India-UK FTA could drive more trade, investments—and disputes. More cross-border business for law firms?
Enhanced bilateral trade and investments following the India-UK FTA will likely increase the volume of cross-border transactions, driving demand for legal services in mergers and acquisitions, intellectual property, and international dispute resolution, they said.
The India-UK trade agreement signed by Prime Minister Narendra Modi on 24 July won several waivers for Indian exporters to the UK while protecting India’s interests.
Indian legal practitioners and law firms have been allowed to practise international law in foreign jurisdictions, including the UK. But it was only in May that the Bar Council of India notified amended rules allowing foreign lawyers and law firms to practise international law in India in a regulated, non-litigious capacity.
“Indian firms have long advised international clients across jurisdictions, and CETA (India-UK Comprehensive Economic and Trade Agreement) does not alter that existing access in any way,” said Hemant Sahai, founding partner, HSA Advocates.
“Indian lawyers were always entitled to practice international law in the UK. The converse was not true. The real shift, if any, may be on the Indian side as CETA could potentially facilitate greater access for UK law firms into the Indian market,” said Sahai.
Ayush Mehrotra, partner at law firm Khaitan & Co., said as the India-UK agreement is expected to boost trade and investment, there will be increased demand for legal services related to cross-border activities.
“Indian firms specialising in corporate law, M&A (mergers and acquisitions), intellectual property, international arbitration, and international trade will be well-positioned to serve clients involved in these transactions,” said Mehrotra.
Increased trade and investment between the two nations also increases the possibility of disputes, creating an opportunity for India’s arbitration lawyers and arbitrators, said Shashank Garg, senior advocate and arbitration counsel.
“As it is a common norm for such deals and contracts to subscribe to arbitration as their preferred dispute resolution mechanism, this may bring in a lot more work for Indian arbitration practitioners, reputed institutions based in India as well as qualified arbitrators,” said Garg.
The principle of reciprocity
Policy experts said India’s laws for foreign law firms and lawyers, embedded in the Bar Council’s recent amendments, are protectionist. Foreign law firms are uncertain about coming to India under strict ‘fly-in, fly-out’ rules and limited scope of practice, Mint reported on 23 May.
BCI’s new rules require foreign lawyers to disclose the duration, purpose and the nature of legal work every time they visit the country.
Reciprocity of market access is a key feature of bilateral trade and investment agreements, policy experts said.
“The principle of reciprocity is addressed more in spirit than in full equivalence (in the India-UK deal),” said Manuj Bhardwaj, executive secretary, Indian National Association of Legal Professionals. “India still maintains restrictions on foreign law firms practising domestically, while the UK has a more liberal approach.”
Bhardwaj, however, said the India-UK agreement was a step towards more reciprocal market access. “The CETA creates a structure within which reciprocal access can be expanded over time, particularly if India continues to explore phased liberalization in legal services,” he said.
The India-UK trade agreement also has a provision where both countries agree to work on mutual recognition agreements (MRAs), which have the potential to streamline market access for both nations, legal practitioners told Mint.
“Without a mutual recognition agreement for qualifications and licensing, Indian lawyers may still face regulatory hurdles in practising UK law or integrating into UK firms,” said Bhardwaj.
At the same time, the trade deal promises “enhanced mobility” for professionals from both nations.
“Enhanced Mobility will simplify visa procedures and liberalise entry categories for professionals, including legal professionals, benefiting those in short-term assignments or advisory roles,” said Mehrotra of Khaitan and Co.