Large-scale reforming of civil legislation, economic factors, new trends of development of legal business often change rules of the game for the companies – customers of legal services and consultants. Today legal consulting has to adopt as fast as possible to these new conditions to meet expectations of the clients. What changes happen in legal business, how to develop large projects by efforts of a small team, why consultants are more into friendship nowadays, what makes “venture” lawyers different from the others and how to enjoy work – about this and much more we spoke with Maxim Bunyakin, Managing Partner of Branan Legal.
Before creation of Branan Legal more than ten years you worked in legal departments of large corporations. Why did you decide to leave in-house for legal business four years ago?
Having gained vast professional experience acting on behalf of the customer, engaging and managing consultants, I understood that I have a good opportunity to apply the received skills and to broaden the professional horizons.
My business idea was not to make another law firm but something bigger, and, above all – something of more interest and use to the clients. In this sense creation of an independent legal practice of Branan Legal in the Branan company, which by that date had already been operating on the market of administrative and strategic consulting for 12 years, was unique.
Now it is possible to say that this business idea was successful and advantageous. In almost four years we realized many unique projects . Often, especially in difficult projects of restructuring and integration of business, the customer faces a quite specific objective – for everything to pass well, where this “everything” besides corporate and legal questions includes many others. At the same time, of course, we have lots of projects demanding purely legal competences to be present.
By the way, as Branan Legal slogan we decided to go simple: “More than lawyers”. They precisely capture the essence of that we do.
|Year of foundation: 1999 г.||Year of foundation: 2011 г.|
|Number of practices: 3
|Practice specialization: restructuring, corporate management, M&A, venture projects, legislation amendments|
|3 partners, 27 employees||1 partner, 9 lawyers|
Maxim, major part of Branan Legal projects is related to restructuring and other aspects of corporate governance. Why?
It is my rule: you have to be the best in one or in several areas. For us these are restructuring, M&A and corporate management. Here we are not some random advisors, we are “the playing trainers”, i.e. we can realize the project by own efforts and train colleagues (holding a seminar or corporate training).
You have dealt with restructuring for quite a while, participated in many large-scale projects. In your opinion, what are the most significant changes effected in this sphere?
I admit, I have a passion for restructuring, I caught up this “flu” long ago, and it has already progressed to a chronic form. For about 10 years I have been engaged in reorganization, I was the participant and the head of many unique projects. It is necessary to say that before new changes were introduced our legislation on reorganization had many good tools, but the very few used them. First of all I mean Article 19.1. Federal Law “On Joint-stock Companies” (division or allocation at the same time with merge or accession). Such schemes of reorganization were used, for example, by RAO UES of Russia, MTS, INTER RAO UES. These mechanisms are convenient when business challenges aim at isolation and consolidation of a certain kind of activity in group of companies (service, non-core, etc.), reduction of levels of corporate control, accelerated transfer of an asset to another company and so forth.
Since September 1, 2014 (from the moment the Civil Code of the Russian Federation was amended) the legislator significantly expanded opportunities for application of new schemes of reorganization.
First, now the companies of different organizational and legal forms can participate in reorganization. For example, limited liability company can now be merged with a joint-stock company. Earlier it was a big problem. If someone wanted to consolidate the business within one company, but the group included the companies of different legal forms (joint-stock companies and limited liability companies), at first it was necessary “to brush” these, bring them all to one form. It required time and money for inventory, shareholders meetings, , etc.
Secondly, now all legal entities can combine various forms of reorganization (not only the joint-stock company), i.e. the tool became universal. Unfortunately, the Civil Code of the Russian Federation granted such rights but failed to specify how to do it. Together with colleagues from the ministries and the companies we now try to solve this task in profile laws and bylaws.
You have a rather compact team of lawyers, at the same time you work with big customers. Several years ago it was impossible, today the number of similar examples increases. Is it difficult to explain to clients that even difficult corporate issues do not always require the involvement of dozens of lawyers?
Very much so, however there are some important nuances which I try to explain to clients, seemingly successfully. What allows our team to realize big projects with rather small amount of people? We are mobilized, we distribute tasks, we build work individually for each specific project. Should it be necessary, we work at night and during the week-end.
In any, even the most difficult projects there won’t be all 50 or 100 employees of major law firm engaged, so, it is unimportant what advisor you approach: a big law firm where 5–10% of total number of employees will be working on your project, or a more compact firm where almost all lawyers will devote the time to work on your project. Besides, the consultant shouldn’t be some “transcendental object”, it is necessary that he works together with the team of the client. Then the synergetic effect is reached, when consultants as experts in the professional area work with in-house lawyers who know the company better.
At the same time, coming back to tendencies in the market, the increase in number of consultants, of course, is observed. Possibly, such is the crisis influence. The next “boom” of business division is at place, with partners exiting to create companies. Nowadays not only small teams of several lawyers, but also loner consultants perfectly cope with the solution of key questions on the project, with difficult legal issues, outsourcing separate tasks.
What does your work, business mean to you?
Certainly, it is business, but at the same time it is creativity. There are three approaches to any activity (work, study, hobby and so forth). The first – slavish (when you are forced to work), the second – consumer (when you do it only for the sake of money); and, at last, the third – creative (when you do it at own will, you develop and, what is most important, you benefit people that doesn’t exclude being paid for it). I try to ensure there is more creativity in what I do, i.e. freedom, after all it is the only state which results in making useful things. There is more: it is important to be obsessed by business and to be ready for changes.
Any crisis leads to competition increase, to change in price for legal services. How did your approach to work and pricing change? Do you feel any dumping from competitors?
Legal consulting becomes more flexible and adaptive regarding satisfaction of needs of the clients who found themselves in difficult circumstances. First of all, budgets are reduced – and here it is important to react quickly and adequately, i.e. not to reduce quality, but to offer services only of use to the client. For example, you shouldn’t insist and try to sell complex support of the project if analysis of possible schemes of the transaction and examination of key documents would be enough for the customer. It isn’t necessary to put work of all your team (from the legal assistant to the partner) at once in the price of services if the client needs only technical part (to file documents to government body) or, on the contrary, only the substantial help (at a stage of negotiations on the transaction). Pricing has really changed, withdrawal from hourly rates is even more often observed.
Besides, if there is a complex task, you always have to be able to attract the tried and tested partners. It is for this purpose absolutely optional to keep them in staff. In my opinion, now consultants are far more into friendship.
How did the crisis affect the demand for legal services? What practices, services of legal consultants you consider to be the most demanded now?
Besides “classical” for crisis times expertise (judicial, offshore, bankruptcies), services in optimization and restructuring of business are now very demanded. It is connected both with economic situation and with the advent of new rules of reorganization. For example, it is necessary to reduce number of the societies within the group to decrease business expenses, or there is a task – to prepare an asset for sale, previously having moved it from balance of the main company. Or, finally, owners of business decide to divide it as they have different plans. In all these cases reorganization is very useful and demanded.
You initiated introduction of the “Innovative and Venture Companies” nomination in the competition “The Best Legal Departments of Russia”. Why?
Yes, there was no such nomination before. In the past few years the market in this sphere has very much developed, though it is considered young (it is about 5-7 years old). I plunged into this industry when working in ROSNANO and since then I have worked a lot in this segment. Actually, colleague lawyers from this sphere are very vigorous, creative people and incorrigible optimists. Certainly, it is interesting for them to compete over the rank of the best. Some venture and innovative companies were incorporated two-three years ago but they managed to bring a lot of use: to organize financing of unique projects, together with colleagues from the industry to achieve introduction of important changes in the legislation. By the way, in connection with youth of the market we suggested to make an exception for this nomination: more than five years don’t have to be obligatory for the nominees.
Today many say that the future of the market of legal services lays in Asia. The Russian law firms seek to conclude the alliances with the companies from China, Japan or Korea, look for clients from these jurisdictions. How do you estimate such tendency?
The subject of Asia interests me a lot, I became fond of it long ago. From very young I practiced single combats, I began to be interested in east languages. I like the Asian culture, the attitude of its representatives to many things. I think that in order to get closer to China and other eastern countries, it is necessary to make an attempt or at least to put your mind to understand them – culture, language, customs of business conduct. With this regard I try to take part in the Russian-Chinese initiatives, interesting conferences, to expand circle of personal and professional acquaintances to Chinese, to study their legislation. Besides, I learn Chinese and I consider it to be the most reliable way to gain mutual understanding.
In general, the process of building strong relations with China is neither easy nor rapid. You shouldn’t wait for prompt victories. As my coach on wushu (his name Yangtze) says when we hardly study the next difficult element: “Don’t bother, only first ten years are difficult”. Laborious work will yield result. Very precisely this approach is expressed in the Chinese wisdom “It is not so important, with what speed you go, until you stopped”. And we aren’t going to stop.