The inception of this issue dates back to 1995 when a writ petition was filed before the Bombay High Court challenging the practice of a few foreign firms. A lawyer, A.K. Balaji, filed a writ petition before the Madras High Court raising similar issues. The Bombay High Court in 2009 in Lawyers Collective versus BCI & Ors. held that the Reserve Bank of India was not right in granting permission to foreign law firms to open liaison offices in India. The Madras High Court in A.K. Balaji versus The Government of India & Ors. in 2012 observed that foreign lawyers or foreign law firms need to fulfil the criteria laid down in the Advocates Act, 1961, to practise the profession.
Hitherto, there was no bar on foreign lawyers or law firms to practise in India for a temporary period on a ‘fly in and fly out’ basis to advise their clients, and no bar on lawyers visiting India to appear in arbitration proceedings arising out of a contract relating to international commercial arbitration. However, full-fledged legal practice before regular courts and quasi-judicial fora was prohibited.
As such, this has come to mean that there was no bar on foreign lawyers or law firms to practise in India for a temporary period on a ‘fly in and fly out’ basis to advise their clients, and no bar on lawyers visiting India to appear in arbitration proceedings arising out of a contract relating to international commercial arbitration. However, full-fledged legal practice before regular courts and quasi-judicial fora were hitherto prohibited.
The verdicts of the Bombay and the Madras high courts were taken up to the Supreme Court in BCI versus A.K. Balaji & Ors. (2018), in which the court encountered five major issues. Firstly, whether the expression ‘practise the profession in law’ includes both litigation practice and non-litigation practice; secondly, whether foreign lawyers and foreign law firms could be allowed to practise without fulfilling the requirements in the Advocates Act and the BCI Rules made under the Act; thirdly, if there is a bar on foreign lawyers practising in India on a ‘fly in and fly out basis’; fourthly, whether foreign lawyers and law firms can appear in arbitration proceedings or disputes arising out of a contract relating to international commercial arbitration; finally, whether business process outsourcing (BPO) companies providing integrated services come within the purview of the Advocates Act or Rules thereunder.
The Supreme Court held that the Advocates Act governs foreign lawyers and foreign law firms equally, and there is not an absolute bar on foreign lawyers visiting on a ‘fly in and fly out basis’. Furthermore, the court decided that there is no bar to conduct arbitration proceedings if an international commercial arbitration governs the matter; finally, it confirmed that BPO companies providing integrated services do not come within the purview of the Advocates Act or Rules thereof.
Spirit of reciprocity
Five years after the judgement of the Supreme Court, the BCI has laid down the 2022 Rules after much deliberation and dialogue between authorities of different countries, state bar councils and BCI officials. In particular, official delegations from the United Kingdom have made it known that Indian advocates are already eligible in England and Wales to practise Indian law, international law as well as provide English-law advice. However, Indian advocates are restricted from practising in the following reserved activities: appearing before a court, contracting to grant a short lease, will or other testamentary instrument, and probate activities or notarial activities.
The Bar Council of England and Wales does have a process to invite advocates, who are engaged in one case, to appear before English courts by a temporary call to the Bar. Moreover, Indian advocates can qualify to become solicitors in England and Wales through the Solicitors Qualification Examination process. As such, there are formalised pathways for Indian advocates to enter the legal profession in England and Wales. In the spirit of reciprocity, the BCI has now come around to notifying the 2022 Rules.
The 2022 Rules were notified in the Official Gazette on March 13, and require foreign lawyers and law firms to register themselves with the BCI by paying a fee of US $ 50,000 in case of foreign law firms and US $ 25,000 in case of an individual foreign lawyer. They also restrict the practice of foreign law firms or foreign lawyers to only non-litigious matters, including transactional work, mergers and acquisitions, intellectual property matters, drafting contracts and advisory work.
The 2022 Rules restrict the practice of foreign law firms or foreign lawyers to only non-litigious matters, including transactional work, mergers and acquisitions, intellectual property matters, drafting contracts and advisory work.
In other words, registered foreign law firms and foreign lawyers cannot enjoy the audience of Indian courts, tribunals, statutory boards or any other fora except for the matters requiring a foreign lawyer’s expertise. They also cannot prepare documents regarding procedures before an Indian court of law or undertake any work relating to conveyancing, title verification, or other related work.
It is also mentioned in the Rules that if any advocate enrolled with any state Bar council in India chooses to be a partner of a foreign law firm, then such an advocate can advise only on non-litigious issues relating to laws other than Indian law. However, foreign lawyers are exempt from registration if they practise in India on a ‘fly in and fly out’ basis for a period not exceeding sixty days aggregated over twelve months.
Undoubtedly, the 2022 Rules will open the market for law firms and lawyers in India. They indicate that foreign lawyers and foreign law firms must engage the services of Indian lawyers and law firms when advice on Indian law is sought by their clients.
Moreover, the principle of reciprocity is pertinent; only if an Indian lawyer/law firm is allowed to practise in a jurisdiction can a lawyer/law firm from the said jurisdiction be permitted to practise in India. This would encourage foreign jurisdictions beyond England and Wales to open their market to Indian lawyers and law firms. Indian businesses which are expanding to foreign jurisdictions will now be able to access expert legal advice from foreign law firms which are already operating in India.
International commercial arbitration is an area which may see an immediate spike in activity. Some foreign lawyers may also eventually be able to impart education or lectures in our universities and to our students on areas of foreign law, which may not have too many specialists in India. Cross-jurisdictional fields of study, such as comparative constitutional research, would blossom and help us strengthen our legal standards.
There are many such reasons to welcome the 2022 Rules, but more than anything else, it will help Indian advocates keep pace with the ever-changing global legal profession.