Herbert Smith Freehills will end its exclusive association with the firms Saudi Arabian sponsor Al-Ghazzawi Professional Association (GPA) on 1 August 2013.
In a joint statement the UK firm and GPA, which established the association in 2008, said the decision was agreed mutually and that the two firms will continue to work together on a non-exclusive basis.
A spokesman for Herbert Smith said, at present, neither firm had plans to enter into a new association. Under Saudi Arabian law the UK firm, which merged with the Australian outfit Freehills last year, must have a local sponsor to operate in the country.
Head of Herbert Smith Freehills' Middle East practice, Zubair Mir, said: "Both firms have concluded that, going forward, an exclusive association would not support the achievement of their broader business strategies."
Senior managing partner of GPA, Belal Al Ghazzawi, agreed. Our strategy and that of Herbert Smith Freehills have developed in ways we couldnot have foreseen in 2008, and which now make it appropriate for us not to continue with our exclusive association, he said.
In December last year Allen & Overy ended its association with Abdulaziz Al Gasim Law Firm, its local sponsor. The magic circle has now reached an agreement with the law firm of one its former lawyers, Zeyad Khoshaim, while its previous Saudi Arabian partner has entered into a similar arrangement with Linklaters.