Progress made in liberalization as India's law secretary convenes critical meeting
The legal landscape in India is on the brink of a significant change, as the country moves towards the liberalization of its legal services sector. The Union Law Secretary, Suresh Chandra, has called a meeting in New Delhi on Sept. 29 to discuss draft rules governing the entry of foreign law firms and lawyers in India.
The discussions have primarily focused on whether foreign firms will overwhelm domestic firms, rather than on how Indian lawyers can compete internationally once restrictions ease. A core challenge remains the antiquated ban on legal advertising under Rule 36 of the BCI Rules, which severely limits Indian lawyers' visibility globally and thus their competitiveness.
The formal move to open the Indian legal market is underway, with a specific committee examining foreign participation, known as the Cyril Shroff committee. However, no definite timeline for full liberalization has been publicly announced as of mid-2025. Significant regulatory and cultural hurdles remain, such as strict advertising rules and the profession’s traditional treatment as a "calling" rather than a commercial market.
The draft rules for the liberalization process were jointly prepared by law firms Hammurabi & Solomon, Medhaadvisors, and the Indian National Bar Association (INBA). The meeting on Sept. 29 will be attended by various Indian ministries, including finance and commerce and industry, chambers of commerce like Federation Of India Chamber Of Commerce & Industry (FICCI) and Associated Chambers of Commerce and Industry of India (ASSOCHAM), and the Society of Indian Law Firms (SILF), which has been one of the more vocal opponents of the liberalisation of India's domestic legal market.
Despite the concerns, many, including Jayesh H, founder partner of Juris Corp., are optimistic about the liberalization's impact. Jayesh questions why a "Big Bang" approach is not being taken for the liberalization process, suggesting a gradual entry of foreign law firms into India in three phases, each phase lasting about 5-7 years.
Manoj Kumar, managing partner of Hammurabi & Solomon, asserts that the fears are unfounded as the domain of practice for foreign firms is limited to setting up offices in India to practice foreign law, international/cross-border transactions, and international arbitration, not domestic law practice or litigation. Kumar believes that the liberalisation of India's legal market will have a positive impact, making it easier to do business in India, and will make legal services more affordable for clients.
Jayesh also notes that there are misconceptions about liberalisation, including the belief that it will drive up costs for clients. On the contrary, Jayesh expects faster turnarounds and an increase in profit margins for law firms without increasing chargeout rates. Moreover, Jayesh believes that law firms will need to leverage technology following liberalisation, leading to increased productivity.
In conclusion, while the liberalization of India's legal market is actively being studied and considered, actual entry of foreign law firms and lawyers is not yet permitted or in effect, and the expected timeline for implementation remains unclear as of July 2025. However, the potential benefits, particularly for the start-up sector and Indian entrepreneurs seeking multi-jurisdiction legal assistance, are significant, and the reforms are part of a broader package of reforms India is adopting to enhance its global trade and investment appeal.
- The draft rules for the liberalization process were jointly prepared by law firms Hammurabi & Solomon, Medhaadvisors, and the Indian National Bar Association (INBA), indicating a collaboration between different legal entities in the discussion of foreign participation in India.
- Manoj Kumar, managing partner of Hammurabi & Solomon, asserted that the fears of foreign law firms overwhelming domestic firms are unfounded, as the domain of practice for foreign firms is limited to specific areas like international arbitration and foreign law, not domestic law practice or litigation.
- Jayesh also believes that law firms will need to leverage technology following liberalization, potentially leading to increased productivity, which could drive down costs for clients and increase profit margins for law firms without increasing chargeout rates.
