“We don’t have any big news in Lithuania at the moment,” says Eugenija Sutkiene, Partner at Tark Grunte Sutkiene. “Except for the general trends that are affecting legal markets everywhere, of course: Commoditization, dropping legal fees, and growing in-house legal markets — the same as all legal markets.” She laughs, saying, “we’re running quickly to stay in the same space."
When asked about the dropping fees, Sutkiene reports that “we’ve been feeling this pressure for three or four years now because of the fierce pressure in the markets.” According to Sutkiene, “Law firms here are stronger than ever and competition has increased, with increased capabilities and competencies.” In addition, she reports, referring to the global crisis, “the legal market got spoiled, and it’s hard to get back to those billing rates.” Indeed, she says, hourly rates are essentially disappearing, and are primarily relevant at this point for internal budgeting purposes. “Most work is done on fixed budgets or with capped fees,” she says. Still, she emphasizes, the problem is hardly exclusive to Lithuania: “It’s a general trend across all markets.”
Still, this pressure reflects the fact that the Lithuanian legal market, according to Sutkiene, is “consolidating, and getting stronger,” as the larger full-service firms are “matching competencies.” As a result, with little else distinguishing the top players, “we’re competing primarily for price now.”
There’s little news on the legislative front either at the moment in Lithuania, Sutkiene reports, although as the Peasant & Greens Union — an Agrarian political party in the country — won last fall’s parliamentary elections, she says, “we’ll see what they do, and if they live up to their promises.”
The highly-anticipated Labor Law adopted by the old Parliament to introduce a long-awaited new employment scheme was supposed to come into effect on January 1st, but has now been postponed until July 1st, and Sutkiene reports that changes are likely to be introduced to it in that time. The previous employment scheme was considered “very rigid”, she reports, and “one of the least attractive in Europe.” The new version is expected to “increase competitiveness,” and she describes it as “the most controversial and widely-discussed in recent years.” Indeed, it should provide substantial work to law firms in Lithuania, and Sutkiene reports that Tark Grunte Sutkiene has “already started to work with clients in preparation.”