Festina Lente or Disguised Protectionism?: Monopoly and Competition in the Indian Legal Profession
25 Pages Posted: 25 Jan 2014 Last revised: 24 Feb 2014
Date Written: January 1, 2014
India has come a long way since her leading lawyers pioneered independence from the British colonialism in 1947. As juxtaposed with the role of lawyers in struggle for political freedom, lawyers played a limited role in the 1991 economic reforms which initiated dismantling of Indian brand of socialism. The 1991 reforms are sometimes regarded as India’s second independence leading to economic freedom. Perhaps owing to the limited role that the lawyers played in India’s second independence, the legal profession has largely remained insulated from the process of deregulation initiated post-1991.
In spite of this insularity, the impact of globalization on the Indian legal profession, nevertheless, is inevitable. Globalization portends challenges as well as opportunities for the legal profession. While India seeks accelerated economic growth to lift millions above poverty, legal institutions strive towards delivery of just, fair and efficient dispute resolution. The challenge for the legal education is to align its curriculum with the globalized world and impart relevant, skill based training to the aspirants. Concomitantly, in the era of globalization, in order to ensure legitimacy amongst the stakeholders, access to quality legal education a fortiori assumes significance. Further, a protectionist legal profession is unlikely to be in a strategic position to play an effective role in fair and effective resolution of disputes.
This paper will focus upon the regulation of the Indian legal profession and its implications upon the entry of foreign law firms. The paper posits that although the Indian legal profession is ostensibly protectionist, owing to multifarious ‘push’ (external) and ‘pull’ (internal) factors, it has been taking baby steps towards liberalization i.e. entry of foreign law firms. Since the current debate on the entry of foreign law firms has unnecessarily generated more heat than light, this paper critically surveys the relevant legislations A closer scrutiny of the Advocates Act, 1961 (“Advocates Act”) – the fundamental legislation governing the Indian legal profession – indicates little regulatory barrier for the entry of foreign law firms on a reciprocal basis.
Further, the paper analyzes the legislative provisions and the precedents emanating from the Supreme Court of India and the High Courts. The paper takes into account certain international instances such as that of South African Competition Commission’s decision relating to advertizing by lawyers.
To be sure, the legal profession’s lethargy towards liberalization has costs associated with it. The paper, however, considers it beyond scope to undertake cost-benefit analysis or to analyze the pros and cons of entry of foreign law firms.
Structurally, the paper is divided into several parts. Part II deals with the advent of the Advocates Act and the Indian legal profession’s diffident approach towards liberalization. It enumerates the position of the Bar Council of India, State Bar Councils, Society of Indian Law Firms and the Bombay High Court. Part III builds upon Part II and catalogues the multifarious ‘push’ and ‘pull’ factors in the liberalization. Both international and domestic factors have been accounted for. Part IV analyzes the baby steps towards the liberalization of the Indian legal profession. Towards this endeavor, the inception of common market for the legal professionals, the Bar Council of India’s monopoly, the initiation of a pan-India Bar examination, creation of limited liability partnerships, regulation of advertisements and infusion of a modicum of competition through a Madras High Court judgment have been assessed. Part V summarizes the concluding observations.
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