The Supreme Court today reserved its verdict in the case relating to entry of Foreign Law firms (BCI vs AK Balaji) into Indian legal market..On the final day of the hearing today, the Bench of Justices AK Goel and UU Lalit heard the matter the whole day with hearing going on till 5.30 pm..Senior Advocates Sajan Poovayya, Arvind Datar, CU Singh, Dushyant Dave and Guru Krishnakumar and advocate Nakul Dewan argued today for various parties..Below are the important submissions advanced by the parties today..Nakul Dewan.Dewan, who is appearing for Global Indian Lawyers Association resumed his arguments today. Below is a summary of his submissions..Advocates Act deals with the practice of Indian law only. Practice of law under Sections 29, 30 and 33 do not cover practice of foreign law.Court should only consider whether an Indian lawyer can team up with a foreign lawyer to set up a foreign law firm in India. Court should not go into how the structures will play out.Foreign lawyers cannot advice on Indian law in India. They can only advice on foreign law of the jurisdiction where he is enrolled.When a foreign lawyer gives advice on foreign law in India, he is regulated by the law of the country where is enrolled as well as by Section 36 of Advocates Act.Section 36 of the 1961, Act gives power to the BCI to Govern non-enrolled persons which would include foreign lawyers, and if the Bar Council of India wants to regulate foreign lawyers/law firms then it should bring out Regulations and not ask the Supreme Court to do their job..Sajan Poovayya .Poovayya, representing US-based law firms White & Case and Covington & Burling, made it clear that his submission would be limited to the ‘fly in fly out’ aspect of the Madras High Court judgment and the permission granted for International Commercial Arbitration. His argument was that the Madras High court has laid down the correct law with respect to these aspects..“I am not challenging the Bombay High Court judgment. It is also my submission that there is no incongruence between the two judgments and that the Madras High court, in fact, accepts the Bombay High Court judgment.”.Poovayya then went on to give illustrations of fly in fly out and how the same is necessary..“If TATA motors wants to launch a product in say New York. It would require advice on New York Law. TATA would prefer flying in a New York lawyer to India than their whole Board and officials going to New York.”.Poovayya also argued that fly in fly out would be on mandate of the client and the test for ‘fly in fly out’ would be permanence of establishment..“What if a foreign lawyer has mandate for fly in fly out every day by different persons? Will he not be able to permanently stay here”, asked Justice Goel..Poovayya replied that regularity or frequency of ‘fly in fly out’ is not what should be taken into account..“It is the permanence of the establishment which should be looked into. Regularity is not a relevant consideration. For example, in the case of the Mexican lawyer cited by BCI, the lawyer had established a permanent office in New York. That cannot be permitted.”.Further, Poovayya also made another interesting submission, when he said that the monopoly created in favour of Indian lawyers by the Advocates Act is actually for the benefit of the general public and not for the benefit of lawyer community..“The monopoly is for the benefit of people and not for the benefit of lawyers. It is to ensure that people are not taken for a ride by quacks. BCI cannot say that foreign lawyers will impact Indian lawyers because the monopoly is not intended to benefit the Indian lawyers.”.After discussing ‘fly in fly out’, Poovayya proceeded to deal with the permission for International Commercial Arbitration. His argument in this regard was that Arbitration Act permitted anybody to represent a party to an arbitration..“Scientists, Engineers and other experts are frequently engaged by parties to plead before arbitral tribunals. There is no restriction on non-lawyers to appear and plead before arbitral tribunal. Then how can foreign lawyers be restricted from appearing in International Commercial Arbitrations?”.Arvind Datar.Datar, who is representing six law firms from United Kingdom, had earlier argued on the scope of Sections 30 and 33 of the Advocates Act, particularly the ambit of the term “practice’’..Today he dealt with Sections 29 and 30..Regarding Section 29, he submitted that the provision is intended to obliterate different classes of lawyers and bring in uniformity among advocates..On Section 30 and the use of the word tribunal in the said provision, Datar’s argument was that tribunal means a judicial tribunal alone and not an arbitral tribunal..“When Parliament enacted Advocates Act in 1961, tribunals were all judicial tribunals. Hence, the word ‘tribunal’ in Section 30(ii) should be construed as tribunals set up by the Parliament and not private tribunals.”.Datar was assisted by Advocates Mahesh Agarwal and Rishi Kumar while representing six law firms – Clifford Chance, Linklaters, Evershed, Ashurst, Clyde & Co and Bird & Bird..Guru Krishnakumar.Krishnakumar appeared for Freehills, Australia and Norton Rose. His argument was that the Advocates Act has to be construed and interpreted in the context of changed scenario of current times..“When the statute was enacted so much trans-national work or involvement of foreign lawyers were not contemplated. The changed scenario and even the policy of the government have to be considered. The Madras High Court took into consideration all these aspects when it allowed the fly in fly out.”.Dushyant Dave.Dave was appearing in case concerning the nomenclature of London Court of International Arbitration (LCIA). A suit had been filed against the use of the word ‘court’ in LCIA but the case itself had become infructuous since LCIA had stopped its operations in India..Dave however, assisted the court with respect to the necessity of allowing foreign lawyer for International Commercial Arbitration..“The simple reason why there can be no prohibition on International Commercial Arbitration is because it is voluntary mechanism and State has minimal role. A party can engage anybody to plead his case and that person need not be a lawyer. The person representing the party before the arbitral tribunal is called representative and not lawyer.”.Further, it was Dave’s contention that since Arbitral tribunal was not bound by the Code of Civil Procedure or Indian Evidence Act, there cannot be prohibitions on such a voluntary mechanism..“Arbitral Tribunals need to take evidence as per law. They are not bound by CPC of Evidence Act. If there is a breach of ethics or misconduct by a foreign lawyer, the Bar Council of the concerned country from where the lawyer hails will take appropriate action.”.CU Singh.Singh, appearing for the Bar Council of India, responded to the submissions made by various law firms. Citing Sections 19 and 24 of Arbitration and Conciliation Act, Singh contended that there is no prohibition on Arbitral Tribunals taking evidence..“They can take evidence, their decrees are enforceable”, said Singh..Singh then proceeded to deal with the scope of the term of ‘practice’ only to be met with a barrage of questions from the Bench..“If only lawyers can practice, how can retired Supreme Court and High court judges go for arbitration, give legal opinions etc”, asked Justice Lalit..Singh’s response was that,.“They are seen as members of legal fraternity. So we have not really visited this issue. But they can revive their Sanad anytime after retirement.”.Thereafter, Singh tried to bring out the differences between regulatory regiments in India and other countries. He stated that the foreign firms are not bound by the ethics that an Indian lawyer is bound by like prohibition in India with regard to Advertisements, Solicitation, Contingency Fee and Conditional Fee Arrangement..He also quoted that although United Kingdom is one country, why is that Scottish and Irish lawyers are required to take permission to practice in England and Wales..However, the Bench then quizzed Singh on various aspects relating to permissibility of ‘fly in fly out’ while also making some interesting remarks..“Today’s world is a global village, you cannot insulate India. Is a total ban practical? Why not allow fly in fly out? If you are sceptical, lay down regulations”, the Bench remarked..The Court sat till 5.30 pm, well past the scheduled time of 4 pm before concluding the hearing and reserving its verdict..You can read Day 1, Day 2 and Day 3 arguments here.
The Supreme Court today reserved its verdict in the case relating to entry of Foreign Law firms (BCI vs AK Balaji) into Indian legal market..On the final day of the hearing today, the Bench of Justices AK Goel and UU Lalit heard the matter the whole day with hearing going on till 5.30 pm..Senior Advocates Sajan Poovayya, Arvind Datar, CU Singh, Dushyant Dave and Guru Krishnakumar and advocate Nakul Dewan argued today for various parties..Below are the important submissions advanced by the parties today..Nakul Dewan.Dewan, who is appearing for Global Indian Lawyers Association resumed his arguments today. Below is a summary of his submissions..Advocates Act deals with the practice of Indian law only. Practice of law under Sections 29, 30 and 33 do not cover practice of foreign law.Court should only consider whether an Indian lawyer can team up with a foreign lawyer to set up a foreign law firm in India. Court should not go into how the structures will play out.Foreign lawyers cannot advice on Indian law in India. They can only advice on foreign law of the jurisdiction where he is enrolled.When a foreign lawyer gives advice on foreign law in India, he is regulated by the law of the country where is enrolled as well as by Section 36 of Advocates Act.Section 36 of the 1961, Act gives power to the BCI to Govern non-enrolled persons which would include foreign lawyers, and if the Bar Council of India wants to regulate foreign lawyers/law firms then it should bring out Regulations and not ask the Supreme Court to do their job..Sajan Poovayya .Poovayya, representing US-based law firms White & Case and Covington & Burling, made it clear that his submission would be limited to the ‘fly in fly out’ aspect of the Madras High Court judgment and the permission granted for International Commercial Arbitration. His argument was that the Madras High court has laid down the correct law with respect to these aspects..“I am not challenging the Bombay High Court judgment. It is also my submission that there is no incongruence between the two judgments and that the Madras High court, in fact, accepts the Bombay High Court judgment.”.Poovayya then went on to give illustrations of fly in fly out and how the same is necessary..“If TATA motors wants to launch a product in say New York. It would require advice on New York Law. TATA would prefer flying in a New York lawyer to India than their whole Board and officials going to New York.”.Poovayya also argued that fly in fly out would be on mandate of the client and the test for ‘fly in fly out’ would be permanence of establishment..“What if a foreign lawyer has mandate for fly in fly out every day by different persons? Will he not be able to permanently stay here”, asked Justice Goel..Poovayya replied that regularity or frequency of ‘fly in fly out’ is not what should be taken into account..“It is the permanence of the establishment which should be looked into. Regularity is not a relevant consideration. For example, in the case of the Mexican lawyer cited by BCI, the lawyer had established a permanent office in New York. That cannot be permitted.”.Further, Poovayya also made another interesting submission, when he said that the monopoly created in favour of Indian lawyers by the Advocates Act is actually for the benefit of the general public and not for the benefit of lawyer community..“The monopoly is for the benefit of people and not for the benefit of lawyers. It is to ensure that people are not taken for a ride by quacks. BCI cannot say that foreign lawyers will impact Indian lawyers because the monopoly is not intended to benefit the Indian lawyers.”.After discussing ‘fly in fly out’, Poovayya proceeded to deal with the permission for International Commercial Arbitration. His argument in this regard was that Arbitration Act permitted anybody to represent a party to an arbitration..“Scientists, Engineers and other experts are frequently engaged by parties to plead before arbitral tribunals. There is no restriction on non-lawyers to appear and plead before arbitral tribunal. Then how can foreign lawyers be restricted from appearing in International Commercial Arbitrations?”.Arvind Datar.Datar, who is representing six law firms from United Kingdom, had earlier argued on the scope of Sections 30 and 33 of the Advocates Act, particularly the ambit of the term “practice’’..Today he dealt with Sections 29 and 30..Regarding Section 29, he submitted that the provision is intended to obliterate different classes of lawyers and bring in uniformity among advocates..On Section 30 and the use of the word tribunal in the said provision, Datar’s argument was that tribunal means a judicial tribunal alone and not an arbitral tribunal..“When Parliament enacted Advocates Act in 1961, tribunals were all judicial tribunals. Hence, the word ‘tribunal’ in Section 30(ii) should be construed as tribunals set up by the Parliament and not private tribunals.”.Datar was assisted by Advocates Mahesh Agarwal and Rishi Kumar while representing six law firms – Clifford Chance, Linklaters, Evershed, Ashurst, Clyde & Co and Bird & Bird..Guru Krishnakumar.Krishnakumar appeared for Freehills, Australia and Norton Rose. His argument was that the Advocates Act has to be construed and interpreted in the context of changed scenario of current times..“When the statute was enacted so much trans-national work or involvement of foreign lawyers were not contemplated. The changed scenario and even the policy of the government have to be considered. The Madras High Court took into consideration all these aspects when it allowed the fly in fly out.”.Dushyant Dave.Dave was appearing in case concerning the nomenclature of London Court of International Arbitration (LCIA). A suit had been filed against the use of the word ‘court’ in LCIA but the case itself had become infructuous since LCIA had stopped its operations in India..Dave however, assisted the court with respect to the necessity of allowing foreign lawyer for International Commercial Arbitration..“The simple reason why there can be no prohibition on International Commercial Arbitration is because it is voluntary mechanism and State has minimal role. A party can engage anybody to plead his case and that person need not be a lawyer. The person representing the party before the arbitral tribunal is called representative and not lawyer.”.Further, it was Dave’s contention that since Arbitral tribunal was not bound by the Code of Civil Procedure or Indian Evidence Act, there cannot be prohibitions on such a voluntary mechanism..“Arbitral Tribunals need to take evidence as per law. They are not bound by CPC of Evidence Act. If there is a breach of ethics or misconduct by a foreign lawyer, the Bar Council of the concerned country from where the lawyer hails will take appropriate action.”.CU Singh.Singh, appearing for the Bar Council of India, responded to the submissions made by various law firms. Citing Sections 19 and 24 of Arbitration and Conciliation Act, Singh contended that there is no prohibition on Arbitral Tribunals taking evidence..“They can take evidence, their decrees are enforceable”, said Singh..Singh then proceeded to deal with the scope of the term of ‘practice’ only to be met with a barrage of questions from the Bench..“If only lawyers can practice, how can retired Supreme Court and High court judges go for arbitration, give legal opinions etc”, asked Justice Lalit..Singh’s response was that,.“They are seen as members of legal fraternity. So we have not really visited this issue. But they can revive their Sanad anytime after retirement.”.Thereafter, Singh tried to bring out the differences between regulatory regiments in India and other countries. He stated that the foreign firms are not bound by the ethics that an Indian lawyer is bound by like prohibition in India with regard to Advertisements, Solicitation, Contingency Fee and Conditional Fee Arrangement..He also quoted that although United Kingdom is one country, why is that Scottish and Irish lawyers are required to take permission to practice in England and Wales..However, the Bench then quizzed Singh on various aspects relating to permissibility of ‘fly in fly out’ while also making some interesting remarks..“Today’s world is a global village, you cannot insulate India. Is a total ban practical? Why not allow fly in fly out? If you are sceptical, lay down regulations”, the Bench remarked..The Court sat till 5.30 pm, well past the scheduled time of 4 pm before concluding the hearing and reserving its verdict..You can read Day 1, Day 2 and Day 3 arguments here.
