Opinion Foreign lawyers and firms in India: It’s time the profession was globalised – but it has to be done right

This is a watershed development for the legal profession in India, which can no longer afford to remain insulated from the globalisation of legal practice. That being said, an examination of the rules brings to the surface some apparent shortcomings that need to be revisited.

Firstly, the definition of a “foreign lawyer”, includes within its ambit a “law firm” entitled to practise law in a foreign country. It may be noted here that the Advocates Act, 1961, defines an “advocate” only as an individual. The concept of a law firm is neither envisaged nor recognised under the Act. Further, the rules restrict Indian law firms to a partnership or LLP structure, whereas foreign law firms are permitted to have any form of juristic entity. This incongruity is likely to affect the level playing field since under Indian law, the maximum number of partners in a firm cannot exceed 20; meanwhile, there is no such restriction for foreign firms, some of which have over 100 partners operating across the world.

The second aspect that requires clarity is the concept of “fly in and fly out”. The rules provide that foreign lawyers and law firms that do not have an office in India and don’t spend more than 60 days in a period of 12 months, can practise without registration. This provision may be feasible to enforce for individual foreign lawyers as opposed to law firms. It will be exceedingly difficult to regulate the entry and exit of various members of foreign law firms, which may strategically use this rule and plan their “fly in and fly out” in a staggered manner to escape registration.

The rules also provide a detailed procedure for the registration of foreign lawyers and foreign law firms. They inter alia require the applicant to file for a certificate from a competent authority of the concerned “foreign country of primary qualification” stating that the applicant is entitled to practise law in that country. It is unclear how this will play out for law firms, as most large international law firms have a registered presence in several countries.

Hinged on the principle of reciprocity, the rules also require a certificate to the effect that advocates from India are permitted to practise law in the country of primary origin. This does not cover situations where a law firm that registers itself as a firm from a country that has a reciprocal arrangement with India has partners/members from countries that do not. Take, for example, an English law firm with partners from countries like Pakistan or China. Will they be permitted to practise law in India?

The principle of reciprocity is discriminatory for Indian law firms, as they are excluded from the definition of advocates under Indian law, and the term “law firm” is not defined in the Act. The rules mandate that the country of primary origin of the foreign lawyer or law firm permits advocates enrolled under the Advocates Act in India to practise law in that country. Therefore, permitting individual foreign lawyers and law firms to practise in India in exchange for individual Indian lawyers practising overseas is an unfair barter and requires correction.

Whilst foreign lawyers and law firms registered under the rules have been made amenable to the Advocates Act, they have been excluded from being subject to the jurisdiction of the BCI in cases of professional misconduct. Rule 10(2) states that in cases of professional misconduct, the BCI shall refer the matter to the disciplinary authority of the country of primary origin. This rule is inequitable as the disciplinary and public policy considerations vary from country to country. What may amount to professional misconduct in India may not be so in another country.

Lastly, concerning the practice of law by foreign lawyers and law firms, they have been permitted to practise in non-litigious work such as joint ventures, mergers, and acquisitions, intellectual property, drafting of contracts, and other related matters. The term “related matters” is open to subjective interpretation, and it may be prudent for the BCI to lay down an exhaustive list of the type of work that may be done by foreign lawyers. Interestingly, the rules also provide that in case an Indian advocate is engaged as a partner or associate in such a firm, he/she can only practise non-litigious work. This embargo is in the teeth of Section 30 of the Advocates Act, which entitles every advocate registered with a State Bar Council to appear in any Court throughout the territory of India. Since the rules cannot prevail over the Act, it remains to be seen how this will be implemented.

The move on opening up the legal services sector has been keenly awaited by the profession at large. That being said, such a significant development should have sought the view of the fraternity before notification. There are fundamental issues that need to be addressed, and one can only hope that the BCI will be responsive and open to a course correction before it is too late.

The writer is Partner, Numen Law Offices