Kennedys to close Moscow office

Kennedys to close Moscow office

Linklaters and White & Case confirm reviewing their client rosters after the decision was made to withdraw from Russia last autumn

Top 3 Leading UK law firm Kennedys plans to close its Moscow office in the wake of Russia's invasion of Ukraine, which has increased pressure on international law firms to break ties with client states.

During a meeting with clients today, Nick Thomas, Kennedys' global senior partner, revealed the international law firm has been quietly closing its small Moscow office since 2021.

Simultaneously White & Case and Linklaters have confirmed, joining Baker McKenzie & Co., that they are reviewing their Russian client rosters. White & Case as well as Baker McKenzie revealed that it may be necessary to drop some customers consequently.

"We were uncomfortable with the direction the country was taking and decided to shut our Moscow office down last autumn", Thomas said regarding his firm's decision to pull out of Moscow.

"As a result of our compliance with local employment laws, we have already let go of the little staff that was in that office," added he.

The former managing partner of Clifford Chance's Moscow office, Tony Williams, says it appears that international law firms will find it very difficult to do business in Russia for a while and that soon firms will back off, close their offices, or shift operations to local partners.

"My belief is that firms are working closely with employees to resolve practical issues in the very near future. They have an obligation to their Russian staff, so what they say publicly could be impacted by that obligation. As well as all of these practical concerns, there will also be many practical concerns, including how the workers will be paid and the difficulties of international travel," he further stated.

However, firms are under increased pressure to scale back their Russia projects. Yesterday, UK PM, Boris Johnson's spokesperson cautioned law firms against advising state-controlled companies with close connections to the Kremlin. Foreign Office revealed it had received legal letters from firms representing oligarchs and companies seeking to avoid sanctions as a result of its previous announcement.

The former head of communications at Bakers and a director at Byfield Reputation Counsel, Michael Evans, said: "Historically permissible business with many Russian clients is now subject to sanctions, so firms should be judged on what they are doing today rather than what they did in the past.

There is more to the story than political pressure - businesses' clients and employees are pressing for a clear public statement. Professional service businesses cannot ignore this important stakeholder group.

The law firms Clifford Chance, Freshfields Bruckhaus Deringer, Dentons, Latham & Watkins and Cleary Gottlieb also have significant presence in Moscow along with White & Case, Linklaters and Bakers.

In 2015, Kennedys opened an office in Moscow after hiring Constantin Saranchouk, the former head of Clyde & Co's Russian insurance practice, along with an associate to specialize in high-value insurance disputes in the energy, construction, and aerospace sectors.

Presently distributes his time between Moscow and London, Sergei Saranchouk is a Russian-qualified lawyer. He will move permanently to London once the office closes.

Following the news that Kennedys is pulling out of Moscow, Noerr, a prominent German firm, announced in Feb 2022 that it would spin off its Moscow office to its local affiliates. King & Spalding shut down its Moscow office in May 2021.

Earlier this week, both James Dingley and Baiju Vasani, two London-based arbitration experts, revealed that their firms, Ivanyan and Partners, were closing their London offices. Also, US firms Sidley Austin and Venable announced they no longer advise Russian clients who are affected by sanctions.