International law firms including DLA Piper, Herbert Smith Freehills and Baker McKenzie are looking at opening offices in India after the country changed its rules to widen overseas access to a huge market.
The Bar Council of India announced in March that foreign legal firms would be allowed to set up in the country for the first time and advise clients on the international elements of mergers and acquisitions or appear as arbitrators, among other things.
The biggest international firms have built up large practices working on corporate deals with an Indian focus but until now had to advise clients on a \u201cfly-in fly-out\u201d basis.
\u201cWe are excited \u2014 we think this is a very big opportunity and it\u2019s one we\u2019re taking seriously,\u201d said Ashok Lalwani, a Baker McKenzie partner who runs the firm\u2019s India group from Singapore. He said the rules were the most significant progress for the Indian market in a long time.
Roddy Martin, London-based head of the India practice at Herbert Smith Freehills, said the news was significant, adding \u201cit will possibly be less\u00a0about today than the scale of opportunities in India over the next five years\u201d.
The new rules will not allow foreign lawyers to advise on local law or appear in Indian courts.
The changes have not been unanimously welcomed. Members of the Society of Indian Law Firms plan to send representatives to negotiate with the Bar Council and local firms have raised concerns about how the proposed \u201clevel playing field\u201d would work, particularly as the Bar Council prohibits Indian law firms from marketing their practices online or offline.
\u201cI think we might be entering a silly season of backroom manoeuvring, public petitions etc,\u201d said Karam Daulet-Singh, managing partner at Mumbai-based Touchstone Partners, a cross-border transactions specialist.
The arrival of overseas firms \u201cwould certainly intensify the competition\u201d at the top end of the market, which \u201cwill go through vigorous change and even disruption\u201d, he added.
The changes come as talks over a post-Brexit trade deal between the UK and India grind on.
\u201cThe reform is long overdue,\u201d said Cyril Shroff, managing partner at one of India\u2019s biggest law firms, Mumbai-based Cyril Amarchand Mangaldas. \u201cMy guess is that the UK-India [free trade agreement] discussions were the trigger.\u201d
Firms such as Herbert Smith Freehills and Baker McKenzie currently service Indian clients and international clients operating in India from bases in Singapore or London. \u201cClients always ask us when we\u2019ll get there,\u201d said a partner at one large firm. \u201cMultinational companies investing in India like to have lawyers in the country who have experience on the ground.\u201d
Baker McKenzie, Herbert Smith Freehills and DLA Piper all said they were examining their options but none have committed to opening an India office yet.
Some India specialist partners at international firms said they would wait for the Law Society of England and Wales and the BCI to clarify and give more details of the rules in the coming months, including whether they could work for Indian clients in India as well as international companies.
One international firm based in London said it definitely wanted to launch a Mumbai office, but that it would take a year or more. \u201cIt\u2019s baby steps,\u201d said an Asia-based partner at the firm. \u201cThere needs to be a lot of consultation, but done properly this could be a watershed moment.\u201d
And incumbents have a home advantage \u2014 they are much cheaper. \u201cThe biggest pitfall I see for the newcomers,\u201d said Shroff, \u201cis that they are severely underestimating how hard it is to make money in India. The global pricing model is currently a non-starter in India.\u201d
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