Professional bodies and commercial law firms have welcomed amendments to rules published by the Bar Council of India (BCI) that will allow foreign lawyers to practise in India for the first time. 

The development will bring an end – albeit with significant conditions – to the historic isolation of India’s legal market, which had been one of the most restricted of any major market economy as a result of a 1961 law that prohibited non-Indian law firms from practising in the country. 

The BCI announced Wednesday (14 May) it had enforced the amended rules, having published draft rules on the admittance of foreign firms and lawyers back in early 2023. Those were never implemented, partly because of objections raised by the Society of Indian Law Firms. 

Richard Atkinson, president of the Law Society of England and Wales, noted the decision followed 20 years of negotiation with the Indian government and the BCI. 

“Our constructive dialogue and efforts have helped bring this significant development to fruition,” Atkinson said. “This decision should create huge opportunities for solicitors and Indian advocates in both countries. We share the BCI’s view that opening the legal profession in India to foreign lawyers will also benefit Indian lawyers.”

Under the amended rules foreign lawyers’ work will be “strictly confined to non-litigious areas involving foreign law, international law and arbitration matters, particularly concerning cross-border transactions and international disputes”.

The BCI further clarified that foreign lawyers may participate in international commercial arbitration conducted in India, “provided such arbitration involves foreign law or international law, thereby promoting India as a viable destination for international arbitration without compromising the rights of Indian legal professionals”.

Barbara Mills KC, chair of the Bar Council, said it too had worked closely with the BCI and welcomed the revised rules, which she said would help India position itself as a significant centre for international arbitration.

“Multi-national companies, including many of those from and with headquarters in India, with very substantial commercial and other disputes, like and expect the flexibility, autonomy and control that international alternative dispute resolution processes allow them,” Mills said. “The rules will allow English and Welsh barristers to provide this service.” 

The BCI’s announcement made clear its priority was “the rights and interests of Indian legal professionals”, and as such foreign lawyers and law firms are “categorically prohibited from practising Indian law and appearing before Indian courts, tribunals or statutory authorities”. Furthermore, foreign lawyers seeking temporary entry to give legal advice under ‘fly-in, fly-out’ provisions must limit their stay to 60 days per 12-month period. 

Indian advocates and law firms will also be allowed to register as foreign lawyers or foreign law firms, enabling them to expand their practice to foreign law and international law consultancy without relinquishing their rights to practice Indian law in domestic forums. The BCI said this dual registration would provide Indian lawyers with an opportunity to “broaden their professional horizons while maintaining their status as advocates under Indian law”.

The announcement follows disappointment that legal services were not included in the Free Trade Agreement (FTA) agreed earlier this month between the UK and India. 

Stewarts’ head of India practice and international arbitration, Sherina Petit, said the amendements were a “commendable step forward toward adapting to global legal trends and addressing the shortcomings in the UK-India trade deal”.

The amendments, Petit said, would broaden opportunities for Indian lawyers to engage in international work while enhancing India’s appeal to foreign law firms, albeit on a reciprocal basis, which she said was unfortunately omitted from the UK-India FTA.

Arbitration lawyer Nick Peacock said the development was an expression of “justifiable confidence” in the ability of Indian lawyers and law firms to compete with international law firms, including in international arbitration, with internationally recognised Indian firms and advocates regularly appearing in hearings in London, Singapore and elsewhere.

Baker McKenzie’s Mini Menon vandePol, that firm’s global India practice chair, said that, as a firm interested in supporting client business in India, it was “thrilled” by the news. 

“We look forward to opening our India office under the new rules at the earliest opportunity,” she added. 

Some, however, were more cautious, pending consideration of how the rules will function in practice and suggesting further clarification was needed, including in terms of documentary and financial requirements.

Siddhartha Shukla, an M&A partner in Herbert Smith Freehills’ India group, commented: “India has been a significant market for our firm for many years, and continues to be, so it is good to see this. Like others we are working through the detail.”

The BCI said it had implemented stringent registration and renewal requirements for foreign lawyers and law firms to prevent undue competition and protect the interests of Indian lawyers. The rules mandate “comprehensive documentation, including proof of primary legal qualification, no-objection certificates and declarations of compliance with Indian regulations”.

Petit noted that the revised fly-in fly-out provisions presented operational challenges to cross-border legal work. 

“Completing legal transactions within the newly imposed 60-day limit prima facie seems impractical, and the requirement for visiting lawyers to register with the BCI and disclose client details raises confidentiality and ethical considerations. 

“Additionally, the financial commitments required for registration prima facie do not align with commercial realities. While major industry players may absorb the costs, the $25,000 registration fee, combined with the $30,000 security deposit and additional individual registration fees, may create a barrier for firms entering the Indian market. 

“Further clarification from the BCI is necessary in the coming days, including on compliance requirements and the payment structures set out in the amendments. This would help ensure a smoother transition and adaptation to the amendments.”