Foreign Law Firms Case: Day 1 in Supreme Court

Published on 11 Jan 2018 by Team

Image courtesy- Barandbench

The hearing in the much-awaited Foreign law firms case commenced today in the Supreme Court.

The matter, which was listed as item 2 in court 11, initially came up for hearing in the morning. However, Senior Counsel CU Singh and Guru Krishnakumar sought adjournment in the matter but the same was disallowed.

The Court remarked,

“This is not the right approach. It won’t help anyone.”

It then said that it will take up the matter for hearing at 2 pm.

3 pm

The matter was taken up at the end of the board and came up for hearing at 3 pm.

Senior Advocate CU Singh, appearing for the Bar Council of India, was the first to make submissions. Singh first dealt with the judgment of the Madras High Court.

The Madras High Court, in its judgment dated February 21, 2012, had held that foreign law firms or foreign lawyers cannot practice the profession of law in India either on the litigation or non-litigation side, unless they fulfil the requirement of the Advocates Act, 1961 (Advocates Act) and the Bar Council of India Rules.

However, it had also held that there is no bar either in the Advocates Act or the BCI Rules for foreign law firms or foreign lawyers to visit India for a temporary period on a ‘fly in and fly out’ basis, for the purpose of giving legal advice on foreign law to their clients in India. The Court also held that foreign lawyers cannot be debarred from coming to India and conducting arbitration proceedings in disputes involving international commercial arbitration.

Singh objected to both the above exceptions. He argued that both these exceptions carved out by the Madras High Court would be hit by Section 29 of the Advocates Act.

He also submitted that the law laid down by Bombay High Court was correct.

In 2009, the Bombay High Court had held that the RBI was not justified in allowing foreign law firms (in this case White & Case, Chadbourne & Parke, and Ashurst) to open liaison offices in India. It had also held that these foreign law firms could carry on their liaison activities in India only on being enrolled as advocates under the Advocates Act, 1961 and further held that the expression “to practice the profession of law” is wide enough to cover persons practicing in litigious matters as well as persons practicing in non-litigious matters in India.

“So you are challenging Madras High Court judgment by relying on Bombay High Court judgment?”, asked Justice Goel.

“That is right”, replied Singh.

The Bench then posed a series of questions regarding what would constitute “practice the profession of law” under Section 29 of the Advocates Act, 1961.

“Can a Canadian lawyer give advice to a Canadian who is living in India? What if he sends legal advice via email. Can he draft a pleading and send it to him?”, asked Justice Goel.

Singh replied that though it is a grey area,

“My opinion is that it can be allowed since the situs of practice is Canada.”

Singh then proceeded to elucidate on Section 33 of the Advocates Act and how it is an exception to Section 29.

“Fly in and fly out goes against 29 of the Act. But there is provision under the Act for making exception in particular cases in particular courts. Section 33 allows that.  

Section 33 is an exception to Section 29. However, for such an exception, there should be a law positively permitting a person, other than an advocate under the Act, to practice”, submitted Singh.

Dushyant Dave interjects: Exception to International Commercial Arbitration should be there

Senior Advocate Dushyant Dave, who was appearing in a tagged matter relating to London Court of International Arbitration (LCIA), made a brief submission on the prevalent practice in the field of international commercial arbitration.

Dave said that he has concerns with respect to BCI’s opposition to permit foreign lawyers from coming to India to conduct international commercial arbitration proceedings.

“Indian lawyers are allowed to argue in international commercial arbitration world over. I have been allowed to argue in many jurisdictions. Nobody has stopped us or asked us to take any permission. If we object to foreign lawyers coming to India for the same, it might affect Indian lawyers [when we go abroad]”, said Dave.

Dave also made it clear that the matter he was appearing for is not related to the present issue. Dave said that the petitioner, in his case, had objected to LCIA opening its unit in India. He also submitted that the same had now been closed and that nothing remains in the matter. He further stated that the word “court” in LCIA had caused confusion and that LCIA was not a law firm.

CU Singh then responded by stating that BCI was not against foreign lawyers but submitted that they should be submitted to regulations in India.

“We are not saying ‘don’t practice’. What we are submitting is that they should be subject to our regulations. They should not be allowed to practice here unless they are subject to some regime.”

Regarding international arbitration, Singh submitted that

“Practice in arbitration is practice under the Advocates Act. It is our stand that even in case of international arbitration, the same should apply”.

ASG Maninder Singh

Additional Solicitor General Maninder Singh, appearing for Central government, submitted that rules need to be framed to deal with the issue and urged BCI to do the same.

“I am supporting the BCI till Rules are framed. Till then, the Madras High Court judgment should not be interpreted in a manner which widens the scope of the judgment”, Maninder Singh submitted.

Dushyant Dave once again raised the concern with respect to the impact BCI’s stand on International Commercial Arbitration could have on Indian lawyers. He requested the Court to appoint Senior Advocate Fali S Nariman as Amicus Curiae to assist the Court on the issue pertaining to arbitration.

The Court did not take a decision on Dave’s request after it was informed that Nariman was not keeping well. It then proceeded to rise. The hearing will resume on Monday afternoon next week.


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