From Local Notables to Global Players: Law Companies in a Tax Haven (1960s to 2020s)
In the last fifty years, Luxembourg became an important financial center, being today the second largest fund domicile in the world (Cassis 2010, Majerus&Zenner 2020). Since the 1960, lawyers have played an important role in coding capital (Pistor, 2019), the financial place in Luxembourg being mainly an offshore center serving as an intermediate for international financial flows (Palan 2010). From being local notables focused on litigation (car accident, divorce…), lawyers in Luxembourg became a central interface between local regulations and global business. The field of lawyers in Luxembourg was profoundly transformed: domestic law firms became international players while international law firms tried to become locally accepted. Through the case study of Luxembourg, the paper questions central processes law firms went through in an era of globalization (Dezalay&Garth, 2012), being it the appearance of mega-law firms, the intensification of competition, or the routinization and hyper-specialization of legal work. Instead of assuming a straightforward internationalization of legal norms and practices, the presentation will show how forms of mutual hybridization and translation characterize the transformation of the legal market in Luxembourg, be it for local law firms such as Arendt&Medernach, be it for members of the Magic Circle such as Clifford Chance. This narrative does therefore offer a more complex picture than the one offered by Galanter and Henderson who argued “benefits of localized guild have (…) been destroyed” (Galanter&Henderson 2007, p. 1883).
The paper is based on 20 oral history interviews, a systematic review of legal journals such as the International Financial Law Review and the archives of the Luxembourgish regulation authority (Commissariat au Contrôle des Banques, Institut Monétare Luxembourgeois, Commission de Surveillance du Secteur Financier).
