Capital Legal Services Launches Consulting Service

Increasing investor activity has led to increased demand for investment process consulting services in St. Petersburg. The growing number of foreign companies in the city has revealed a lack of consultants able to handle investment projects. In order to fill the need for services without which the city and regional economies are unable to develop, Capital Legal Services created a subsidiary, Capital Consulting Services, this April. Vladislav Zabrodin, managing partner of Capital Legal Services, tells us about the new service:

Q: How did the idea to create a consulting company come about? And why did your firm in particular, which provides legal assistance, decide to fill the need for consulting services?

A: During the years we have been in operation we have worked with a large number of clients who started their business in St. Petersburg and the Leningrad Oblast by purchasing land plots and building on them. Most of them are foreign investors. In order to provide comprehensive services to our clients, CLS found itself in a position where legal services were not enough, although legal support will always be our core activity. We needed to provide other project support services. Our specialists possess considerable experience in solving many of the non-legal problems encountered by foreign investors unfamiliar with local conditions. Over time, the list of issues lying outside the company's strictly legal activity but requiring solutions during implementation of a project made itself clear. Moreover, it has become apparent that the need for such services is not always fully met in our region. This situation was confirmed during our recent meeting with vice governor of the Leningrad Oblast Grigory Dvas. The format and way a law firm works do not make it possible to provide full consulting services, so we decided to create a new branch of the business. We think this is the best way to solve our clients' problems.

Q: Why did you decide to start a new company? Sometimes a company that wants to expand into a new area of business can just create an additional department within the existing firm.

A: All additional services grew out of our legal practice. Now their number is so great that it has become ineffective to combine them. The amount and complexity of consulting services we are prepared to offer just does not fit into the description of a law firm. Providing legal services is a special business. Our law firm provides mainly comprehensive legal support to major companies, with many of whom we have been working for several years. The consulting firm is oriented more toward work on projects.
In my opinion, consulting and legal services should not be combined. The method of providing services is different. And with the creation of Capital Consulting Services we will expand our clientele. Some investors may not need legal services, but they do need help solving issues like obtaining a plot of land and receiving state permits. It is also important to note that the cost of consulting services is calculated differently, and payment in most cases depends on results.

Q: But what if both types of services are needed?

A: No problem. If a new Capital Consulting Services client needs high-quality legal assistance, CLS specialists will be put on the job. As we see it, the related companies will work very closely since consulting leads to the need for legal documents and, vice versa, consultants are often needed to put these documents into action.

Q: As is known, there are not enough good specialists on the market. How did you create the team of your new consulting company under such conditions?

A: The main staff of Capital Consulting Services is made up of specialists who have been involved in resolving such issues for our clients. Some of the employees worked in our law firm. Others - specialists, for example, who worked on such issues during construction of the IKEA store and the Swedwood plant - came from outside the company. But we are united by a long term of joint cooperation and we are convinced of the quality of their work and their correct approach to the job. None of our employees is new to the business.

It is also important to note that employees of both Capital Legal Services and Capital Consulting Services are well trained, have considerable experience in the field, are fluent in English and Russian, and are intimately familiar with the needs and impressions Western investors have of Russia.

Yevgenia Vasilyeva, a former CLS lawyer, will head the new department. She graduated from the St. Petersburg State law department with honors. Prior to working for Capital Legal Services, Ms. Vasilyeva worked as a lawyer for a major international firm and handled corporate transactions and investment projects in Russia. At our company she supported the IKEA store construction project and solved a multitude of difficult and very specific tasks.

We are able to train high-class specialists from among the talented and well-educated young people who have always been welcome at our firm.

By agreement with the client, we will outsource some of the work that does not fall into our area of expertise, including to those companies with which we have already worked and of whose professionalism we are convinced.

Q: Foreign companies trying to gain a foothold on the Russian market face a broad range of problems. Which of these problems will Capital Consulting Services help to solve?

A: The company provides services in the area of investment project support, including greenfield construction projects, and also other issues connected with acquisition of land plots, coordinating and receiving permits necessary for construction or reconstruction of sites, organization of transportation solutions, and access to utilities lines. We should note that today services are in great demand to assist in receiving permits of all types, in coordinating construction of various types of sites, in rezoning land plots and securing utilities lines.

Our specialists possess considerable experience in coordinating projects with state agencies. The most important factor here is gaining the trust of these agencies. So far, we have been worthy of this trust. Some methods of coordination are not acceptable for some prominent foreign companies. They seek legitimate solutions in order to protect their reputation and achieve the needed result. We help them do this. Russia companies that value their reputation and plan to stay on the market for years to come are also seeking such solutions.

Often potential builders think they have coordinated all aspects of a project, but then it turns out they were simply unaware of certain points. After all, construction of buildings is handled by one agency, while roads are handled by another. It is not difficult to make changes to the blueprints, but when construction is already underway, changes are more difficult to make.

Forested land presents its own problems. There are first-category, protected forests near the city on land slated for construction. This means that the forests are controlled by the federal government. So the process of rezoning such land is complex and may take up to a year. Our employees know and have experience with this very complex procedure.

Another plus of Capital Consulting Services is the fact that CLS has experience working in 12 regions of Russia. Thus, we are familiar with regional specifics, especially the special nature of working in St. Petersburg and the Leningrad Oblast.

Q: Will the consulting company prioritize any particular industry?

A: We have considerable experience of providing consulting services in construction, creation, opening and operations of large shopping centers and active cooperation with local and regional agencies handling issues of land plot acquisition, rezoning, and creating a case for investment incentives.

There are indications that the current construction boom for retail sties will continue because many large and internationally known retail chains intend to expand their business to the Russian market. So we can expect that there will be many retail companies among the consulting company's clients. We have already established close relationships with some of them. For example, we have reached an agreement of strategic partnership with the Russian Council of Shopping Centers, which unites companies in the areas of construction, management, operation of shopping centers, retail trade and public catering. According to this agreement, CLS will provide legal assistance to the Council.

But the experience and high qualifications of the consulting company's employees will be needed by companies in other fields. We are ready to work with a wide range of companies.

Capital Legal Services (Florida, United States) opened its St. Petersburg office in 2000. A CLS office appeared in Moscow in 2002. The St. Petersburg office specializes in providing the entire range of legal services on issues connected with investment and other economic activity in Russia and the CIS. On the Russian market Capital Legal Services strives to combine the intellectual capital of the firm's partners in many countries, with the practical experience of Russian specialists to provide assistance to Russian and international companies. In Russia the firm has serve such well-known clients as IKEA, Swedwood, OTIS Elevator Company, Pratt & Whitney, Hamilton Standard, Tektronix, Paroc Group, Raflatac, Platinum Guild International, and many others. CLS was chosen as the official legal consultant in Russia of United Technologies Corporation, a major U.S. corporation.

Capital Legal Services is a member of the International Bar, a member of the international law department of the American Bar, and also a member of the Association of International Law Firms. CLS is the official legal consultant and partner of the Russian Council of Shopping Centers.

The firm possesses considerable experience in setting up joint ventures, subsidiaries, offices and branches in Russia and abroad, in developing plans and structures for mergers and acquisition of companies, preparation of official reports on the legal aspects of company activities, drafting of agreements of all types, including investment agreements with local and Oblast administrations, loan agreements, pledges, pre-payment and deferred payment agreements, trademark agreements, license and barter agreements.