The Bar Council of India (‘BCI’) is a statutory body established under Section 4 of The Advocates Act, 1961, which governs legal education as well as legal practice in India. On 13th March 2023, BCI notified the ‘Rules for Registration and Regulation of Foreign Lawyers and Foreign Law Firms in India, 2022 (‘Rules‘). This has enabled foreign lawyers and law firms to provide legal services within India. While the entry of foreign lawyers/firms appears to have been permitted, it is crucial to understand that such permission is limited and comes with certain reciprocal obligations. This is, of course, in view of the regulatory regime in place of which the primary intent is to safeguard and protect the interests of home-grown legal practitioners. In this background, the broad object of the said Rules has to be analyzed, keeping in view the specified circumstances as well as the nature of cases involving particular subject matters, which can be dealt with by these foreign lawyers and foreign law firms.
For starters, it needs to be primarily appreciated that the said Rules are based upon the cardinal principle of reciprocity. This rule tacitly aims to permit the foreign lawyers/law firms (having a primary qualification in the form of a certificate from a competent authority in their respective country) of those nations only, where lawyers of Indian nationality are permitted to practice. Upon having fulfilled the said prerequisite, the Rules pave the way for foreign lawyers/law firms to sail through the first access point for attaining eligibility to provide legal services in India. However, mere eligibility would not confer them the said entitlement. Still, they will first be required to register with the BCI under Rule 4 (Chapter III) of the Rules. In furtherance of the same, it becomes imperative to take note that even registration does not guarantee an entitlement to the foreign lawyers/law firms to practice law in perpetuity by way of a one-time registration; rather, Rule 5 (Chapter III) of the Rules, creates a provision for applying for renewal of registration six months prior to the expiry of the 5-year validity of the prior registration, which would ensure BCI to keep a constant check and balance vis-à-vis foreign practitioners.
The specified nature of cases and the subject matters which remain available and accessible to foreign practitioners are primarily confined to non-litigation areas, including International Commercial Arbitrations, transactional work /corporate work such as joint ventures, mergers and acquisitions, intellectual property matters, contract drafting, and other related matters on a reciprocal basis, in a well-defined, monitored and regulated manner.
Correspondingly, to give shape to our comprehension of the Rules, it becomes essential to gauge the nature of work that foreign practitioners are not permitted to carry out in India since it has not been explicitly mentioned in the Rules. In our view, it would be impermissible for foreign practitioners to carry out any work related to the conveyancing of property, title investigation, or other similar works. They are principally barred from appearing before any Court, Tribunal, Board, Statutory or Regulatory Authority, or Legal Forum entitled to take evidence on oath and having trappings of a Court. To attain unequivocal clarity, it is reiterated that the underlying principle of reciprocity has a key role to play. Without reciprocity, the limited scope of practice available to foreign lawyers/ law firms will be inconceivable. Thus, in the future, if reciprocity is allowed vis-à-vis any subject matters referred to above, BCI would again have to clarify whether the scope of practice of foreign practitioners is widened beyond the permissible activities in Rule 8 of the Rules.
Further, it must be borne in mind that to rationally filter out certain exceptional circumstances surrounding some foreign lawyers/law firms that may be functioning on a ‘fly in and fly out’ basis, the prohibition entailing non-registration with the BCI will not apply. To crystallize the distinctiveness of foreign lawyers/law firms falling under the ‘fly in and fly out’ category, certain conditions need to be fulfilled, which are as follows:-
- Legal advice of ‘fly in and fly out’ foreign lawyers/law firms to a client in India must be confined to foreign laws and diverse international legal issues.
- The legal expertise/advice of ‘fly in and fly out’ foreign lawyers/law firms should have been sought from them in a foreign country.
- ‘fly in and fly out’ foreign lawyers/law firms should not be maintaining any office in India for the purpose of such practice.
- Such practice of ‘fly in and fly out’ foreign lawyers/law firms in India should not exceed 60 days in entirety, within a period of 12 months.
Numerous discrepancies are bound to arise once foreign lawyers/law firms are allowed to work within the Indian legal domain. Therefore, the Rules expressly deal with provisions related to their misconduct. If BCI receives any complaint or otherwise has reason to believe that a foreign lawyer/law firm registered under the Rules is guilty of any professional misconduct or any other misconduct related to the practice of law in India or has violated the terms and conditions of the Rules. In that case, it shall be referred to the concerned foreign country’s concerned Disciplinary Authority. In case the misconduct is found to be of grave nature and apparent on the face of the record, BCI may directly suspend the registration of the concerned foreign lawyer/law firm and refer the matter to the concerned Disciplinary Authority after intimating the Indian Government through its Ministries of Foreign Affairs and Ministry of Law and Justice. Even though the BCI has taken foreign lawyers and law firms within its ambit, the Rules are confined to imposing suspension and penalties in the event of disciplinary misconduct; and cancellation of registration and imposition of penalties in the event of wrongful registration.
At this juncture, it becomes essential to visit the status of foreign lawyers/law firms before these Rules are notified. For this purpose, it is imperative to evaluate the decision of the Hon’ble Bombay High Court in Lawyers Collective v. Union of India[1], wherein it was held that only an Indian having an Indian law degree can practice law in India. The word ‘practice’ constitutes both litigious and non-litigious practice, meaning thereby, that foreign lawyers can neither advise their clients in India nor appear in the Courts, and the same is mentioned in Section 29 of The Advocates Act, 1961. The judgment was in response to the cacophony created concerning foreign lawyers and law firms upon their entry into the Indian market. In 2012, a similar issue surfaced before the Hon’ble Madras High Court in AK Balaji v. Union of India[2]; it was held that foreign firms cannot practice either on the litigation or non-litigation side unless they meet the requirement and rules laid down by the Advocates Act and the BCI. However, they can temporarily visit or advise clients on international legal issues and foreign laws on a ‘fly in and fly out’ basis.
The judgment was challenged by BCI before the Hon’ble Supreme Court in BCI v. AK Balaji & Ors[3]. The Hon’ble Supreme Court upheld the previous judgments to the extent that in both litigation and non-litigation settings, foreign legal firms, corporations, or attorneys would be prohibited from practicing in India. The decision allowed foreign attorneys to temporarily provide ‘fly in and fly out’ services to Indian clients but were not permitted to set up a permanent office in India. Nonetheless, arbitration proceedings for disputes arising from contracts involving International Commercial Arbitration could be conducted in India with the involvement of foreign lawyers. Keeping in view the decision dated 13th March 2018 of the Hon’ble Supreme Court, in the case of BCI v. AK Balaji & Ors., the Court desired the BCI or the Government of India to frame rules on entry and regulation of foreign lawyers/law firms in India. In response to the decision, the BCI has now introduced the Rules allowing foreign lawyers/law firms access to the Indian legal domain, confining their presence and involvement to a restricted frame of practice areas while endeavouring to ensure that the Indian advocates practicing in India are not adversely impacted.
The Objects and Reasons of the Rules expressly deal with the innate nature of the legal profession in India and why a need has arisen to accommodate the constantly evolving legal sector from an international standpoint. Unquestionably, the object and reasoning thereof strive to balance maintaining the sanctity of the legal profession in India while creating scope for recognising and regulating the practice of foreign lawyers/law firms in India. The legal profession in India is recognised as a noble profession in India, so ideally, no commercial competition should be associated with it. The world is constantly evolving towards global integration of nations through the interplay of nations’ economies with that of the world. International trade and commerce are advancing, and growth in the international legal work sphere and globalization of the legal practice vis-à-vis the internationalization of law is becoming far more relevant. India being en route to becoming a global hub, undoubtedly, has to rise to the occasion of meeting the global changes and overcoming the challenges that ensued in the Legal Arena caused by the uncontrolled migration of people across the globe.
Indeed, the involvement of foreign lawyers/law firms in restricted practice areas will likely boost the Indian legal profession. It is also expected to bring a sense of uniformity and an extended sense of professionalism in the sector wherein there are a handful of law firms, and it is predominantly dominated by individual practitioners. On the face of it, such a measure appears to be in the best interests of India’s burgeoning clients for international law. Although it is an evolving step at its nascent stage, there is still criticism that the entry of foreign law firms will result in the loss of jobs for many Indian lawyers. Still, contrarily, opening the Indian market to foreign law firms will bring competition, providing better legal opportunities.
This move will create a new impression of professionalism, as there will be a sense of freshness in the legal sector. No doubt, the clientele will have additional choices as the true competence of various firms will be exposed, as well as lead to the increase in the remuneration bar within the sphere. Through this reform, new law graduates will get an additional flavour and an opportunity to acquire first-hand experience in international as well as domestic legal subjects, which is bound to impact the legal education imparted in India, resulting in wholesome reforms. Consequently, these Rules will be a game changer in the legal sector and will help the legal domain to grow sufficiently in India.
Despite introducing these Rules being revolutionary, the same has brought along its share of criticism. The Society of Indian Law Firms (‘SILF’) has resolved to send a representation to BCI upon the Rules, pointing out its vagueness, irregularities, deficiencies, and illegalities. SILF is set to demand BCI to create a level playing for Indian law firms and to hold off implementing Rules.
Whether worthy of applause or criticism, introducing the Rules can be considered an encouraging step, particularly in providing foreign lawyers/ firms clarity about their legal services/ expertise offerings in India. Additionally, weeding out the ambiguities hovering above the undefined boundaries within which foreign lawyers/law firms could function. The Indian legal market has significantly grown, and this progressive step will act as a catalyst in the development of India in the global sphere.
References
[1] 2010 86 AIC 375 (Bom)
[2] 2012 SCC OnLine Mad 723
[3] 2018 5 SCC 379
