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Law-firm Dentons grows in India as Baker McKenzie, others weigh new rules

Confusion persists on the reciprocity framework, the restriction to advise only "foreign" clients in India, and the bar on "fly-in, fly-out" if the law firm has a local office, among other issues

Dentons

Dentons

Bloomberg

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By Menaka Doshi

Global law firm Dentons is the first to enter India by combining with New Delhi-based mid-size firm Link Legal. 
The deal, which involves no transfer of money, ownership or foreign lawyers, remained unaltered after it was first announced in October — even after India relaxed rules to allow foreign lawyers and firms to practice in the country.

“We don’t fly in, fly out, we don’t export, import people,” Dentons global chief executive officer, Elliott Portnoy, said in an interview. The rebranded Dentons Link Legal remains independently owned and managed, said the Indian firm’s executive chairman, Atul Sharma.

The combination means that Dentons is now in five big Indian cities with access to 150 local lawyers and professionals. Dentons overall is a union of firms in 82 countries. 

Other large international firms, some structured like Dentons, are still examining the fine print in the two-month-old India rules. They are also examining a subsequent rules clarification that allows foreign lawyers from reciprocal jurisdictions to register and establish offices in India but practice only foreign law for foreign clients. 

It’s too early to say when Baker McKenzie will set up an India office, said Ashok Lalwani, chair of the international firm’s India practice. Baker McKenzie has 300 lawyers working offshore on India-related matters, using the fly-in, fly-out route to service Indian clients. 

Confusing Rules
 
US-based Covington & Burling said in a note that India’s new rules prescribe a boil-the-ocean registration process and impose self-defeating limitations. 

Confusion persists on the reciprocity framework, the restriction to advise only “foreign” clients in India, and the bar on “fly-in, fly-out” if the law firm has a local office, among other issues. 

The Bar Council of India has yet to publish registration forms, it’s not clear if ongoing protests by Indian lawyers may prompt changes to the rules, and there are concerns around lower fees and taxation in India.

DLA Piper said in an emailed statement that while recent announcements in India present significant opportunities, the firm is still working through how a presence would develop in the country. It has an offshore India-focused practice.

Read: Top India Lawyer Sees More Fees, Deals From Foreign Firms’ Entry

Staggered Opening Up

Law has always been a locally regulated, protectionist profession, said David Wilkins, professor of law and director of the Center on the Legal Profession at Harvard Law School. 

The pressure to open up is usually brought by large clients who want firms that can serve them in multiple jurisdictions, Wilkins said.

Opposition from local firms results in staggered liberalization, he said. “I don’t think there’s going to be a huge rush,” Wilkins said. “It won’t be like China in the ‘90s.”

China’s number of foreign law firms rose to a peak of 232 in 2014, up from 12 in 1992, according to a China Justice Observer report. The number declined to 185 by 2020 because of lower cross-border investment activity, continuing restrictions on foreign firms, and a rise in the number of local firms, the report said.

Private sector law firms have been around for only 25 years or so in China, said Portnoy of Dentons, which has offices in 48 Chinese cities. The Chinese legal bar’s level of sophistication, maturity and experience is much lower than in India, where the profession has long been in existence, he said. “India is more like Singapore.”

Singapore has invested in reform and advancement of the legal industry up and down the board, Wilkins said. There is value in having a globally competitive legal sector, of which corporate law firms are a part, he said.

“If I were India,” Wilkins said, “I would want more people, more firms to want to come to India.”

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First Published: May 24 2023 | 10:21 AM IST

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