|DATE:||(Date of pronouncement)|
|DATE:||December 18, 2009 (Date of publication)|
|Click here to download the judgement (lawyers_collective_practise_law_foreign_firms.pdf)|
Foreign Law Firms are not eligible to open liaison offices or to practice law in India. Even giving an opinion on a legal matter amounts to “practise of law”. Non-Advocates cannot practise law
White & Case, a foreign law firm, was granted permission by the RBI u/s 29 of FERA to open a liaison office in India. A PIL was filed contending that such permission was in contravention of s. 29 of FERA as well as s. 29 of the Advocates Act. HELD upholding the challenge:
(i) The liaison offices opened by the foreign law firms to act as a coordination and communications channel between the head office / branch offices and its clients in and outside India related to providing legal services to the clients. Similarly, the liaison activity of providing “office support services for lawyers of those offices working in India on India related matters” and drafting documents, reviewing and providing comments on documents, conducting negotiations and advising clients on international standards and customary practice relating to the client’s transaction etc. was nothing but practising the profession of law in non litigious matters;
(ii) U/s 29 of FERA, RBI has power to grant permission for carrying on “activities of a trading, commercial or industrial nature”. There is a fundamental distinction between professional activity and the activity of a commercial character. As the liaison activities of the foreign law firms related to the profession of law, no permission could be granted to the foreign law firms under section 29 of FERA;
(iii) S. 29 of the Advocates Act which provides that there shall “be only one class of persons entitled to practise the profession of law, namely, advocates” applies not only to persons practising as advocates before any Court / authority in litigious matters but also to persons practising in non litigious matters as well. Practising the profession of law involves a larger concept while practising before the Courts is only a part of that concept.
(iv) The argument of the UOI that if it is held the Advocates Act applies to persons practising in non-litigious matters, then no bureaucrat would be able to draft or give any opinion in non-litigious matters without being enrolled as an advocate is without merit because there is a distinction between a bureaucrat drafting or giving opinion during the course of his employment and a law firm or an advocate drafting or giving opinion to the clients on professional basis. Further, while the bureaucrat is answerable to his superiors, a law firm or an individual engaged in non litigious matters is answerable to none. To avoid such anomaly the Advocates Act has been enacted so as to cover all persons practising the profession of law be it in litigious matters or in non-litigious matters.
(v) Consequently, the RBI was not justified in granting permission to the foreign law firms to open liaison offices in India u/s 29 of FERA. Further, the foreign law firms were not entitled to practise in non litigious matters in India without following the provisions of the Advocates Act.