Top London law firms are planning to move to Ireland after Brexit, posing a huge threat to one of the capital’s biggest profit drivers.
It comes amid heightened nervousness over Britain’s future relations with the EU as acrimonious divorce negotiations continue.
More than 1,000 UK lawyers have reportedly registered to work in Ireland since the Brexit vote, with 30 taking the further step of getting a certificate to practice.
Many international finance contracts are written in English law, but enforcing them in the EU will become more difficult after Britain’s departure from the bloc.
Like bankers, lawyers are now weighing up a move to Dublin to avoid such possible changes caused by the UK’s exit, a high-profile Irish foreign investment boss said.
Kieran O’Donoghue, head of International Financial Services at IDA Ireland, which is responsible for foreign investment into the country, said: “Other sectors … that initially adopted a ‘wait and see approach’ have now awoken to Brexit and legal firms in the UK are now looking at Ireland.”
Stuart Gilhooly, president of the Law Society of Ireland, said that although most do not intend to move, some firms have announced an interest.
Simmons & Simmons, a law firm set up in the capital’s financial district more than a century ago, said it intended to open an office in Dublin to deal with customers including investment managers and hedge funds, Reuters reported.
“There are other opportunities in Ireland in financial institutions,” said Jeremy Hoyland, managing partner at the firm.
“That is obviously an area where Ireland has not been a focus for us but post-Brexit, there is clearly going to be more activity in Ireland.”
DLA Piper, an international law firm, said it was examining its options, referring to the prospect of setting up an office in Ireland.
Although few moves have yet taken place, such thinking highlights the danger that London’s legal services sector could splinter along with the financial industry.
Ireland’s appeal is based chiefly on its use of a common law legal system, copying that of Britain, which lawyers said would be easier to switch to for international groups that now use London courts and lawyers.
Dublin was also given a boost by industry group the International Swaps and Derivatives Association’s (ISDA) to examine writing contracts for the multi-trillion dollar derivatives sector in Irish and French law due to Brexit.
“The ISDA thing is massive when you think of the sheer value of transactions,” said Paul McGarry of Ireland’s Bar Council, which represents barristers,
He added that the country’s commercial court could grow rapidly to cope with new demand.
“We have a very efficient commercial court. It has plenty of capacity to increase.”