The Supreme Court on Tuesday ruled that foreign law firms cannot practise in India, but allowed international lawyers to “fly in and fly out” to provide legal advice to their clients in the country.
Justice Adarsh Kumar Goel opined, “Fly in and fly out would cover a casual visit and not amount to practice.”
The ruling partially upheld a 2012 Madras High Court ruling that foreign law firms or foreign lawyers cannot practise the profession of law in India either on the litigation or non-litigation side unless they fulfil the requirements of The Advocates Act, 1961 and the rules of The Bar Council of India (BCI).
However, there is no limitation for them to visit India for a temporary period on a “fly-in and fly-out” basis for giving legal advice to their clients in India relating to the law which is applicable to their country.
The apex court also held that foreign lawyers can appear in international commercial arbitration subject to relevant institutional framework and rules.
Due to a phenomenal increase in international arbitrations involving foreign litigants, foreign law firms and lawyers have started appearing in many legal proceedings in India.
The apex court also said BCI has the powers to frame rules and regulate the conduct of foreign lawyers and that rules may be framed keeping these directions in mind.
The only exception that is available is for foreign lawyers coming to India for providing advice on foreign law or when they are coming in to take part in an international commercial arbitration. However, the Supreme Court has clarified that BCI or the government is free to make appropriate rules to govern them which may include making the current code of ethics applicable to the foreign lawyers as well.
Ajay Shaw, partner, DSK Legal, said: “This judgment will not have any bearing on Indian law firms at this stage. The ball has now been passed to the government’s court in order to consider appropriate legislation in connection with allowing foreign lawyers to come into India. This, of course, would be determined by the government on the basis of the principles of reciprocity accorded to Indian lawyers in the relevant jurisdiction. In any case, foreign firms looking to enter India, whenever permitted, will look at local alliances to hit the ground running.”
Uday S Ahlawat, partner, Ahlawat & Associates, said, “The judgment doesn’t really change anything, unlike the view taken by the courts on ‘multinational accounting firms’ which are prevalent in India, there aren’t many foreign law firms practising in India. Foreign law firms have primarily worked on best-friend relationships with Indian law firms and may continue to do so now that specific directives have been issued.