Scandinavia - Law Firms Coudert Brothers' Stockholm Office: Gateway To Scandinavia And Beyond

Sunday, February 1, 2004 - 01:00

Editor: Please tell us something of your background and experience.

Sundqvist:
I received my law degree in 1970 from the University of Uppsala. Fourteen years ago I moved to Stockholm and joined the firm of G. Grönberg Advokatbyrå, which became a part of Coudert in 2000. I am a corporate lawyer, and my major practice areas are insolvency and corporate restructuring.

Hedman: I graduated from the University of Stockholm in 1983. For a number of years I was a partner at Lagerlöf & Leman Advokatbyrå, which I left to become general counsel of ICA AB, the leading Scandinavian food company. I joined Coudert in 2002. My practice is transaction oriented and has a tax focus, but I am engaged in product liability defence as well.

Editor: How did Coudert Brothers' office in Stockholm come about?

Sundqvist:
In 1998 G. Grönberg Advokatbyrå entered into an association with a German firm, Schürmann & Partners. A year later Schürmann started merger talks with Coudert Brothers. We followed that discussion closely, and a couple of years later integrated with Coudert Brothers ourselves.

Editor: In what kinds of work is Coudert Brothers engaged in Stockholm?

Hedman:
We have 19 lawyers engaged in general commercial practice, including a variety of corporate work. We have a particular focus on arbitration, litigation, insolvency and restructuring work. In the main, we represent Swedish clients, but we also are engaged on behalf of European clients doing business in Sweden and, increasingly, American clients and clients from other parts of the world.

Sundqvist: The Grönberg firm had a long history of representing foreign corporations doing business in Sweden. Since joining Coudert Brothers, of course, we have been increasingly concentrating on Coudert's multinational clients.

Editor: Can you tell us whether you found, in joining Coudert Brothers, cultural differences between a typical Swedish firm and what you encounter with Coudert?

Sundqvist:
We have come to the conclusion that there are few cultural differences between a typical Swedish firm and Coudert Brothers. Then, Coudert is not a typical American firm but a very cosmopolitan law firm with a long history of involvement on the international stage.

Hedman: The cultural differences are not very great, but sometimes the difference in the size of firms dictates a difference in the way they operate. For example, many American firms - and almost certainly the larger ones - have a more professional approach to marketing than their Swedish counterparts.

Editor: Can you tell us something about your relations with corporate clients? How closely do law firm lawyers in Sweden work with the legal departments of their corporate clients?

Sundqvist:
Many of our clients do not have their own law departments. When they do, we attempt to integrate them into our work effort as soon as possible. This is a way of establishing, and then maintaining, a relationship for the future.

Hedman: We have worked with many of these corporate clients over a long period of time, and we are closely acquainted with their businesses and their people. As a result of these long-standing relationships, we tend to be included in the business discussion. That helps us to better understand the client's needs and to enhance the legal services we provide to meet those needs. It also helps the client understand the concerns underlying the advice we provide. This is very little different from what occurs in relationships between law firms and their corporate clients anywhere in the world. In any event, it is close communication that is crucial.

Editor: Can you describe the investment climate in Sweden?

Hedman:
In general, the investment climate is quite good. It is easy to start a business in Sweden for both foreign and domestic investors, and conducting that business is relatively easy in the sense that the tax system is comprehensible and there is a minimum of red tape. On the issue of taxes, the corporate tax rates are low and there are no taxes on capital gains and dividends in the corporate sector. While labor costs are high in Sweden, businesses which are not labor-intensive find the investment climate very attractive. High tech industries, biotech and pharmaceutical enterprises in particular, are arriving in substantial number, and they find the high cost of labor balanced out by a highly-educated, disciplined and conscientious work force. In addition, with Sweden now a member of the European Union, the market in which they seek to offer their products is not merely the local Swedish market but rather that of the entire continent.

Sundqvist: Another positive aspect of doing business in Sweden for a foreign enterprise is language. It is possible to do business here in all of the major European languages, and we are particularly proficient in English. I should also mention the fact that the government offers investment subsidies to those willing to establish industrial operations in specific rural areas of the country. Since Sweden entered the European Union, these subsidies have become more limited, but they are still available.

Editor: How far along is Sweden in its integration into the European Union?

Hedman:
We are quite far along. Indeed, we were pretty well integrated prior to joining since we had accepted and implemented a variety of directives stemming from the European Union voluntarily. With respect to the Euro, however, that is not the case.

Editor: The recent tragedy of the murder of the former Swedish minister for foreign affairs, Mrs. Anna Lind, was front-page news across the world. We understand it might have contributed to the Swedish public voting down acceptance of the Euro as Sweden's currency.

Sundqvist:
Having the Euro rejected by referendum means, I think, that we are going to have another seven to 10 years before the issue can be addressed again.

Hedman: All of the political parties here have accepted the outcome of the referendum, which means that they are not likely to approach the issue in the near future. With so many new member states, joining both the EU and the Euro Zone, the entire matter may take on a different look altogether. The political parties may wish to see what transpires over the next five years before raising the issue again, and then working it through the political process may take another two to five years. We are talking about a long-term evolution on this matter.

Sundqvist: I think it is important to understand that our failure to integrate into the European currency at this time is not a failure to integrate for all time to come. And, Sweden's integration into Europe in other respects continues. Over the past 18 months or so the Euro has strengthened considerably in terms of the dollar; so has the Swedish krona. It is more difficult to sell Swedish automobiles and telecommunications equipment in the U.S. as a result, but I think these currency swings are part of a process of normalization. Eventually, and over the long term, the value of one currency against another stabilizes and comes to reflect its true relative value. The process is not very disciplined or predictable, but it does work.

Editor: The Scandinavian countries, with their long experience in international trade and shipping, have been part of a global economy since before the term was invented. What are your thoughts on globalization? Do you think it is inevitable at this point?

Hedman:
Globalization is irreversible. It may proceed at different rates in different parts of the world, but overall there is an inevitability to the process itself.

Sundqvist: Globalization is also very complicated. From a Swedish perspective, we see the former Soviet countries looking inward rather than outward, although this may be a temporary state of affairs. At the same time, we recognize a desire in these countries to be part of the global economy.

Editor: What does globalization mean as a practical matter to Coudert Brothers in Stockholm? Would you consider branch offices in the Baltic countries?

Hedman:
We do not ultimately make these decisions for Coudert Brothers but I doubt we would consider establishing branch offices in the Baltic countries. Nevertheless, we do have an interest in the Baltic countries. We have clients that have interests there, and we need to have good contacts and relationships with highly capable law firms in each of these three markets. As general counsel for ICA, I conducted negotiations and was engaged in acquisition activities in Latvia and Lithuania. I do not foresee Coudert Brothers establishing a permanent presence in any of the three countries, but from time to time, and from one of the firm's nearby offices - Stockholm, St. Petersburg and Moscow - we will have presence there.
Trade between Russia and the three Baltic countries is going to remain important. As these countries join the European Union trade is probably going to accelerate, since the Baltics, the only former Soviet republics in the EU, will constitute a bridge to Russia. We certainly expect to do more and more work in the Baltics in collaboration with our Coudert Brothers colleagues.

Sundqvist: At the same time, Estonia and Latvia have very close historical and trade links to Finland and Sweden. When they join the EU those links are going to be enhanced. They will begin to look west and northwest, rather than exclusively to the east, to a much greater degree. That development, in addition to Anders' comments on the Baltics as a bridge to Russia, will likely keep Coudert's Stockholm office busy.

Editor: What about Russian clients trying to conduct business operations in Sweden? Have you had any experience with that yet?

Hedman:
They have not gone down that path to a material extent as yet. They do arbitrate disputes in Sweden, however, as Stockholm is the site of a great deal of arbitration deriving from Russia and the former Soviet Union.

Editor: Who are the parties in such arbitrations?

Hedman:
Often it is a Russian company and another foreign company, sometimes an American company, which have made a compromise to have Stockholm as the venue and the Rules of the Arbitration Institute of the Stockholm Chamber of Commerce as the governing rules. This is a fairly standard operating procedure where Russian and former Soviet interests are involved. Of course, this is nothing new. During the Cold War, Stockholm was a destination of choice on the part of Chinese and Soviet interests seeking international arbitration.

Editor: Do you have any thoughts about Russia as a destination for Western investment?

Sundqvist:
It is important for the stability of Russia, and for the acceptance of free markets and the rule of law in Russia, that the country become a destination for Western investment. Many large Swedish corporations have made substantial investments in Russia, and obviously they believe that their investments are both protected and sound. There is a great deal more to be done, both in terms of building a modern society and the institutions that provide its foundation and of providing a flow of investment to support that process, but in my view it is underway. As the first major law firm to enter Russia after the fall of the Soviet Union, Coudert Brothers, of course, is there and a part of those developments.