China edges open gap for foreign lawyers in new reforms

China has unveiled a second phase of reforms that will next year further ease the tough restrictions on the country’s legal market, although the reforms still fall short of granting foreign lawyers the right to practise local law.

The new Closer Economic Partnership Agreement (CEPA II) between China and Hong Kong, which was announced by the Chinese Ministry of Justice on 27 August will allow Hong Kong firms to advise mainland legal matters at the request of the mainland law firm.

The new rules are being pored over by foreign law firms eager to take advantage of the booming Chinese economy.

Deacons’ managing partner Lindsay Esler said that it is too early to say what impact the new rules will have for foreign firms: “It effectively means Hong Kong firms can work together with local firms and will make lawyers think more seriously about launching associations.”

CEPA II is expected to come into force on 1 January 2005.