Foreign companies operating in China could be punished under a new law
Dentons has announced that it will split from its China branch, Beijing Dacheng Law Offices, in the wake of new national security restrictions imposed by the Chinese government.
Reuters reported that the 2015 combination between China's Dacheng and U.S.-based Dentons created a 6,600-lawyer mega-firm, with Dacheng accounting for more than 4,000 of its lawyers.
Dacheng will now be fully separate and independent from Dentons, though they will maintain a "preferred firm" relationship, according to a memo to Dentons clients that was viewed by Reuters. Dentons said it will remove the Chinese characters for Dacheng from its logo and branding.
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The separation is in response to "recent Chinese government mandates on Chinese law firms, including those relating to cybersecurity and data protection," Dentons said in a statement.
The United States has warned that foreign companies operating in China could be punished for their regular business activities under the new law, Reuters reported.
The separation with Dacheng removes thousands of lawyers and employees from Dentons' ranks. A firm spokesperson told Reuters that Dentons has more than 12,550 employees.
Dentons said its Hong Kong office remains a part of the firm.