Please forgive me for the delay in posting Laurel Terry's terrific list of the Top Ten International Legal Profession Stories of 2012. Most of readers know that Laurel has been writing on the international aspects of our field for many years. Further information on all of these developments will appear
in Laurel S. Terry, Transnational Legal
Practice Developments Outside the U.S.: 2010-2012, 47 Int’l L. __
(2013)(forthcoming).
Top Ten International Legal Profession
Stories of 2012
Laurel Terry (LTerry@psu.edu), Penn State Dickinson School of Law, USA
- 1.
ABS Goes Live in the UK
As reported in John Steele’s Top
Ten Legal Ethics Stories of 2012 (Item #3), 2012 was the year that the UK
Solicitors Regulation Authority issued alternative business structure licenses. The stage had been set by the 2007 UK Legal
Services Act which created a regulatory framework that allowed (and arguably
encouraged) ABS. After years of discussion
in articles and at conferences,
it finally happened. I predict that ABS
will dramatically reshape legal services not only in England and Wales, but
elsewhere in the world. ABS licenses have been issued to,
among others, The
Co-Operative, which is a mutually-held company that operates grocery,
travel, financial services, and funeral service businesses and plans to add
3,000 solicitors in the next five years to challenge the traditional “High [Main] Street” firms. Additional ABS licenses have been issued to
an arm of Australian publicly-traded law firm Slater & Gordon (Russell
Jones & Walker), UK firm Irwin Mitchell, legal expenses insurer Abbey Protection, a claims
management company called Parabis
that has private equity backing, and a consultancy headed by Cherie
Booth QC. Transatlantic law firm DLA
Piper has an ownership interest in LawVest, which reportedly has applied for an
ABS license.
- 2.
The
Influence of the Troika
The Troika
refers to the International Monetary Fund, the European Central Bank, and
the European Commission. The Troika has become influential in lawyer
regulation as it has put pressure on financially troubled European countries such
as Ireland, Portugal, and Greece to reform their systems of lawyer regulation
as a condition of the bailouts. In
December 2011, the ABA and the CCBE (the umbrella organization for EU bars and
law societies) became so concerned about the Troika’s actions that they issued
a joint
letter to IMF Managing Director Christine Lagarde expressing concerns about
the impact of its actions on the independence of the legal profession. Although the IMF has said there is no
reason to be concerned, the influence of the Troika is a development worth
watching. Professor John Flood has a
number of useful blog entries here, here,
and here;
they include links to the underlying IMF documents.
- 3.
Market
Liberalization in Countries Such as Korea, Singapore, and Malaysia
A number of countries liberalized their
legal services markets, providing greater access to foreign lawyers. The Korea-U.S. Free Trade Agreement (KORUS)
took effect in March 2012 and by summer 2012, more than a dozen U.S. law firms
had opened
up offices in Korea. In 2012,
Singapore announced that it would be issuing additional Qualified Foreign Law
Practice license; this is part of its effort to become a global legal hub. Other jurisdictions that liberalized include Malaysia
and the Shanghai
Bar Association, which invited foreign lawyers to become special members in
a dramatic turn-around from its 2006 request to the Ministry of Justice to
crack down on foreign firms.
- 4.
Market
Access Contraction in Brazil and Vietnam
2012 may have provided examples of
market liberalization for foreign lawyers, but there were also high profile market
access contractions. Global firms and
commentators expressed concerns during 2012 about the actions of Brazil’s national
bar association, which voted in favor of strict regulations that forbid
formal alliances between Brazilian lawyers and foreign legal consultants or
their law firms. The national bar
association vote followed on the heels of several well-publicized opinions from
the Sao Paulo branch of the bar association that had reached similar
conclusions. Vietnam
has also called for more restrictions on foreign law firms.
- 5.
Developments
in India’s Ongoing UPL Saga
India has been a leading source of stories
in the past few years as the UPL cases against US and UK law firms have worked
their ways through the various Indian courts.
The latest developments include a February 2012 Madras
High Court decision that dismissed a lawsuit brought by an Indian lawyer
against thirty-one foreign law firms, ruling that foreign lawyers were entitled
to participate in international arbitration proceedings in that country and to
advise clients on foreign law on a "fly in fly out" basis. (The Madras High Court also ruled that the
legal process outsourcing defendants were not covered by the Advocates Act.)
This Madras decision stands in contrast to a 2009 Bombay High Court
decision and has been appealed to the Supreme Court, which issued an interim
order on July 4, 2012. The
proceedings are ongoing.
- 6.
FATF
and Gatekeeper Developments:
In 2012, the Financial Action Task Force
(FATF) adopted a revised
version of its recommendations which are designed to prevent money laundering
and terrorism financing, some of which the ABA considers problematic. The FATF also decided to conduct a “typology”
study to learn more about whether and how lawyers are involved in
facilitating money laundering – a decision which the legal profession welcomed. ABA representatives continue to be actively
engaged with U.S.
government and FATF
representatives regarding “gatekeeper” issues.
The ABA has also continued its
outreach efforts to publicize the ABA’s
Voluntary
Good Practices Guidance for Lawyers to Detect and Combat Money Laundering and
Terrorist Financing including a February
2012 presentation to the National Organization of Bar Council which also
included representatives from the U.S. Treasury Department, the U.S. Depart of
Justice and the U.S. Attorney for the Southern District of New York. So far, the U.S. federal government has been
willing to rely on the legal profession’s efforts in implementing the FATF.
- 7.
U.S.
Action (and inaction) Regarding the Accreditation of Foreign Law Schools and
Full Admission Applications from Foreign Lawyers
Although this item technically involves
U.S. events, rather than international events, I have included on my Top 10 International Legal Profession Developments
list various U.S. actions related to foreign lawyers. Two of these items involve inaction – in
September 2012, the Council of the ABA Section of Legal Education and Admission
to the Bar decided to
take no action with respect to the accreditation of foreign law
schools. (The Peking University School
of Transnational Law had
indicated that it would seek ABA accreditation if the accreditation rules
were changed.) The Council similarly
failed to take any action with respect to its International Committee’s
recommendation regarding a Model Rule on Admission of Foreign Educated
Lawyers and Criteria for ABA
Certification of an LLM Degree for the Practice of Law in the United States. Both the foreign
accreditation possibility and the foreign
lawyer full admission model rule had been the subject of criticism when circulated
for comment. (It is also noteworthy that
in August 2011, the Conference of Chief Justices rescinded
its 2007 resolution in which it asked for ABA assistance).
In contrast to the ABA Council’s failure to
act, there were several noteworthy state actions including an amendment to New
York Rule 520.6,
which governs the ability of foreign LL.M. students to sit for the New York bar
exam and which took effect in April 2012; Wisconsin’s
2012 rule change that allowed foreign-educated applicants who had obtained an
LL.M. to sit for its bar exam; Minnesota’s
2012 admission of a foreign-educated New York lawyer (pursuant to its 2011 rule
change); and Georgia’s
December 2012 adoption of a rule permitting foreign in-house counsel. Another noteworthy event was the ABA 20/20
Commission’s submission of the inbound
foreign lawyer proposals for consideration by the ABA House of Delegates in
February 2013.
- 8.
New
Resources Available Regarding Legal Practice and Admission Outside the U.S.
I find it surprising that as of 2012, it is
still difficult to find out information about lawyer regulation elsewhere in
the world. EU Directives, such
as 98/5 and the CCBE’s
webpages make it easy to find out the titles and rules that apply to EU
regulated lawyers, but beyond that it can be difficult to find this
information. Luckily, several new
resources appeared in 2012 that should help.
They are the publication of the APEC Legal Services
Inventory, the publication of the ABA
Guide to International Bar Admissions, the Canadian FLSC’s ongoing consolidation
of admissions,
discipline,
and ethics (here
and here)
information, and the IBA’s
effort to consolidate lawyer regulatory information (click on “Countries”
for links to ethics codes). If the new
international network of lawyer regulators (described below in item #9) takes
off, it can provide an additional source of information. (U.S. information is aggregated in several
spots, including websites of the
ABA, NCBE, and NOBC.)
- 9.
Formation
of an International Network of Legal Regulators
In September 2012, the U.K.
Solicitors Regulation Authority (SRA) hosted the first ever International Conference of Legal Regulators. This two-day conference, which had more
than 100 attendees from Australia, Africa, Asia, Canada, the U.S., and the U.K.,
seemed to demonstrate a pent-up demand among “day job” lawyer regulators to
discuss the challenges they faced and regulatory approaches. During the final session, attendees indicated
by a show of hands their interest in continuing their communication and
collaboration. They also agreed to meet
in San Francisco in August 2013, as an adjunct to the National Organization of
Bar Counsel meeting. U.S. attendees
included representatives from the National Conference of Bar Examiners, the
Conference of Chief Justices, and the National Organization of Bar
Counsel. Although attendees were positive, at
least one commentator has suggested that it would be better to have the
International Bar Association or another existing entity serve this “network”
function. Further information about this
conference is available here
(Legal Futures blog), here
(Law Gazette), here
(SRA press release), here
(Solicitors’ Journal) and here
(PSU news item).
10. National Developments
During the past year, there have
been a number of significant legal profession developments in Australia, Canada,
the EU, and the U.K, among other places.
The Canadian developments are set forth in Alice Woolley’s blog entry
entitled The
Top Ten Canadian Legal Ethics Stories – 2012. I hope that John Steele can find contributors
who will create “top 10” lists devoted to Australia, the EU, and the UK. In the meantime, some of the noteworthy developments
of which I am aware include Australia’s National
Legal Profession Reform, which has been percolating for years; the UK’s updated
SRA Handbook,
which uses an outcomes-focused approach to regulation; the UK Legal Services
Board’s request for research and advice on many issues, including the “cab
rank” rule for UK barristers. Its reports
and research
initiatives are important sources of information, along with consultations by
the Legal
Services Board, the Solicitors
Regulation Authority, and the Bar
Standards Board. Noteworthy EU
developments include: 1) the September 2012 European
Court of Justice case that denied in-house counsel the right to appear
before it (following up on the 2010 Akzo
Nobel case which also took a restrictive view of the rights of in-house
counsel); 2) the ongoing work on the E-Justice portal; 3)
the ongoing ten year review of the EU’s Lawyers Establishment Directive [98/5];
and 4) a number of important money laundering developments including the
European Court of Human Rights Michaud
case, and a review of the 2005 EU money laundering directive which is
expected to lead to the
issuance of a new directive.
Further information on all of these developments will appear
in Laurel S. Terry, Transnational Legal
Practice Developments Outside the U.S.: 2010-2012, 47 Int’l L. __
(2013)(forthcoming).
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