Supreme Court (SC) recently delivered its judgment on the issue of whether foreign law firm/lawyers are permitted to practice in India. The Supreme Court bench that delivered the judgment comprised of Justice Adarsh Kumar Goel and Justice UU Lalit. Previously, the Madras and Bombay High Courts had also dealt with the same issue and the matter is finally settled with SC laying down the law on the matter.
The SC framed five broad issues for consideration, including the meaning of the expression ‘practice of profession of law’, the permissibility of such practice of law in India by foreign law firms, any bar for the said law firms/lawyers visiting India on a ‘fly in and fly out’ basis to advise clients on foreign law, any bar on conducting arbitration proceedings by foreign lawyers in India, and the status of BPO companies operating from India.
The SC, referring to earlier decided cases, observed that, ‘right to practice is genus of which right to appear and conduct cases is a specie’. The rights of the advocate have been enunciated and been seen to envelope a host of acts which an advocate is at liberty to perform as part of discharging his professional duties, including appearing before the courts, dispensing consultation to his clients, giving legal opinion whenever sought for, drafting instruments, pleadings, affidavits or any other documents, participating in any conference involving legal discussions, and so on. Echoing the earlier judgments, the SC in the present judgement took the view that ‘practice’ of law included litigation and non-litigation, as ethics of the legal profession apply equally to advocates appearing before the Court, as they do to regulate practice outside the Court.
The SC clarified that per the scheme contained in the Advocates Act, only advocates enrolled with the Bar Council of India are entitled to practice law; whose ambit has already been held to encompass more activities than simply appearing in courts. Any other persons looking to practice law as an advocate need express permission of the court, or other relevant authority. This prohibition on practice of law by any person other than an advocate registered with the Bar Council of India applies not only to Indians but also to foreigners.
SC then took up the issue of the status of a foreign lawyer visiting India on a ‘fly in and fly out’ basis to give advice on international law, and whether the same could amount to ‘practice’ of law. Madras High Court had held there to be no bar on a foreign lawyer/foreign law firm visiting India on a ‘fly in and fly out’ basis for advising clients on matters relating to foreign law. The SC narrowed down the scope of the Madras High Court and made it clear that such a visit could amount to practice of law if made on a regular basis. The SC stated that ‘a casual visit for giving advice may not be covered by the expression ‘practice’. The frequency, duration and nature of a visit by a foreign lawyer is to be decided on a case to case basis, and the making of rules in the regard have been left to the Bar Council of India (BCI) or Union of India (UoI). The SC did not accept the contention that a foreign lawyer was entitled to practice foreign law in India without subjecting himself to the regulatory mechanism of the BCI Rules. In addition, the judgment explicitly states that the prohibition applies as much to a group of individuals as it does to an individual.
mostly agreeing with the stance of the Madras High Court on the issue of the absence of any bar to foreign lawyers conducting arbitrations in India, the SC made some further observations. It noted that in matters arising out of an international commercial arbitration agreement, conduct of proceedings may fall under provisions of the Advocates Act read with the provisions of the Arbitration Act and even in such cases, the Code of Conduct applicable to the legal profession in India has to be followed.
SC also shed light on BPO companies providing customized and integrated services to its customers like secretarial support, transcription services, etc. It was clarified that BPO companies would remain outside the purview of the Advocates Act or the Bar Council of India Rules, unless in pith and substance their services amounted to practice of law, in which case, the provisions of the Advocates Act and Bar Council India rules will be duly applicable.
effect, SC’s ruling has made clear that foreign law firms/companies or foreign lawyers cannot practice profession of law in India either on the litigation or non-litigation side, and they cannot open offices in India. The expression ‘fly in and fly out’ is to be limited to a casual visit for giving advice, and the code of conduct has to be followed by foreign lawyers participating in an international commercial arbitration.
However, despite the Supreme Court ruling, the matter is still not put at rest with the Central Government now considering the matter regarding allowing entry of Foreign Law Firms on a reciprocity basis. The Supreme Court Judgement and the Law Commission Report in this regard are being considered by the Central Government.
Also, the Central Government has sought from the Bar Council of India whether it is opposed to the entry of foreign law firms in India and in case if the foreign law firms are permitted to operate in India, the manner in which a foreign law firm will qualify to be listed as an advocate under Advocates Act, 1961. Presently the Advocate Act provides that for an advocate to be enrolled with the Bar Council of India, they should be citizens of India and should possess an Indian law degree, with exceptions.