The Government of India has made up its mind to allow foreign law firms to practice in India. It has virtually crushed all opposition for years altogether in a matter of months.
There have been several media reports in India late last month quoting the then Union Commerce Secretary, Rajiv Kher ‘We have taken a note on legal services to Committee of Secretaries (CoS). The CoS will talk about it shortly’. The government has started discussions with the Bar Council of India and other stake holders to open up legal services sector to foreigners in a calibrated manner. However, the fear in the minds of majority of Indian litigators has been allayed since he categorically mentioned that undertaking litigation by foreign lawyers will not be allowed. This step will lead to opening of the non-litigious services and international arbitration legal services to foreign law firms. After the CoS approves it, the same will be taken up by the Cabinet which is chaired by India’s Prime Minister, Mr. Narendra Modi, who is quite vocal in his support to this initiative.
The Government of India has somewhat bulldozed its way successfully through the stiff wall of objection against the entry of foreign law firms, made strong over the years by the Bar Council of India (BCI) and the Society of Indian Law Firms (SILF) joining hands. Prime Minister Narendra Modi has set up an inter-ministerial group to prepare a proposal on an entry of foreign law firms into India. It was at a consultation with this group that SILF President Lalit Bhasin and BCI chairman Manan Kumar Mishra said that they had no objections.
SILF, a body which represents a large number of Indian law firms, had softened its stand late last year itself when its President, Lalit Bhasin, suggested a phased sequential approach for entry of foreign legal consultants and law firms into India over a period of five to seven years. He followed it up with an article titled ‘Road map for reform’ in the widely read Indian Law Journal, wherein he explained why he now supports the phased entry of foreign law firms. This is a complete u-turn from his previous statements, which he has admitted in this article. In an interview a few years back in the same journal, he had categorically stated ‘The Bar Council of India has taken the correct stance in its categorical opposition to foreign law firms in India and I fully support the Bar Council on this score.’
Meanwhile, the Hon’ble Supreme Court of India has issued the notice to the Government and BCI to explain its position in a Special Leave Petition filed by Global International Lawyers against the Bombay High Court’s 2009 order quashing the Reserve Bank of India’s decision allowing some foreign law firms to open liaison offices in the country. Appearing before a bench of Justices A R Dave and Kurian Joseph, some international law firms pleaded that restriction on their entry should be done away with and they should be allowed to practice in India.
SILF, which has perhaps lost its voice (and possibly also faced a loss of face) due to the dramatic backtrack on its views against the entry of law firms, has tried to fire another salvo against a new target. It has filed a formal complaint with BCI against the Big 4 accounting firms for alleged ‘unauthorised practice of law’ (providing legal services) in violation of the Advocates Act. BCI has taken the cue and sent notices to the Big 4 firms in India. We will wait to see if this complaint has any basis or turns out to be another frivolous initiative.
In view of the Government’s thrust to open up the legal sector, it is imminent that decks are being cleared for entry of foreign law firms in India. It is only a matter of time now that the legal services sector will be opened up, almost 25 years since India’s economy was liberalized in 1991. The Modi Government’s determination has ensured an end to the delay due to the inactions of previous Governments and resistance from all quarters. Where there is a will, there is a way.