India liberalisation blow as foreign firms lose landmark case
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Ashurst, Chadbourne & Parke and White & Case have lost their long-running case in India against the Lawyers’ Collective.
Ashurst, Chadbourne & Parke and White & Case have lost their long-running case in India against the Lawyers’ Collective, website legallyindia.com reports.
In the Bombay High Court today the practice of all law by foreign firms in India has been ruled illegal.
The judgement and reasoning of the court has not yet been published but lawyers for both sides have confirmed the decision.
FoxMandal Little Mumbai litigation partner Guruprasad Pal, who represented White & Case in the matter, said: “We do not have the copy of the judgement but the court pronounced that the petition has been allowed. It’s a victory for the Lawyers’ Collective.”
Senior advocate CU Singh, who appeared on behalf of the Lawyers’ Collective also confirmed the judgement.
He was arguing in the Delhi Supreme Court today and was not present at the judgement but he was lead counsel on the case throughout and suggested several reasons for the court’s decision.
“Apparently they’ve allowed the petition,” said Singh, “so they’ve held that the permissions which have been granted by Reserve Bank of India to run liaison offices [by foreign firms] were illegal and those permissions have been quashed.”
“They also held that the practice of law under the Advocates Act in India encompasses all forms of practice, not just litigation practice in court but also corporate practice, advisory practice, M&A and the whole works,” he added.
“One of the main arguments of foreign law firms was that the Advocates Act covers only litigation practice in court but not advisory work pertaining to foreign law in India,” explained Singh.
An Ashurst spokesperson confirmed that the Bombay High Court had handed down its verdict today but added: “We haven’t received the judgement yet and we will examine the details when we do.”
The case against the foreign firms has been running since 1995, after Ashurst, Chadbourne & Parke and White & Case opened up liaison office in India but were accused by contravening the Advocates Act by practising law in India.
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Readers' comments (15)
anonymous | 16-Dec-2009 3:26 pm
What is going to happen to all these Indian lawyers working in UK law firms in London and providing Indian legal advice?
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Anonymous | 16-Dec-2009 3:29 pm
I have read (briefly though) the text of the decision. it is available on www.legallyindia.com
i do not think that it is a blow for liberalisation. it is delivered on technical grounds and simply asks the government of India to make rules for entry of foreign firms. In fact this clears the way for government to take a decision, rather than hide behind (which it has been doing all along) the excuse of the matter being sub-judice.
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Indian Lawyer | 16-Dec-2009 4:51 pm
Read further news on this story @ www.barandbench.com - I agree with anonymous...there is nothing....in the judgment that suggests that it is a 'blow' to the liberlisation process....and for all who know the Indian legal mechanism...there will be an appeal to Supreme Court for sure?
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Anonymous | 16-Dec-2009 4:56 pm
Well done India.
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The Flashing Blade | 16-Dec-2009 5:08 pm
Anonymous raises a very good point. It's not the end of the world and it begs the question, will Moily be able to cobble together enough support to clarify the Advocates Act and destroy the monopoly of the family firms?
The actual judgement itself is astonishingly silent on whether foreign firms can practice foreign law.
Despite a minor reference to a NY Court of Appeal case which is pretty obiter dicta, it cannot be logical for an Indian court to determine whether a foreign law firm operating from its soil can practice foreign law or not - surely that is purely a matter for the relevant professional foreign body and has nothing to do with the Bar Council of India or the courts of India?
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Anonymous | 16-Dec-2009 5:09 pm
Clearly anyone is able to provide Indian Legal advice. They just can not offer it in India. Lawyers doing outbound work will be fine.
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Indian Lawyer v.2 | 16-Dec-2009 6:16 pm
I''m sorry if I'm nitpicking, but the usage of the term illegal is driving me crazy. I'm not sure if this is an accepted common law definition, but in India, 'illegal' means an act expressly proscribed by law and generally accompanied by a penal provision. The Court in this case expressely refrained from using the word 'illegal', preferring the term 'bad in law', which has an entirely different connotation, especially since the act of the RBI granting permission to these firms was not in contravention of law, but due to a misinterpretation of the specified provision.
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Anonymous | 16-Dec-2009 6:40 pm
To anonymous : Obviously you have not read the judgement. Since neither does the judgement nor the Advocates Act applies to firms outside India. They could in thoery provide any amount of Indian law advise to their clients (subject to cleint satisfaction of course!!). Look at any deal happening in India today all (or a large majority) have a foreign law firm on board.
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Anonymous | 16-Dec-2009 10:14 pm
This could be a blessign in disguise for foreign law firms, since the court has prodded the Indian govt to take a decision soon. There are many pro-reform minsiters in India and foreign law firms may be allowed in sooner rather than later.
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Anonymous | 17-Dec-2009 3:02 am
Since W&C does not have much of an India practice left after all the departures over the past few years, this decision should not affect them much.
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