Chinese cheques

The newest Asian battlefield between US and UK lawyers was marked out in early October, with the signing of an agreement allowing Chinese companies to list on the London Stock Exchange, opening a new vista of potential work for lawyers.

Leading English law firms based in Hong Kong hope the new listing route will benefit them, because they can offer a combination of expertise both in China work and London capital markets. They argue that many leading US firms are acknowledged for their strength in either China or in international capital markets - but rarely in both.

Despite such bullish talk, round one of this fight has gone to the Americans, with Datang Power, almost certain to be the first Chinese company to come to the London market, being readied by global lead managers Salomons advised by their usual legal advisers, the US firm Cleary Gottleib Steen & Hamilton.

Datang is expected to raise around $300m to $400m, with about 30 per cent of the issue offered to institutions in Europe. But the consensus among lawyers is that Hong Kong will remain the primary international equity market for Chinese companies. Ian Jackson, London partner in Clifford Chance's China group, said: "By obtaining a London listing, Chinese companies can now target investors who prefer to deal in a European time zone. However, shares listed in Hong Kong will continue to be the most popular vehicle for trading Chinese equity outside China"n