The Russian law firms received a devaluation handicap

Nikita Prokofiev, Managing Partner of Legal Search One, describes the current situation: “There is a colossal movement in the market, it has just begun and cold lead anywhere”. Cutting costs, splits of firms, dumping, creation of boutiques by ILF graduates and appearance of free-lancers of the highest qualification, fight for survival and expansion – all this is happening simultaneously and at once, lawyers say. Alexandra Nesterenko, President of the Association of Corporate Lawyers, says that there has never been so much competition at the legal market. Vedomosti questioned the market players and their clients in order to assess the situation, the lawyers’ attitudes and their prognostications (with the help from the ACL).

The market enters into the crisis

The Russian legal market was prepared for the crisis, when it came. Oksana Balayan, Managing Partner of Hogan Lovells (CIS), is ironic: “We have lived through so many crises that we have been working on the constant crisis premises for quite some time already”.

Lawyers learned their lessons during the crisis of 2008–2009, when the years of abundance came to sharp end and were followed by, economically speaking, “budget consolidation” – clients pushed the prices down and did more and more things themselves. That was a period of a desperate struggle for new orders, of splits of large Russian law firms, dismissals in the IFLs, appearance of new and aggressive players <...>

The average rates are stable, says Evgeny Zhilin, Managing Partner of YUST.

One of the main demands of the clients (and this is a universal trend over the last years): “Know how much you pay”. According to a survey done by Legal Insight and Legal Success, 47% of law firms employ the hourly rates in less than a half of all projects, 40% – in more than a half, while 13% - not at all.