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20 March 2018 at 07:15 BST

Foreign law firms not permitted to set up in India

Foreign law firms are still not allowed to set up in India but can give advice on a 'fly-in, fly-out' basis, according to a long-awaited ruling.


Foreign law firm are prohibited from setting up permanent offices in India but can give foreign law advice to clients on a 'fly-in, fly-out' principle, according to a long-awaited ruling from  India's Supreme Court. The case of Bar Council of India v AK Balaji & Ors revolved around the liberalisation of the Indian legal market with the Bar Council of India refusing to make decisions about the rights of foreign law firms to operate in India until the case was resolved. The court gave the Bar Council of India (BCI) regulatory control over such assignments. However, it also said it was not opposed to liberalisation of legal services and that the government could enact legislation to open the sector up to offshore lawyers and firms as it saw fit. 

Foreign licences

The dispute originated more than 20 years ago when licences were granted to foreign firms such as White & Case and Ashurst to set up offices in India. Local Indian lawyers brought a case  before the Bombay High Court challenging this. When the court ruled against the foreign firms, they appealed to the the Supreme Court, which sent the case back to the Bombay court. It took a further 13 years for the Bombay High Court to back its original decision that foreign law firm should not set up offices. However the question as to whether foreign lawyers practising foreign law in India without a physical office was unresolved until a lawsuit was filed the following year by a lawyer, AK Balaji, claiming some 30 foreign firms did not have the right to practise law in India. The Madras High Court ruled in favour of the ‘fly-in, fly-out’ arrangement for foreign lawyers to visit clients in India in 2012 which was reaffirmed by the Supreme Court. This was appealed by the Bar Council of India.  Clifford Chance, Linklaters, Herbert Smith Freehills, Norton Rose Fulbright, Ashurst, Clyde & Co, Eversheds Sutherland and Bird & Bird gave evidence int he case.   


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