Why Engaging a Legal 500 or a Traditional Law Firm May Not Be the Best Choice for Regulatory Licensing

At Zitadelle AG, we are often approached by clients who initially engaged well-known Legal 500 or local law firms in the jurisdiction where they plan to establish their business or apply for a regulatory authorization.

While this might seem like the “safe” or “prestigious” choice, our experience shows that in many cases, it’s not the most efficient or cost-effective option - especially when it comes to obtaining financial services licenses or virtual asset service provider (VASP) authorizations.

Let’s explore why.

1. Paying a Premium That May Not Reflect the Real Work Done

Large Legal 500 firms often charge significant premiums for their brand reputation. However, in many real-life cases we’ve seen, the client ended up doing most of the practical work -including drafting business plans, compliance manuals, and internal policies- while the law firm merely provided a brief review or minor comments.

In extreme cases, clients paid tens of thousands of euros, only to discover that their internal compliance team had prepared the majority of the documentation.
So the question becomes: why pay a premium price for work you essentially perform yourself?

2. Lack of Practical Experience from Assigned Junior Lawyers

Another common issue is who actually handles your case.
At many large law firms, the initial engagement might be led by a senior partner, but the day-to-day work is often delegated to junior or mid-level associates.

While these lawyers may be competent in quoting legal provisions, they often lack hands-on regulatory experience and practical understanding of how local authorities interpret those provisions.

If you request deeper analysis or clarification, you might face additional hourly charges for “senior lawyer time” - adding more cost without necessarily improving results.

3. Every Minor Task Comes with an Extra Invoice

Clients frequently tell us that with large law firms, every small communication, even a simple request for a case update - results in a new charge.

Time logs from such firms often include lines like:

• “Checked for an update”

• “Drafted a letter with update”

• “Had a short internal call to verify status”

Each entry may cost anywhere between EUR 100 and EUR 350, turning even routine correspondence into a significant expense.

This kind of billing structure creates frustration and unpredictability, especially for clients managing multiple licensing projects across jurisdictions.

4. What Makes Zitadelle AG Different

At Zitadelle AG, we approach regulatory licensing and compliance as practitioners, not as generalist lawyers.
Our consultants have hands-on experience in obtaining financial, payment, and crypto licenses across multiple jurisdictions, including Labuan, Mauritius, Seychelles, Curacao, Cyprus, United Kingdom, Vanuatu, and the AIFC (Kazakhstan).

Here’s how we stand apart:

• Transparent fixed fees: We agree on the scope and price before starting, with a hard fee cap - no hidden charges.

• All-inclusive support: Calls, updates, and necessary clarifications are included at no extra cost.

• Regulatory know-how: We combine legal, operational, and compliance perspectives to deliver a complete licensing solution.

• Practical results: We don’t just interpret the law — we help you achieve authorization approval efficiently.

Final Thoughts

While Legal 500 firms and traditional law firms can deliver quality legal opinions, they may not be the best fit for regulatory licensing or fintech authorizations. These projects require a mix of legal, compliance, and business expertise, which most law firms are not structured to provide efficiently.

Choosing a specialized consultancy like Zitadelle AG ensures that your project is handled by professionals who understand both regulation and execution, offering a transparent, fixed-cost engagement with no surprise fees.