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Practicing law - Ukrainian style

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May 5, 2000, 6 p.m. | Business — by Roman Olearchyk

Roman Olearchyk

Kyiv Post Staff Writer

Ex-pat lawyers brave the murky waters of Ukraine’s infant legal system cticing law takes on a literal meaning. As the three ex-pat lawyers who work in the Kyiv office of international corporate law firm Salans, Hertzfeld & Heilbronn have found, in a country with a nine-year-old legal system that is constantly in flux, sometimes you just have to make it up as you go along. The three - Myron Rabij and Andrew Bej and his wife, Natalie Bej - may not have typically Ukrainian surnames, but all three trace their roots back to Ukraine. "[I came to Ukraine] to be able to combine my U.S. experience and non-U.S. experience with a desire to come to Ukraine," said Andrew Bej, an associate at Salans, Hertzfeld & Heilbronn. "Naturally, a Western lawyer who knows Ukrainian, who can read the legislation and deal with the authorities is a pretty valuable product [here]." All three have gained legal expertise in places like Washington, Italy and Korea. But it was as much personal reasons as professional that motivated them to come to Ukraine. "The need for American-trained lawyers was there ... companies had demanded it, Andrew Bej said. "[But,] there were personal reasons - in the end, we are Ukrainian Americans, and we would sooner come here." The Bejs joined the firm’s Kyiv office in 1997. Rabij has been with the firm since the early days of its Kyiv operations. All three were quick to point out the major role played by Salans, Hertzfeld & Heilbronn partner and Kyiv office head Oleg Batyuk in making a success of the practice in Ukraine. "[Batyuk] actually has two law degrees - one from Kyiv University and a Western degree from London," Rabij said. "He was actually the first Ukrainian partner in an international law firm." As Rabij explained, following a year with the firm in London, Batyuk returned to Kyiv in 1992 to open the Kyiv office. Today, the Kyiv office employs a total of 10 attorneys. The firm was started in 1978 by two Americans and a Frenchwomen in Paris. Today, in addition to Kyiv, Salans, Hertzfeld & Heilbronn boasts seven other main offices in the cities of Paris, London, New York, Warsaw, Moscow, St. Petersburg and Almaty. Here in Kyiv, the firm’s clientele consists mainly of foreign multinationals, but its domestic clientele base is also growing. "You don’t see that many medium-sized investors [in Ukraine]," Andrew Bej said. "More often what you find are either the true explorers - ’the Wild West’ - or the Fortune 500 companies." While most of their current clients are based in the United States and Western Europe, recently more business has been coming from Asian clients. And despite the lingering effects of the 1998 regional financial crisis, the law business has been growing. "In fact, I think our business last year was better than ever before," Andrew Bej said. "Assets became cheaper and more attractive for foreign investors." According to Rabij, while many international law firms in Ukraine have Western lawyers, Salans, Hertzfeld & Heilbronn is actually one of the few whose foreign lawyers have actually participated in court proceedings. While Ukrainian law prohibits non-residents from acting as legal counsel, they can provide de-facto representation to their clients. That’s something they often must explain to the judge. "It’s generally a bit of a shock to the court [when a foreign lawyer comes in]," Rabij said, "Their first questions are who let you in and what right do you have to be here?" Although the three have degrees in U.S. rather than Ukrainian law, they find it no trouble competing with Ukrainian-trained attorneys. "Let’s face it, Ukrainian law per se came into existence in 1991; we’re learning it simultaneously with the Ukrainians," Rabij said. "Ukrainian law is a developing and emerging phenomenon - there was a fresh start for everyone. "A lot of fundamental issues [that are often taken for granted] are very much openly discussed in Ukraine." That makes practicing law here challenging, Rabij said, because "a lot of us wouldn’t think about these issues - we have to go back to what we learned in law school and have not thought about since." But in some ways it’s easier because, as he put it, Ukrainian laws tend to be written in less detail than U.S. laws. "But the problem is that lawyers are detail oriented, and the battle is in the detail," he said. "The lack of detail in the law leads to vast open areas for interpretation." "Negotiations can take quite some time here," he added. But the three agreed that Ukrainian law is getting more complex, more sophisticated. "People are starting to interpret the law," Rabij said. "Now we have about nine years of experience with certain laws." And when the Ukrainian courts come up short, foreign entities with interests in Ukraine can always turn to foreign courts or international laws for their defense, Natalie Bej said. As with all business sectors operating in Ukraine, foreign lawyers have also had their tangles with Ukraine’s notorious red tape. Recently, a parliamentary committee started preparing a draft law called "Amendments to the law on Advocacy" that would have completely prohibited foreign lawyers from practicing Ukrainian law. Both Ukrainian and foreign firms in Kyiv quickly responded by lobbying the lawmakers. "I heard that [the draft law’s] been pulled from the table," Andrew Bej said. According to the group, there are about a dozen Western lawyers practicing in Ukraine. They stick together when they need to, but the rest of the time they compete. In terms of international firms, Salans, Hertzfeld & Heilbronn has three main competitors in Ukraine - Baker & McKenzie; Squires, Sanders & Dempsey; and Altheimer & Gray. But the market is hardly saturated. "A lot of times, several firms get a piece of the same action," Natalie Bej said. In fact, Salans, Hertzfeld & Heilbronn would like to see more competition. The more international firms enter the market, the higher the level of investor confidence in the country will be, the firm’s three ex-pat lawyers said. And the more foreign investors, the more business for Salans Hertzfeld & Heilbronn. "We’re here directly as a result of investment in Ukraine," Rabij said.
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