Solomon Cortes greets his guest at reception, shakes hands and makes small talk about his firm's new floor-to-ceiling tropical fish tank before leading him into a meeting room and offering a chair.

There is nothing unusual in this scene - except that it is taking place at a virtual law firm, and Solomon Cortes is in fact the sunglasses-wearing digital alter ego of David Naylor, an intellectual property partner at Field Fisher Waterhouse.

Thanks to Mr Naylor and his team of tech-savvy lawyers, FFW yesterday became the first major UK law firm to open an office in Second Life, a fast-growing online community with more than 5 million inhabitants and a self-sustaining economy worth $2 billion (£1 billion) a year.

The two-storey virtual office boasts the same meeting rooms, corporate art collection and giant presentation screens that can be found at any self-respecting City firm. It even includes a roof terrace with a water feature that, according to Mr Naylor, was designed for "hosting client receptions".

Mr Naylor devised the office with the intention of putting FFW at the forefront of a fast-emerging market for legal advice on how to conduct business in alternative digital worlds.

Multinational businesses such as Dell, Nike, Mercedes and Calvin Klein have sought to establish their brands in Second Life and Mr Naylor hopes that having a virtual presence will help attract them as clients in the "real world".

As the complexity of online worlds such as Second Life increases, so do the legal issues surrounding them, Mr Naylor said. "By setting up an office in Second Life, which is already being used to transact hundreds of millions of dollars of business a year, we are showing clients that we understand the business and legal issues involved in working in the virtual world."

Second Life is not yet developed enough for a debate to have taken place over which, if any, legal jurisdiction applies. But Mr Naylor insists that with real business being carried out and real money changing hands - albeit in Second Life's own virtual currency - companies operating there need legal advice.

"Businesses are moving increasingly rapidly into Second Life," he said, "and their advisers should be there with them."

So far the list of businesses operating in the virtual world is not limited to standard retailers with a tangible product to sell. Professional advisers such as ABN Amro, Accenture and PA Consulting have already established a presence and rumours are circulating that several accountancy firms are planning similar moves.

In addition to attracting new clients and winning publicity for the firm, Mr Naylor believes his new office can be used to help existing clients and staff by hosting virtual seminars, conferences and training days. It will also be a useful recruitment tool in the increasingly competitive market for young legal talent. Prospective employees could "visit" the firm in Second Life and find out more about it instead instead of visiting a careers fair or reading a website.

Times Online is aware of two other UK firms that have recently been looking at the possiblity of opening an office in Second Life, but both decided not to.

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