02:10, July 26 924 0

2017-07-26 02:10:07
Indian market liberalisation “imminent”, law firms told

The Society of Indian Law Firms (SILF) has contacted its members saying the opening of the country’s legal services market to foreign firms is “inevitable and imminent”.

A message was sent out by SILF president Lalit Bhasin to around 100 law firm members last week, calling for a meeting on 17 July in New Delhi in anticipation of the government’s move to open up the country’s legal services market.

Sources familiar with the market predicted the decade-long attempt to liberalise India’s legal services market could finally become a reality within the coming year.

The SILF letter’s opening sentence reads that “Any day you may expect an announcement/ordinance/rules permitting foreign lawyers to set up their law practice in India. It appears that there will be no further consultation with the legal profession.”

Bhasin explained in the email the perception that this development is likely to happen is further strengthened by the fact that the Chief Justice of India and another senior judge of the supreme court of India have openly declared their support for the entry of foreign lawyers in India – even without any conditions.

He was referring to the chief justice J.S. Khehar’s speech on 8 July at an All India Seminar of the International Law Association, where he voiced his support to the entry of foreign lawyers into the Indian legal sector. But he added that there should be on the basis of “reciprocity” between their countries.

The SILF email stated the purpose of last week’s emergent meeting was to “discuss the implications of the likely move on the part of the Government of India of suddenly and without prior intimation opening of the legal services sector to foreign lawyers” and required the attendance of its members to this “crucial meeting”.

Apart from the signals protruded from the SILF email, which can be viewed in full on SILF’s website, there are also talks about a new set of draft rules to allow foreign lawyers to practise in India has been completed by the Bar Council of India (BCI).

According to Ritvik Lukose, the CEO of Indian law firm consulting firm Vahura, there is a meeting scheduled for July 28 between the Bar Council and government to discuss the revised draft rules. “We expect a fresh set of draft rules to be issued post that meeting,” said Lukose.

The SILF meeting together with the upcoming meeting between the Bar Council and the government mean the liberalisation discussions and preparation process have resumed after almost a year-long halt after hitting a roadblock.

Last July, the BCI completely its first proposed rules to allow foreign lawyers to practise in India. The proposals would allow foreign lawyers and firms to set up offices in India to practise non-Indian law. Law firms would have to pay BCI registration fees of around $50,000 and a deposit of $40,000, while individuals would pay $25,000 and a deposit of $15,000.

Foreign lawyers would then be allowed to practise non-Indian transactional law and then could hire or go into partnership with Indian lawyers, as well as to work for Indian firms.

But the SILF voiced oppositions to the proposed rules and instead would prefer a phased approach to the liberalisation.

In September, the BCI also backtracked on its previous support of liberalisation of the legal market and withdrew its draft rules, adding further uncertainty to the long-running row.

Several global firms that already have an established Indian practice based outside of the country remain sceptical about the drawn-out liberalisation process and long-awaited promise.

“I’ve been there many times, and I’ve learned to be patient. I will believe it when I see it,” said a head of India practice of a top UK firm.

Surprisingly though, some local Indian firms have expressed interest in the potential opportunity of an international tie-up following the market opening, instead of concerns over competition.

“We have been genuinely surprised by the number of top firms who have told us they are open to an international tie-up,” said Moray Mclaren, director of Redstone Consultants who has been working with both Indian firms and global firms’ Indian practices.

“Most are handicapped, however, by a lack of clarity or consensus over what they are seeking to achieve and the extent to which an international tie-up would help or hinder that,” he added.

According to The Lawyer Asia Pacific 100 2017, India is the third most represented jurisdictions among the region’s Top 100 largest law firms by lawyer number. This year, 12 India firms made into the Top 100, and their combined lawyer headcount in 2016 experienced a 16 per cent increase from the previous year.