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published FEBRUARY 05, 2010

Freshfields launches global investigations practice as regulatory enforcement becomes more international

International law firm Freshfields Bruckhaus Deringer launched a global investigations practice to help multi-national businesses manage the mounting risks posed by aggressive cross-border investigations from regulators and prosecution authorities covering accounting, anti-trust, bribery and corruption, financial reporting, market manipulation and other related issues. The practice will be jointly led by litigation partners Geoff Nicholas and Adam Siegel and will bring together corporate, dispute resolution, financial services, competition and trade, tax, employment and intellectual property lawyers with expertise in civil, regulatory and criminal investigations. In the past year there has been increased international cooperation between regulators resulting from initiatives such as the International Organisation of Securities Commissions information sharing agreement, of which more than half the world’s securities regulators have joined, and a host of bilateral and multi-lateral treaties between government agencies. These have amplified the reach and aggressiveness of regulator investigations into corporate corruption, bribery, market abuse and trade issues. Freshfields’ newly created global investigations practice will offer an integrated, cross-border investigations team with global regulatory capabilities. This will assist multi-national businesses with the development of compliance procedures to manage the risks faced across all their markets and to defend complex investigations instigated by regulators in different jurisdictions. The group will also conduct internal corporate investigations, including those relating to compliance with corruption legislation in established and emerging markets (such as the Foreign Corrupt Practices Act in the US and the UK Bribery Bill), advise on financial reporting and corporate governance requirements, and handle complex securities litigation. Joint head of global investigations Geoff Nicholas comments: ‘The regulatory approach to multi-national business is increasingly one with a large bite, cross-border reach and sharp teeth. Our global investigations practice brings together lawyers from all major jurisdictions to offer comprehensive legal support for companies navigating the increasingly globalised approach to regulatory enforcement.’ Figures obtained from the SEC and FSA underline the increased cooperation between regulators on international investigations with the US regulator reporting a 30% increase in its requests for assistance to foreign regulators during 2009* and the FSA responding to 25%** more requests over the same period compared to the year before. The launch is also underpinned by preliminary findings from a soon to be released Freshfields survey of FTSE 350 General Counsels***. Over a third (32%) of them reported an increase, seen over the past 12 months, in the amount of significant disputes they have had to defend - almost half (48%) international in nature. The survey also points to the growing risk of international litigation and international regulatory investigations with almost 40% of GCs believing such risk to have increased over the past 12 months compared to the previous year. Chris Pugh, global head of Freshfields dispute resolution practice says, ‘The macroeconomic dynamics of the world have changed and regulatory oversight has moved quickly to keep in step. Compliance and planning for regulatory issues is of the utmost importance for large companies looking to avoid the sharp end of enforcement proceedings.’ He adds, ‘Large multi-nationals are increasingly looking to emerging markets for growth opportunities. But, new markets present expanding companies with acute strategic risk as they tussle with new ways of doing business - the risk of bribery and corruption is significant.’ Joint head of global investigations Adam Siegel, says, ‘The incidence of US-led bribery investigations into both US and non-US companies is on the rise. Regulators such as the Securities and Exchange Commission and Department of Justice are taking a hard line view on what they see as corporate corruption, and are at times using tangential links with the US as the basis for initiating cross-border investigations, particularly with regard to the Foreign Corrupt Practices Act.’ Siegel concludes, ‘Multi-national companies have to acknowledge the possibility of invasive regulatory scrutiny and the need to activate globally integrated legal support at a moments notice.’ The Freshfields global investigations practice includes 67 partners from a total 142 lawyers in 13 jurisdictions.