In a strategic recalibration amidst the ongoing market slump and escalating Sino-U.S. tensions, U.S. law firm Dechert LLP is weighing the closure of its offices in Hong Kong and Beijing, sources say.
With over 20 employees in Hong Kong, including 14 lawyers and four partners, and a smaller Beijing contingent of three lawyers, the firm has begun internal discussions about the potential shutdown. Impacted employees were informed earlier this month, though official announcements are pending.
As part of a broader shift, Dechert is considering relocating its Chinese operations to Singapore, which currently hosts 14 lawyers, including six partners. The firm’s global footprint includes approximately 1,000 lawyers.
This potential retreat from China aligns with a trend among international law firms, grappling with new regulatory pressures, economic instability, and geopolitical frictions. Last year, Dentons terminated its partnership with China’s Dacheng, citing stringent data privacy and cybersecurity regulations. Similarly, Morrison & Foerster and Sidley Austin have also scaled back their Chinese operations recently.
Dechert’s financial performance mirrors industry-wide challenges. The firm’s global revenues saw a modest 0.4% increase to $1.294 billion last year, while profits per equity partner dipped by 1.2%. In May 2023, Dechert laid off 55 lawyers and 43 business professionals, a 5% reduction of its workforce, as it adjusted to declining demand in legal services following a hiring surge during the corporate deal-making boom of 2021 and early 2022.
The decision on the final closure date and client notifications remains undetermined. Dechert representatives have yet to comment on the matter.
