ASHURST Morris Crisp has been granted a temporary reprieve in India after the Court of Justice refused to suspend its licence as injunctive relief in a battle with local lawyers.
However, the court admitted the writ petition of the Bombay Lawyers Collective, which claims foreign practitioners, licensed to act only as conduits between clients and parent offices, are flouting local rules and acting in a "totally illegal and unregulated manner".
In its preliminary opinion the court questioned the validity of the licences granted to Ashursts and US firms White & Case and Chadbourne & Parke, and instructed the Enforcement Directorate and the Reserve Bank of India (RBI) - which issued the licences - to take action if conditions were violated.
The RBI has already issued a show cause notice to Chadbourne & Parke saying it "appears to have violated the terms and conditions of the permission granted".
Counsel to the collective Anand Grover said the group, which had called for the revocation of the licences, had hoped for stronger injunctive relief.
"At least the court has agreed with us on the interpretation of the law," he said. "But this is only a prima facie view and it has to be decided.
"Ideally we wanted that they should cease functioning at all as an interim measure."
But Ashursts senior partner Andrew Soundy said the court had acted "properly and correctly" in denying calls for interim relief.
"The arguments presented in its [the petition's] support are perfectly respectable and should be answered on their merits," he said.
"We are confident that we can convincingly do that in regard to the position of my own firm at a full hearing."
The court has preliminarily agreed with the collective that the Advocates Act 1961 - which requires lawyers to enrol with local Bars before practising - covers all legal work, including a non-contentious caseload.
This is denied by counsel for the three firms, who say foreign lawyers working outside of courts and tribunals are not required to sit local Bar exams.
One City lawyer said he was "astonished" at the preliminary indication that legislation in India conferred a monopoly upon Indian advocates for the provision of all legal advice.
"The consequences in such an event would appear to be bizarre," he said. "Any opinion in India on any legal matter would seemingly have to be given by an Indian advocate, whether contentious or non-contentious and whether the law was Indian, English, New York, Japanese or whatever.
"Such an outcome would not appear to well-serve the interests of local clients."