SC upholds barring of foreign law firms from practicing in India

SC says foreign law firms cannot open offices in India

"We hold that the expression "fly in and fly out" will only cover a casual visit not amounting to "practice".

The Supreme Court made certain modifications to the high court judgements, making allowances for foreign law firms to offer legal advice on foreign laws, but only on a temporary "fly in and fly out" basis.

The Supreme Court on Tuesday barred foreign law firms/companies or foreign lawyers from practising legal profession in India either in the litigation or in non-litigation (rendering legal advice) side.

The court also said that foreign lawyers can not be debarred completely from coming to India to conduct arbitration proceedings in disputes arising out of a contract relating to global commercial arbitration, if rules of arbitration permit such appearance.

Ashwini Kumar Upadhyay has filed a petition praying that legislators be debarred from practicing as Advocates (for the period during which they are Members of Parliament or State Assembly), in spirit of Part-VI of the Bar Council of India Rules. The judgment of the Madras High Court in Balaji had held that foreign lawyers were allowed to advise clients in India on a "fly in fly out" basis. Conversely, the plea that a foreign lawyer is entitled to practice foreign law in India without subjecting himself to the regulatory mechanism of the Bar Council of India Rules can also be not accepted.

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It, however, said that foreign lawyers may not be debarred from conducting arbitration proceedings arising out of global commercial arbitration in view of the provisions of the Advocates Act.

Modifying the High Court order, the top court said: "We hold that mere label of such services can not be treated as conclusive".

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".

"Visit of any foreign lawyer on fly-in-and-fly-out basis may amount to practice of law if it is on regular basis".

The ruling came from a bench of Justices A K Goel and U U Lalit which heard a batch of appeals against orders of the Bombay and Madras High Courts.

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