TRUTH AND JUSTICE: Foreign companies are investing again in Estonia, providing more work for legal advisors.
RIGA - Estonia has made huge efforts in getting back to a productive working environment after the financial crisis, says the latest report of IFLR (International Financial Law Review). It is also mentioned that “the business climate of Estonia is becoming more investor-friendly and the efforts undertaken are already bringing results.” Investors are a very important part of the business for law firms now in Estonia. Nowadays, both international and local entrepreneurs need to be supported by qualified law firms in order to make the best decisions for the legal issues.
Greinoman & Co, established in 2007, provides legal advice in commercial and business law, in addition to different litigation work. For such a competitive business environment as is now, Greinoman says it has to offer highly personalized service to maintain business stability. Maksim Greinoman, a sworn advocate at Greinoman & Co, explains his view about the situation for this year: “In my personal opinion, 2011 will most likely bring stability to the volatile legal services market and create strong differentiation among law firms, dealing with business clients on the one side, and the high street law firms engaging private clients and taking state funded legal aid cases on the other side.” He also adds that significant changes during the crisis have influenced client purchasing power. “The hourly rate will remain at the level of 130-180 euros per hour, VAT exclusive.
Our company also expects to maintain its hourly rate, fitting this indication,” says Greinoman, emphasizing that this represents only his own personal opinion. Other members of the legal profession or the bar association might have different point of views, clarifies Greinoman.
Another noted firm in the legal industry is Tark Grunte Sutkiene, which specializes in commercial law for clients in the Baltic States. Its basic core practice areas include banking and finance, capital markets, merger and acquisitions, general corporate and dispute settlement. Janeli Jallai, management assistant at Tark Grunte Sutkiene, explains that nearly half of their clients are either from abroad, or local subsidiaries of international companies. In the question of further improvements for law firms, Jallai points out that law firms have not suffered as much as Estonia did, in general. “Grunte Sutkiene even improved its market position and is very optimistic about the future. Estonia’s exports in 2010 Q4 were record high; foreign investments have returned and we see more activity among our foreign as well as domestic clients,” adds Jallai.
Gencs Valters Law Firm also deals with companies that have established their business in the Baltic States. Their focus is mainly on legal and tax questions, in order to serve mainly expatriates who are residents in the Nordic states and have business in the Baltics. Valters Gencs, founding partner of Gencs Valters Law Firm, explains: “[Our] Estonian [office] was set up in spring 2008 to serve foreign companies which have business in the Baltics, to provide seamless service on a pan-Baltic scale. In autumn 2008, the Lithuanian office of our firm was founded in Vilnius. This leads us to be the only Latvian law firm which has our own offices in all the Baltic States. In 2008 we joined Multilaw, a worldwide association of independent law firms with over 6,000 lawyers in 150 commercial centers around the world.” Gencs also mentioned assisting companies in resolving shareholder disputes which arise from a different understanding of the profit split, or allowable expense items.
Annika Trass, managing partner at Gencs Valters Law Firm, shares her opinion about the current trends in the industry: “The situation in law companies in Estonia in 2011 is remaining stable; the years 2006-2007 brought many new law firms into the market, a lot of them closed their doors in 2009, many fired their workers. 2010 showed new positive indicators in the business and the remaining firms are hiring new staff again. The currency change in 2011 brings in many new investors; therefore, law firms are active again. There is also change of the ownership of the businesses, which means a change of legal advisers. Weak companies are acquired, stronger ones start to dominate the market, as the crisis’ excess is being reversed. As an example, on February 21, it was reported publicly that Alta Property and Construction sold its shares in Latvijas Energoceltnieks back to the Latvian company.”
Strong political forces in Estonia could bring a positive impact to the law industry, along with a healthy business environment. Jallai hopes that general elections in March will make that happen. “Lawyers would like to work in such an environment,” says Janeli. Gencs points out that an effective VAT refund system and electronic signature supports important trends in business for Estonia.