Ashurst has closed its Delhi liaison office following the outcome of the Lawyers Collective case, which ruled that the practice of all law by foreign firms in India is illegal.
At the end of last year the Bombay High Court ruled that the Reserve Bank of India (RBI) should not have granted Ashurst a licence to open a liaison office in India (16 December 2009).
In a statement Ashurst said: “In view of the Bombay High Court’s decision in the Lawyers’ Collective case, we’ve decided not to apply for an extension of the current licence for our New Delhi liaison office, which expires on 22 February 2010.
“The Indian market has moved on significantly since we established our liaison office in 1994 and our India business is not dependant on a continuing liaison office.”
Ashurst India group head Richard Gubbins told website LegallyIndia.com: “I came to the conclusion some time ago that we have a naturally successful India platform outside the confines of the liaison office.”
According to Gubbins, it had mooted closing its Indian office at least two months before the court ruling was handing down.
Gubbins explained that Ashurst’s India group partners had unanimously decided at an October 2009 partners’ meeting to gradually begin to wind down the Delhi office because of the large cost and India’s changing legal landscape.
The firm’s statement noted: “Having considered for some time the future of our liaison office, we concluded that our India business has reached a level of maturity whereby a presence on the ground in India no longer provides the benefit it once did.
“In that sense, the ruling of the Bombay High Court has merely accelerated a decision that we had already taken.”
Ashurst’s Delhi office is headed by retired India Administrative Service (IAS) officer Ashok Mubayi, whose formal retainer with the firm will also end with the office closure.
“He’s been an extremely loyal friend and trusted adviser to the firm for the past 15 years and following the closure of our liaison office I’m sure we’ll continue to seek his guidance and advice, which we’ve found so valuable over the years,” commented Gubbins.
“The same is true with all the other friendships that we’ve forged in India over this time.”
Ashurst’s statement also noted that the firm had never breached the terms of its RBI licence, that it never practiced law from the liaison office and that the RBI had renewed its licence continually for 15 years.
“Our commitment to India remains as strong as ever and is in no way diminished by the closure of our liaison office,” it said, adding: “We still believe that the opening up of the Indian legal market would not only benefit the legal community in India but would also help the continued growth of international business in India.”
This article first appeared on LegallyIndia.com.
Readers' comments (12)
Poster 2 | 15-Mar-2010 8:24 am
At the above poster, cutting and pasting your views from another website is hardly original. As for pitching to Public Sector Undertakings, you're probably aware that any disinvestment or offer of securities to foreign institutional investors or otherwise, will require foreign counsel. Why not have them sitting in Delhi instead of Singapore, Dubai, London or New York?
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Anonymous | 13-Apr-2010 10:38 am
On a recent trip to India I met with some of the leading law firms and each lawyer I met (all young, recently made up Partners) was somewhat embarrassed about this situation and completely unable to justify it.
It is market protection - that's all there is to it. Client service or needs don't come into this at all. The Indian legal profession has a lot of political clout and they use it well...altough ironically only the larger law firms actually benefit from this, since a non-Indian law firm is hardly likely to compete with Indian lawyers for the morass of Indian litigation work.
On the upside, some Indian clients have realised that there is better quality service to be obtained outside India and we are seeing the effects of that. Some forms, of course, have hired Indian-qualified lawyers to service their Indian clients outside India.
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