Bar Council of India (BCI) has sought to allay the misgivings among the domestic legal fraternity over the recent opening up of the legal services market to foreign law firms and lawyers, stating that entry has been allowed in a “very restricted sphere”. 

This is even as the domestic law firms spearheaded by the Society of Indian Law Firms (SILF) have decided to make “representation” to the BCI demanding a level playing field and need to address the inconsistencies and vagueness in the rules. 

“We have decided to make representation to the BCI to point out the irregularities, inconsistencies, ambiguities and vagueness in the latest rules”, Lalit Bhasin, President, SILF told businessline after a meeting of SILF members on Monday.

The domestic law firms at this meeting conveyed their concerns over various facets of the rules and even felt that the BCI’s latest rules don’t make any sense in light of the clarifications issued by the regulator.

Aseem Chawla, Managing Partner, ASC Legal, said, “The BCI regulations though talk of foreign lawyers and foreign law firms, but there is no regulatory prescription currently in vogue which deals with Indian law firms. We need to consolidate things first at home before opening up.”

Sidharth Mody, Senior Partner, Desai & Diwanji, said, “Given that the foreign lawyers and firms can only advise foreign clients and that too on foreign laws , one could say that the impact of these rules on Indian lawyers would be very limited. However, without their being a clear demarcation made by the Bar Council of India, it would be difficult to determine as to which services foreign lawyers can and cannot provide to their clients in relation to foreing law, diverse international legal issues in non-litigious matters, and in international arbitration cases.”

Meanwhile, BCI said that the opening up move is not going to impact at all advocates practising in India even while clarifying on the scope of its recent notification on the rules allowing registration and regulation of foreign law firms and foreign lawyers.

What BCI’s clarifications say 

Seeking to clear the air around some of the issues on recent opening up of legal services to foreign law firms, the BCI has clarified that the foreign law firms and foreign lawyers can render advisory work on foreign laws for “their foreign clients” only.

SILF members in their meeting on Monday highlighted the need for clarity on the definition of “foreign clients” and wondered whether a MNC controlling subsidiary in India registered under Companies Act would be treated as “foreign client” or otherwise for the purposes of the latest BCI rules.

Meanwhile, the BCI has now in its latest set of clarifications made it clear that foreign law firms and foreign lawyers would be allowed to advise their clients about foreign laws and international laws only.

Also, the entry of foreign lawyers would be on reciprocal basis only i.e. lawyers of only those countries would be permitted in India, where Indian lawyers are also permitted to practice.

As part of the statement, BCI has reiterated that foreign lawyers and law firms would be allowed to function in non litigation areas only.

Foreign lawyers and law firms would not be allowed to appear in any Court, Tribunal, Board, before any Statutory or Regulatory Authority or any forum legally entitled to take evidence on oath and/or having trappings of a court, it added.

Also, foreign lawyers would be allowed to appear for their clients in International Commercial Arbitration and this move would help India become a hub of International Commercial Arbitration.

“Experience and facts show that MNCs and foreign commercial entities, in case of International Commercial Arbitration, don’t prefer India as a venue of Arbitration Proceedings, because they are not allowed to bring lawyers and law firms from their own countries to advise them in International Commercial Arbitration Proceedings, thus, making them to prefer London, Singapore, Paris etc. as the venue for Arbitration Proceedings. BCI’s rules will, now, encourage India being preferred as a venue for such International Arbitration Proceedings”, BCI statement said.