Wednesday, June 27, 2007

Liberalisation of the Legal Profession

As most of you are aware, there have been whispers (some loud, others less so) in respect of the impending liberalisation ( primarily meaning permitting foreign lawyers to pratcice in India) of the legal profession in India. Despite innumerable deadlines, most of them imaginary, liberalisation has not happened. It appears that over the last year there has been a signifcant effort by the UK Law Society and the English City Firms, supported by the UK Government to press for the liberalisation of the legal profession. News reports indicate that a joint committee of Indian and UK lawyers are negotiating the terms of the liberalisation under the ageis of the UK-India Trade Comittee.

On the UK side, there has been a significant amount of information available to the public (through press reports, presentations made before the UK parliament, etc ) regarding the reasons for the negotiations and the extent of liberalisation (very shortly, UK firms want to be able to set up on their own without having to enter into joint ventures with Indian firms). Worryingly (but not surprisingly) there has been no concrete information on the Indian side (except a few statements of denial by the Chairman of the Bar Council). I understand that the Commerce Ministry had posted a paper on its website last year, but I have not been able to find that paper. Again from sporadic news reports, I understand that India is represented by the Chairman of Bar Council of India, the vice-chairman of the Bar Association of India and Rajiv Luthra of Luthra & Luthra on the joint committee. I am not aware if there are more people on this committee.

What worries me is the complete lack of public debate in India. There has been no effort (atleast not publicly known) by anyone to study the impact that any such move may have on the vast legal profession. Opinions (ranging from- it will not affect litigating lawyers, it will be great for young lawyers, to it will be disastrous and render many lawyers jobless) vary about the effect, but these opinions are merely based on intuition and hope (or cynicism). For example, no effort has been made to draw lessons from the impact on the accounting profession in India following the entry of the multinational accounting firms. Such a study could through light on the potential impact on the legal profession (though the two professions are not organised in the same manner) if foreign firms are permitted to enter into India. There have been one or two opinions in news papers by chartered accountants warning the legal profession! One of the opinions warns that there has to be internal liberalisation allowing the profession to be better organised and ready for any external competition.

Given the emotions that this issue has raised in the past, I have a feeling that it will be difficult to have a reasoned public debate. It is therefore vulnerable for special interests to influence the outcome, one way or the other. Consequently, I fear that we may be presented with a fait accompli, and then we will have the usual efforts to rationalise whatever has happened. For example, will the bar council regulate foreign firms practicing in India. Will there be different practice rules? Issues like advertising and sharing profits with people other than advocates will become challenging for foreign firms who are not subject to such restrictions.

Also, what is the process for any such liberalisation. It probably requires a modification to the Advocates Act and rules thereunder. Even if the statute is amended, will the bar council be able to make rules given popular emotive opposition?

Based on sources close to the negotiation (this sounds like investigative journalism now) I understand that the Indian negotiators have made proposals which sound ( to me) completely unrealistic and probably constitutionally invalid. One of the proposals is said to have been that only those Indian law firms that have been registered for 10 years should be permitted to enter into joint ventures with foreign law firms (Article 14 anyone?).

Personally, I am not sure if liberalisation is a good thing or not. I have not studied the issue in any detail to decide one way or the other. There will clearly be certain benefits (better training, better organisation, etc) and some burdens.

I hope that some of you will take the time to give some thought to this issue and post comments which will hopefully generate a larger reasoned debate in the country.
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