New Delhi: The Bar Council of India (BCI) — the country’s apex disciplinary and regulatory body for legal education and profession — has finally allowed foreign law firms and lawyers to practise in India, but in a restricted manner and on reciprocity basis.
The BCI had opposed the entry of foreign law firms and lawyers for years.
On 10 March, the BCI released the Bar Council of India Rules For Registration and Regulation of Foreign Lawyers and Foreign Law Firms in India, 2022, to facilitate the registration and practice of international lawyers in India.
This comes 5 years after the Supreme Court permitted the entry of foreign lawyers and firms on a temporary basis, but left it to the BCI to frame appropriate rules.
From restricting foreign lawyers and firms to playing only advisory roles to their clients in India to making renewal of registration mandatory every 5 years, the BCI has framed the rules in such a way that it does not jeopardise the prospects of Indian lawyers.
“Time has come to take a call on the issue. BCI is of the view that opening up of law practice in India to foreign lawyers in the field of practice of foreign law; diverse international legal issues in non litigious matters and in international arbitration cases would go a long way in helping legal profession/domain grow in India to the benefit of lawyers in India too,” said the BCI notification on the rules.
It added, “Taking an all-inclusive view, the BCI resolves to implement these rules enabling foreign lawyers and foreign law firms to practice foreign law and diverse international law and international arbitration matters in India on the principle of reciprocity in a well-defined, regulated and controlled manner.”
BCI officials, who were part of the committee that drafted the rules, told ThePrint that, subject to their registration, the lawyers and legal firms from abroad shall be allowed to take up only non-litigious work, that too in an advisory role. However, exceptions are given with regard to international arbitration cases.
The rules restrict such advocates and firms from appearing before a judicial forum including tribunals and other statutory or regulatory authorities. They would be permitted only to render advice about the law of the country of their primary qualification, and allowed to practise on transactional work/corporate work such as joint ventures, mergers and acquisitions, intellectual property matters, drafting of contracts and other related matters on reciprocal basis.
The rules also clarify that such lawyers shall not be involved to do any work pertaining to property-linked matters.
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An exception
An exception, however, has been carved out in the rules for international arbitration cases that are conducted in India.
In such matters, the rules say, international lawyers and law companies can provide legal expertise or advice and appear for a person, firm, company or corporation in case their client’s head office is in a foreign country.
These arbitration cases may or may not involve foreign law, the rules further stated.
Foreign lawyers and firms can also appear before bodies that are not legally entitled to take evidence on oath, but where knowledge of foreign law is essential.
The rules also entitle registered foreign lawyers and law firms to open their offices in India, subject to the condition that BCI is informed of the particulars.
It also directed them to engage and procure legal expertise and advice of one or more Indian advocates registered as foreign lawyers in other countries, seek legal expertise with an Indian lawyer enrolled with any state bar council in India on any subject relating to Indian laws, and enter into partnership with only foreign lawyers or foreign law firm registered in India under the BCI rules.
Giving out details on how a foreign law firm or advocate can apply for registration, as well as the charges to be paid while applying for it, the rules said a firm or lawyer would have to apply for renewal of registration after a period of 5 years.
Five years since SC verdict
The BCI officials quoted above said that the rules are based upon a 2018 Supreme Court judgment that restricted foreign law firms and lawyers from setting up their offices in India, but permitted their entry on a temporary basis, describing it as “fly in and fly out”.
The verdict was given on two cross-appeals filed separately by the BCI and Lawyers Collective, a law firm.
While the BCI challenged a Madras High Court judgment that foreign lawyers and law firms can practise law in India in case of litigation and commercial transactions, Lawyers Collective questioned a Bombay High Court ruling that held the phrase “to practise profession of law” under the Advocates Act, 1961, is wide enough to cover litigious as well as non-litigious practice.
The SC judgment had left it to the BCI to work out the rules for entry. However, the rules go a step further by allowing foreign law firms to set up offices in India, while ensuring their entry does not jeopardise the prospects of Indian lawyers.
“We are very clear that foreign lawyers or firms would be allowed to practice, in a limited way, only on reciprocity basis. If any country bars Indian lawyers from practising there, we shall withdraw the permission given to their advocates as well,” one of the officials quoted above said.
The BCI, he added, is vested with the power to decide which lawyer and firm shall be registered. No application would be rejected without hearing the side of the applicant. Renewal after 5 years is not an automatic process, hence, the BCI has the discretion to reject such an application.
Moreover, grant of registration does not give a foreign lawyer or firm the right to live in the country and the Government of India is adequately empowered to recommend cancellation of a firm or lawyer’s registration at any time on the ground of national security or national interest or any other valid reason, he noted.
The requirement for registration is not needed in case a foreign lawyer or firm practises on a ‘fly in and fly out basis’ for the purpose of giving legal advice to a client in India regarding foreign law and on diverse international legal issues.
However, in this scenario, the rules say that such a firm or lawyer should not be maintaining any office in India. Further, the ‘fly in and fly out’ practice would not be allowed for more than 60 days in a year.
Qualifications required for registration
The rules also spell out the qualifications required by a lawyer or firm to apply for registration, and added that the BCI’s disciplinary rules apply to them in case of complaints of malpractices against them.
Any international firm or lawyer seeking to practise in India would need to get a clearance or no-objection certificate from the disciplinary body with which they are enrolled and also permission from the ministry concerned.
Pointing out that the rules address concerns expressed over flow of Foreign Direct Investment into the country and making India a hub of international commercial arbitration, the notification further states: “It is noteworthy that the standards of Indian lawyers in proficiency in law is comparable with the international standards.”
“The legal fraternity in India is not likely to suffer any disadvantage in case law practice in India is opened up to foreign lawyers in a restricted and well controlled and regulated manner on the principle of reciprocity. This would be mutually beneficial for lawyers from India and abroad and these rules are an attempt by the BCI in this direction,” it added.
Welcoming the BCI’s move, Rajesh Narain Gupta, managing partner of law firm SNG & Partners said: “Entry of foreign law firms will change the landscape for law firms in India. This would overall support in a big way the ambition of India to be more visible and valuable in a global context, especially on international trade and commerce.
“This will be a game-changer for the mid-size firms and will also help the law firms in India to achieve more efficiency in talent management, technology, domain knowledge in a global context and management,” he added.
(Edited by Geethalakshmi Ramanathan)
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