It can be clearly witnessed from the history of India that there have been various foreign nations and companies that always tried to enter our country and affect our market for their own profit. Especially after globalisation, various foreign brands and offices have established themselves in India and are doing pretty well in terms of profit and recognition. Different foreign companies establish their offices and operate in India by employing Indian citizens in their offices. In the name of self-sufficiency, India has created barriers to entry for outsiders in many businesses since winning its independence in 1947. Everywhere in the world, including the legal profession, people believed it to be highly delicate. The Advocates Act of 1961 required that all lawyers be Indian citizens because the subject was so delicate. In response to a request from the central bank, the Foreign Exchange Regulation Act of 1973 [1]established an exemption. Foreigners were still not allowed to represent clients in court, but they may advise them on topics like mergers and contracts. The BCI criteria released in March 2023, enabling the entry of international law firms and lawyers in the country have recently caused a dispute among the domestic legal professionals in the country. People around the nation have expressed both support and hostility for these BCI standards. The public appears sceptical about foreign companies’ propensity to dominate the Indian market and is also dubious about how such liberalisation will affect the future of Indian lawyers. Our goal in this article is to study the most recent BCI rules on the admission of foreign lawyers and legal firms to practise and establish their own offices in India.
BACKGROUND
The Supreme Court of India rejected the entry of foreign law firms in March 2018 and ruled that they could not open offices there. However, foreign lawyers could travel to India on a fly-in, fly-out basis, which allowed them to counsel the clients on issues relating to foreign law while there. Simply put, there were strict restrictions on how any foreign law firms could conduct business in India. There were many responses to this Supreme Court decision, both positive and negative. The domestic legal industry has always been critical of the uneven level of competition between domestic and international legal practitioners. The legal community, the BCI, and non-statutory entities, all fiercely opposed to the concept of opening the legal market for the foreign businesses and lawyers. In 2009, the Bombay High Court ruled that foreign law firms could open offices there, and in 2012, the Madras High Court decided that the foreign law firms or organisations might momentarily visit India for consultation with clients on issues relating to foreign laws, leading to the discovery of errors by the Reserve Bank of India. This decision was made in 2018 as a result of the massive number of appeals that were filed with the Supreme Court after those rulings. However, lawyers, law students, and other legal professionals were still very confused after the 2018 decision. In order to allow the foreign lawyers to practise law in India, the Bar Council of India (BCI) published the Bar Council of India Rules for Registration and Regulation of Foreign Lawyers and Foreign Law Firms in India, 2022 (Rules) [2]on a notification dated March 10, 2023. The most recent news release issued by the Bar Council of India contains the following information: restricting the advice provided to clients by foreign lawyers and law firms to information on foreign and international legislation. Could only counsel their overseas clientele on those laws. Should solely work in non-litigation-related areas. Not allowing foreign lawyers or law firms to testify in court or any other setting where taking evidence under oath is permitted and which has other features of a court. On a reciprocal basis, only lawyers from countries that also enable Indian solicitors to practise law may enter. Reciprocity is the foundation of the BCI Rules. Foreign solicitors can represent clients in international commercial arbitration. The BCI regulations that allow foreign solicitors and law firms should not be considered to allow any other professionals, such as BPOs. It is illegal to enter India and start practising in any subject if it is comparable to the practise of law, as established in Bar Council of India v. A.K. Balaji[3]. This will help Indian lawyers and considerably enhance the growth of the Indian legal system.
LAWS/ ACTS
There are specific laws and acts that govern this matter. The All India Bar Committee, 1951 was constituted with Justice S.R. Das as its head. In order to maintain the function of advocates in India, this committee advocated a number of reforms and regulations, including the creation of an All India Bar Council and state bar councils. The federal government of the entire nation passed the Advocates Act of 1961[4], which completely overhauled the legal system in India. It contains several parts that give out guidelines for this matter. The reciprocity concept is mentioned in this Act’s section 7(1). This clearly indicates that only if Indian nationals are permitted to practise law in a foreign country can a foreign national or foreign lawyer be admitted as an advocate in India. The requirements for advocates’ enrolment in the State Bar Councils are clearly outlined in Section 24 of the Advocates Act. In accordance with the reciprocity principle, the clause also authorises enrolment by foreign nationals. According to Section 47(1), a foreign national cannot be allowed to practise law in India if there is no reciprocal agreement in their home country. The BCI may adopt the required rules for the enrolment of non-Indian citizens with foreign legal degrees, according to the Section 49 of the act.
CASE LAWS
Using case laws, it is feasible to comprehend this topic in a better way.Lawyers Collective v. BCI [5]was a case that the Bombay High Court heard in 1995. The key issue the court considered was whether foreign companies might open liaison firms in India for non-litigious cases before getting a licenced lawyers under this Act. The Bombay High Court determined that the meaning of “to practise profession of law” as specified in Section 29 of the Act applies to both disputed and non-litigious practise. As a result, global law firms and advocates must follow the law. The Reserve Bank of India misjudged by allowing foreign legal firms to set up liaison offices there. The central question in the 2012 case of AK Balaji v. GOI [6]was whether foreign solicitors, advocates, and law firms were entitled to conduct business and participate in litigation in India. Lawyer Mr. AK Balaji filed a writ suit with the Madras High Court requesting rules prohibiting the entry of foreign legal firms and solicitors into India. According to the Madras High Court, foreign lawyers and law firms are free to take part in Indian international commercial arbitration. Also emphasised was the right of all parties to an international contract access local legal counsel from their home country. To give their Indian customers legal advice about foreign law, foreign lawyers and law firms have the ability to fly into and out of India. In 2018, a new appeal of this case was made to the Supreme Court. The Honourable Supreme Court has defined “practise of a profession” to encompass both litigation practising and non-litigation practise. As a result, the definition of “practise of profession” has been expanded to encompass giving legal counsel, offering advisory services, and other professions. The court concluded that a fast or casual visit with the purpose of providing counsel is allowed and won’t be viewed as practises. This decision addressed the question of whether it is unlawful for foreign professionals and law firms to enter and exit India in order to offer legal advice on foreign laws. The Supreme Court has unequivocally ruled that foreign legal firms and solicitors are not permitted to practise law in India, whether they are involved in litigation or not, unless they comply with all applicable laws, rules, and regulations. This means that rather than being permitted to open liaison offices or permanent installations in India, international law firms and lawyers will only be allowed to come to India on brief or infrequent visits that have been decided not to be deemed professional activity.
MERITS and DEMERITS
If we look deep into this matter, we would be able to analyse the merits and demerits of it. Starting with the points in favour of the guidelines, the entry of foreign firms would increase the employment opportunities for all the legal professionals in India and provide them with better options to enhance their careers. The newly graduated law students would have various opportunities in terms of jobs and law students would also have options to intern at top reputed law firms. The foreign firms could help and guide the Indian companies on international matters rather than creating their own monopoly in the country. There would be a huge evolution of the legal sector in India with this change since it would boost the sector’s professionalism, add newness, give customers more options, and raise the pay threshold. Customers will have more options for both quality and service, and incompetence at all levels will be revealed. However, the legal community believes that allowing foreign law firms and lawyers to establish their business in India would be detrimental for the local firms and lawyers. The law graduates would face huge difficulties in foreign countries since the law degrees of educational institutions in India is not valid in various foreign nations and the legal education in India is different when compared with other nations. Allowing foreign lawyers in India would increase the competition among the legal fraternity, which is already increased due to large population of local lawyers in India.
SUGGESTION
After carefully examining the subject, it is certain that the Indian legal industry would benefit from the introduction of international firms into India, if the domestic firms are given the protection from unhealthy competition and job insecurity. It would be better if the domestic law firms join hands with the foreign firms and strive to increase the opportunities for the entire legal fraternity, so that everyone is able to enhance their practice and no one is left without any chance. Nothing should prevent domestic law firms and lawyers from expanding because of their global counterparts. However, for that to happen, it would be necessary for the legal sector of India to enhance and evolve by becoming more welcoming and less restrictive for the betterment of the country. An effective legal framework must be adopted before implementing these guidelines for a healthy and positive existence of both foreign and domestic law firms and lawyers. Allowing the foreign firms in India would be beneficial not only for the legal sector of the country, but the entire country as a whole.
CONCLUSION
Overall, the guidelines released by BCI on allowing the entry of foreign law firms and lawyers in India seems to be a beneficial move for the legal fraternity as well as the country and would be a huge transformation for the legal sector in India. Few amendments in the legal framework would be more advantageous for the nation. India has always witnessed various transformations in sectors of education, space, Information technology, aviation, banking etc. Another shift in the legal sector will only help the country to be a more progressive Global leader in the entire world.
[1] India code: Home, https://www.indiacode.nic.in/repealed-act/repealed_act_documents/A1973-46.pdf
[2] F.NO.A-60011/141/2021 government of india ministry of law & justice …, https://legalaffairs.gov.in/sites/default/files/vacancy/YP%20Advt%20latest.pdf
[3] Bar Council of India vs A.K. Balaji . on 13 March, 2018 – Indian kanoon, https://indiankanoon.org/doc/132041574
[4] The advocates act, 1961 – India code, https://www.indiacode.nic.in/bitstream/123456789/1631/1/A1961_25.pdf
[5] Indian kanoon – search engine for Indian law, https://indiankanoon.org/
[6] A.K. Balaji vs the Government of India on 21 February, 2012 – indian kanoon, https://indiankanoon.org/doc/155095202/
Author: Samriddhi
Juris Centre 