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24 March 2023: Are foreign law firms now allowed in India?

Context: The Bar Council of India (BCI), in its recent initiative, has allowed foreign lawyers and law firms to practice in India. Although they cannot appear in court, they can advise clients on foreign law and work on corporate transactions.

Background: The Advocates Act says that only lawyers who have signed up with the Bar Council can practice law in India.All others, such as a plaintiff, can appear only with the permission of the court, an authority, or the person before whom the proceeding is pending.

What is the decision of the BCI?

On March 13, the BCI notified the Official Gazette of the Registration and Regulation of Foreign Lawyers and Foreign Law Firms in India Rules, 2022. BCI is a statutory body established under the Advocates Act, 1961, and it regulates legal practice. Education in India For more than a decade, the BCI was opposed to allowing foreign law firms in India.

Now, the BCI says that its move will ease worries about FDI coming into the country and make India a center for international commercial arbitration.The rules make it clear how the law works for foreign law firms that only do very limited work in India right now.

In a long statement of its goals and reasons, the BCI said that it “resolves to promulgate these rules” so that foreign lawyers and law firms can practice foreign law, international law, and international arbitration in India.well-defined, regulated, and controlled manner.

What will be the effect of allowing new rules?

The Advocates Act says that only lawyers who are signed up with the Bar Council can practice law in India.All others, such as a plaintiff, can appear only with the permission of the court, an authority, or the person before whom the proceeding is pending.

The notification basically says that foreign lawyers and law firms can sign up with the BCI to practice law in India as long as they are allowed to do so in their home countries.However, they cannot practice Indian law.

“Foreign lawyers or foreign law firms shall not be allowed to appear before any courts, tribunals, or other statutory or regulatory authorities.

They will be permitted to practice transactional or corporate work such as joint ventures, mergers and acquisitions, intellectual property matters, the drafting of contracts, and other related matters on a reciprocal basis.

They shall not be involved with or allowed to do any work relating to a transfer of property, a title inquiry, or other similar works, the notification said.

Indian lawyers working with foreign law firms would also be subject to the same restriction of merely engaging in “unlawful practice.”

How have foreign law firms fared so far?

The issue of foreign law firms entering the Indian market came up in the courts in 2009 with a challenge before the Bombay High Court. In ‘Lawyers’ Collective v. Union of India’, the Bombay High Court essentially held that only Indians holding an Indian law degree can practice law in India.

Section 29 of the Advocates Act says that only advocates who are registered with the BCI can practice law. The High Court interpreted this section.The HC also said that ‘practice’ would include both litigation and non-litigation practice, therefore foreign companies cannot advise their clients in India nor appear in court.

In 2012, the issue came up before the Madras High Court in ‘AK Balaji vs. Union of India’.

What was the decision of the SC?

The decisions of both the Madras and Bombay High Courts were challenged before the Supreme Court by the BCI and the Lawyers Collective, respectively. In 2018, the Supreme Court upheld both the High Court judgments disallowing foreign law firms and lawyers, with some modifications to expand the expression “fly in and fly out” to cover only “casual travel practice”. was kept for

This meant that a “fly in and fly out” route could not mean regular visits. On the issue of LPOs, the Supreme Court did not decide on their fate. He argued that they were essentially BPOs that managed secretarial support, transcription services, and proofreading.

Services, travel desk support services, etc., which are not technically covered under the Advocates Act or the BCI Rules.