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ANALYSIS OF NEW RULE OF BAR COUNCIL OF INDIA - FOREIGN LAWYERS AND LAW FIRMS TO PRACTICE IN INDIA.
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ANALYSIS OF NEW RULE OF BAR COUNCIL
OF INDIA - FOREIGN LAWYERS AND LAW FIRMS
TO PRACTICE IN INDIA.
AUTHORED BY - RADHA SHARMA
ABSTRACT
The legal profession is one of the
ancient professions, not only in the country but in the world also. Since very
long standing time, it has been observed as a noblest profession. Government
and administration can’t run properly without adequate laws and
without the contribution of the legal profession. In 1961 existing Advocates
Act enacted for the purpose of amending and consolidating the law relating to
legal practitioners. This act also makes provision for establishment of State
Bar Council and Bar Council of India. “One of the important function of Bar
Council of India is to frame rules to practice the profession of law by
advocates. In exercise of it’s power the Bar Council of India has also framed rules
called Bar Council of India Rules in exercise of its powers under Section 49 of
the Act. In Chapter III of Part VI of the Rules dealing with the 'Conditions
for right to practice', are found rules frame under Section 49(1)(ah) of the Act which deals with the conditions subject to
which an advocate shall have the- right to practice, and the circumstances
under which a person shall be deemed to practice as an advocate in a court[1].”
In the present research paper I will analyze the new rule of Bar Council of
India vide notification dared 10th March, 2023 namely the Bar
Council of India Rules for registration and regulation of foreign lawyers or
foreign law firms to practice the profession of law in India.
Introduction
In other words, the legal profession
is considered as noble as virtue and as important as justice. The lawyer helps
the court to reach at a right decision because lawyer collects all evidences
pertaining to the case, then presents all evidences to the court and helps to
court to reach at right decision. In the
matter of Madhav Singh[2]
the Court has observed that advocates and pleaders are enrolled not only for
the purpose of rendering assistance to the Courts in the administration of
justice but also for giving professional advice for which they are entitled to
be paid by those members of the public who require their services. It has
rightly been observed that a sound system of administration of justice must
have three basic ingredients, namely a well-planned body of laws based on wise
concepts of social justice, a judicial hierarchy comprised of the Bench and the
Bar, learned in the law and inspired by high principles of professional conduct
and existence of suitable generation to ensure fair trial[3].
Chapter IV of the Rules lays down
nature and extent of law practice by a foreign lawyer and foreign law firm.
Rule 8 of Bar
Council of India Rules provides the nature and extent to which a foreign lawyer
is authorized to practice law in India[4].
The Bar Council of India recently
made the Rules for the Regulation of Foreign Lawyers and Foreign Law Firms in
India, which allows them to practice the profession of law in India.
However, it does not allow them to
appear before courts, tribunals or other statutory or regulatory bodies. The
BCI has been opposed to allowing foreign law firms and foreign lawyers to
practice in India for more than a decade. But now, the BCI has reasoned that
this move will address concerns over FDI flow in the country and will make India
a hub for international commercial arbitration. This rule will bring legal
clarity for practicing legal profession with regard to foreign law firms and
foreign lawyers.
The BCI said "it is determined
to implement these rules to enable foreign lawyers and foreign law firms to
practice foreign law and various international law and international
arbitration matters in India on a reciprocity basis in a well-defined,
regulated and controlled manner."
As per section 29 of Advocates Act,
1961[5] “ there shall be only one class of persons entitled to
practice the profession of law, namely, advocates”. Under the Advocates
Act, 1961, only advocates registered with the Bar Council are permitted to
practice law in India. All others may appear only with the permission of the
court, authority or person before whom the proceedings are pending.
New rule framed by Bar Council of
India permits foreign advocates and law firms to register with the Bar Council
of India only if they are permitted to practice law in their home countries.
However, they cannot practice with regard to litigious matter in the field
of Indian law. They will be permitted to
work Non - Litigious matters such as joint ventures, mergers and acquisitions,
intellectual property matters, contract drafting and other related matters on a
reciprocal basis. They shall not be permitted to do any work related to
property transfer, title investigation or any other kind of similar work. Same
restriction shall also applicable to Indian lawyers working with foreign engaged
only in "non-contentious practices".
Points to be considered for practice in India:
Foreign advocates must follow the rules
and regulations set by the Bar Council of India to practice the profession of
law in India. The rules for foreign advocates to practice in India are
primarily governed by the Advocates Act, 1961 and the rules of the Bar Council
of India framed in exercise of power given under Section 49 (1) of Advocates
Act, 1961[6].
Here are some points to be considered to practice the profession of law in
India:-
Qualifications:
A foreign lawyer must be qualified to
be admitted as an advocate on a state roll as per section 24 of Advocates Act,
1961. As per Section 24 “a person
shall be qualified to be admitted as an advocate on a State roll, if he
fulfills the following conditions, namely:—
(a) he is a citizen of
India
Provided that subject to the other provisions
contained in this Act, a national of any other country may be admitted as an
advocate on a State roll, if citizens of India, duly qualified, are permitted
to practice law in that other country;
Registration:
It is also required to register with the Bar
Council of India by foreign lawyers to practice law in India. The registration
process includes submit an application, paying a fee and completing a security
check.
Limitation on practice:
It is not allowed for foreign lawyers
to engage in litigation matters or appear in courts in India. They can only
provide legal advice and consulting services to their clients i.e. they are
allowed to practice in India in non litigious matters.
Overall, while foreign lawyers can
practice law in India, there are several restrictions and requirements that
must be met. It is important to carefully check and follow the regulations set
by the Bar Council of India to avoid any legal problems.
Advantages of this new rule-
The question of whether foreign
lawyers should be allowed to practice law in India is a contentious issue
having strong arguments on both sides. Here are some critical analyzes of the
pros and cons of allowing foreign lawyers in India.
Being allowed to practice law in India to
foreign advocates can bring a number of benefits such as:
Increased Competition: Allowing foreign lawyers to practice law in India will lead to increase
competition among advocates, which will further lead to better quality of legal
services and it will also lower costs for clients. Definitely foreign lawyers
would bring some new perspectives, best practices of international law and
experience that would benefit Indian clients.
Expertise in International Law: Often foreign lawyers also have expertise in international
law, which will be beneficial to those Indian clients who are involved in
cross-border transactions or disputes.
Access to Global Networks: Foreign lawyers can bring with them access to global
networks of lawyers and law firms, which can benefit Indian clients seeking
legal representation or advice in foreign jurisdictions. . In addition, it
would provide an opportunity for Indian lawyers to learn from foreign lawyers
and possibly work on international cases.
Promotion of India as a legal hub: Allowing foreign lawyers to practice law in India can help to
promote India as a legal hub for all countries and it will attract more foreign
investment and business to the country.
Opportunities for Indian lawyers: Allowing foreign lawyers to practice law in India can also
provide opportunities for Indian lawyers to collaborate and learn from foreign
lawyers, which can help improve the quality of legal education and training in
India.
Expanding Legal Services: This would also increase the range of legal services that
can be provided in India, which would be beneficial to businesses and
individuals who want to engage in international trade and commerce.
Economic benefits: Allowing foreign lawyers in India could also have economic benefits as
it would encourage foreign law firms to set up offices in India, create jobs
and contribute to the growth of the legal sector in India.
Disadvantages of this new rule-
Impact on employment opportunities : One of the major disadvantages of allowing foreign lawyers
to practice law in India is that it could have a negative impact on employment
opportunities for Indian lawyers. If foreign lawyers are allowed to practice in
India, they may be able to offer their services at lower rates, which could
make it difficult for Indian lawyers to compete. This could lead to a reduction
in the number of jobs available for Indian lawyers.
Understanding of Indian laws: Another disadvantage is that foreign lawyers may not have a
thorough understanding of Indian laws and legal procedures. This could lead to
them making mistakes or giving inaccurate advice to clients. This could have
serious consequences for clients who rely on their legal representation.
Outflow of legal talent from India :Allowing foreign lawyers to
practice in India could also lead to an outflow of legal talent from the
country, as Indian lawyers may be attracted by higher salaries and better
working conditions offered by foreign law firms. This could have a negative
impact on the development of the Indian legal system.
Unethical
practices and behavior: There are
concerns about the ethical implications of allowing foreign lawyers to practice
in India. Foreign lawyers may not be subject to the same ethical standards and
regulations as Indian lawyers, which could lead to unethical practices and
behavior. This could damage the reputation of the legal profession in India and
undermine public confidence in the judicial system.
Violation of sovereignty: Allowing foreign lawyers to practice in India could be seen
as a violation of Indian sovereignty as foreign lawyers may not be familiar
with Indian law and culture, leading to potential misunderstandings and
conflicts.
Lack of reciprocity: There is no guarantee that foreign countries would reciprocate and
allow Indian lawyers to practice law in their countries, leading to an uneven
playing field.
Risk of Exploitation: There is a risk
that foreign law firms could take advantage of the Indian legal market, leading
to exploitation of Indian lawyers and clients. Foreign law firms may also have
an unfair advantage due to their greater resources and international
relationships.
In conclusion, while there are valid
arguments on both sides, the decision to allow foreign lawyers to practice law
in India ultimately depends on weighing the potential benefits against the
risks and potential disadvantages. It is important to ensure that any policy
changes are made with care and that appropriate safeguards are put in place to
protect the interests of Indian lawyers and clients.
Previous cases regarding this BCI decision
There have been cases where foreign
lawyers have been allowed to appear in Indian courts under certain
circumstances.
The legal profession in India has
traditionally been restricted to Indian citizens only, with foreign lawyers not
permitted to practice law in India. However, this began to change in the late
20th century when India began to liberalize its economy and open up to foreign
investment.
In 1995, the Bar Council of India,
which regulates the legal profession in India, amended its rules to allow
foreign lawyers to visit India to advise on foreign law or matters arising from
international transactions. This was seen as a significant step forward as it
opened up new opportunities for foreign law firms to advise clients on
cross-border transactions and other matters.
However, this was only a partial
opening of the legal profession in India to foreign lawyers. Foreign lawyers
were still not allowed to appear in Indian courts or engage in the regular
practice of law in India.
In 2009, the Indian government
introduced a bill in parliament that would allow foreign lawyers to practice
law in India, but the bill faced opposition from the Indian Bar Association and
other groups and was eventually withdrawn.
In 2012, the Bar Council of India
amended its rules again to allow foreign lawyers to come to India to advise
clients on foreign law or work in collaboration with Indian lawyers on specific
projects. This was seen as another step forward but again failed to allow
foreign lawyers to engage in regular legal practice in India.
As of today, foreign lawyers are
still not allowed to sit in Indian courts or practice law in litigious matters
in India, but they can advise clients on foreign law or work with Indian
lawyers on specific projects.
The Lawyers Collective vs. Bar Council of India (2010)[8] – The Lawyers Collective, an NGO,
challenged the Bar Council of India's rule barring foreign lawyers from
practicing law in India. The case went all the way to the Supreme Court, which
upheld the bar rule but clarified that foreign lawyers can visit India
temporarily to advise clients on foreign law or participate in arbitration
proceedings.
AK Balaji Vs. Government of India (2012)[9] – In this case, the Madras High
Court held that foreign lawyers cannot practice law in India even if they are
merely providing legal advice on foreign law. The case was appealed to the
Supreme Court, which forwarded it to a larger panel for further consideration.
These cases highlight the ongoing
debate and legal issues surrounding the issue of allowing foreign lawyers to practice
law in India. Although there has been some relaxation of the rules in recent
years, the issue remains contentious and unresolved.
Vodafone tax dispute case[10]
One such case is the Vodafone tax
dispute case. In this case, Vodafone, a British multinational
telecommunications company, was involved in a tax dispute with the Indian
government. The Indian government claimed that Vodafone was liable to pay taxes
in India for the acquisition of shares in the Indian company. Vodafone, on the
other hand, argued that the transaction took place outside India and therefore
was not subject to any tax in India.
During the hearing of the case,
Vodafone was represented by a team of Indian lawyers as well as a foreign
lawyer, Mr. Harish Salve. Mr. Salve was a senior advocate in the Supreme Court
of India and is also qualified to practice law in England and Wales. Mr. Salve
was allowed to appear as a "friend of the court" or as amicus curiae
in the case.
The role of amicus curiae is to
assist the court in a case where there is no party representing a particular
view or where the court requires specialized expertise. In the Vodafone case,
Mr. Salve was appointed amicus curiae by the Supreme Court to assist the court
in interpreting certain provisions of the Income Tax Act and the relevant
Double Taxation Treaty between India and the United Kingdom.
Mr. Salve's arguments and opinions
had a great influence on the final judgment of the case. In its judgment, the
Supreme Court held that Vodafone is not liable to pay taxes in India for the
transaction in question. The judgment was widely discussed and debated in the
legal community and Mr. Salve's contribution to the case was highly
appreciated.
In conclusion, while foreign lawyers
are generally not permitted to practice law in India, they may be permitted to
appear in Indian courts under certain circumstances, such as in the role of
amicus curiae. The Vodafone case is an example of how a foreign lawyer can make a significant contribution to a case in India
even though he is not allowed to practice law in the country.
In India, foreign lawyers were not
allowed to practice law or appear in courts, with a few exceptions such as
international arbitration. However, there have been discussions and debates
about the possibility of allowing foreign lawyers to provide legal services in
non-contentious matters on a fly-in-fly-out basis.
The Bar Council of India (BCI), which
is the regulatory body for legal education and profession in India, has earlier
barred foreign lawyers from practicing in India in any form, including in
non-judicial matters. However, in 2017, the BCI issued a draft set of rules
that would allow foreign lawyers to provide legal services in India on a
fly-in-fly-out basis, subject to certain conditions. Under the proposed rules,
foreign lawyers would be allowed to provide legal advice, consultation and
representation to clients in matters that do not involve appearing before a
court or tribunal in India. This would include advising clients on legal issues
related to business transactions, mergers and acquisitions and other business
matters. But there has been some resistance from the legal community in India.
Some lawyers argue that allowing foreign lawyers to provide legal services in
India would lead to an influx of foreign law firms, which could threaten the
livelihood of Indian lawyers. Others argue that foreign lawyers could bring
valuable expertise and knowledge to the Indian legal profession and could help
improve the quality of legal services available in the country. In conclusion,
while foreign lawyers are currently not allowed to practice law or appear in
courts in India, there have been discussions about allowing foreign lawyers to
provide legal services in non-contentious matters on a fly-in-fly-out basis.
Bar Council of India Vs. A.K. The Balaji[11]
The Bar Council of India Vs. A.K. The
Balaji case was a landmark decision by the Supreme Court of India in 2018. The
case dealt with whether foreign law firms and foreign lawyers could practice in
India.
The Bar Council of India passed a
resolution in 2012 barring foreign lawyers and law firms from practicing in
India on the grounds that their presence would harm the interests of Indian
lawyers. However, a group of foreign lawyers challenged the order in the Madras
High Court. The Madras High Court held that the Bar Council of India had no
power to restrict the practice of foreign lawyers and law firms in India and
that the order violated the right to practice any profession or practice any
occupation guaranteed under the Indian Ordinance Constitution.
The Bar Council of India appealed
this decision to the Supreme Court. The Supreme Court upheld the decision of
the Madras High Court and held that foreign lawyers and law firms could visit
India on a "fly in and fly out" basis to give legal advice on foreign
law, but could not set up permanent offices or practice. The court also ruled
that foreign lawyers can participate in international commercial arbitrations
held in India, but only if they are domiciled outside India.
Taken together, Bar Council of India
Vs. A.K. The Balaji case shed light on the scope of practice of foreign lawyers
and law firms in India and highlighted the importance of maintaining the
independence and integrity of the Indian legal profession.
There have been several landmark
cases in India related to the issue of allowing foreign lawyers to practice law
in the country.
Conclusion
This significant new step by bar
council of India is likely to pave the way for potential consolidation,
particularly for firms engaged in cross-border mergers and acquisitions
(M&A) matters. The entry of foreign law firms will go a long way in
boosting India's ambitions to be more visible and valuable in the global
context, especially in the field of international trade and commerce. This new
rule will be a game changer for mid-sized firms and will also help law firms in
India achieve greater efficiency in talent management, technology, domain
knowledge in a global context and management.
Article Information
ANALYSIS OF NEW RULE OF BAR COUNCIL OF INDIA - FOREIGN LAWYERS AND LAW FIRMS TO PRACTICE IN INDIA.
Authors: RADHA SHARMA
- Journal IJLRA
- ISSN 2582-6433
- Published 2023/09/06
- Issue 7
About Journal
International Journal for Legal Research and Analysis
- Abbreviation IJLRA
- ISSN 2582-6433
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