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A&O to get liberalisation back on agenda with survey showing 9 of 10 corp lawyers want foreign firms, only 1 in 10 want reciprocity

Brayne: Liberalisation not standing still
Brayne: Liberalisation not standing still
Aiming to rekindle a “constructive debate” on the liberalisation of the Indian legal sector, UK headquartered magic circle firm Allen & Overy (A&O) has started a public relations (PR) offensive with an independent survey that confirmed overwhelming support for the entry of foreign law firms among Indian corporate lawyers and clients.

The A&O-commissioned report by international market researchers YouGov, which was first published exclusively by the Economic Times yesterday, showed that 96 per cent of Indian lawyers, in-housers and corporate executives were in favour of legal market liberalisation.

In 2010, Clifford Chance’s then senior partner Stuart Popham had predicted that Clifford Chance could have an office in India by 2012. In September 2011, Legally India reported that England & Wales’ Law Society president John Wotton visited Indian with a delegation and expressed optimism about liberalisation, but since then neither country’s regulator has made any significant public moves or statements on the subject.

“I don't think the [liberalisation] debate’s at a standstill,” Allen & Overy India group chair Jonathan Brayne told Legally India yesterday, denying that there has been a lack of progress.

“This research provides hard, independently generated, statistical insights into the opportunities and issues that liberalisation of the legal market creates. We hope it will generate more constructive debate.”

The telephone-based survey conducted by YouGov between February and April 2012 asked 301 India-based lawyers and senior corporate execs about their opinions on legal market liberalisation. A&O has a best friend relationship with Indian law firm Trilegal.

“We were keen to hear the views of people who had not been prominent in the debate previously - the corporate clients at both senior executive and general counsel level; and lawyers in private practice who had a view but perhaps hadn't voiced it before,” explained Brayne.

“That's why YouGov went for such a large sample - 100 respondents from each of those three communities.”

Indian law firm partners emerged as the most pro-liberalisation and were also keen to partner with foreign lawyers in the practice of both Indian and foreign law in India.

The survey did not specify the seniority of the partners surveyed, but stated: “The debate has tended to be between senior members of the profession in private practice. The views of the Indian corporates, who are stepping out onto the world stage to compete with their international peers, and of younger Indian lawyers, whose careers will be most affected by the outcome of the debate, have not been prominent.”

Full or partial liberalisation

A whopping 98 per cent of 51 partners and 50 associates from India’s top 50 corporate law firms, selected from independent rankings, were in favour of full or partial liberalisation.

That view was shared by 93 per cent of 100 general counsel (GCs), and 96 per cent of 100 chief and senior executive officers in Indian companies.

However, only 18 per cent of all respondents said they were in favour of “complete” liberalisation, with 78 per cent preferring “partial” liberalisation.

At 27 per cent, law firm partners were the largest segment of the survey favouring full liberalisation, while only 13 per cent of general counsel wanted complete liberalisation.

Modes and timings

A total of 84 per cent of the partners surveyed favoured foreign law firms opening offices in India by merging and partnering with Indian law firms and lawyers to practice both Indian and foreign law in India.

63 per cent of respondents voted for such an entry of foreign firms within two years or less and 28 per cent preferred a three to five-year period.

Legally India’s associate, in-house and advocate survey revealed in May that 75 per cent of 536 respondents were in favour of the entry of foreign lawyers within two years or less, while 58 per cent of the lawyers said they wanted a legal market liberalisation to happen immediately.

This sentiment was particularly powerful among law firm and in-house lawyers but among court-based lawyers only 60 per cent voted in favour of liberalisation immediately or within two years and a more significant proportion of the advocates — 20 per cent — said they never wanted foreign lawyers to enter the Indian market.


The strongest stated reason behind lawyers backing liberalisation according to the YouGov survey was the potential availability of international legal expertise to Indian lawyers and clients: 90 per cent associates and 88 per cent partners “agreed”, while the combined average of the sample was 79 per cent.

The primary reason behind 76 per cent of company executives supporting liberalisation was that it would increase the choice available to clients.

GCs and company executives (71 per cent) agreed with the statement that their business would become more globally competitive through liberalisation.

The second-biggest incentive for lawyers was an increase in career opportunities: 84 per cent of associates, followed by 82 per cent of partners, and 76 per cent general counsel agreed.

80 per cent of respondents believed that competition from foreign law firms would attract better pay and work conditions for Indian lawyers. Law firm partners formed the highest proportion agreeing on this aspect, while in-house counsel formed the least.

Disincentives: poachings, attrition & ‘they’ll take our jobs’?

Respondents were divided about whether the entry of foreign law firms would result in a migration of Indian talent, with 43 per cent of partners agreeing and 45 per cent disagreeing that some of the most talented Indian lawyers would be taken away from Indian law firms.

The opinion of associates was similarly split down the middle, but of GCs, 76 per cent agreed that the best talent would move to foreign firms.

Only 33 per cent partners were concerned that foreign law firms would eat into their share of work.

Only 28 per cent of associates and 24 per cent of partners agreed that foreign lawyers would take away jobs from Indian lawyers. GCs opinions were split firmly on that subject with 43 per cent on each side.

A majority of all respondents also said that the entry of foreign firms would contribute in the area of corporate social responsibility (CSR).

Less than 15 per cent of all respondents agreed that the entry of foreign lawyers would damage the image of the Indian profession as a noble one.

Preconditions: unfulfilled; Reciprocity: unwanted?

Views on the preconditions before allowing liberalisation of the market were also addressed.

More than 80 per cent of partners and 72 per cent of associates said that Indian law firms should be allowed to practice as limited liability partnerships (LLP) before liberalisation, which GCs generally agreed with.

Perhaps surprisingly, only 53 per cent of general counsel were in favour of allowing partnership firms of more than 20 partners, compared to 75 per cent of partners and 64 per cent of associates.

A total of 82 per cent of partners also said that Indian law firms should be allowed to market themselves and their services before liberalisation could happen, “subject to rules to protect the good reputation of the Indian legal profession”. Around two thirds of general counsel and associates had the same view.

Irrespectively of liberalisation, 72 per cent of respondents were in favour of allowing law firms to have websites and advertise in “professional news publications”.

Only 10 per cent of partners and even fewer associates said that before full liberalisation could happen they wanted “reciprocal rights” to practice abroad, which was a main counter-argument that has long been made by the Indian regulators against liberalisation.

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