Why in news?

• The Bar Council of India (BCI) has allowed foreign lawyers and law firms to practise law in India on a reciprocity basis.
• In this regard, the BCI had notified the Rules for Registration and Regulation of Foreign Lawyers and Foreign Law Firms in India, 2022.
  • BCI had earlier opposed the move.

What’s in today’s article?

• Bar Council of India (BCI)
• News Summary

What is Bar Council of India (BCI)?

• The BCI is a statutory body established under the Advocates Act, 1961, and it regulates legal practice and legal education in India.
  • BCI regulates legal professional standards in India including directing the state bar councils, standardizing law education, and course framework at the universities and law colleges in India.
• It also conducts the All India Bar Examination to grant 'Certificate of Practice' to advocates practicing law in India.
• BCI also funds welfare schemes for economically weaker and physically handicapped advocates.

News Summary:

• Recently, the BCI notified in the official gazette the Rules for Registration and Regulation of Foreign Lawyers and Foreign Law Firms in India, 2022.

What do the new rules allow?

• According to the Advocates Act, advocates enrolled with the Bar Council alone are entitled to practise law in India.
• All others, such as a litigant, can appear only with the permission of the court, authority or person before whom the proceedings are pending.
• Foreign lawyers and law firms can practice in India
  • The notification essentially allows foreign lawyers and law firms to register with BCI to practise in India if they are entitled to practise law in their home countries.
  • However, the foreign lawyers or foreign Law Firms have not been permitted to appear before any courts, tribunals or other statutory or regulatory authorities.
  • They are allowed to practise transactional work /corporate work such as joint ventures, mergers and acquisitions, intellectual property matters, drafting of contracts and other related matters on a reciprocal basis.
• Same restrictions for Indian lawyers working with foreign law firms
  • Indian lawyers working with foreign law firms will also be subject to the same restriction of engaging only in non-litigious practice.

How have foreign law firms operated so far?

• For over a decade, BCI was opposed to allowing foreign law firms in India.
• Issue was raised in Bombay High Court in 2009 (Lawyers Collective v Union of India)
  • The issue of foreign law firms entering the Indian market came to courts with a challenge before the Bombay High Court in 2009.
  • The Bombay High Court held that only Indians holding Indian law degrees can practise law in India.
  • The HC also held that practice would include both litigious and non-litigious practice, so foreign firms can neither advise their clients in India nor appear in court.
• Same issue came up before the Madras High Court in 2012 (AK Balaji v Government of India)
  • The Madras High Court also held that foreign firms cannot practise either on the litigation or non-litigation side unless they meet the requirements and rules laid down by the Advocates Act and the BCI rules.
  • However, the Madras HC created an exception. It said that there would be no ban on temporary visits or advising clients on a fly in and fly out basis.
• Business Process Outsourcing (BPOs) arrived in India
  • By 2012, BPOs had arrived in India on a big scale and did backend work for US-based companies.
  • In the legal profession, these firms, Legal Process Outsourcing (LPOs), carried support operations for lawyers.
  • They operated in uncertain legal frameworks and the Supreme Court had to intervene to settle the law on the issue.
• SC verdict on the issue
  • In 2018, the Supreme Court upheld both the High Court judgments disallowing foreign law firms and lawyers.
  • It passed the order with some modifications such as holding the expression fly in and fly out to cover only casual visit not amounting to practice.
  • On the issue of LPOs, the SC did not decide on their fate.
    • They argued that they were essentially BPOs that managed secretarial support, transcription services, proof-reading etc.
    • Technically, these activities do not come within the purview of the Advocates Act or the BCI Rules.

What is the significance of recent notification of BCI?

• Legal clarity to foreign law firms that currently operate in a very limited way in India.
• Address concerns about Flow of Foreign Direct Investment and make India a hub of International Commercial Arbitration.