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Interview: SILF’s Lalit Bhasin slams quick foreign lawyer entry floated by INBA (which just won a seat at tomorrow’s negotiating table)

Lalit Bhasin: Silf 'contemptuously rejects' INBA proposal to open up legal profession this year
Lalit Bhasin: Silf 'contemptuously rejects' INBA proposal to open up legal profession this year

The Indian National Bar Association (INBA), which released a report last week calling for the entry of foreign law firms this year, has now also been invited to also meet the Government in tomorrow’s talks on legal market liberalisation.

The invite for tomorrow’s postponed meeting (29 September) in Delhi at 17:30, has been sent to various ministries, as well as to the Society of Indian Law Firms (Silf), the Indian Corporate Counsel Association (ICCA), the Bar Council of India (BCI), industry lobby groups FICCI and ASSOCHAM, as well as INBA members Manoj Kumar, Kaviraj Singh and Shweta Bharti.

However, Society of Indian Law Firms (Silf) president Lalit Bhasin has strongly condemned INBA’s report in a telephone interview with us on Saturday (24 September), one day after a Silf meeting was held.

Bhasin said that all 25 Silf members present at the meeting on 23 September “contemptuously rejected” INBA’s report. Silf had produced its own report about opening the market in three phases, beginning with creating a “level playing field”.

Hammurabi & Solomon founder and Silf office bearer Manoj Kumar, who jointly drafted the INBA proposal, said the “apprehensions were misplaced” (see full response below).

In the last meeting with the government and stakeholders on 5 July, the government was enthusiastic about opening up, while Silf expressed reservation and looked for an extension of timelines to file its responses.

Lightly edited interview with Lalit Bhasin, on INBA, advertising, and more

Lalit Bhasin (LB): The view of Society of Indian Law FIrms, the views of the Bar Association of India, even views of the ministry of commerce, government of India, and even lately ICCA, they have all supported you see, the phased sequential entry because in principle now there is no objection that foreign lawyers should not come.

We said they should come, there should be a rational approach and let us learn by the experience of other jurisdictions. No one has just suddenly decided to open up you see one fine day the legal profession.

Do it in a proper way.

Our stand, and the stand of government of India so far, official stand that is of ministry of commerce has been, first phase will be internal reform of the profession in India.

After all we’re talking about professional legal services. Foreign lawyers and other things, those issues, come later on.

How do we reform the legal procedures and systems in India, to come up to the level of what is in overseas jurisdictions.

That should be phase 1, which can be accomplished if there is a will and a wish on the part of Bar Council of India and the Government of India.

Kian Ganz, Legally India (KG): The former of those is a particular problem though? The Bar Council of India has no will and wish to reform anything it seems, otherwise it could have done so in the last 10 years.

LB: No but they have put on record now that the rules – the draft BCI rules – what they can do. Nothing stops them from liberalising the things about advertising. [The BCI says:] Ok you have your website, subject to certain conditions this should not amount to advertising.

Don’t put it on electronic media, don’t publicise yourself in newspapers, all that can be done. LLP you are allowing the foreign lawyers to come and LLPs to come here, but you are not allowing the LLPs in India.

Shocking state of affairs that we have.

And what these people have done, your INBA and Manoj Kumar, and there’s some third organisation also, I’ve never heard of it.

In a nutshell they’re reporting only three sentences, otherwise this report can be just thrown into wastepaper basket, nothing substantial, no statistic, no rationale is given. They say, first phase, allow the foreign lawyers to come to India within this year. Even Bar Council of India has not said that.

Said that allow them to come to India this year.

Number 2, they say, let’s think about the internal reforms. That to me, says, forget about the Indian legal profession, because those internal reforms will never materialise, will never come.

Then what will be the fate of internal reforms?

KG: But if you are saying internal reforms will never happen, if you make reforms subject to internal reforms, that means that foreign law firms might never happen as well.

LB: What I’m saying, within a month’s time they can do it.

KG: But how come they haven’t done it yet? You have been requesting for so any years, LLPs have been requested for so many years before the BCI, they never bothered to do anything.

LB: In 2010, 12, our representations are there, because these people are not doing it.

If they are not, and allow foreign lawyers to come and set up the shop here, thereby totally removing the first phase as envisaged by the government itself and by SILF.

I don’t think any professional person or body can go and suggest this preposterous suggestion that you allow foreign lawyers to come, phase 2 we will decide later on.

KG: But allowing foreign lawyers to come and only do foreign law, that would not compete with Indian law firms at all?

LB: That has to be seen along with rule 5, rule 9 and all, that foreign lawyers can engage with Indian lawyers and partnership.

KG: But INBA proposal only said phase 1 is partnerships, is only foreign law.

LB: No they should be allowed to practice foreign laws, they should be allowed to practice in India, this is what in a nutshell Manoj Kumar has reproduced, and he adds those words ‘within this year’, which means within the next three months to do this. Now we in our meeting in Silf yesterday (TK), unanimously condemned this view.

We said this can never happen and we can never allow this to happen.

Not a single person out of the 25 persons who were representing the top law firms that were there, so I told them, you have anything to say on this, not a single person, and unanimously it was said we disapprove of this and we take it up very strongly in the meeting that we are having on 29th with law ministry.

That is our stand. That is what transpired in the meeting yesterday.

KG: I definitely agree there are rough edges in the INBA proposal, but some parts are quite pragmatic. It’s also a phased approach, it’s just taking different phases, and the argument I think can be legitimate: would a foreign law firm in India compete with an Indian law firm if it’s not allowed to practice Indian law. And that’s something that’s not really been discussed yet, if they’re banned from litigation, from Indian law, from partnerships with Indian lawyers.

LB: We are saying we welcome foreign lawyers to come here, but do it in a proper way.

We are in total agreement with the government’s policy to open up the legal service sector and till now we have the impression that the government has been supporting us, the department of commerce.

Because they have taken this official stand, that phase 1 is internal reforms, phase 2 should be allowed to have law practice in foreign law, and then gradually you keep on liberalising that and involve them with the Indian lawyers and all.

KG: The commerce ministry’s Sudhanshu Pandey also said at the meeting at the Jindal panel, he said that for the government he would be happy for phase 1 to happen at the same time as liberalisation, rather than being a consequential approach.

LB: Yeah, but I’m talking about INBA report – they say phase 1 is to allow foreign lawyers. Now we will not accept this and I don’t think profession all over India will accept.

KG: Talking about phase 1, some of the questions I have – one of the requirements you have in phase 1, is to ban the surrogate practice of Indian law by foreign law firms. How is that possible to even police or check, there are thousands of foreign law firms, how can you check if any of them are practising so called Indian law in surrogacy from abroad, jurisdictionally and evidentially, it becomes almost impossible.

LB: That is a question of monitoring you see. Therefore as an issue there is nothing wrong if we raise this issue. To stop this surrogate practice until proper rules are in place. There is nothing wrong in our making it an issue, now how this issue has to be resolved is a question for the regulator to decide.

And regulator is totally silent on these issues, gov’t is totally silent on these issues. People are openly advertising and they’re silent. They are looking at it with open eyes on these things but not taking any action.

People are openly advertising.

KG: But Indian law firms are also openly advertising, right?

LB: That is right. Because they don’t take action. They don’t take action against anyone.

KG: But probably half of Silf members are advertising abroad, sponsoring conferences, all these things are happening. Most of them have websites…

LB: What they consider is advertising, we consider dissemination of basic information.

Advertising is what they do in US and other jurisdictions on electronic media: You want a divorce specialist, you come to me; if you’ve met with some accident, I’m an ambulance chaser, you come to me, I will help you. That is what is advertising, but giving out your firms’ brochure and all that…

KG: Or conference branding and advertising and all that?

LB: Particularly because you have these restrictions on the website.

KG: But then a lot of law firms are having very comprehensive websites: Luthra has a comprehensive website, Khaitan has a very comprehensive website, Trilegal has a very comprehensive website.

LB: I am not going on individual names; my firm does not have any websites.

You are giving those examples, there are examples of those that do not have websites also.

KG: But then in practice every law firm is doing what it wants anyway, because there is no legal regulation. The Bar Council doesn’t even know that law firms even exist really.

LB: No, Bar Councils they know about it – they sent a show cause notice to law firms over websites…

KG: That was 10 years ago or so, right? [Note: Silf was set up in 2000 partly to resist the Delhi bar council’s show cause notice regarding listings in legal directories. In 2008, the Delhi bar council relaxed its rules to allow simple websites. In 2010 the Delhi bar council made some noises to curtail websites, which never proceeded.]

LB: Whenever it was, they have been aware of it for the last 10 years.

KG: But since then they have not given any indication that they would crack down on it.

LB: They have not given any indication that they would relax this so-called obsolete rule also.

KG: That’s the biggest danger with the proposal, if the government wants foreign law firms to enter, and so much of it is contingent on the BCI creating a level playing field, the BCI will not do any of that, given prior conduct. Unless the government pushes them very hard – under the Advocates Act the government can also make its own rules…

LB: The onus is on the BCI and the government of India to create that sort of situation and environment where there are internal reforms. and that is like a precondition for us to have foreign lawyers.

And this stand has been unanimously taken at yesterday’s meeting and we totally rejected the proposal of INBA and Manoj Kumar’s email, which he circulated directly to the American Bar Association, as if the American Bar Association is a party to these proceedings.

At the moment it is an internal issue, but he sent that with a picture of the Prime Minister on the report that he submitted and also to the law secretary, as if this report has been commissioned by the Government of India and they were handing over that report to them.

In that covering email to the ABA, he says very clearly that first phase should be to allow foreign lawyers within this year.

It is a preposterous and absurd suggestion, which we contemptuously rejected yesterday.

And I want you to quote me on that.

The INBA response to Bhasin

We have reached out to INBA for a response to Bhasin, which we have reproduced in full below.

INBA secretary general Kaviraj Singh said that INBA had 10,000 members, including 145 law firms:

INBA represent the entire legal eco system in India. 

INBA report is credible and best that is why Lalit called the meeting.  There are following questions to Lalit:

A) How many members were present at the meeting on Sept 23.  Why very few members attended the meeting.

B) Lalit represents whom [and] whether tier 1 law firms only?

C) The committee headed by Lalit for preparing report.  Whether this committee has consulted all SILF members and all the stakeholders.  Ask this from the committee members as well. 

D) Who is stake holder in the opening of legal market.  Is it only Lalit and a few firms?

E) Why Lalit failed to reply my email asking him to conduct the secret poll / ballet among the SILF members firm and all the partners, associate to vote.

F) Who will decide what is the best interest for India.

We have reached out to Bhasin for a response to Singh’s queries.

Hammurabi & Solomon founder Manoj Kumar (and Silf office bearer) said in an emailed response:

The apprehensions are misplaced as the Draft BCI rules propose to permit only limited opening up of law practice in India to foreign lawyers in areas which do not conflict with Indian legal profession i.e

1. practice of foreign law;

2. diverse international legal issues in non-litigious matters and

3. in international arbitration cases

The draft rules therefore neither permit foreign lawyers to practice Indian Law nor any litigation cases.

Therefore foreign lawyers should be allowed to practice in these areas in the first phase itself as it does not impact the Indian legal profession in any which way and will only have a positive impact as explained.

Availability of foreign legal advice at the doorstep impacts a multitude of stakeholders in India  including Indian and foreign companies operating in India, large law firms, mid-size and emerging law firms, boutique law firms, small law firms, Law Schools, Interns & Students, ADR & mediation Professionals and General Counsels as well as emerging class of Indian entrepreneurs under numerous initiatives of the government requiring high quality and competitive priced, domestic & foreign legal advice.

Each and most of these stakeholders are impacted differently by the said reforms. Therefore, the said reforms would need to drive the growth of all the above stakeholders.

‘Ease of Doing Business’ by entrepreneurs and Investors in India should be at the centre-stage of reforms in the legal services sector in India. With India targeting a $5 trillion GDP in the next 5-7 years, the reforms in legal services sector has to keep pace with the requirements of stakeholders in the development and growth of India.

The report prepared by Hammurabi & Solomon along with INBA focusses on India emerging as the “Legal Services Capital” to the world in the Asian and African region. The reforms should therefore enable the availability of world class legal support at the very doorstep of entrepreneurs and professionals doing business in India and in the region.

Update: Bhasin has responded to Singh and Kumar with:

I do not wish to respond to Kaviraj Singh as his response is more personal than objective. In any case matters relating to SILF meetings are none of the concern of Kaviraj Singh. Suffice it to say that entire SILF membership with the sole exception of Hammurabi and Solomon and one more have supported SILF presentation to the Ministry and response to Manoj Kumar's presentation. Kaviraj has no locus standi in internal SILF matters as representing INBA. 

Manoj Kumar has not adverted to the main issue that Phase I should be "internal reforms". Why is he against introducing internal reforms before foreign lawyers are allowed to come in. Phase 2 of Manoj Kumars's report may not happen at all or may be inordinately delayed thus causing irreparable damage to the Indian legal profession by way of stagnation. He seems to be keen to see foreign lawyers in India as is clear from his comment that this should be done "in this year" - in 3 months.

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