The IBA has bowed to the inevitable and agreed a list of suggested rules to regulate MDPs.
The IBA's original proposals on MDPs, drafted this summer and sent to the World Trade Organisation, contained draconian rules which would have imposed more restrictions on MDPs than currently exist in many jurisdictions.
But the IBA ruling council last week agreed to delete the harshest proposals and turn the others into suggestions. US legal consultant Ward Bower will chair an IBA sub-committee that has been formed to draft the final resolution.
The most controversial rule – that the profession should regulate the whole MDP, rather than just its lawyers – has been scrapped. Remaining suggestions include a prohibition on giving audit services and legal advice to the same client, a requirement for a minimum percentage of ownership by lawyers and rules on restricting access to confidential information and avoiding conflicts.
Bower said: “We want to make clear to trade bodies like the WTO that any rules are there for the protection of clients.”