China-US trade conflict escalation, GDPR, and new technology will continue to influence developments in the legal industry. Our market insights team has monitored various industry developments and summed up some of the top trends will shape the legal industry by 2020:
1.China-US Trade Conflict Continues
The trade conflict between China and the United States is two sides of the same coin. The utter uncertainty has affected various industries, including legal, but on the other hand, it has increased the demand for legal advice.
Trade conflict will inevitably slow down international trade, and global companies may see reduced revenue. However, the fast-changing trading landscape creates chances for the following sectors: IP and commercial. One of the US critiques in the IP system in China was its limited enforcement capabilities that have been awarded for IP infringement. During economic turbulence caused by the trade conflict, businesses will turn to the enforcement of IP rights to provide new revenue streams that will increase in IP litigation and licensing activities both in China and the US. The trade war appears not likely to end soon, and multinational companies scramble to reconsider their business models. They will rely on commercial lawyers to draft contingency terms into new contracts and to apply for a tariff exclusion.
2. Legal Compliance for Fintech & Startups
Compliance law has become increasingly rigorous throughout the world. Complying with various regulations in regulated markets haunts every fin-tech or startup. This problem is compounded for these companies with presences in multiple jurisdictions, where regulatory approaches in different countries can create additional burdens. Companies come to realize a clear-sighted assessment of regulatory risk and making compliance a part of their business operations are fundamental to success. Regulatory compliance and risk management, therefore, will be a major growth area in 2020.
3. The General Data Protection Regulation (GDPR) in Asia
The European GDPR not only rattled tech giants with threats to hand out hefty fines but also was a wake-up call to Asian countries. We are living in a connected digital society, the businesses of many organizations in Asia are global in nature. Online transactional data and privacy issues through an extra-territorial application is the primary focus of Europe’s new GDPR. The lawsuits against Google and Facebook proclaim the GDPR is a big issue for all global companies, including non-European organizations that do business with EU citizens. After the law came into force, Asian companies and firms will continually assess whether their business operations will place them within reach of the GDPR and EU regulators and prepare accordingly. As a result, more job opportunities for legal and compliance sector in the region will be created.
4. Moving In-house
The headline hires in the Hong Kong legal market this year is undoubtedly several major law firms’ partners moving in-house: Paul Chow from Davis Polk to Cathay Pacific, Jeanette Chan from Paul Weiss to Airwallex, and Bonnie Chan from Davis Polk to HKEx. When regulatory risks and global political environments are challenging, more multinational companies are determined to strengthen their risk management, to provide more significant supports for the operations, and to increase transparency and accountability in their businesses. Hiring the best talent with a proven track record of corporate transactions, corporate governance, and regulatory compliance seems to be a wise choice.
5. Regional Hub Singapore
From the threats of the trade war to the rising growth of the Southeast Asia market, more global companies choose Singapore as their base for reaching the rest of the region and some even global. The most eye-catching deals of 2019 are the Dyson’s £330million global headquarters in Singapore and the new Singapore-Rolls-Royce AI partnership. We have seen a rapid evolution of the business landscape and climate across Singapore. We anticipate the in-house legal teams, and the business legal services market in Singapore will steadily grow in 2020.
6. The Rise of Aero-Space Law
Commercial space flights, SpaceX, and Blue Origin, spur a new economy. China is also planning to install the first space-based solar-powered satellite into orbit. Moving ahead, we anticipate exciting developments in the area of space law at both international and domestic levels. How the law develops to regulate the operations of corporations and individuals in space as past and current treaties are inadequate to govern new space developments. This gap represents a transitional point with worlds of opportunity waiting for space lawyers from different jurisdictions. As this sector is dynamic and evolving in nature, companies require legal professionals to evaluate the development and handle copyright and accident liabilities.
Key Contributor: Fai Choi