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Legally honest / Issue 115

Legally India newsletter
Legally India newsletter

Last week British lawyers made a push for India again with Lord Chancellor and justice secretary Ken Clarke turning up with entourage and rekindling the liberalisation talks that had become a little tepid of late. But are they following the right strategy?

Nothing was signed between the BCI and England’s Law Society, with both agreeing to keep talking. Meanwhile, Ken’s Indian counterpart Khursheed promised to "fast-track" the entry of foreign firms.

In an in-depth interview with Indian business daily Mint, Clarke promised that litigation was of no interest to foreign firms and said that while his reception in India was “cautious”, his arguments also elicited some sympathy from locals. And, he added, the parties had “approached an MoU” with drafts to be approved by the Indian cabinet now doing the rounds.

But as another Mint feature on the liberalisation game showed last week there has been very little movement in the main debate and arguments for years now.

The Law Society, which has a new president in former Allen & Overy partner John Wotton, is trying a bit of a new tack.

While the previous generation of Law Society India strategists were certainly visible, they were also perceived by some as being a little on the aggressive side, albeit leaving foreigners with a feeling akin to ‘progress’.

Wotton & Co now seem to be adopting a more softly-softly approach of collaboration and debate with their Indian counterpart, the BCI, hoping that it can persuade enough locals that foreign firms will not be a threat. And while the BCI may not really have a horse in this race, as corporate lawyers only make up a minority of its constituents, that is no guarantee of an outcome.

But if the raft of promotions and activity at India’s largest firms is any indicator, maybe the domestic legal market has long recognised and started dealign with the external and internal pressures.

Amarchand promoted a bumper crop of eight associates to partnership, made one lateral associate from White & Case a partner and lifted Irish qualified lawyer Paku Khan into a partner-equivalent position in the competition team.

Plus, the Amarchand partnership as a whole has now been presented with the long-awaited report of the Boston Consulting Group (BCG), which was being baked for more than a year. More than a decade ago too the BCG was drafted in and arguably successfully professionalised Amarchand’s set-up, the second review now, while not having come cheaply, is supposed to iron out the management and structural kinks of the firm for the next decade.

At many levels India really has become a very dynamic legal industry in recent years. Innovation happily continues in the mid-market and start-up segment, for example, as four-month-old start-up Prism took up the Naik Naik & Co banner under an exclusive referral arrangement in the financial regulation space.

But all said and done, the biggest anti-liberalisation concern by opponents really must be that the war for talent could intensify at all levels.

Legally India’s updated fresher salary survey reveals that an increasing number of domestic firms and companies are scratching at the Rs 10 lakh ($20,000) a year barrier, even without much external pressure.

If foreign firms do ever enter, this could trigger a salary war as it did in London when US firms first arrived and it will take a chunk of domestic firms’ profits. And even more worrying to Indian managing partners should be the risk that firms’ senior associates and junior partners could start coming into the crosshairs of head-hunting international firms. Foreign firms will want to open in India to make a profit and not to make friends, after all.

However, these most sensitive points are usually downplayed by both sides in the debate.

If the Law Society and other foreign lawyers are serious about the India project, perhaps more mutual and brutal honesty about intentions and repercussions is the way forward - if one can find the right people to talk to.

Event announcement: Participate in the Bribery and Corruption Seminars: 18th October Delhi, 21st October Mumbai. Speaker and sponsorship opportunities available.

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