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Opinion: Collective's wisdom; Should foreign firms be allowed at all?

Bhasin & Company and SILF chairman Lalit Bhasin
Bhasin & Company and SILF chairman Lalit Bhasin

To me it appears childish to pose the query "until when can entry of foreign lawyers be prevented in India", says Bhasin & Co managing partner and Society of Indian Law Firms (SILF) chairman Lalit Bhasin in response to last week's opinion that the Lawyers Collective judgment is wrong.

This query can only be answered if the basic question "why and whether foreign lawyers should be at all be allowed in India" is answered.

The first query indicates the mind-set of people who have already adopted the name and format of foreign law firms.

Who wants the foreign lawyers in India? The Indian business, the foreign business, the Indian government, the foreign governments, the Indian lawyers or the foreign lawyers?

Business case
Indian business has categorically stated in CII (Confederation of Indian Industry) meetings that as and when inputs are required regarding legal issues in non-Indian jurisdictions, they leave it to their lawyers in India to seek foreign lawyers' help.

There is no evidence that foreign business or multinational companies want foreign law firms in India. Evidence is to the contrary. Multinational Corporations are outsourcing legal work directly to India to avoid the heavy expense of professional fees to US or UK law firms. This possibly can be the only reason (loss of earnings) why there is a clamour for entering India.

Multinational companies have reposed confidence in the Indian legal profession at about one tenth of the cost they would have had to incur in the UK or US.

Powers that be
The Indian government left to itself does not want foreign law firms to open their offices in India. Reference to the General Agreement on Trade in Services (GATS) is misplaced. The Indian Government (Ministry of Commerce) is on record that opening of legal services is not on their agenda.

World Trade Organisation (WTO) and GATS regimes are applicable within the four corners of existing laws. No nation can be compelled to change its laws – that is a sovereign function and international treaties/conventions/protocols are all subject to the laws of member states.

Foreign governments such as those of the United Kingdom and Japan have definitely taken a stand that foreign law firms should be allowed in India. This is mainly because of the negative growth that the legal profession is facing in those countries. The profession exerts pressure on the governments to put pressure on the Indian Government.

It is therefore the legal profession in foreign jurisdictions which wants the Indian legal services sector to be opened up. The legal profession in so-called advanced countries is a product of Industrial Revolution whereas in India it is a product of Independence Revolution – a product of our struggle for independence in which lawyers' role was most illustrious. The names are well-known.

The Indian legal profession is alert to and vigilant about the obnoxious pressures being brought on the Government of India in this regard. These attempts would be resisted.

In any case, Bombay High Court has authoritatively pronounced on these aspects under discussion here and until the judgment is over-ruled or the laws are amended this remains the law of the land.

Right for wrong reasons
One has a right to say that the judgment is wrong – but there have to be cogent reasons.

The reason given that chartered accountants, engineers, company secretaries are doing legal work is begging the question. What these professionals are doing is illegal, being in gross breach of the provisions of the Advocates Act (Section 33) which authorises only advocates to engage in practice of law.

This is one issue which the legal profession has taken up strongly with the Government. We are opposed to multi-disciplinary practice. In any case two wrongs don't make one right.

The entire focus on what will happen to "millions of non-lawyer professionals" is totally misplaced and with great respect I do not understand the rationale or logic of this concern for those who are non-lawyers doing lawyers' work.

Frankly I have no answer to this line of reasoning which does not deal with the basic issue of foreign lawyers' right to practice in India but with the issue of "millions of non-lawyer professionals" doing legal work in violation of law.

This sympathy is totally misplaced. Jurisdiction of the courts (especially the High Court) has been transferred to tribunals and authorities (tax, Company Law Board, and others) where  professionals from other disciplines are allowed to appear.

Especially in corporate litigation, the High Court's jurisdiction is virtually stripped and is to vest in the National Company Law Tribunal (NCLT).  The say of the Bar in these tribunals is very limited or negligible.  

At the same time, there are advocates who have been practicing on the tax side and they suffer restriction by the introduction of mandatory tax audits and the courts have held that Advocates practicing on the tax side cannot audit.

I am not canvassing that advocates should become auditors but at the same time the exclusivity of the advocates and law firms is to be protected too.

We notice big accounting and consulting firms employing in-house counsel to advise their client on legal issues. These firms advice on drafting, conveyance and more and would create a redundancy for small and mid size law firms.  

Chartered Accountants and others appear before Arbitral Tribunals and quasi-judicial bodies and argue cases. While qualitatively they may not match the advocacy skills of a good lawyer the fact remains that such issue will snow ball and affect the exclusivity of legal practice of lawyers and this may not augur well for the profession.

The big accounting and consulting firms have been doing this where there is significant foreign accounting or law firms' indirect presence.  

Wrong for right reason
In my view the judgment of Bombay High Court is wrong in one respect.

The observation of the Bombay High Court that the Government should decide on its policy regarding foreign lawyers is not a 'direction'. It is only an observation and is per incuriam.

But as a matter of fact and law the High Court is wrong in making this observation.

In any case the Government cannot, despite the observation of the High Court, evolve any policy which is contrary to law. Whether or not there should be an amendment to the law is for our Parliament to decide. Moreover the Bar Council of India (BCI) is a statutory body and the Government has no supervisory role over the BCI.

We will decide what is good for India and Indian legal profession.

We never interfered in the matters of others, why should others for "personal gains" adopt a high-handed approach towards India.

Lalit Bhasin is the managing partner of Bhasin & Company and the chairman of the Society of Indian Law Firms (SILF).

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