UK Firms Outline Requirements For General Counsel In Emerging Markets

by Robin Pilgrim, LawAndTax-News.com, London

27 April 2005

A report published last week by international law firm Baker & McKenzie has highlighted the appetite among UK companies for doing business with the emerging markets of Brazil, Russia, India and China, providing insight into what opportunities British industry perceives to exist in the so-called BRIC markets, and what they are looking for from their General Counsel to facilitate them.

According to Baker & McKenzie, respondents rated China and India as the most attractive markets, followed by Russia and then by Brazil. More than two-thirds of respondents revealed that they are already operating in China, with more than half in Russia and India, and just under half operating in Brazil.

In terms of the priorities for general counsel in the aforementioned emerging markets, tensions were highlighted in the report between globally set standards and local practices - with ethics and dealing with corruption very high on the agenda of UK PLCs and a major challenge in all markets, but especially in Russia.

Business executives expressed concerns about their liability in the light of heightened corporate governance standards (such as Sarbanes-Oxley), tougher anti-money laundering measures, and the need to ensure that the requirements of various industry regulators are fully met.

The report, based on in-depth interviews with 51 high level officials from FTSE 500 companies, went on to explain that intellectual property (IP) and brand protection issues are the predominant concerns for businesses. This feeling was expressed across the board, and included concerns about giving away IP to joint venture partners without protecting it adequately, through to criminal activities such as counterfeiting goods.

Paul Rawlinson, Chair of Baker & McKenzie's Global IP Group observed that:

“The more diverse your product market, the more wide-ranging your protection must be: getting your trade mark back from an opportunist local entity can be a nightmare; being locked-out of a market because of an abusive patent registration is also a nightmare. It comes back to having a proactive strategy to avoid this type of issue."

"Companies are not filing IP rights early enough, particularly where there is a first to file rule. One single abusive registration can put you in the position of having to pay locally or rely on international treaties to get your rights back."

The law firm concluded by announcing that in emerging markets such as Brazil, Russia, India and China, the challenge for general counsel is to maintain the focus of the board on risk management.

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