Nishimura & Asahi has become the second Japanese Big Four law firm to allow foreign lawyers to become full equity partners, as the country’s legal industry fights to compete with foreign law firms on cross-border deals in the world’s third-largest economy.
The change to its structure comes days after Japan released guidelines to promote increased M&A activity in the country, cracking down on defence tactics aimed at blocking takeovers and entrenching management that have frustrated global investors for years.
The shift involves 800-attorney Nishimura registering as a foreign law joint enterprise – the same structure under which international law firms such as Baker McKenzie, Clifford Chance, Morrison Foerster and White & Case operate in Japan.
The move will allow Nishimura to attract international transactions lawyers with cross-border M&A expertise to its Japanese offices, as it looks for a bigger slice of the country’s M&A advisory pie.
“As cross-border economic activity becomes increasingly important, clients require legal services unconstrained by past precedents,” Nishimura & Asahi said in a statement. “We aim to strengthen the international collaboration between Japanese and non-Japanese lawyers on cross-border matters through the establishment of the Foreign Law Joint Enterprise,” the firm said.
Traditionally, Japanese law firms did not allow foreign lawyers to obtain an ownership stake in law firms. This made it difficult for local firms to attract non-Japanese talent at any level, who would not want to move to Japan without the prospect of growing to equity partner.
Rival Big Four firm Anderson, Mori and Tomotsune undertook the same structural change in 2020 and has increasingly attracted more non-Japanese talent as a result.
Another large Japanese law firm Atsumi & Sakai registered a foreign law joint enterprise with Janssen Foreign Law Office to launch Atsumi & Sakai and Janssen in 2014.
Nishimura & Asahi also unveiled a new logo that features three “Nishimura Arrows” pointed upwards, denoting reaching for the sky.