房地产行业向来是中国政府的监管重点，在后疫情时代，监管者愈发强调房地产管控，以预防系统性经济及金融风险。在频繁变化的监管下，房地产企业总法如何带领团队支持业务合规？后疫情时代，房产企业纷纷思考优化经营模式，甚至开辟新业务条线，总法又如何参与决策，并带领团队提供支持？
ALB：过去一年房地产领域监管变化频繁，哪些法规政策对您所在企业产生了重要影响？您如何带领团队在监管频繁变化的环境下保障企业合规？
龙光集团控股有限公司风险控制室总经理杨小兰：政策方面，今年以来最热的可谓“三条红线”和“两集中供地”，它们对企业的经营性资金提出了更高要求，监管部门要求企业更多地使用自有资金和经营收入投地，而不是用银行杠杆转嫁风险。三条红线对于整个行业的降杠杆有明显作用，对房地产企业来说，现在很难再实现大步跃进式的发展。在降杠杆的同时，我们要从管理上要效益，对内部的管控成本、项目本身的周转率都提出了更高要求。
两集中供地则改变了传统的供地方式，首先在前期的集中投标阶段，对企业的资金池有了比较高的要求，并且进一步削薄了企业利润。此外，集中招投标将导致未来的集中销售和交付，因此房企在销售阶段又会有一轮竞争，会进一步压缩利润。
第二是今年以来国家严查消费贷，包括最近正在修订《反洗钱法》，未来肯定会影响房屋购买力。监管政策降低了很多客户用杠杆方式购房的可能性。《反洗钱法》的修订则增加了房地产企业和租售业务企业的反洗钱审查义务，相关义务的主体原本是金融机构，但现在实体行业在销售、客户筛选过程中也将承担谨慎义务。
面对新政策新法规的挑战，龙光坚持以合规为底线。在组织架构上，龙光在风险控制室下设了风控和法务两个部门，风控控制室的职责包括：首先，要负责解读新政策新法规的内容，同时要把和自身业务相关的地方做出解析；其次，就新政策新法规的规定，要尽快与业务部门积极展开讨论，做出改进优化业务措施的相关建议。例如为应对“三条红线”，我们和业务、资金部门对接讨论：如何继续推进业务，又保持在红线规定范围内操作？并就业务合规提出建议。关于消费贷和反洗钱，我们也给销售部门提出了分析意见和改进建议。
融信集团助理总裁兼法务管理中心总经理董樑：首先是《民法典》的颁布，它对法律人提出了新的学习课题，我们也在不遗余力地抓紧培训；其次是对于房地产企业的监管“三道红线”，它对每一家高速发展中的房地产企业都提出攻守兼备的要求；第三是“两集中”政策，即集中发布出让公告、集中组织出让，在资金等方面提出了新的要求。
在监管不断变化的环境下保障企业合规，首先要第一时间联络权威培训方、组织大家学习新政策；另一方面，更重要的是能够厘清中央监管的脉络思路，对政策深入理解，尤其对未来的执法口径进行展望。例如有些业务可能当下不违法，或处于模糊地带，但如果能够前置考虑到某些业务持续操作的后果，会有不同的评判。
“‘未来的合规’是近几年一个很重要的概念。今天合规不代表明天继续合规，我们需要更具前瞻性的思考，预判行业监管措施的走向和落地方式，从而对企业业务未来的合规状况做出超前的判断和准备。”
- 董樑，融信集团
“未来的合规”——这是近几年一个很重要的概念。今天合规不代表明天继续合规，所以我们需要更具前瞻性的思考，预判行业监管措施的走向和落地方式，从而对企业业务未来的合规状况做出超前的判断和准备。这样的判断部分来自于对政策法规的理解，部分来自于以往的实践经验。
阳光城集团股份有限公司总法律顾问汪怡群：最近一年房企法务面临的挑战是空前的：法律层面，《民法典》及相关司法解释对于每个法律人的影响不言而喻，新法规要学，实践中的变化要关注，投融资、建设、销售，所有的业务流程风控点要随之调整，所有的业务标准文本都要重新修改，工作量巨大。政策层面，各地、各类型的限制性政策密集出台，但是企业仍然要生存和发展，业务部门煞费心思，法务也就随之伤透脑筋——所有的非标和创新都意味着新研究和探讨。
“法务从未像今年这样如此需要各类内外部课程帮助知识更新……没有扎实的专业知识，根本无法应对新环境下的法务工作，很多新型业务模式没有经验可依。”
- 汪怡群，阳光城集团
因此，法务从未像今年这样如此需要各类内外部课程帮助知识更新。资深的法务容易基于经验主义处理工作，但法规政策更新幅度之大已经不允许法务再吃老本。所谓“打铁还需自身硬”，没有扎实的专业知识，根本无法应对新环境下的法务工作，很多新型业务模式没有经验可依；即使是操作惯了的业务模式，其中的某个法律规定变了，风控点的把握就会出现偏差，这是非常可怕的，谨慎的法务根本无法给出法律意见，而胆子大一点的法务，给出的意见就可能导致风险。
所以，我们不仅精选了培训内容，还有配套考试，与法务人员的绩效进行挂钩，激励他们去学习和提升。同时，集团总部法务也加紧梳理各类规则指引和标准文本，指导基层实践。对于一些重难点问题，集中条线内部的专长人才，以及外部律师的力量重点突破，必要的时候也会和同行们进行交流，确保我们法务意见的专业性——既符合新环境下的业务模式需要，又满足风控要求。
ALB：严格监管环境及疫情影响下，房地产企业纷纷思考优化现有经营模式、开辟新的业务条线。作为总法，您如何参与决策，并带领团队支持上述变化？
杨小兰：关于新的业务模式，龙光也在做一些尝试，例如去年我们成立了新的生鲜产业集团，并已在南宁落地了第一个项目。
“在新业务决策阶段，风险控制室会参与战略决策……对于公司已经决定开展的新业务条线，我们风控部门会帮助新业务板块梳理清楚业务风险。”
- 杨小兰，龙光集团
在新业务方面，首先，在新业务决策阶段，风险控制室会参与战略决策，主要从政策合规性、市场风险性，以及新业务运营、经营、盈利模式等多个维度提供具体风控意见，供管理者决策。
其次，对于公司已经决定开展的新业务条线，我们风控部门会帮助新业务板块梳理清楚业务风险；建立制度、流程、体系的风控模型。法务团队则会尽快帮助新业务落实标准合同模板——包括业务采购合同、招投标合同、收并购标准合同等；同时加强对新业务的法务力量的引进及培训，包括在集团律师库中增补和新业务经验相关的外聘律师，以及增加熟悉新业务条线的风控、法务人员。
董樑：其实几年前地产业就已经关注到：蛋糕可能就这么大，如果坚持传统房地产业务，就不得不面临稳中有降的市场。很多企业开始寻求其他增长点，传统一点的企业在和房地产有关联板块进行突破，决心大一点的，跨行业动作更为明显。融信也如此，例如今年物业板块——融信服务已通过港交所聆讯。融信的立足点还是一步一个脚印，开拓自身有把握的新业务板块。
具体到对总法律顾问和法务团队的要求，第一，对于基础性特色业务，我们会投入重兵研究，例如融信现在发挥头部企业优势，和区域性房地产企业展开了战略合作，法务在其中投入了非常大研究精力。例如在有些合作中超比例投入的情况下，如何确保资金能够安全收回，以及股东双方权利义务（尤其是利润分配等）的不对等约定能否经受民法典、公司法，甚至审判实践的检验，也展开了研究。
法务不是单纯的风控部门，也要参与管理决策。当企业考虑进入新产业时，我们不仅要协助考察理念的超前性，也要关注是否具备实践基础，对于缺乏实践的板块会提出审慎建议，充分起到保驾护航的作用。
此外，疫情也促使房企拓展线上销售模式等。我们对于未来不确定大事件的准备也更充分了，例如疫情下很多企业无法展开线下销售，甚至一度有企业面临现金流断裂困境。融信也在思考：如果未来再有这样的大事件，我们怎么活下去，而且能活得好？
汪怡群：阳光城非常重视法务的意见，不论是投资决策还是具体业务模式，都有法务参与决策。作为法务，充分理解公司战略非常必要，因为我们做的是“风险管理”、而非“风险规避”工作。业务的开展通常都伴随着风险，而法务需要在风险处理上做出抉择，这就需要深刻领会公司战略，才能把握好公司的风险偏好，并以此调整不同风险处理的方式。
在严峻的形势之下，无论是新的业务模式还是新的赛道，在法务给出意见之前，我都要求团队快速掌握商务逻辑和法律规定，同时以底线思维来研判法律风险：即可能会出什么问题、公司业务部门或者法务的能力能否处理、出现最坏情况的概率，以及最后的结果公司能否接受。这对法务的预判和解决问题能力都提出了很高要求。
法务作为公司的一分子，对于公司的生存和发展也负有不可推卸的责任，我们首先应该帮助公司尽量地放开手脚去干，让业务部门去冲业绩，法务顾好后方；但在需要踩刹车的关键问题上，法务也要坚决，同时保障这个“刹车”能够让业务部门信服、接受。
ALB：过去一年，您如何借助新的科技工具和运营方法优化法务团队工作？
杨小兰：龙光的云数字信息化系统正在建立、完善，其中有两大系统涉及风控和法务团队：一个是风险预控系统，主要关注业务管控风险；第二个是案件管理系统，其中的信息能够由龙光全体法务共享，同时提供大数据集中管控，定期分析公司案件：它们集中在哪些类型、涉及哪些子公司……如果一个子公司类似案件发生数量过多，就证明它在某个环节的管理存在薄弱之处，就此从风控角度展开改进。此外，系统还可以对类似案例进行对比，及时提取分析法院对类似案件的倾向意见。
在内部风控法务工具的开发过程中，我们需要从两方面进行配合：第一是提出明确需求，包括系统开发的目的、法务对管控工具实现效果的想象；第二，风控系统的搭建需要设置好关键节点，法务和风控同事要积极发表意见，这样系统建起来才好用。
此外我们也在使用一些外部工具，例如威科先行的数据库等。
董樑：运营工具确实带来很多创新，提供更多管控手段，包括以电子印章为基础的新型管理模式、以线上沟通为基础的新工作方式等。但我们始终认为，科技只是赋予我们更多的管理工具，与此同时，我们的管理思路也要与时俱进。
在法律科技工具方面，我们还是考虑以采购方式引进。目前我最感兴趣的是风险管控工具，例如有些保险公司，可以对公司保单风险进行一网通览。我们也希望通过这种技术，在第一时间知晓集团内部哪个合同或哪个事件出现了风险。
汪怡群：阳光城的法务系统一直在持续优化。现在，大部分标准文本都可以实现线上编辑，业务发起人只需引入相关文本，在法务后台预设的空白处填空（未设置的不允许修改），系统就会自动显示出修改处，大大节省了法务审核时间，提高了工作效率。
案件管理系统方面，我们实现了动态管理，案件一旦上报，系统即自动生成案件信息，诉讼材料用印、诉讼目标设置、调解方案审批、案件结果上报等都直接与案件关联，一目了然掌握案件进展，方便查询文件文书，同时关联案件和律师评价，如果流程报审超时，系统也会自动提示。
法人公司系统方面，我们可以实现批量报审，树状查询等功能，同时法务系统数据作为公司主数据来源，确保风控落位以及法务系统数据的准确性。现在我们还从公司别的业务系统模块获取数据，提供风控预警。
这些信息化手段使法务可以腾出更多精力在制定规则、标准本身，同时也使法务能够获取更多信息，更多地理解业务逻辑，统筹做出更准确的判断。
ALB：当下您最需要外部律师提供哪些领域协助？对于外部律师继续优化房地产领域服务，您有哪些建议？
杨小兰：外部律师大概可以分为交易和诉讼两大类，早期地产公司更多使用的是诉讼律师，最近几年我们则越来越多使用到交易律师，包括收并购交易、营销、资产管理、劳动用工，可以说逐渐改变了我们使用律师服务的狭窄性。
龙光选律师的大原则是看团队，而不是看律所规模的大小。我觉得律所的大小可能只代表管理水平，但律师的强弱体现在专业度、服务态度和敬业度上。例如在诉讼领域，我们越来越觉得律师的专业度比资源更重要，包括案例检索、类同案件的推演、对法律和事实问题的理解等能力。在交易律师方面，我们接触到一些律师对于当下的交易模式和销售模式会提供新的建议，这也是我原来没有想到的。
董樑：优秀的外部律师始终是我们非常需要的合作伙伴，但“优秀伙伴”的定义也在与时俱进。我不否认，有些常年合作伙伴的价值确实有所下降，尤其针对传统业务，我们的出价越来越低，服务内容的含金量在不断下降。
与此同时，有很多我们非常渴望探索的新业务，如果律师能走在行业前面，帮企业事先想透新问题，我们依旧愿意购买他们的研究成果。举一个简单例子，现在房地产集中土拍不但竞房价，还竞自持物业。自持物业怎样变现？传统是通过转让项目公司来变现，现在也可以通过将它转变为金融产品变现。通常来说，自持物业能卖到商品住宅的七成就算实现了目标，但如果通过金融产品，把它包装为基金或者REITS等从而实现更高估价，具有这种能力的合作伙伴是我们十分期待的。而且我们对于新政策反馈速度的要求也愈发严格，如果律所能为我们快速提供让企业走在行业前列的引领性解决方案，我们依旧愿意付出相应对价。
需求始终存在，但需求的内容会发生变化。我们会更换一部分老合作伙伴，替代以更符合企业发展需求的新伙伴。
汪怡群：房企一般都有比较专业的法务团队，在公司内部，法务团队统筹法律事务管理，我们需要外部律师主要是出于几类需求：其一，公司法务出于人效限制，没有人力和精力去做的常规案件或者尽调服务等。这种情况一般会找提供常年顾问服务的律师团队，对专业要求不高，但是因为量大，有时时效要求较高，需要较高的响应度，因此，这样的律师团队需要有足够的人手。
其二，一些重大疑难的法律问题，法务拿不准，需要外部律师给予专业意见。我们会找库内专注于该细分领域的律师团队，这类服务对于专业的要求极高，必须能够说服法务，并能解决问题，实务经验非常丰富的律师才能胜任。其三，一些重要的诉讼案件，需要律师沟通协调。我们会找当地专注于诉讼的律师团队。
所以，我们内部对于律师团队有比较明确的定位，哪些团队从事什么类型的服务，都有方向性的限制；反过来，律师为企业提供服务，也应该明确自身定位。团队成员是什么背景，擅长提供什么服务，应该有所取舍，有所专长。
ALB：未来12个月您带领团队的工作重点有哪些？您如何制定团队下一步的发展或人才策略？
杨小兰：首先，企业马上要结束前半年度的经营，对龙光法务团队来说，我们还是要全力保障公司今年经营目标的实现。我们团队对各个业务条线的风险管控和法律支持依旧承担着很多工作任务，接下来的半年还是以经营为导向。因为龙光寻求的是均好性发展，不光要卖得好，而且要有利润，这就需要团队不断和业务部门做协同，保障经营目标的实现。
对我自己来讲，还是要进一步完善团队架构，提升人员管理和人均效能。我们会考虑增加一定的人员，但考虑到人均效能，增加的人数还是比较有限。龙光目前已建立较为完善的内部人才培训机制，我们会通过内部的培训培养，培养出更多适合的法务风控人才，来强化团队的实力，为企业服务。
董樑：目前融信法务团队已基本成型，拥有司法、工程、金融、诉讼、境外融资等背景的各类人才。有些事情我们会一如既往做下去，例如和行业领先企业对标；以及继续和中房协、房管部门，尤其是政策制定部门保持密切沟通，积极参与他们主办的行业活动，甚至把我们的诉求反馈给决策部门，保证融信在行业认知和行业信息方面继续站在第一梯队。
未来有几类人才会受到行业青睐。一类是有金融或互联网思维的物业总法。现在房地产公司基本会把关联的物业公司打造上市，但重要的是上市后如何做好运营。这要求物业法务拥有前瞻性的互联网思维，能够和资本市场接轨。这样的人才目前比较稀缺。
第二，我们希望法务成为复合度越来越高的人才。以前法务只要有一技之长，就能在地产公司安生，现在则需要精通多样武艺，且能把不同能力结合在一起。例如收并购法务，不但要有收并购能力，还要有金融思维，在收并购的同时需要对融资问题做出基本考虑，同时也要有税务筹划理念，诉讼能力也不能太弱……法务复合度越高、越能独挡一面，其含金量就越高。
汪怡群：我们的团队花了3年时间，建立了法务内部管理制度体系，构建了公司风控体系框架。从去年开始，我们开始结合前一阶段的实践反馈，对制度进行优化升级，对公司风控体系的具体内容进行填充，包括拉通各业务条线，梳理各类合同文本（业务模式），以及联名发布各类风控指引等。
但是由于大量法规政策的变化，以及结合近期和信息部同事进行的交流，接下来我们会和信息部的同事们一起，拉通各个部门，逐个梳理业务逻辑，从信息系统切入，争取在一到两年内合力完成风控系统的建设。目前，我们集团的法务已经就条线进行了分工，分头开始开展工作了。
另外，我们内部的管理，前期已经实现了各单项考核的试点，计划在今年底明年初，完成法务考核体系化工作，解决法务工作业绩难以量化和考核的问题，考核结果将和各区域法务负责人的绩效，以及各区域法务团队的奖金池挂钩，既能够使团队业绩更可视化，使得其他部门同事和公司领导也能很容易地了解法务工作质量，也能够更好地激发团队的积极性，创造良性互动的氛围。
GC Roundtable: Real Estate
Real estate has long been a target of scrutiny from Chinese regulators. Especially in the post-pandemic era, Chinese regulators are paying great attention to this “grey rhino” sector that is prone to systemic risks. How are real estate GCs and their teams supporting business compliance amid these frequent regulatory changes? In the post-pandemic era, real estate companies in China are also considering optimizing their operation models, even creating new business lines. What role are GCs playing in this decision-making process?
ALB: Property market regulatory policies underwent frequent changes last year. Which changes had the most significant impact on your company? How did you lead your team to ensure regulatory compliance at your company in the face of the frequent policy changes?
Yang Xiaolan, general counsel, Logan Group: As far as policymaking is concerned, the buzzwords this year are the “three red lines” and “dual concentration of land leases”, and they impose more strict operating cash flow requirements on companies. The regulators now ask the companies to rely more on their own funds and operating income to acquire land, rather than pass the risk on to banks.
“Dual concentration of land leases” changed the traditional mode of land supply. Firstly, it requires that the companies have greater capital pooling capacity during the initial intensive bidding process. Secondly, intensive bidding means centralized sales and delivery of properties, which again reduces developers’ profits through competition at the sales stage.
Furthermore, the government has clamped down on consumer loans this year and it is working to revise the Anti-Money Laundering Law, which will definitely affect spending on housing properties. The regulations make it more difficult for many clients to buy properties with leverage, and an amendment to the Anti-Money Laundering Law will give property developers and rental and sales companies additional obligations to prevent money laundering activities.
In terms of organizational structure, Logan has set up risk control and legal affairs units under the risk management and control development. On the one hand, we study new policies once they are introduced, and interpret certain parts of the policies related to our business operations. On the other hand, the legal affairs unit discusses the new policies with the strategic planning team.
Dong Liang, assistant president and general manager of the legal affairs department, Ronshine Group: First of all, the promulgation of the Civil Code set a new topic for legal practitioners to study, and we spared no effort in training our people. Secondly, the “three red lines” imposed on real estate companies require all fast-growing developers to improve their capabilities. Thirdly, the “dual concentration” policy – that is, concentration of land lease notification and concentration of land leasing – raises new funding requirements.
In order to ensure compliance at the company in the face of constantly evolving regulation, we need to, first and foremost, organize employees to study the new policies; the most important thing is to get a clear understanding of the general guidelines adopted by the central government regulators, gain insights into the policies, and in particular predict the future criteria for policy enforcement.
“’Compliance in the future tense’ is an important concept in recent years. We need to put ourselves in the central government’s position, and theorize about the possible countermeasures the central government may take, and thoroughly assess the company’s policies accordingly.”
- Dong Liang, Ronshine Group
“Compliance in the future tense” is an important concept in recent years. We need to put ourselves in the central government’s position, and theorize about the possible countermeasures the central government may take, and thoroughly assess the company’s policies accordingly. Such assessment is based, in part, on an understanding of the regulations, and on our past experience as well.
Wang Yiqun, general counsel, Yango Group: Counsel of property developers were confronted with unprecedented challenges in the past year: at the legislative level, it goes without saying that the Civil Code and related judicial interpretations had a major impact on every legal practitioner. We need to study the new regulations, while paying attention to practical-level changes; at the policy level, various types of restrictive policies have been introduced by local governments in quick succession, but enterprises still need to survive and develop, and all non-standard and innovative businesses require new studies and investigations.
“Counsel had never needed inhouse and external courses to keep themselves up to date as much as they did this year. Without solid professional expertise, they cannot deal with legal work in the new environment.”
- Wang Yiqun, Yango Group
Therefore, counsel had never needed in-house and external courses to keep themselves up to date as much as they did this year. Without solid professional expertise, they cannot deal with legal work in the new environment, as past experience does not exist for most new business models; even in the case of traditional business models, risk control operations may deviate, after a relevant law is revised.
That is why we carefully selected the items of training, and also designed related exams, the results of which are linked to the counsel’s performance appraisal, encouraging them to study the latest changes, and enhance their skills. In addition, counsel at the headquarters has stepped up efforts to sort out various types of rules, guidelines and templates to guide related practices at lower levels. As regards high-priority and difficult issues, specialists across the business lines are brought together to form task forces, as well as leveraging the strengths of outside attorneys. Where necessary, we consult other legal practitioners to ensure the professionalism of our legal opinions – that is, they meet the needs of business models in the new environment, as well as the needs of risk control operations.
ALB: Tightening regulations and COVID-19 have prompted real estate companies to rethink and improve their existing business models, and open up new business lines. As a general counsel, how do you get involved in the decision-making process and support these ventures?
Yang Xiaolan: The entire real estate industry is considering whether new business models should be added, and Logan has also done some exploratory work. For example, we set up a new fresh food division last year, and acquired related new businesses in Nanning.
“As regards new business models, the legal and risk control department is involved in strategic decision-making by putting forward specific risk control-related suggestions. We also help set up a risk control model covering related policies, workflow and systems.”
- Yang Xiaolan, Logan Group
Firstly, as regards new business models, the legal and risk control department is involved in strategic decision-making by putting forward specific risk control-related suggestions regarding the new business lines from three perspectives: i) policy compliance, ii) market risk exposure, and iii) operation of the new businesses, management and profit model, informing the management in decision-making.
Secondly, if a new business line has already been determined by the management, we help the new business division get a clear understanding of the risks associated with the business, and set up a risk control model covering related policies, workflow and systems. The legal department helps them create standard templates for procurement and tender contracts; builds on legal affair management capacity for the new business division – for example, by adding external lawyers experienced in the new business as the group’s panel lawyers, and by recruiting risk control and counsel familiar with the new business.
Dong Liang: In fact, the real estate industry realized several years ago that the market was no longer increasing, and if we keep on doing the traditional business, at the end of the day we will have to accept a steadily shrinking market. Many companies have started to look for other growth drivers. For example, Evergrande branched out into carmaking, and some more traditional companies tried to make breakthroughs in property-related areas, and Ronshine too – for example, our property management business will go public this year.
Speaking of the requirements on general counsels and the legal team, firstly, we invest heavily in research on novel core businesses – for example, Ronshine has carried out frequent collaborations with small- and medium-sized regional real estate companies, and the legal team has dedicated a great deal of energy to these projects. For example, the bilateral shareholder partnership model was adopted for some of these projects – where the investment is proportionally excessive, the legal team needed to make sure that the money invested can be recovered, and studies were conducted to find out whether the unequal agreements on the shareholders’ rights and obligations can stand the test of the contract law and the company law, and even the judicial process.
Legal work is not purely about risk control, we also need to get involved in management decision-making. When the company plans to enter a new business, we need not only to assist in investigation into the pioneering nature of the business, but also examine as to whether it has the practical foundation. If a business lacks practical foundation, we would advise caution, so as to fulfil our role as the “gatekeeper”.
Wang Yiqun: Yango Group takes opinions from the legal department very seriously, and we take part in decision-making on investment decisions and specific business models alike. As in-house counsel, it is absolutely necessary to fully understand the company’s strategies, because our job is to “manage risks” rather than “avoid risks”. Only if we thoroughly understand the company’s strategies, we can effectively gauge the company’s risk appetite, and adjust risk management methods accordingly.
In the face of severe challenges, before issuing opinions on new business models or new business lines, I always ask my team to understand how the new business works and related laws, and assess the legal risks involved based on “bottom-line thinking” – that is, what issues may occur, whether the business and legal team will be capable of handling these issues, the likelihood of the worst-case scenario occurring, and if the company can accept the outcome. This requires the in-house counsel to work very effectively in predicting and handling the potential issues.
As members of the company, in-house counsel have unshirkable responsibility for the company’s survival and development. First of all, wherever possible, we should remove restraints that get in the way of the company’s growth; but we also need to apply the brakes on critical matters that must be avoided, and make sure that the decision is fully justified and convincing to the business teams involved.
ALB: How have you used new technologies and operational tools to better equip the legal team in the past year?
Yang Xiaolan: Logan’s cloud digital IT systems are currently being created and developed. Two systems involve the risk control and legal team: one is the risk pre-control system, which focuses on the management and control of business risk; and the other is the case management system, and information stored in the system is shared by all the in-house counsel of Logan – it also performs regular analysis of cases within the company through big data collected by the legal team. Items analyzed include what the most common types of cases are, and which subsidiaries are involved…Furthermore, the system is also capable of comparing similar cases to assess the courts’ preferences in handling similar cases.
The development of internal risk control and legal affairs tools involves collaborative efforts in terms of: i) communicating specific needs, including the exact purposes for which a system is to be developed, and the management and control process envisioned by the legal team; and ii) setting key time points in the risk control system, which also requires the in-house counsel to contribute their thoughts and suggestions.
We also use some external tools such as Wolters Kluwer’s China Law & Reference database.
Dong Liang: Operating tools have indeed brought many innovations and provided more management and control methods, including new management models based on electronic seals, and new ways of working enabled with online communications. But I always believe that technology only gives us more management tools, and we need to also adapt our mindset to the new era.
Risk management and control tools are what interest me most at the moment. We see some insurance companies are using these tools to preview risk exposure of insurance policies online and we also hope to leverage the same technology to detect which internal contract or event caused a risk in real-time.
Wang Yiqun: our internal legal system has been constantly optimized. Most standard texts can be edited online, and the initiator only needs to import related texts, and fill in the blanks (revisions are not allowed for items that are not pre-set) in the legal affairs backend system, and the system displays the revisions automatically, substantially reducing the legal review process, and improving efficiency.
As regards case management system, real-time management has been attained – once a case is reported, the system generates case information automatically, and the seal(s) required for lawsuit documents, setting of the objectives of the lawsuit, approval of the mediation plan and outcome submission are directly linked to the case, so that all information about the case is intuitively displayed, and documents can be easily retrieved.
Besides, we can now file cases for approval in bulk, and have developed query trees. Data in the legal affairs system are the main source of data in the company, so we make sure that the risk control policies are effectively enforced, and data in the legal affairs system are accurate. We also acquire data from the company’s other business systems and modules to issue risk control warnings.
These IT facilities allow the legal team to concentrate on formulating rules and standards, as well as allowing them access to more information, such that they can get a better understanding of how certain businesses work, and made more balanced and accurate judgement.
ALB: What are the areas in which you require most assistance from external lawyers? What are your suggestions as to how external lawyers should continuously improve real estate-related services?
Yang Xiaolan: External lawyers can be generally divided into transaction lawyers and dispute lawyers. Real estate companies mainly hired the latter in the early years, but we have used more and more transaction lawyers in recent years, for matters such as mergers and acquisitions, asset management, labour and employment etc. This means that we have gradually broadened the range of external legal services that we engage.
Logan selects external lawyers based on the expertise, rather than the size of the law firm. In my opinion, the size of the law firm only reflects management quality, but the lawyers’ competence lies in their professionalism, work attitude and their dedication to the profession. For example, in the litigation space, we are increasingly convinced that the professionalism of a lawyer (e.g. skills related to case retrieval, deduction based on similar cases, and understanding of legal and factual matters) is more important than resources. As regards transaction lawyers, some of the lawyers that we worked with would propose suggestions regarding the existing transaction and sales models, and that is something that exceeds our expectations.
Dong Liang: For us, highly qualified external lawyers have always been in high demand, but the definition of “highly qualified” has changed – and is changing – with the times. I have to admit that the value offered by our long-term partners has indeed declined – especially when it comes to traditional businesses, the prices we offer have been falling, and so have been the value of their service.
On the other hand, there are many new businesses that we are eager to explore. For example, centralized land auctions nowadays not only consider property prices, but also the prices of self-operated property management services, which is conventionally monetized through a transfer of the project company, and now can also be done by converting it into a financial product. Typically speaking, the sales target for the self-operated property management business is about 70 percent of all the properties sold, but it can be sold for a higher price if it is sold as a financial product such as a mutual fund or a real estate investment trust (REITS). We cannot wait to find a partner that is capable of doing this. If a law firm can provide us with solutions that can bring us to the forefront of the industry, we will be willing to pay substantial premiums.
Wang Yiqun: We need external lawyers mainly from three aspects. First, to process routine cases or conduct due diligence services – these tasks do not require highly specialized expertise, but the massive workload involved requires exceptional responsiveness. Second, for some major legal issues, the legal team requires professional opinions issued by external lawyers. Third, for some important lawsuits, we’ll seek for the help of litigation experts.
As such, we’re very clear about what kind of lawyers we need for certain work. On the other hand, attorneys should also have a clear strategy for themselves.
ALB: What are the focuses for your team in the next 12 months? What’s your strategy for the team in the future?
Yang Xiaolan: Firstly, the company is about to wrap up business operations for the first half of the year. As Logan’s legal team, we still need to make all-out efforts to ensure the fulfilment of the annual business targets. Logan strives for balanced development – that is, our products should sell well, and profitability must also be attained. This requires the team to continuously collaborate with the business teams to jointly achieve the earnings targets.
My job is to further improve the team structure, and enhance staff management and average productivity.
Dong Liang: Ronshine’s legal team has already taken shape and is comprised of legal practitioners specializing in judicial matters, engineering, finance, litigation and offshore financing. We will stick to some of our existing practices in terms of benchmarking against leading market players, and maintaining close communications with the China Real Estate Association and property market regulators –policymaking authorities, in particular – to communicate our needs to the policymakers, so as to retain Ronshine’s leading position on understanding the latest market policies and accessing industry information.
Some types of talent will be highly sought-after in the future. First, general counsel equipped with financial savvy and “internet thinking”, especial GC for the property management arm of a real estate company.
Second, we want our in-house counsel to become more versatile. For example, an M&A counsel must be able to conduct M&A deals, and be adequately financially savvy to take fundamental financing issues into account during the M&A process, as well as being capable of effectively planning tax and litigation matters. The more versatile an in-house counsel is, the higher value s/he offers.
Wang Yiqun: Our team spent three years establishing an internal legal affairs management system, and a risk control system framework.
However, due to the substantial changes in the laws and policies, we will work with the IT department to review business processes one-by-one. We will strive to complete the establishment of the risk control system within the next one to two years.
Furthermore, as regards internal management, we plan to finish prioritizing the assessment system of the in-house counsel’s work performance. The assessment results will be linked to the performance of chief regional GCs, and to the bonus pools of regional legal teams. The changes will make it easier for other departments and executives to understand the real input and value of the legal teams.
To contact the editorial team, please email ALBEditor@thomsonreuters.com.