick Robison, dispute resolution partner at Guernsey firm Babbé, states: ‘That has been by far the hardest thing. We’ve had five people agree to arrive but have pulled out at the last minute. And because of the travel ban, people are reluctant to move away from their families. We’ve had someone arrive from Australia after experiencing visa issues, then when he arrived, he had to self isolate… it’s been hugely disruptive.’

‘During the first lockdown some deals fell through, however as the year progressed and the markets remain uncertain, we are seeing some new-money deals in addition to loan extensions and covenant waivers.’
Katrina Edge, Ogier

He continues: ‘While we have locked borders, we’ll find it harder to recruit, and when we find it hard to recruit, we have to recruit people of a lower standard, people we wouldn’t otherwise be hiring. And if we have people of a lower standard, we offer products of a lower standard. If we’re doing that not just as a firm but as an island, we will cease to be competitive compared to other jurisdictions that have open borders. That to me is the biggest threat to Guernsey in the short term.’

So they might be more inclined to head over to Jersey where it is more open? ‘I’ve in fact seen that. We had two lawyers who signed up to join the firm who said “no, we’re off to Jersey instead, sorry”.’

House in order

If there is one widely discussed positive development for the legal industry arising from the global pandemic, it is that of rapid technological acceleration, and the Crown Dependencies are no different in this regard. While in London remote hearings and cross examinations have received a rather cold reception from judges, the same cannot be said in the offshore world, where such proceedings have become routine, and largely seamless. Jersey’s famously high broadband speeds – consistently ranking in the top three globally – have further contributed to the seamlessness of remote working on the island.

Nicolle, who sits on the Law Society’s subcommittee for wills and succession, speaks of further innovative procedures in private client work: ‘We were really fortunate to benefit from a flexible government. We worked together to very quickly get remote witnessing of wills up and running. In England and Wales it happened maybe only a month or so ago, whereas we passed legislation in April. And that combination of work between the Law Society, the government, the court and the law draftsmen enabled us to keep business going as usual. The corporate team benefited from that team effort as well because we then brought in remote witnessing of powers of attorney, which further facilitated business, whereas the UK was probably hamstrung.’

For better or worse, the rapid expansion of remote working and increasingly sophisticated virtual networking platforms have led to a seismic shift in the way client interaction and business development are performed. According to David Pike, chief operating officer of Bedell Cristin: ‘We’ll see less of the old-fashioned way of doing things in terms of the long lunches and the dinners and the paintball sessions, which will still have its place. I can’t begin to think of when we’ll be allowed 50,000 people congregating in Cannes for MIPIM, or thousands of people in one bar again. I just don’t think that’s the world we’re going to be living in in the future.’

‘There’s a real convenience and cost efficiency from operating still face-to-face but using electronic means, now that we have the technology to do so.’
Jean-Marie Renouf, Seymour Law

But is there an appetite to make this the new normal, or is there a desire to get back to the traditional ways of interaction? Jean-Marie Renouf, dispute resolution partner at Jersey-based Seymour Law, says: ‘There’s a real convenience and cost efficiency from operating still face-to-face but using electronic means, now that we have the technology to do so.’ According to Renouf, ‘the creeping tendency towards hot-desking’ will have consequences for commercial property, with law firms and financial institutions reconsidering their expensive leases.

However, Hay says: ‘Everyone I speak to misses the face-to-face interaction. There’s nothing like sitting down together over a cold beer and getting to know each other properly. But on the other hand, we’ve saved an absolute fortune by not travelling all over the world to these conferences. So I imagine when it comes to setting budgets, we’re going to be looking really carefully whether we really need to spend a week traipsing around in business class flights for the minimal benefit you get from it.’

The surge in remote working and the associated increase in autonomous working conditions are also evolving traditional relationships between younger lawyers and senior management. Those firms adhering to old-fashioned models of micromanagement may very well want to assess whether this way of operating will serve them well in the brave new world ahead.

So while it is predominantly good news for the legal markets and economies across the Crown Dependencies, what the future holds is unknown. But what can firms do to prepare themselves for the ride?

‘While we need to deal with what’s going on now, we also need to be planning to be in good shape when we get out of it,’ says Ogier’s global managing partner Edward Mackereth. ‘Whether that’s by investing in those service lines that are going to take off in six months’ time or being part of the solution to some of the serious questions which are currently being discussed – things like the environment, on diversity, on providing meaningful 21st century careers for our people. When Covid goes away, suddenly we’re going to be faced with a whole raft of other things and now is the time to be putting your house in order.’ LB

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The Caribbean’s offshore financial centres have faced their fair share of challenges in recent years thanks to the increased international scrutiny of the tax haven environments, the impact of falling oil prices and the business interruption caused by the seemingly endless cycle of hurricanes, which sees the region bear the brunt of the ever-pervasive impact of climate change. Add to that a global pandemic, and there’s certainly the potential for a substantial economic disaster.

While the Covid-19 infection numbers for the Caribbean as a whole have remained low thanks to quick action by the local governments to close borders, enact temporary lockdowns and implement testing and contact tracing methods, the primary impact of the coronavirus pandemic on the Caribbean is undoubtedly on tourism. For Bermuda, the British Virgin Islands (BVI) and the Cayman Islands (Cayman), the tourism industry contributes 28%, 52% and 70% of the average GDP respectively and figures suggest that, at worst, 2020 could see a 71% reduction in the number of international visitors.

With the main victims of the downturn being hotels, airlines and other service industry businesses, the region has shifted its efforts to focus on local residents and ‘staycations’, while several jurisdictions have also offered temporary residency permits to attract more freelance and mobile businesspeople to their shores; Bermuda is a notable example, which is advertising its Work from Bermuda Certificate, which allows workers and students to work remotely from Bermuda for a year.

Caribbean territories have also utilised business continuity plans originally created to assist businesses with the aftermath of hurricanes to put themselves a step ahead when it comes to weathering the economic storm that Covid-19 has brought. But with the devastation of the tourism industry (including its effect on the peak Christmas holiday period) and the impact still being felt from Hurricanes Irma and Dorian in previous years, it is no surprise that it has been a rough year for the region.

That being said, as is often the case in times of substantial crisis, the law firms in the Caribbean’s offshore markets are doing surprisingly well and have proven their resilience. Harneys’ chair and corporate specialist Peter Tarn states the impact of the pandemic on business activity has been ‘extraordinarily limited in reality’. As he recalls: ‘Of course March was moderately scary but month on month through the year we have seen great performances from the businesses and by mid-September it had become apparent that the world had far from ended.’

‘It is often the years when there are significant challenges, market disruptions or important global changes that we see some of the greatest demand for top-notch legal advisers.’
Jonathan Green, Maples Group

Maples Group’s global managing partner Jonathan Green adds: ‘It is often the years when there are significant challenges, market disruptions or important global changes that we see some of the greatest demand for top-notch legal advisers – lawyers that can really add value for their clients.’ He continues: ‘If our experience is anything to go by, then the legal market is generally managing the impact extraordinarily well.’

Firms in the Caribbean were also already ahead of the game in terms of remote working as Christian Luthi, chair of Conyers, explains: ‘From a practical perspective, legal and financial services were already largely provided remotely so were little affected. In our jurisdictions of operation, the regulatory authorities and the courts rapidly transitioned to remote working/remote hearings, ensuring that business was able to continue more or less as normal.’

Ingrid Pierce, global managing partner of Walkers, agrees: ‘While the effects of the pandemic have given rise to certain challenges, it has reaffirmed the resilience of our business. Our infrastructure enabled us to continue to engage with clients in many of the same ways as before.’

Another factor playing to the strengths of many Caribbean firms is their broad global footprint, with many expanding in recent years, including Carey Olsen’s Hong Kong office, which opened in 2016 and Harneys’ office in Shanghai, which was established in 2017.

With different parts of the world impacted to varying degrees at differing times, the Caribbean offshore firms with bases in locations such as Shanghai, Singapore and Hong Kong alongside their UK and European offices have been able to benefit from a broader international office network, as Tarn notes: ‘Like any firm with a wide geographical footprint it has been interesting – and helpful – having different locations at different stages of the virus impact and government reaction through the year, and slightly bizarre to have Shanghai back to ordinary operating procedures at times when, say, London is fully remote.’

As is the case globally, one area that is being given notable thought, however, is the question of office space, given the now widespread acceptance of virtual meetings and working from home. Tarn says, ‘it’s reached cliché proportions, but of course we are thinking long and hard about the purpose of physical offices’, while Luthi adds: ‘Although most of our offices are once again open, a more flexible approach to working practices is here to stay.’

‘While the effects of the pandemic have given rise to certain challenges, it has reaffirmed the resilience of our business.’
Ingrid Pierce, Walkers

While the means and methods of advising the firms’ global client rosters remain fairly resilient, the type of work coming through the doors has seen some substantial changes and shifts. Unsurprisingly, restructuring work has increased across the board, and is now a mainstay practice for most firms. For Harneys, recent top-drawer work included advising the Virgin Group on the offshore elements of Virgin Atlantic’s £1.2bn private-only solvent recapitalisation of its airline and holiday business, working with Herbert Smith Freehills and Allen & Overy as onshore counsel in London, while Conyers advised Caribbean telecoms giant Digicel on its $7bn debt restructuring.

Finance departments have also been noticeably active, with refinancing transactions and debt capital markets work keeping local lawyers busy. In this arena, Conyers’ Bermuda office assisted cruise ship company Carnival with its private offering of $6bn in two tranches of notes in the early months of the pandemic and also handled Avalon Holdings’ two private offerings totalling $2.4bn, while the firm’s Cayman office advised on the Cayman elements of Stonegate Pub Company’s $1.57bn bond issuance program, the largest in the UK since Virgin Media issued £1.1bn of senior secured notes in 2013. The firm’s BVI team also assisted Despegar, a leading online travel company in Latin America, with a series of financing transactions to supplement its liquidity levels.

For Maples Group, its financing department has been active advising both Delta Air Lines and United Airlines on their $9bn and $6.8bn financing plans respectively, and also acted as Cayman counsel for Ninebot on the first-ever listing of Chinese depositary receipts on the Shanghai Stock Exchange science and technology innovation board.

The use of special purpose acquisition companies (SPACs) – shell companies created to raise capital via an initial public offering – is becoming increasingly common, and Pierce says recent months have seen ‘a surge’ in work for the firm in advising on the formation of such structures. ‘Established fund managers have been tapping the public markets for capital, with Oaktree, Apollo and SoftBank, among others, successfully bringing SPACs to the market,’ she notes. Walkers has also been active in advising on asset loyalty programmes, a novel way in which airlines are aiming to ride out the pandemic by raising capital using Cayman-domiciled loyalty programmes as security against debt.

Litigation has also shifted focus, with pure commercial litigation taking something of a back seat to be replaced by insolvency and shareholders disputes. Christian Hay, managing partner of Collas Crill’s Guernsey office notes: ‘Our Cayman team is all about contentious insolvency, and that is where all the work is in Cayman at the moment due to the collapse of substantial investment funds that have lots of claims flying out of them. In the BVI it’s all about shareholder disputes as companies get into trouble and the principals behind them start falling out with each other.’

‘Like any firm with a wide geographical footprint it has been interesting – and helpful – having different locations at different stages of the virus impact and government reaction through the year.’
Peter Tarn, Harneys

Alongside changes in types of work, regions of interest have also changed for a market traditionally reliant on mandates originating from Europe and the US, two regions affected far more intensely by the pandemic than the rest of the world. According to Jason Romer, group managing partner in Collas Crill’s Jersey office: ‘We’ve seen a lot of really interesting BVI deals coming out of Russia and the Far East. Potentially, those markets have started to pick up more than the traditional European and US markets.’

With changes rife, some aspects of the legal market have remained fairly consistent and as active as they were prior to the global lockdown. Regulatory issues have dominated discussions in the Caribbean in recent years with a wide variety of policies introduced to try to change the mindset surrounding the ‘tax haven’ status of some of the region’s jurisdictions. This culminated in 2019 with the introduction of the economic substance rules, a series of requirements for companies (primarily in the banking and financial services sectors) stating the company must have adequate expenditure, physical premises and employees in the jurisdictions it claims to do business.

This trend continued in 2020 with the Cayman Islands Monetary Authority (CIMA) implementing the Private Funds Law, which increases the number and types of closed-ended Cayman-based investment vehicles required to register with the CIMA. Maples Group has been particularly active here – Green states ‘in terms of regulatory work, we assisted clients in registering many thousands of private equity funds with the CIMA. This was an enormous undertaking on an extremely compressed timetable. When one considers that it was also achieved under pandemic operating conditions it is all the more impressive’.

‘We’ve seen a lot of really interesting BVI deals coming out of Russia and the Far East. Potentially, those markets have started to pick up more than the traditional European and US markets.’
Jason Romer, Collas Crill

For some though, the continued regulatory scrutiny is not necessarily always welcome. Luthi comments: ‘Increased regulatory scrutiny of offshore jurisdictions has been ongoing for several years, regardless of the direction of the global economy. However, it is likely that the financial difficulties brought about by the pandemic will only increase efforts by onshore tax authorities to de-legitimise offshore jurisdictions.’

Phillip Kite, global head of dispute resolution, insolvency and restructuring at Harneys and managing partner of the firm’s London office, concurs: ‘Whenever there is any seismic negative global event it seems the offshore world gets blamed for it at some stage in the process but it is important to note that jurisdictions like the BVI and Cayman are regulated very heavily, more so than onshore jurisdictions.’

A new hope

This diversified offering is ultimately the key to law firm survival, Luthi argues: ‘Firms that have a diversified practice are better positioned to survive the impact of the pandemic than those with a boutique offering.’ Pierce adds: ‘Law firms that were able to adapt to an agile approach to working during the early stages of the pandemic and actively supported their employees while making necessary budget cuts to adjust to a more virtual work have a good chance of survival. Firms that are less able to diversify may find it tough to keep their doors open.’

Likewise, firms without sound IT and operations infrastructure are likely to face more difficulties, but Green argues that this diversification is nothing new for Caribbean firms: ‘Operating in the Caribbean, with its annual hurricane season, for over 50 years has meant that Maples Group has always had to maintain a level of IT infrastructure and business continuity preparedness that would likely impress even the most stalwart geek’.

‘Our Cayman team is all about contentious insolvency, and that is where all the work is in Cayman at the moment due to the collapse of substantial investment funds that have lots of claims flying out of them.’
Christian Hay, Collas Crill

So, what for the future? There’s no doubt that there will be notable repercussions from the pandemic that will leave a lasting impact. Whether it be the businesses that weren’t able to survive or the additive effects of the pandemic on the recovery efforts from previous years’ hurricanes, the island nations certainly have their challenges to face. ‘The coronavirus pandemic will have socio-economic effects for many years to come,’ states Luthi. ‘We will likely see continued economic turbulence for the next 12 months as the pandemic plays out, and we expect continued high demand for legal services as a result. It will likely be four-to-five years before we can anticipate a return to “normality” – assuming no other black swan event comes along meanwhile.’

However, while 2020 has thrown up myriad problems, there is a returning sense of hope. As Green states: ‘The coronavirus has challenged us to work in novel ways and, in its way, has also presented us with opportunities.’ For Pierce: ‘There are signs of light at the end of the tunnel and increasing commitments from government, industry and citizens to work together to better the circumstances.’ Pierce also argues that even the pandemic has a silver lining: ‘The pandemic has undoubtedly spurred a greater sense of community as we continue to find ways of maintaining connectivity. It has also led to unprecedented levels of innovation, with many firms completely reimagining the way to stay front of mind with clients and conduct business going forward.’

‘Whenever there is any seismic negative global event the offshore world gets blamed for it at some stage but it is important to note that jurisdictions like the BVI and Cayman are regulated very heavily, more so than onshore jurisdictions.’ Phillip Kite, Harneys

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On paper at least, history will show that 2019 was a very good year. Encouraged by sustained low interest rates, declining trade policy uncertainty and diminished fears of an economic slowdown, US stock markets led the way: the S&P 500 ended the year up 28% and the Nasdaq 35%. Meanwhile, the Europe-wide STOXX 600 increased by 23% and the FTSE 100 by a more modest 12%.

But on the ground, things seemed a little different for many offshore law firms. ‘Even by recent standards, 2019 was an extraordinary year in geopolitical and macro-economic terms: US-China trade wars, Brexit uncertainty, volatility in the US dollar/GBP exchange rate, tension in Hong Kong and the growing risk of a global economic downturn,’ says Jonathan Rigby, global managing partner of Mourant.

Rather than a single global event, he notes, it was the combination of these factors that had the greatest impact, ‘bringing peaks and troughs in workflow and making it challenging, at times, to plan ahead’. Alex Ohlsson, group managing partner of Carey Olsen, concurs: ‘Uncertainties have impacted business confidence and this in turn has impacted deal flow.’

For some offshore leaders, uncertainty had a natural apotheosis. ‘Brexit undoubtedly had the biggest impact on Appleby over 2019,’ says its new group managing partner, Malcolm Moller. ‘With shifting deadlines, extravagant promises, cantankerous debates and radically differing visions for the future proposed by different political parties, and sometimes by individuals from within the same party, the trials and tribulations of Brexit have always loomed large. This uncertainly fed into conversations across just about every practice area with clients understandably nervous about new and existing commitments.’

Jason Romer, group managing partner of Collas Crill, adds: ‘Brexit created significant uncertainty, which has been uncomfortable for everyone affected and the market in general. As a consequence, many investors have been reluctant to commit to deals.’

However, Ingrid Pierce, global managing partner of Walkers, strikes a different note: ‘Brexit continued to have a (mostly positive) impact on our business as we continued to advise regulated financial services providers on migrations from the UK to Ireland.’ Walkers established a new employment group in Dublin last year. ‘Several clients who sought to establish an Irish presence as part of their Brexit contingency planning required employment law advice as they looked to expand their footprint in Ireland,’ she adds.

The stock market numbers also tell another story, in part fuelled by global M&A that hit $3.9tn in aggregate value last year – albeit half of this figure related to US deals. One of the largest was Takeda Pharmaceutical’s £46bn acquisition of Shire: the biggest-ever outbound M&A deal by a Japanese company and the largest-ever takeover of a Jersey company. Ogier advised Takeda while Mourant advised Shire. But even Edward Mackereth, Ogier’s managing partner, notes: ‘The impact of recent trade disputes on the flow of capital between Asia and the US has definitely dampened the growth in deal flows.’

‘Brexit uncertainty has been uncomfortable for the market in general. Many investors have been reluctant to commit to deals.’
Jason Romer, Collas Crill

While lawyer headcount at many offshore firms was either flat or showed modest growth last year, Ogier and Walkers continued to buck the trend. Mackereth notes that Ogier’s compound annual headcount growth over the past three years has been 22%, while Pierce says Walkers had a record partner promotion round last year. In less than five years, Walkers has doubled its lawyer numbers, including a 13% growth in legal fee-earner headcount last year.

Both firms remain dwarfed in overall terms by the Maples Group, which consolidated its Maples and Calder and MaplesFS (Maples Financial Services) offerings under a single brand in 2019, taking total staff headcount beyond 2,000 people. Maples also expanded its global footprint to 18 locations worldwide, opening new offices in Abu Dhabi, Bermuda, China, Jersey and Luxembourg, although it only offers legal services in the last two on the list. ‘Being able to combine business lines, including legal, fiduciary, fund administration and entity formation and management services is a powerful solution for clients, and this formula continues to drive our growth,’ says Jonathan Green, the firm’s new managing partner.

For large firms without a Channel Islands presence, such as Harneys and Conyers Dill & Pearman, other factors loomed large. While it has no plans to be in the Channel Islands, Harneys merged with M Partners to form Harneys Luxembourg. ‘As a result of the merger we gained four Luxembourg partners,’ says chairman, Peter Tarn. Meanwhile, Conyers chair, Christian Luthi, notes: ‘The unrest in Hong Kong and the US/China trade wars have been a source of concern. Fortunately, Asian business remains robust, although we expect an uptick in Asian restructuring work in the next couple of quarters.’

According to Tarn, economic substance requirements have been ‘one of the most fundamental shifts in our business environment since the late ’90s, bringing both challenges and opportunities’. Economic substance concerns have resulted in a huge amount of advisory work as investors, funds, businesses and individuals have all been pulled into its orbit. The new regulations that came into force in 2019 require entities carrying on specific types of business in key offshore jurisdictions to demonstrate adequate economic substance in that jurisdiction.

Ohlsson notes: ‘The introduction of economic substance requirements across offshore jurisdictions over the past 12 months has, without question, been a significant area of focus for businesses. Our teams across Bermuda, the BVI, the Cayman Islands, Guernsey and Jersey have been busy advising on all substance matters.’

So what do firms anticipate for 2020? ‘Clients will reposition for growth or downsizing depending on the markets,’ says Pierce. Meanwhile, Mackereth points to ‘multifaceted uncertainty: the nuts and bolts of the Brexit trade agreement, whether the China-US trade war and investor confidence will continue, or whether the storm clouds will part and global growth will accelerate’.

Despite numerous headwinds, Rigby remains upbeat. ‘The prospect of a global economic downturn has receded, there is growing hope of a breakthrough in the US-China trade war, and the recent election result has delivered much needed political stability in the UK and clarity over the country’s membership of the EU.’

Below are snapshots of the ten largest offshore firms in 2019, focusing on their recent performance and practice growth.

***

APPLEBY

Lawyers: 184, including 70 partners

Offices: Ten (Bermuda, BVI, Cayman Islands, Guernsey, Hong Kong, Isle of Man, Jersey, Mauritius, Seychelles, Shanghai)

Group managing partner: Malcolm Moller (Mauritius)

Focus: Corporate, dispute resolution, private client/trusts, property and regulatory

Recent standout work: Representing HSBC in a £7bn longevity swap associated with its pension plan members and a reinsurance transaction – the second largest on record; advising Santander on the transfer of its banking businesses in Jersey and the Isle of Man, a complex multi-jurisdictional restructuring involving court-sanctioned schemes in both jurisdictions

‘Our leading clients in terms of revenue continue to be dominated by global banking groups and we are seeing an increase in revenue across these clients.’
Malcolm Moller, Appleby

Following a management buyout of its fiduciary arm Estera in 2016, Appleby became the latest offshore firm to return to the market launching a new fiduciary business, Appleby Global Services (AGS), in February 2019. Moller, who was appointed group managing partner in January, says it is ‘a significant part of Appleby’s growth strategy’. AGS launched in six jurisdictions (Bermuda, Cayman, Hong Kong, Isle of Man, Jersey and Mauritius) and has secured a licence to open in Seychelles from early 2020. ‘The business is growing rapidly, ahead of target in its first year,’ he adds.

Pointing to continued steady growth overall, Moller notes: ‘Our leading clients in terms of revenue continue to be dominated by global banking groups and we are seeing an increase in revenue across these clients.’ Appleby has also seen a year-on-year strengthening in retention of its top 25 clients. In the latest financial year, the firm worked for 23 of its top 25 clients (92%), compared to 88% the previous year and 80% two years ago.

There has also been a significant rise in economic substance advice for clients in 2019: a revenue increase of 366% in this area compared to the previous year and therefore a major source of fee income, particularly in Bermuda, BVI and Cayman. That apart, Appleby continues to capitalise on its position as the only offshore law firm operating in every Crown Dependency, advising banking and institutional clients across the three jurisdictions. Appleby has led on all six major restructurings completed by UK banks in the Crown Dependencies since 2013, involving cumulative assets of a round £50bn.

BEDELL CRISTIN

Fee earners: 86, including 29 partners

Offices: Six (BVI, Cayman, Guernsey, Jersey, London, Singapore)

Global managing partner: Tim Pearce (Jersey)

Focus: Banking, capital markets, property, corporate/commercial, insolvency/restructuring, insurance/reinsurance, investment funds, litigation, private client, probate, regulatory and compliance

Recent standout work: Acting for Inflexion Private Equity Partners on the acquisition of Estera, a global provider of funds, corporate and trust services, from Bridgepoint; advising a US hedge fund, the majority creditor of Four Seasons Health Care, on Jersey, Guernsey, BVI and Cayman law

‘We have had a lot of interest in our traditional offshore centres, such as Jersey and Guernsey, as a result of what is happening in Hong Kong.’
Tim Pearce, Bedell Cristin

‘This year has been one of consolidation because in October 2018 we merged with Solomon Harris in Cayman,’ says Bedell’s global managing partner Tim Pearce. ‘Following the split from what became Ocorian [formerly Bedell Trust] in September 2016, the firm has had to make many changes and a lot of investment. Cayman was part of that and our Cayman property team is absolutely booming. BVI litigation is another part: 2019 was our best year in the last five.’

Given the uncertainty over the US-China trade war and potential conflict with Iran, notes Pearce, people want to put their capital in a stable environment like Cayman. ‘We have also had a lot of interest in our traditional offshore centres, such as Jersey and Guernsey, as a result of what is happening in Hong Kong,’ he notes. ‘A lot of our clients are now routing their capital through our Singapore office and using that as a hub instead.’

Consolidation has also involved building strength across the firm. In 2019, six partners were laterally hired: in the Channel Islands, corporate partner Sara Johns joined the Jersey office from Ogier while another corporate partner, Dylan Latimer, joined the Guernsey office from Mourant. Two partners were also hired in Cayman: Joss Morris joined the corporate team from Collas Crill and Andrew Miller joined from Walkers as head of international private client. Meanwhile, Tim Wright joined from Carey Olsen as head of dispute resolution in BVI and Kerrie Le Tissier joined from Collas Crill as an international private client partner in Guernsey.

CAREY OLSEN

Lawyers: 235, including 59 partners

Offices: Nine (Bermuda, BVI, Cape Town, Cayman, Guernsey, Hong Kong, Jersey, London, Singapore)

Group managing partner: Alex Ohlsson (Jersey)

Chair: John Kelleher (Jersey)

Focus: Banking and finance, corporate and commercial, investment funds and private equity, dispute resolution, trusts/private wealth, property, employment and insurance

Recent standout work: Advising insurance company Marsh & McLennan on its acquisition of Jardine Lloyd Thompson Group for $5.6bn; representing Asia Private Credit Fund and Adamas Asia Strategic Opportunity Fund in Cayman and Hong Kong, joint voluntary liquidators of two investment funds in separate but related cases

‘Our growth in Asia continued apace in 2019 with the launch of a BVI and Cayman corporate practice in Hong Kong and a BVI and Cayman litigation practice in Singapore.’
Alex Ohlsson, Carey Olsen

‘Our growth in Asia continued apace in 2019 with the launch of a new BVI and Cayman Islands corporate practice in Hong Kong and a new BVI and Cayman Islands litigation practice in Singapore,’ says Alex Ohlsson, group managing partner of Carey Olsen. This was supplemented by lateral hires of disputes partners Michael Padarin and James Webb, both from Walkers.

Other lateral partners were hired last year: corporate partner, Jasmine Amaria, who joined the London office, also from Walkers; litigation and insolvency partner Richard Brown, who joined from the London office of Harneys; and James Noble, who launched the firm’s BVI and Cayman litigation practice in Singapore, having been the managing partner of Harneys’ Singapore office.

At the end of 2019, Carey Olsen employed 470 people. This includes 235 lawyers (up 11% on 2018 and up 15% on 2017). Partner numbers went up from 52 in 2018 to 59 at the end of last year. Ohlsson notes that the firm has also added a Bermuda law capability in Hong Kong with the relocation of Henry Tucker and Kyle Masters, a move that means ‘Carey Olsen is the only offshore law firm in Hong Kong and Singapore that can offer on-the-ground advice of Bermuda, BVI, Cayman, Guernsey and Jersey law’. Having initially launched in 2017 with just one lawyer, managing partner Michael Hanson, the Bermuda operation has since grown to four partners and a total of 14 lawyers.

COLLAS CRILL

Lawyers: 82, including 34 partners

Offices: Seven (BVI, Cayman, Guernsey, Jersey, Hong Kong, London, Singapore)

Group managing partner: Jason Romer (Guernsey)

Chair: Nigel Vooght (London)

Focus: Banking/finance, capital markets, corporate/commercial, dispute resolution/insolvency, investment funds/private equity, trusts/fiduciary/private client services, property, risk and regulatory, and UK real estate

Recent standout work: Advising Arif Naqvi, former chairman/chief executive of The Abraaj Group, on provisional liquidations and potential restructuring of financial obligations, valued at $500m, spanning Cayman, the Middle East, Latin America and Africa; defending the professional trustee against an allegation of breach of trust and conspiracy in a £70m claim, AFS Trustee v Wilton Trustees, and successfully opposing appointment of a receiver over the BVI company

‘Our strategy over the past five years has been to diversify revenue streams and establish an international footprint. This has enabled us to double in size.’
Jason Romer, Collas Crill

‘Our strategy over the past five years has been to diversify revenue streams and establish an international footprint, serving our clients in the jurisdictions in which they operate,’ says Jason Romer, group managing partner of Collas Crill. ‘This approach has served us well and has enabled us to double the size of the firm in that time.’

Having extended its reach through mergers – Collas Day in Guernsey and Crill Canavan in Jersey (2011); Charles Adams Ritchie & Duckworth in Cayman (2015); and Farara Kerins in the BVI (2017) – organic growth has since become the key strategic objective. In November 2019, Collas Crill Compliance was launched to provide governance, risk and compliance, and anti-money laundering/counter-terrorist financing services, to regulated and non-regulated businesses.

Dispute resolution continues to dominate the firm, in particular high-profile insolvencies, and with the evolution of trust structures, disputes between second-generation beneficiaries. ‘We’ve made several strategic lateral hires in recent years, which have been instrumental in developing the global DR practice,’ says Romer. Last year, these included corporate finance and funds partner Matthew Gilley, who joined from Ogier in Jersey, and Tom Mylott, head of international private client and trusts in Cayman, who joined from Scotiabank. Romer notes that the BVI office has seen a significant increase in corporate advisory and restructuring work arising from new economic substance legislation.

CONYERS DILL & PEARMAN

Lawyers: 136, including 58 partners

Offices: Eight (Bermuda, BVI, Cayman, Dubai, Hong Kong, London, Mauritius, Singapore)

Chair: Christian Luthi (Bermuda)

Focus: Corporate (including aviation, banking and finance, capital markets, hedge funds, insurance, M&A, private equity/venture capital and shipping), dispute resolution, private client/trust, intellectual property (IP) and real estate

Recent standout work: Advising Aircastle on its $7.4bn acquisition by Marubeni Corporation and Mizuho Leasing Company; advising Luxoft, an NYSE-listed software development company on its $2bn acquisition by DXC Technology – the largest ever takeover by value of a publicly listed BVI company; acting for PagSeguro Digital on its $653.3m secondary follow-on offering on the NYSE

‘Litigation has enjoyed the strongest performance. While corporate had a good year, we have not seen the same number of company incorporations as before.’
Christian Luthi, Conyers Dill & Pearman

Conyers headcount grew by about 6% in 2019, according to Christian Luthi, with 19 new fee-earners anticipated to be joining in the 2019-20 financial year. ‘We have continued to grow and strengthen our Cayman offering, with three lateral partner hires,’ he adds, pointing to ‘a steady flow in restructuring and insolvency work across the board’. Nicholas Pattman, corporate (funds) partner, joined from Walkers and litigation partner Jonathon Milne from Mourant, while disputes partner Alex Potts QC will soon be joining from Kennedys.

‘Litigation has enjoyed the strongest performance,’ says Luthi. ‘While the corporate practice had a good year we have not seen the same number of company incorporations as before across the three jurisdictions in which we operate.’

Conyers has hired experienced associates across its corporate and litigation practices in Bermuda, Cayman and in BVI. ‘In Hong Kong and Singapore, we see demand for further increasing our capability, particularly in dispute resolution,’ says Luthi. In Bermuda, he points to insolvency and restructuring work sourced in Asia and significant energy restructuring matters. However, the big-ticket litigation continues to be in trusts, while the busiest areas for Conyers’ BVI litigation practice continue to be asset tracing and asset recovery work as well as shareholder disputes and receiverships. Conyers acted in the longest BVI Commercial Court trial of the year, Yao v Kwok, an Asia-based shareholder dispute.

HARNEYS

Lawyers: 182, including 60 partners

Offices: Nine (Bermuda, BVI, Cayman, Cyprus, Hong Kong, London, Luxembourg, Shanghai, Singapore)

Executive committee chair: Peter Tarn (London)

Focus: Litigation, restructuring and insolvency, commercial and corporate, private wealth/trusts, investment funds, tax and regulatory, IP, banking and finance, shipping/aircraft, insurance and real estate

Recent standout work: advising DXC on its $2bn acquisition of Luxoft, the largest ever (by value) take-private of a BVI publicly listed company; acting as issuer counsel for China Feihe on its $855m initial public offering (IPO), one of the biggest Hong Kong IPOs of 2019; and acting as issuer counsel for Melco Resorts Finance on a $600m public bond issued by Studio City Finance

Peter Tarn describes his firm’s performance as ‘a steady upward growth trajectory’. In April, it merged with M Partners to form Harneys Luxembourg, providing advice on investment funds, corporate, private wealth, regulatory and tax. The firm gained four Luxembourg partners: managing partner and head of regulatory and tax, Andrew Knight; corporate partner Charl Brand; multi-disciplinary lawyer Chiara Deceglie; and head of Luxembourg investment funds, Vanessa Molloy.

Other 2019 partner hires included Nicola Roberts (from Ogier) who joined the Hong Kong litigation, insolvency and restructuring team; Yin Xu (from Walkers) who became a transactional partner in Hong Kong; Lishi Fong was recruited from Norton Rose Fulbright to head up the Singapore transactional team; while Charlie Clayton-Payne joined the Hong Kong banking and finance team from Hogan Lovells.

‘Since 2017, we’ve noticed a trend towards increasing deal values, as demonstrated by DXC Technology’s acquisition of Luxoft.’
Peter Tarn, Harneys

Meanwhile, Harneys no longer has a Bermuda office. Instead, it now provides Bermudian legal services through a referral arrangement with Zuill & Co, an independently owned and controlled Bermudian law firm.

‘It’s been an incredibly successful year for our corporate team: our BVI office has been the most active over the past year,’ says Tarn. ‘Since 2017, we’ve noticed a trend towards increasing deal values, as demonstrated by DXC Technology’s acquisition of Luxoft.’

In Cayman, he adds, subscription finance has been a key growth area. ‘We’re seeing more banks enter the market and more deals being launched as the appetite for this level of speciality finance from private equity funds increases.’

MAPLES AND CALDER

Lawyers: 355, including 136 partners

Offices: Nine (BVI, Cayman, Dubai, Dublin, Hong Kong, Jersey, London, Luxembourg, Singapore)

Global managing partner: Jonathan Green (Cayman)

Focus: Disputes, corporate, finance, funds, insolvency and corporate restructuring, insurance, IP/technology/telecoms, private equity, property/construction, regulatory/financial services, sports/media/entertainment, tax and trusts

Recent standout work: Advising Alibaba on its $11.2bn IPO, the largest offering in Hong Kong since 2010; advising SMBC Aviation Capital on Global Aviation Equipment Leasing Fund, an aviation equity fund for 17 Japanese institutional investors

‘2019 was a memorable year. We reached 2,000 staff, rolled out a complex rebrand and expanded our global footprint to 18 locations.’
Jonathan Green, Maples

Taking account of its broad service offering, Maples is comfortably the largest offshore firm, although in terms of pure lawyer headcount it was overtaken for the first time by Walkers last year.

2019 was a ‘particularly memorable year for the Maples Group’, according to Jonathan Green, who was appointed in December. ‘We reached 2,000 staff globally, rolled out a complex rebrand and expanded our global footprint to 18 locations worldwide. Over the past 18 months, we opened new offices in Abu Dhabi, Bermuda, Shanghai, Jersey and Luxembourg. Over the past five years, we also extended the number of locations from which we offer our jurisdiction-specific services, for example, we now have an Irish practice in four of our 18 locations: Cayman, Dublin, Hong Kong and London.’

In Abu Dhabi, Bermuda and Shanghai, MaplesFS is a corporate service provider offering specialised fiduciary and fund administration services. But in Jersey and Luxembourg, it also offers legal services. In terms of recruitment, two lateral partner hires stand out: Karen Killalea, head of employment in Dublin, who came from A&L Goodbody and Jonathan Silver, finance partner and head of shipping for Asia, who joined from Norton Rose Fulbright in Hong Kong.

The January 2019 rebrand, says Green, consolidates the Maples and Calder and MaplesFS offerings under a single brand: the Maples Group.

MOURANT

Lawyers: 237, including 61 partners

Offices: Six (BVI, Cayman, Guernsey, Hong Kong, Jersey, London)

Global managing partner: Jonathan Rigby (Jersey)

Senior partner: Robert Shepherd (Guernsey)

Focus: Finance and corporate, funds, international trusts/private client and litigation

Recent standout work: Advising Shire on its £46bn takeover by Takeda, the largest-ever outbound M&A deal by a Japanese company and the largest-ever takeover of a Jersey company; acting for Kalo as liquidators in a $2bn liquidation of Kingate Global Fund and Kingate Euro Fund, two of the largest investors in the Madoff Ponzi scheme, in a BVI settlement and Chapter 15 recognition

‘If our optimism proves well founded, our biggest challenge will be to continue to recruit the talented professionals we need to sustain our growth.’
Jonathan Rigby, Mourant

‘We have seen further year-on-year revenue growth off the back of a record year in 2018,’ says Jonathan Rigby. ‘In line with our strategy, US dollar revenue growth has been particularly strong and now accounts for well over a third of our revenue overall. In Asia, specifically, our compound annual growth rate has averaged 54% per year over the last five years.’

Rigby points to corporate work as having the highest revenue growth rate last year. ‘The strong activity in our corporate practice is also generating impressive growth in our affiliated business, Mourant Governance Services,’ he notes.

Mourant’s Jersey office had an ‘outstanding performance’ in 2019. The biggest drivers were schemes of arrangement, investment in UK commercial real estate, downstream private equity transactions and – in the second half of the year – new investment fund launches. In Cayman and Hong Kong, he points to fund finance, private equity transactions, and demand for increasingly sophisticated regulatory and compliance advice.

Mourant made three lateral partner hires last year, including two from Walkers in Cayman: corporate and finance partner Ramesh Maharaj, and banking and finance partner Alexandra Woodcock. In Hong Kong, insolvency and commercial litigation partner Justine Lau joined from Mayer Brown.

‘We’re relatively optimistic about market conditions in 2020,’ says Rigby. ‘If our optimism proves well founded, then our biggest challenge will be to continue to recruit the talented professionals that we need to sustain our growth in what is already a highly competitive recruitment market.’

OGIER

Lawyers: 365, including 65 partners

Offices: Eight (BVI, Cayman, Guernsey, Hong Kong, Jersey, Luxembourg, plus presences in Shanghai and Tokyo)

Global managing partner: Edward Mackereth (Jersey)

Global senior partner: Steve Meiklejohn (Jersey)

Focus: Banking and finance, corporate and commercial, dispute resolution, environment, investment funds, listings, private client/trusts, real estate, regulatory, restructuring/insolvency and tax

Recent standout work: Advising Takeda on its £46bn acquisition of Shire, creating one of the world’s largest pharmaceutical firms and the largest-ever foreign takeover by a Japanese company; acting for The Carlyle Group and Carlyle Investment Management in a $2bn dispute – Guernsey’s Court of Appeal upheld the judgment that they were not responsible for Carlyle Capital Corporation, a Guernsey investment fund, going into insolvency in the 2008 financial crash

‘Requirements for cross-jurisdictional working have increased, notably between Cayman and Luxembourg, two of the leading investment fund jurisdictions.’
Edward Mackereth, Ogier

‘All of our offices have seen growth,’ says global managing partner Edward Mackereth. ‘Client requirements for cross-jurisdictional working have increased, notably between Cayman and Luxembourg, two of the world’s leading investment fund jurisdictions.’

Ogier’s headcount has grown by 22% over the past three years and last year there was a notable increase (to almost 5:1) in partner: associate leverage. As part of that growth, the firm hired three lateral partners in 2019: tax partner William Jean-Baptiste and investment funds partner Benoît Rose, who both joined the Luxembourg office from CMS, and litigation partner Nic Journeaux, who joined the Jersey office from Carey Olsen.

‘We’ve seen a noticeable spike in dispute resolution work in the past 24 months across almost all jurisdictions,’ adds Mackereth. ‘In particular, our Cayman, BVI and Hong Kong teams have seen the most substantial growth, collectively doubling in size in two years.’

The impetus, he says, comes from ‘many large, complex cases, including cross-border commercial litigation, restructuring and insolvency, trusts, regulatory, professional negligence cases, proceeds of crime cases originating from North and South America, Europe and CIS, Middle East and Asia.’

In Cayman, Ogier’s disputes team has been heavily engaged in the Abraaj litigation, while in the BVI it acted for QGOG Constellation in its $2bn restructuring – the BVI’s first ‘soft touch’ provisional liquidation.

WALKERS

Lawyers: 408, including 114 partners

Offices: Ten (Bermuda*, BVI, Cayman, Dubai, Hong Kong, Guernsey, Ireland, Jersey, London, Singapore)

Global managing partner: Ingrid Pierce (Cayman)

Focus: Banking and finance, corporate, funds, insolvency and dispute resolution, insurance, listing services, private equity, real estate, regulatory and compliance, structured products/capital markets, taxation (Ireland) and wealth structuring

Recent standout work: Acting as Cayman, BVI and Bermuda counsel to Parkland Fuel Corporation in their 75% acquisition of Sol Global Investments for $1.2bn; advising across five offices on the Cayman court-driven restructuring of Abraaj, once the largest private equity firm in the Middle East with $14bn in assets

‘In 2019 we experienced 14% growth in global headcount and 13% growth in legal fee-earner headcount.’
Ingrid Pierce, Walkers

Walkers continues to grow at a remarkable pace – more than doubling its staff numbers from 420 in 2015 to 900 today. ‘In 2019 we experienced 14% growth in global headcount and 13% growth in legal fee-earner headcount,’ says global managing partner Ingrid Pierce. Notably, partner numbers increased from 99 in 2018 to 114 last year.

Eight of these were lateral hires: in Bermuda, finance partner Sarah Demerling joined from Estera, having previously been an Appleby partner; in BVI, finance partner Matthew Cowman joined from Australian Unity; in Dublin, employment partner Susan Battye joined from LK Shields; in Guernsey, trusts partner Rajah Abusrewil joined from Babbé; in Hong Kong, finance partner Nicholas Davies joined from Appleby; in Jersey, disputes partner Nigel Sanders joined from Ogier and funds partner Leanne Wallser joined from Mourant, while regulatory partner Sara Hall joined the London office from Deutsche Bank where she was global head of regulatory compliance.

‘Demand for our services has increased across the board,’ says Pierce. ‘Finance and capital markets remain highly active in Ireland and Cayman. Insolvency and dispute resolution is on the rise, with impressive growth in Jersey, while Cayman-domiciled private equity fund instructions have increased, due in part to a stronger US market and the amount of capital now being deployed.’ She adds that fund finance has remained very strong and that Walkers global regulatory practice has grown because of new developments. LB

Offshore headcount by firm/office – partners/associates

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