The Supreme Court of India clarified the debatable issue as to whether International Lawyers/ International Firms can practice law and whether they can advice the clients in India. The Supreme Court vide its judgment dated 13th March, 2018 titled as BAR COUNCIL OF INDIA v. A.K. BALAJI AND ORS (CIVIL APPEAL NOS.7875-7879 OF 2015) held that foreign firms, companies and law firms are allowed to practice foreign laws on casual visit and can advice Indian clients on ‘fly in and fly out’ mode on foreign law or on their own system of law and on diverse international legal issues.
The said matter had already been addressed before the Hon’ble Madras High Court and the Hon’ble Bombay High Court .The Bar Council of India (“BCI”) had filed an appeal against the Madras High Court decision, while Global Indian lawyers challenged the Bombay High Court decision before the Hon’ble Supreme Court of India.
- Whether International Lawyers/International Firm can practice Law in India.
- Whether International Lawyers/International Firms can open an office in India.
- Whether Foreign Advocates shall be allowed to fly-in-fly-out in India to provide legal advice to its Clients.
- Clarified that meaning of “practice the profession of law”.
A writ petition was filed before the Hon’ble Madras High Court to seek direction to Union of India, RBI and BCI to take action against 32 foreign law firms which had been allegedly practicing in India.
The main issue which had been addressed in the said matter was the principle of reciprocity and to whether Foreign Advocates shall be allowed to fly-in-fly-out in India to provide legal advice to its Clients.
Hon’ble Madras Court held that:
- The Court had restrained foreign law firms and lawyers from practicing as an Advocate in India. However, it stated that foreign lawyers could visit India for a temporary period on a ‘fly in and fly out’ basis to render legal advice regarding foreign law or their own system of law and on diverse international legal issues as there is no specific provision in the Advocates Act to prohibit a foreign lawyer from visiting India for a temporary period to advice his or her clients on foreign law.
- Foreign Lawyers were allowed to conduct arbitration proceedings in respect of disputes arising out of a contract relating to international commercial arbitration.
- Business Processing Outsourcing (BPO) providing wide range of customized and integrated services and functions to its customers were not included within the purview of the Act or the Rules. However, in the event of any complaint made against these B.P.O. Companies violating the provisions of the Act, the Bar Council could take appropriate action against such erring companies.
The Supreme Court of India heard over 30 law firms hailing from the United Kingdom’s, United States of America, France and Australia on the aforesaid issues. The Supreme court of India modified Madras High Court order wherein, the Hon’ble High Court though had restrained foreign law firms and lawyers from practicing as an Advocate in India but however had allowed foreign lawyers to visit India for a temporary period to render legal advice. The court had adopted the concept of flying in and flying out (FIFO).
Vide this order The Supreme Court of India held that:-
The concept of Flying in Flying Out had been clarified that foreign lawyers have been allowed fly in and fly out of India on casual basis for rendering legal services on offshore laws and diverse international legal issues. It shall include drafting instruments and being part of discussions on the issue. Hon’ble Supreme Court of India observed that ‘fly in and fly out’ may amount to practice of law if, done on a regular basis, and concluded that whether a particular visit qualifies to be a frequent visit, or a casual visit has to be determined on a case to case basis, and Bar Council or Union of India have been directed to frame appropriate rules in this regard.
Had clarified in respect of the law on the interpretation of words ‘practice the profession of law’ whereby allowing foreign lawyers to practice foreign law in India only with prior permission of the court or tribunal, authority or person before whom proceedings are pending. It had held that “practice the profession of law’ includes both litigation as well as non-litigation practice such as giving of opinion, drafting of instruments, participation in conferences involving legal discussion as well.
Foreign lawyers have not been completely barred from coming to India for conducting arbitration proceedings in disputes involving international commercial arbitration, but they would be subject to the code of conduct applicable to the legal profession in India. Rules of institutional arbitration will apply to them.
The Supreme Court of India also modified the Madras High Court ruling stating that the BPOs, providing customised and integrated services, do not come within the purview of the laws regulating the legal profession provided their activities do not amount to practice of law. The Hon’ble Madras High Court had ruled that services such as word processing, secretarial support, transcription services, proof reading services, travel desk support services, etc., do not come amount to legal practice and did not come within the purview of the Advocates Act, 1961.
The Supreme Court of India vide this judgment had allowed foreign lawyers
- To fly in and fly out of India and give advice on international legal issues which would be casual in nature.
- To conduct arbitration proceedings in respect of matters regarding international commercial arbitration, but they shall be required to adhere to the code of conduct applicable to the legal profession in India.
The Ruling of Supreme Court of India had a shown path towards opening up the Indian legal market to the foreign contemporaries for which Bar Council of India has been directed to frame Rules governing the practice of law in India by foreign lawyers and law firms.
The presence of foreign law firms will increase competition in the legal sector by making young lawyers of India being exposed to diverse international legal laws and will provide more employment opportunities for young lawyers. While Supreme Court has not expressly restricted foreign lawyers but has however acknowledged Bar Council’s right to regulate legal profession.
Presently the Government of India is trying to make India a Global Arbitration Hub in order to adopt more liberalization, the presence of global law firms will, in fact, reassure foreign investors to India.