Wednesday, July 15, 2009

Welcome foreign law firms to India

Foreign law firms? Law firms? What are these creatures? Common people may not care for two seconds why foreign law firms should or should not be allowed to operate in India. Common man wants to stay as far away from lawyers and courts even in his dreams! So public may not have any opinion for or against it.

But the issue may have important ramifications for legal system in India.

First things first, there is no shame in using 'foreign' in India. Many Indians are comfortable with following foreign made or foreign owned goods:
1. Coke & Pepsi are both marquee US companies and present in India.
2. Snacks and food products by Unilever, P&G and other are consumed in India.
3. Many clothing brands are named after 'phoren' sounding names like Allen Solly, Van Heusen, Peter England etc. The interesting thing is that some of these brands are actually owned by Indian companies. So clearly people prefer to buy a brand called 'Peter England' than say 'Subbu Swami'.
4. Foreign owned manufacturing and Industrial companies are operating in India. e.g. GE
5. Foreign owned companies in Telecom space e.g. Vodafone are also present in India.
6. Foreign owned banks like Citibank, HSBC, and service companies like IBM, Accenture are operating in India.
7. Foreign insurance companies have joint ventures with Indian companies.

So why do lawyers as a fraternity oppose entry of foreign law firms. They give 2 broad arguments:
1. Indian firms should also get reciprocal entry into foreign jurisdictions like UK etc.
2. Entry of foreign firms will make legal service expensive for common man and poor people.

The first point is valid but it can be take care of by lobbying at appropriate business forums and with government. If free trade and services are happening in other instances it can be done for legal services too.

The second argument that legal service will become out of reach of common man is totally fallacious. Competition in a market economy is known to reduce prices. Which of the following things have become more expensive and/or less accessible in last 10 years?
1. Mobile phones and services
2. Medical Insurance
3. Financial services (for middle classes and above only)
4. Automobiles - cars (think nano), motorcycles etc
5. Consumer durables - TV, fridge, washing machines
6. None of the above

The right answer is 6. "None of the above". More competition and entry of foreign/joint ventures have improved both cost and quality for common people in India.

The reality of the issue is as follows:
1. Foreign law firms will want access to corporate and global legal services like taxation, merger and acquisition, international trade laws etc. These services are high-end and only few law firms in India provide such services. It does not take away legal jobs except give competition at the top end. Foreign firms are not coming to India to serve the common man, at least not directly.
2. Also let us not forget many Indian KPO firms are providing legal services to foreign firms. That is providing lucrative employment to many legal professionals in India and can be used as valid argument by foreign law firms to claim entry into India.
3. But most importantly, the Indian legal community *does not* provide services to the common man or poor person. The common man is dead afraid to go to a lawyer. Can you really picture a poor man taking out his mobile phone (poor people have mobiles now) and saying "let me speak to my lawyer first"!

The reason is simple. In Indian legal /judicial system, there is so much delay that no sane person goes to courts except in complete desperation and helplessness. The lawyers bred in this system also feed on this helplessness. Because once a person gets trapped he cannot get out so easily. He lives on eternal hope.

A few months back the same lawyers had opposed an amendment in criminal procedure which will make it more difficult for police to arrest a person. Hello lawyers? Do you have any argument to back your claim. Do more arrests lead to more justice in India? The jails are anyway filled with undertrials of many years. Do they get justice because you are there to help them after they get arrested? Do you help their cases to be concluded quickly?

Recently, a few lawyers including a lady lawyer assaulted a judge in a Delhi court when the judge passed an unfavourable order against their client! Also there are many instances in past when lawyers have resorted to vandalism and strikes on flimsy issues.

Obviously lawyers think they are above the law of land. Common people depend on them to get access to courts, but lawyers do not seem to be accountable to anyone including judiciary. Many incompetent lawyers feed on miseries of poor people who get arrested by police and do not have knowledge and access to speedy justice. There may be competent and incompetent people in any profession but the legal system should not encourage incompetence.

So we should support entry of foreign law firms in India. This will achieve the following:
1. Competent Indian lawyers will work in these firms or in legal service firms giving outsourced service to foreign clients. It will encourage good students to take up law as profession.
2. Middle level competent lawyers will have enough opportunity to get legal work once judicial and police reforms are in place. Because when justice is quick and effective, more people will go to courts for reasonable remedies. False and frivolous cases will get thrown out quickly, so the needy people will get speedy access to justice.
3. The incompetent lawyers will have to fend for themselves somehow. They will not be able to exploit poor people due to an unresponsive police and judicial system.

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