The Practice of Law in Asean – Impact of Globalization and Technology

Samuel D.Bernal, JD, LLM, MBA, MD, PhD ALA Philippines

ASEAN Economic Community and the Legal Profession

The ASEAN Economic Community (AEC) expects by 2015 to act as a single common market and production base. A fuller

economic integration under the AEC could lead to increased flows of trade and investment within ASEAN and foreign

direct investments from outside ASEAN. The member nations of ASEAN can benefit from positive changes in the

country’s economic structure and create new jobs. In the Eighth Law Ministers Meeting in 2011, the Joint Communique

enunciated these goals:

With the coming into force of the ASEAN Charter, the legal structure of ASEAN is envisioned to transform into a “rules-

based organization with appropriate legal and institutional frameworks/mechanisms in order to effectively support and

facilitate the realization of the ASEAN objective of building an ASEAN Community by 2015.”1

As such, the goals include the harmonization of ASEAN trade laws and the progressive liberalization of trans-national

legal services in ASEAN.

Cross-border practice of law and Foreign Direct Investments – from within ASEAN and

from outside ASEAN.

Indeed, transnational legal services would be critical in facilitating cross-bordertransactions within ASEAN. The goal of

becoming a single market and production base can be enhanced by the liberalization of legal services. The free flow of

goods and services would need to be supported by the necessary legal infrastructure through the freer establishment of

law firms and movement of legal professionals across ASEAN.2

The AEC would also be a more attractive destination for Foreign Direct Investments (FDIs) not only within ASEAN but

from outside ASEAN. Most of these FDIs come from the European Union ($ 74.8 B), Japan ($ 57 B) and the USA ($ 24 B),

as compiled from 2011 to 2013, presentedin the ASEAN Foreign Direct Investment Statistics Database as of 1 June 2014

by the Working Group on International Investment Statistics (WGIIS).3The current sectoral characteristics of ASEAN FDI

reflect the preferences that direct investors have for manufacturing and services industries.

1Joint Communique of the Eighth ASEAN Law Ministers Meeting (ALAWMM), Phnom Penh, 04 November 2011. At

http://www.asean.org/news/asean-statement-communiques/item/joint-communique-of-the-eighth-asean-law-ministers-meeting-

alawmm-phnom-penh-4-5-november-2011-2?category_id=26.

2 Pasha L. Hsieh. Asean’s liberalization of legal services: the Singapore case. 8 Asian J. WTO & Int'l Health L &Pol'y 483 2013.

3 ASEAN Foreign Direct Investment Statistics Database At

http://www.asean.org/images/resources/Statistics/2014/ForeignDirectInvestment/Aug/Table%2027.pdf.

These FDIs coming from outside ASEAN will continue to create a major impact in the economic future of ASEAN

countries, affecting the development of investment infrastructure, job creation, entry of competitive technologies and

job creation. The companies that are the major sources of FDIs from Europe, Japan and the US, rely on the lawyers

based in their home countries who will need to deal with the legal entities of ASEAN, with individual ASEAN countries if

not yet the ten countries of ASEAN as a bloc.

The number of business transactions involving international and multinational clients is rapidly increasing. These

business clients themselves tend to have operations in multiple countries around the globe and require legal advice and

support from specialists with international or transnational experience. Under ASEAN, what may initially appear to be a

local legal issue will quickly appear to have transnational ramifications. Multinational clients will also demand that the

resolution of disputes by litigation or arbitration be handled on a multinational basis.4

The presence and participation of foreign lawyers from outside ASEAN, constitute a major incentive for transnational

business transactions and incoming FDIs. The globalization of legal services will create a major impact on the growth of

economic opportunities in the region.5 Conversely, the rise of economic activity within ASEAN and investments from

outside ASEAN will fuel the opportunities for lawyers and law firms, in the continuing growth of legal services in the

Asia-Pacific which reached $80.4bn by 2013.6

Lawyers and the regulators of law practice in each ASEAN country have a great role to play in the future of the AEC and

will have to carefully consider the major opportunities (and not focus on the threats) posed by the cross-border practice

of lawyers within ASEAN as well as the liberalization of policies towards the practice of non-ASEAN lawyers.

As trade and business worldwide is rapidly changing with the impact of globalization and technology, so law practice

everywhere, not only in ASEAN, is being increasingly affected by globalization and technology.

Law Practice and Globalization

Globalization is causing major changes in the practice of law.7 The effects of globalization on the practice of law are seen

with intergovernmental trade organizations suchas the World Trade Organization, with inter-government institutions

such as theInternational Criminal Court and United Nations Institute for the Unification of Private Law, with

4 Colin Ong and SitiNurbaniBintePengiranDato HJ Tengah. Cross-border legal services within ASEAN under the WTO: The

law and practice Brunei Darussalam. 1 Jan 2005. At www.aseanlawassociation.org/docs/w2_brunei.pdf.

5 Legal Services in Asia-Pacific, Marketline Industry Profiles, 22 Nov 2012.

athttp://www.alacrastore.com/storecontent/MarketLine-Industry-Profiles/Legal-Services-in-Asia-Pacific-2124-2189.

6 ASEAN: A New Magnet for Foreign Direct Investments, 28 May 2013. Posted in 2013, ASEAN Secretariat News. At

http://www.asean.org/news/asean-secretariat-news/item/asean-a-new-magnet-for-foreign-directinvestments.

7James Faulconbridge and Daniel Muzio Legal education, globalization and cultures of professional practice. Geo. J.

Legal Ethics Vol 22, 1335, 2009.

transnational legal frameworks such as the development of international commercial law and regional economic

groupings such as the European Union and the trading bloc associated with the North American Free Trade Agreement.8

The transnational practice of law can create situations such as:

[A]n Australian lawyer working in the Brussels office of a New York law firm on a contract for a Japanese client with a

German counterpart, which isgoverned by English common law, but in which disputes are to be referred to the

International Chamber of Commerce's International Court of Arbitration inParis.9

Globalization of legal services tends to be associated with more competition between different multinational providers

and thus far, has been predominantly US firms which operate branch offices in different countries.10 The impact could

be more deregulation of the legal services market. Within a particular country, there may also be pressure by local law

associations and legal practitioners for more regulation to protect local lawyers and to exclude foreignlawyers.

However, the effect of protectionism in legal services could be to the detriment of local legal practitioners because they

would lose out to lawyers from other countries who partner with foreign lawyers in serving multinational clients.

Moreover, the presence of foreign lawyers in a host country, as indicated above, is itself an incentive for foreign

investments.

All jurisdictions have been affected by globalization in legal services. Since 20008, local markets for legal services around

the world have contracted while multinational legal services have expanded.

But legal services are not a single market as it is highly segmented between personal and corporate submarkets,

litigation versus transactional lawyering, representation versus consulting, private v public etc. The impact of economic

integration would be in both regional and international commercial transactions and would favor practitioners with

multinational corporate experience and connections. In the U.S., the segmentation of personal and corporate

submarkets has been well-defined with large law firms cornering the corporate market. The distinction has not been so

clear in most markets of legal services around the world. One consequence of globalization has been the increasing

segmentation of the corporate market in Europe, East Asia and Latin America and the appearance of a more distinct

corporate segment where U.S. law firms have the advantage of experience, operational capacity and where they have

operated quite successfully.11

8John Flood & Fabian Sosa, Lawyers, Law Firms and the Stabilization of Transnational Business, 28 Nw. J. INT'L L. & Bus.

489, 501-04, 2008.

9Laurence Etherington& Robert Lee, Ethical Codes and Cultural Context: Ensuring Legal Ethics in the Global Law Firm, 14

IND. J. GLOBAL LEGAL STUD. 95, 95-118, 2007.

10NunoGaroupa. "Globalization and Deregulation of Legal Services" International Review of Law and Economics 38.S: 77-

86, 2014.

11Laurel S. Terry, Steve Mark, and Tahlia Gordon, Trends and Challenges in Lawyer Regulation: The Impact of

Globalization and Technology, 80 Fordham L. Rev. 2661, 2012.

Law Practice and Technology

Hand in hand with globalization, the rapid changes in science and technology are affecting the practice of lawyers

worldwide both in technology used in the law office and the legal issues presented by multinational corporations that

depend upon technology for their competitive market advantage.

“Globalization is here to stay. Technology is going to radically change the way that lawyers work. We are going to have

to rethink what lawyers offer and what our services look like. If our regulatory structure can’t adapt, it could get

displaced. …the legal profession may have little choice but to adopt drastic changes in its regulatory structure. We need

an international system that can function effectively in this very mobile, very global, very technology-oriented world that

we live in.” - in an article by Persky quoting Laurel S. Terry, a law professor at Penn State University in Carlisle who is an

expert on international regulation of the legal profession.12

As a profession that is particularly dependent on information, the practice of law could not avoid the full impact of the

Information Age. The effect has been evident for many years in law schools and law libraries, law office operations,

computerized court operations, electronic discovery, and criminal procedure.13 But this is only the beginning.

In the courtroom, the advantages of using of digital technology includes the ability of present the case visually,14 to

facilitate comprehension and retention of information presented,15 to increase persuasive impact and to increase

efficiency of trial procedures.16

At a recent meeting of the American Bar Association (ABA), the impact of technology and globalization were presented.

Alan Davidson, Director of Public Policy at Google described a number of technology trends affecting legal

practice.17First, computing power capacity for data storage, is increasing exponentially while becoming cheaper and

more easily archived permanently. As an example, he remarked that the printed works of the Library of Congress would

take up ten terabytes and yet, individual private individuals can now purchase computers with more than one terabyte

of memory.The second trend is the increasing number of people connecting on-line on computers and on mobile

12

Anna StolleyPersky. Despite Globalization, Lawyers Find New Barriers to Practicing Abroad ABA Journal Nov 1, 2011. At

http://www.abajournal.com/mobile/mag_article/ the_new_world_despite_globalization_lawyers_find_new_barriers_to_practicing.

13

Richard L. Marcus, The impact of computers on the legal profession: evolution or revolution? Pope & John Lecture on the Legal

Profession, delivered at Northwestern University School of Law on October 18, 2007. at

http://www.law.northwestern.edu/depts/legalpub/lawreview/v102/n4/1827/lr102n4marcus.pdf?origin=publication_detail 14 Frederic I. Lederer, High-Tech Trial Lawyers and the Court: Responsibilities, Problems, and Opportunities, 52 FED.

LAW. 41, 42, 2005.

15 Joana Gallant et al. The science of courtroom litigation: Jury research & analytical graphics. 327, 2008.

16Michelle Quigley, Courtroom technology and legal ethics: Considerations for the ABA Commission on Ethics 20/20.

2010. http://digitalcommons.law.msu.edu/king/152/

17Minutes of April 29–30, 2010 Meeting of the ABA Commission on Ethics 20/20, at 10–11,2010. At

http://www.americanbar.org/content/dam/aba/migrated/2011_build/ethics_2020/apr_2010_minutes.authcheckdam.p

df (statements by Alan Davidson, Dir. of Pub. Policy, Google).

communication devices. About 90% of new on-line connectionsare through broadband connections with increased

efficiency and accessibility. Another trend is cloud computing that provides computing power and storage more than an

individual will need to install locally. Along with advances technology, lawyers have to be more savvy about legal issues

surrounding the technology including contracts between cloud service providers and customers, provisions relating to

security, outages, access to data, privacy, and customer control over what data is and is not maintained or deleted by

the provider.

In a presentation by Susan Hackett, Senior Vice President and General Counsel, Associationof Corporate Counsel (ACC),

the interactions of technology and globalization of legal practice was discussed.18 The ACC has 26,000 individual in-

house counsel members from every industry, representing 10,000 companies including members from all of the Fortune

500 companies and most of the FTSE 100. Atty.Hackett identified ways that the current ethics rules and professional

regulations have been outpaced by a new legal practice paradigm. The large majority of corporate workis done outside

the court system and in an international practice context. Although the modern transactional and cross-border practice

being discussed at the ABA Commission on Multijurisdictional Practice focused on domestic cross-border practice, the

more important challenges are on the impact of technology and globalization –trends that make borders increasingly

irrelevant.

The need for legal information systems was discussed and presented extensively by several country representatives at

the ALA meetings in Bali, Indonesia on February, 2012, including the establishment of electronic databases of court

records, laws, ALA proceedings and set-up of law information centers.19

Law intersects with Science and Technology – which are two of the most powerful institutions in modern life.20 The

growth of science and technology has propelled economic development and has affected just about all of commercial

enterprises. In legal practice, scientific practices and technology-related harms are increasingly the subject of litigation.

Scientificand technological evidence, such as molecular techniques, genetic tests and digital technologieshave found

frequent utility, especially in criminal cases, medical malpractice, environmental law and intellectual property law.

Scientific presentations are presented in the courtroom through the testimony of certified expert witnesses, including

scientists that address the scientific or technological subjects of litigation or forensic specialists called in to interpret

scientific and technical evidence, including their utility and limitations.21

Although there is often the perception that law and the legal process are impediments to the development and

exploitation of science and technology because of bureaucratic government regulation or excess courtroom litigation, it

is precisely in the understanding of the power and limitation of science and technology that lawyers and judges can

properly assess the role that law can play in promoting and enhancing the mechanisms allowing society to best benefit

18

Minutes of April 29–30, 2010 Meeting of the ABA Commission on Ethics 20/20, at 10–11, 2010. At

http://www.americanbar.org/content/dam/aba/migrated/2011_build/ethics_2020/apr_2010_minutes.authcheckdam.pdf

(statements by Susan Hackett, General Counsel, Association of Corporate Counsel).

19 ALA Meeting Documents. At http://www.aseanlawassociation.org/11GAdocs/

20 Sheila Jasanoff, Science at the Bar:Law, Science and Technology in America. Harvard University Press, Cambridge, MA,

USA, 1995.

21 Duane Valz, Book Review: Science at the Bar. Berkeley Technology Law Journal, 1996. At

http://btlj.org/data/articles/vol11/Valz.pdf.

from the advances in science and technology.22 There are numerous areas of intersection between law and

science/technology, including standards of liability in several areas of law: products liability, medical malpractice

andenvironmental protection; legal issues with genetic engineering, reproductive technology, stem cell technology and

life-sustaining technology; intellectual property in scientific and technological innovations, including patent law, trade

secrets law, trademark and unfair competition law, copyright law and other areas of law, such as contracts and antitrust

law, that also affect the protection of intellectual propertyand the public’s right to access and use of such innovations.23

For the practice of law in the context of the ASEAN Economic Community, the combined impact of globalization and

technology represented major challenges and opportunities but also highlight the advantages of linkages and

partnerships with law entities in advanced countries in Europe, North Asia and North America.

22 Suzanne Scotchmer, Standing on the Shoulders of Giants: Cumulative Research and the Patent Law, 5 J. ECON. PERSP.

29 (1991).

23 U.S. Patent and Trademark Office Information Infrastructure Task Force, Intellectual Property and the National

Information Infrastructure: The Report of the Working Group in Intellectual Property Rights 213 (Final Report, Sept. 5,

1995.

Cross Border Law Practice in the ASEAN Context

This paper includes a review of cross-border practice of law in three countries, namely Singapore, Malaysia and Vietnam,

because these countries have the most experience in the practice of foreign lawyers. Among ASEAN countries, the

“foreign” lawyers and law firms involved in the past appear to be predominantly Western lawyers and law firms,

especially from the US and the UK. This may be due to the international investments coming from Western countries

that require international legal services in individual countries. This is in contrast to the situation in Europe where the

cross-border practice of law is mainly within the European Union from one EU country to another and in the US where

the practice is from one US state to another. In the context of cross-border law practice, “foreign” lawyers from outside

the EU practicing in EU countries or “foreign” lawyers from outside the US practicing in a US state are a minority

although there are some non-nationals who studied law in the EU or the US and/or who took the bar examination there.

With increasing economic integration of ASEAN and increased intra-ASEAN investments, we could look forward to more

intra-ASEAN liberalization of legal services.

Singapore

The experience of liberalization of legal services in Singapore involved a "menu of options" for foreign law firms and for

foreign lawyers in an incremental and stage-wise approach that also minimizes the impact on the local legal

profession.24Singapore has progressively liberalized legal services since 2000. There are pragmatic factors that led

Singapore’s judiciary and leaders in the legal profession to allow the practice of foreign lawyers.

By encouraging foreign law firms to locate in Singapore and use Singaporean law for arbitration andtransactions

promotes Singapore as an attractive forum for dispute resolution and to position Singapore as Asia's "key legal services

hub.25" Joining international law firms with Singaporean law firms facilitates the transfer of legal technologies and

expertise. The presence of leading foreign law firms in Singapore also encourages local lawyers to work in Singapore

instead of migrating abroad such as to London or Hong Kong. Perhaps most significantly, the foreign law firms bring in

substantial volume of offshore transactions and investments that drive GDP growth with particular impact on the

banking, corporate finance and maritime industries.

Singapore is considered to have the most liberal policy for foreign lawyers and law firms in ASEAN. It is noteworthy in

this regard that in ASEAN, Singapore has by far the highest incoming foreign direct investment (FDI) amounting to

almost $61 B in 2013, although the country has the second smallest (after Brunei) population of 5.4 M.26 In contrast, the

two most populous countries in ASEAN, Indonesia with 249 M people has FDI of $18.5 B and the Philippines with 100 M

people has FDI of only $3.9 B in the same period. In terms of liberalization of legal services for foreign lawyers and law

firms, the Philippinesis considered to be on the other end of the spectrum from Singapore.

The “menu of options” for foreign law firms in Singapore includes the FLP (Foreign Law Practice) which are foreign

24Hsieh. Asean’s liberalization of legal services: The Singapore case. Supra note 2.

25 Ministry of Law of Singapore Government, Report of the Committee to Develop the Singapore Legal Sector – Final

Report 69, 2007.

26 ASEAN Foreign Direct Investment Statistics Database, supra note 3.

boutique firms or multilateral firms that specialize in offshore transactions.27 Singapore-qualified lawyers are not

prohibited from joining FLPs, but their legal practice is restricted to what FLPs can do. FLPs are limited to the practice of

non-Singaporean law. In arbitration cases where there is a dispute regarding Singaporean laws, Singaporean lawyers in

FLPs may handle the case.

Under the FLA (Formal Law Alliances) and JLV (Joint Law Ventures) structure, a Singaporean law firm and a foreign law

firm can act as "single service provider" bythe sharing of office premises, profits or client information.The foreign

counterpart in bothan FLAor a JLVmust possess legal expertise in areas such as banking, finance, and corporate laws, so

that the SLP (Singaporean Law Practice) may benefit from the advanced expertise of the partner FLP.28

The two entities are different in that the FLA permits the foreign law firm and the Singaporean law firm to operate

together without cross-ownership. The alliance of the two firms under the FLA does not create a new legal entity. In

contrast, a JLV is a new entity jointly owned by the foreign law firm and the Singaporean law firm. The license of the JLV

allows the firm to practice "permitted areas of legal practice," which is typically commercial law. Thus, the JLV is a

separate entity from its constituent law practices. Both the foreign and Singapore law practices should each have strong

track records in one or more of the following areas of legal practice: a) banking law; b) finance law; c) corporate law; d)

arbitration; e) intellectual property law; f) maritime law; or “other areas of legal practice that facilitate or assist in the

growth and development of the Singapore economy.29”

In the JLV, the foreign and Singaporean law practices must have joint representation and participation in the

management of the JLV. They must have an agreement to jointly manage the JLV and are required to submit a plan for

the transfer of expertise and know-how;

The foreign law practice may share in up to 49% of the total profits of the JLV. Singapore-licensed lawyers may

concurrently serve as partners or directors of the participating Singapore law practice and of the JLV. The JLV may

practice foreign law in any areas of legal practice and may also practice Singapore law through Singaporean lawyers in

most areas of legal practice, except for those excluded under Rule 3 of the LPIS Rules 2008. The J|LV may market or

advertise itself as a single service provider and bill its clients as if it were a single law practice.

Because of a high failure rate of FLAs and JLVs, Singapore introduced QFLP (Qualifying Foreign Law Practice) licenses in

2008, which allows foreign law firms to practice permitted areas of Singaporean law. The QFLPs are permitted to

practice Singapore commercial law without local partners unlike the foreign law firms operating in FLAs and JLVs. Under

the rules, the QFLP commits to increase the value of offshore work that it creates and the number of lawyers it retains in

Singapore.30

27

LEGAL PROFESSION ACT (Sing.) At http://statutes.agc.gov.sg/aol/search/display/view.w3p;page=0;query=DocId%3A%22c8171754-

7d8c-4d2d-ac8b-67ae3e3911fe%22%20Status%3Ainforce%20Depth%3A0;rec=0

28Award of the second round of Qualifying Foreign Law Practice licences. At https://www.mlaw.gov.sg/news/press-releases/award-

of-second-round-qflp-licences.html. 29 Id. (Rule 4(2)(a) of the LPIS Rules 2008.

30Hisieh, supra note 2.

Temporary practice ('fly-in, fly-out' practice) by foreign lawyers is allowed in Singapore as indicated in the APEC survey of

law practice.31

In particular foreign arbitrators and mediators may enter Singapore and provide arbitration and mediation services for

up to 60 days without the need to apply for a work pass with the Ministry of Manpower or a license with the Attorney-

General's Chambers.

A foreign lawyer can also obtain a limited license to offer advisory services in foreign and international law and thus

render services as a foreign legal consultant. To offer advisory services in foreign and international law, a foreign legal

consultant is not required to but may enter a commercial association with local lawyers. The legislation covering this

limited license is Part IXA of the Legal Profession Act (LPA).32

To qualify as a foreign lawyer practicing foreign law pursuant to section 130K of the LPA and Rule 18 of the LPIS Rules

2008, the foreign lawyer must be a) authorized or registered to practice law in a state or territory other than Singapore

by the empowered foreign authority. There are no restrictions as to the nationality of the applicant, or the jurisdiction in

which the applicant is authorized or registered to practice law. The foreign lawyer may be employed by any foreign law

practice located in Singapore or any Singapore law practice; b) the law practice in which the foreign lawyer is registered

must be maintained throughout the period of the lawyer's registration; c) the foreign lawyer must carry insurance

policies providing indemnity against loss arising from civil liability claims in relation to the applicant's practice; with a

minimum amount of insurance covered of SGD 2 million.

The foreign lawyer registered under section 130K of the LPA and Rule 18 of the LPIS Rules 2008 may practice foreign law

and international law in or from Singapore in the law practice in which the foreign lawyer is registered. There are no

limitations in the areas of foreign law and international law that a foreign lawyer may practice but the foreign lawyer is

not allowed to practice Singapore law in any area of legal practice.

The number of foreign lawyers in Singapore increased by 42% since 2007 and is estimated to include 1,200 foreign

lawyers which comprise one-fifth of the legal professionals in Singapore. In the meantime, the value of Singapore's legal

services industry grew by 25% from 2008-2012, amounting to more than S$1.9 billion.33

Clearly, the liberalization of legal services in Singapore has led it to become the hub of ASEAN for international law firms

and significantly enhances the growth of legal market in Singapore. Multinational companies often choose Singapore as

their base of operations for their business in the region and as the preferred forum for dispute resolution for

transactions involving ASEAN and India. As a result of the demand for legal services the top foreign law firms set up

31

APEC Economy: Singapore. At http://www.legalservices.apec.org/inventory/singapore.html.

32 Legal Profession Act (LPA), Chapter 161; Legal Profession (International Services) Rules 2008 (LPIS Rules

2008).http://statutes.agc.gov.sg/aol/search/display/view.w3p;page=0;query=DocId%3A%22c8171754-7d8c-4d2d-ac8b-

67ae3e3911fe%22%20Status%3Ainforce%20Depth%3A0;rec=0.

33 Award of the Second Round of Qualifying Foreign Law Practice Licences, MINISTRY OF LAW OF

SINGAPORE GOVERNMENT (Feb. 19, 2013), http://www.mlaw.gov.sg/news/press-releases/award-ofsecond-round-qflp-

licences.html; Hsieh, supra note 2.

their law practice headquarters in Singapore. Instead of suffering from the presence of foreign law firms, Singaporean

law firms have become more competitive and by 2012, comprise the majority of the top law firms in the country. It

appears that overall, the liberalization of legal services benefitted Singapore in its economy and in the competitiveness

of the local Singaporean law firms.

Malaysia

Recently, Malaysia has made rather dramatic moves to liberalize the practice of law. Foreign law firms and lawyers are

now permitted to practice in Malaysia because of amendments to the Legal Profession Act (LPA) and the Legal

Profession (Licensing of International Partnerships and Qualified Foreign Law Firms and Registration of Foreign Lawyers)

Rules which came into force on June 3, 2014.34

According to Malaysian Bar president Christopher Leong, “The opening up of Malaysia to foreign law firms and foreign

lawyers is a natural progression as world and regional economies become more integrated in trade in goods and

services.” Leong explained that “a major consideration behind the new legislation was to ensure that the liberalization of

the Malaysian legal services market and the entry of foreign lawyers were balanced with the need for the development

of Malaysian law firms, and to enable these firms to achieve expertise to compete with foreign counterparts on a level

playing field. With the liberalization of the legal market, the challenge was for Malaysian lawyers to build capacity and

abilities to be more competitive.35”

These statements are reminiscent of policies and rules on foreign lawyers and law firms instituted by Singapore many

years ago. And as was experienced by Singapore, the liberalization of the legal sector in Malaysia has attracted

considerable interest among international investors. Malaysia is already ranked among the top 10 economies with the

most business-friendly regulations in the World Bank’s Doing Business 2014 guide. Malaysia is already the world’s

fourth-largest Initial Public Offering (IPO) destination in terms of monetary value after the US, China and Japan.

The legal system in Malaysia is rather complex and differs from other countries in ASEAN. The country has two main

jurisdictions: West (Peninsular) Malaysia and East Malaysia (Sabah and Sarawak).

The legal profession in West (Peninsular) Malaysia is governed by the Legal Profession Act of 1976 (recently amended)

and regulated by the Malaysian Bar Council.36 Membership to the Malaysian Bar Council is compulsory for all practicing

advocates and solicitors, who must apply for annual practicing certificates issued by both the Malaysian Bar Council and

the High Court of Malaya. The legal profession in East Malaysia is governed in Sabah by the Advocate Ordinance Sabah

1953 while those in Sarawak are governed by the Advocate Ordinance Sarawak 1953. The Attorney General of the

respective state is tasked with regulating entry and issuing licenses annually. West Malaysian advocates and solicitors

may appear in any West Malaysia court, but they need to register before being permitted to practice in East Malaysia.

34Green light for foreign law firms. The Star Online 1 July 2014.

http://www.thestar.com.my/News/Nation/2014/07/01/Green-light-for-foreign-law-firms-Threeyear-renewable-

licences-made-available/

35Doing Legal Business in Malaysia. The Law Society of England and Wales, Nov. 2014.

http://international.lawsociety.org.uk/files/Doing%20legal%20business%20in%20Malaysia_0.pdf

36

Liberalisation of Legal Services, The Malaysian Bar. At http://www.malaysianbar.org.my/trade_in_legal_services_formerly_known_as_gats/liberalisation_of_legal_services.html.

Likewise, advocates in East Malaysia have to apply for admission to the High Court of Malaya to practice in West

Malaysia.37

As of 3 June 2014, with the Malaysian Attorney General’s announcement of the Legal Profession (Amendment) Act 2012

and additional amendments in 2013, foreign law firms may apply for a Qualified Foreign Law Firm (QFLF) license to set

up an office in Malaysia.38 Foreign law firms may also apply for a license to set up an international partnership (IP) with a

Malaysian law firm. Moreover, Malaysian law firms will be permitted to employ qualifying foreign lawyers.

The QFLF and IP licenceswill be granted for an initial period of three years and are renewable. The international

partnership (IP) will require 60% equity and voting rights for the Malaysian law firm and 40 % for the foreign partner.

Law firms applying for the QFLF licence are required to show experience and expertise on international Islamic finance.

The supplementary amendments of 2013 developed a new ‘fly-in fly-out’ practice scheme. Foreign lawyers may provide

‘fly-in/fly-out’ legal services in areas not involving any aspect of Malaysian law provided that they do not exceed a

maximum stay of 60 days per lawyer per year. The foreign lawyers will also need an ‘immigration authorization’ for each

period of stay in offering legal services.

Under the current rules, foreign lawyers are permitted to undertake arbitration and mediation in West Malaysia under

the LPA. In East Malaysia, the High Court of Sarawak ruled that the Advocate Ordinance Sarawak 1953 does not permit

foreign lawyers to undertake arbitration and mediation, whereas the current policy in Sabah is still unclear.

Key legal practice areas in Malaysia include Sharia finance, private capital and funds, real estate and international

arbitration, shipping, commercial litigation, technology and telecommunications. Alternative forms of dispute

settlement or mediation are available for parties involved in international trade, commerce and investment at The Kuala

Lumpur Regional Center for Arbitration (KLRCA), which operates independently from the Malaysian judicial system.

Parties to arbitration may be represented by foreign lawyers, with an International Panel of Arbitrators consisting of

experts in various fields from all over the world.39

37 Legal Services APEC: Malaysia. At http://www.legalservices.apec.org/inventory/malaysia.html.

38Laws of Malaysia. Act A1444. Legal Profession (Amendment) Act 2012. At

http://www.federalgazette.agc.gov.my/outputaktap/20120920_A1444_BI_BI%20A1444.pdf.

39Law Council of Australia. Practice of foreign law: Malaysia. At http://www.lawcouncil.asn.au/lawcouncil/images/LCA-

PDF/Country_Fact_Sheets/Asia/PFL%20Malaysia_map.pdf

Vietnam

The evolution of policies on foreign law practitioners in Vietnam is worth tracing because the country has a long history

of presence of foreign lawyers and has one of most liberalized law practice policies in ASEAN. Major law firms, mainly

from the U.S., have been present in Vietnam since early 1990. During this period, foreign law firms could only open

representative offices in Vietnam, but could not practice law.40

Then, in 1998, the government issued Decree No 92/1998/ND-CP (’92 Decree’) which allowed foreign law firms and

lawyers to practice law in Vietnam.41

Under Article 7 of the 92 Decree, foreign law firms are allowed to set up a maximum of two branches in Vietnam and to

appoint one of its own lawyers to act as the chief of its branch. The branch chief manages, runs and carries the

responsibility for the organization and operation of the branch in Vietnam.In terms of the scope of practice, foreign

branch offices may provide legal consultation on international law and foreign law only. They may not give advice on

Vietnamese law or represent clients in litigation cases in court.After the 92 decree by 2000, there were forty branch

offices of foreign law firms in Vietnam.

On December 10, 2001 after the U.S. Congress and the Vietnamese National Assembly voted for its approval, the U.S.-

Vietnam Bilateral Trade Agreement (BTA) went into force.42 In this BTA, Trade in Services was outlined in Chapter III of

the BTA and Annex G details the practice of foreign law firms and lawyers.

The provisions on modes of supplydescribe no limitation on market access in cross-border supply and Consumption

abroad; for Commercial presence and Presence of natural persons the supply of services are described as follows:

“Companies of the U.S. may supply services in the form of branches,company with 100% U.S. invested capital, and

Vietnam-US jointventures.Practicing lawyers of the U.S. are not permitted to participate in legalproceedingsin the

capacity of defenders or representatives of their clientsbefore the courts of Vietnam. The term of operation of a branch

of a law firm of the U.S. is 5 years from the date when license is granted and may be extended every 5 years. Branches of

U.S. law firms, law firms with 100% U.S. capital, joint venture law firms between Vietnamese law firms and U.S. law firms

are permitted to make consultations on Vietnamese laws if the consulting lawyers have graduated from a Vietnamese

law college and satisfy requirements applied to like Vietnamese law practitioners.43”

After the US-Vietnam BTA came into force, the Vietnamese government issued a new decree on foreign law firms in

2003, which opened the door for foreign law firms and lawyers. In effect, Decree No 87/2003/ND-CP (’87 Decree) dated

July 22nd 2003replaced Decree No 92/1998/ND-CP.

40 Lindsay Griffiths Vietnam Lawyers Federation and Legal Practice in Vietnam with Mr. Nguyen Van Thao. Zen and the

Art of Legal Networking. March 30, 2011. At http://www.zenlegalnetworking.com/2011/03/articles/

conferencewebinar-session-reca/vietnam-lawyers-federation-and-legal-practice-in-vietnam-with-mr-nguyen-van-thao/

41 Decree No 92/1998/ND-CP dated Nov 10, 1998 on the Legal Consultancy Practice by Foreign Lawyers.

http://moj.gov.vn/vbpq/en/Lists/Vn%20bn%20php%20lut/View_Detail.aspx’ItemID=1289.

42US Vietnam Bilateral Trade Agreement, 2001.http://www.usvtc.org/trade/bta/US-VN-BTA.pdf.

43Chapter III Trade in Services, At http://www.usvtc.org/trade/bta/text/chapter3.htm; Annex G. Vietnam Schedule of Specific

Commitments of Trade in Services. http://www.usvtc.org/trade/bta/text/annexG_VN.PDF

The 87 Decree prescribed the conditions for, scope and forms of professional practice, rights and obligations of foreign

lawyers' organizations and foreign lawyers practicing their profession in Vietnam, and the State management over

professional practice by foreign lawyers' organizations and foreign lawyers in Vietnam.44

Under the 87 Decree, a foreign law firm can have a representative in Vietnam in the form of a branch office, in the form

of a foreign law firm, 100%-foreign-owned, or a joint venture company with a Vietnamese law firm. A foreign law firm

cannot give legal advice on Vietnamese law, but may do so if the firm employs a licensed Vietnamese lawyer. The 87

Decree added a provision that if a foreign lawyer graduates from a Vietnamese law university, he or she can be qualified

as a Vietnamese lawyer.

Chapter IV of the 87 Decree covers the “Profession-Practicing Conditions, Forms and Scope, Procedures for Granting

Licenses, Rights, and Obligations of Foreign Lawyers.” Article 41 of Chapter IV specifies Legal Profession Practice

Conditions. Foreign lawyers are granted licenses for law practice in Vietnam if they meet the following conditions:

having lawyer's profession-practicing certificates granted by the foreign competent agencies or organizations which are

still valid;“having goodwill toward the Vietnamese State;” and being designated by a foreign lawyers' organization to

practice their profession in Vietnam or being recruited by a Vietnam-based foreign lawyer's profession-practicing

organization or a Vietnamese lawyer practice organization to work at such organization.

The forms of practice that foreign lawyers may engage in Vietnam are outlined in Article 42: 1. Working as members or

employees of Vietnam-based foreign lawyer's profession-practicing organizations; 2. Working as employees of

Vietnamese lawyer’s offices or Vietnamese law partnerships. The scope of professional practice by foreign lawyers in

Article 43 include: 1. To provide consultancy on foreign laws and international laws; 2. Not to provide consultancy on

Vietnamese laws, except for cases where they have Vietnamese law university degrees and fully satisfy the

requirements as for Vietnamese lawyers; 3. Not to participate in legal proceedings as defense counsels or

representatives of clients before the Vietnamese courts.

As with Decree 92, foreign law firms may enter legal consultancy co-operation contracts with Vietnamese law offices

and law partnerships, either on a long-term or case-by-case basis, for consultancy on Vietnamese law and foreign and

international law.

Decree 87 introduced changes to the rules making the operational duration of foreign law practices in Vietnam to be

limited, not by law but as proposed by the applicant and approved by the Ministry of Justice. Decree 87 no longer

prescribed a 5 year (extendable) limit on branch licenses, unlike Decree 92. Decree 87 also provided for the merger of

one or more foreign law firms into another foreign law firm established in Vietnam and for the consolidation of two or

more foreign law firms into one foreign law firm.

Under Decree 87, the scope of practice of foreign law practices in Vietnam was widened. In addition to advising on

foreign and international law in the fields of business, investment and commerce (under Decree 92), the foreign law

practitioners were now permitted to provide legal consultancy services and other legal services, including consultancy

on the Vietnamese law when the foreign law practice employed a Vietnamese lawyer or employed a foreign lawyer with

a Vietnamese law degree and who satisfied the requirements applied to Vietnamese lawyers as prescribed in the

Ordinance on Lawyers.

44 Decree No 87/2003/ND-CP dated July 22nd 2003. http://luatsukinhte.com/en/law-dissemination/legal-

documents/administrative-law/878-decree-no-872003nd-cp-dated-july-22nd-2003.html.

However, Decree 87 retained the prohibition on participation in Vietnamese court proceedings that was in Decree 92,

applied to foreign lawyers and Vietnamese lawyers and trainees employed by foreign law practices.

Foreign lawyers may be employed on a contractual basis by a Vietnamese law office or law partnership, but foreign

lawyers practicing in Vietnam were required to be present in Vietnam on a regular basis.

Foreign law practices in Vietnam may employ Vietnamese lawyers under Decree 87 unlike Decree 92 which prohibited it.

These employed Vietnamese lawyers had unlimited scope of legal consultancy and legal services and extended to

foreign and international law as well as Vietnamese law. Foreign law practices in Vietnam may also receive trainee

lawyers from Vietnamese Bar Associations to train them in legal practice.

Vietnam allows temporary practice ('fly-in, fly-out' practice) of foreign lawyers under the Law on Lawyers. A foreign

lawyer is not obliged to practice in commercial association with a local lawyer or local firm, although this option is

open.45

Decrees that followed includedDecree No 28/2007/ND-CP dated 26 Feb 2007.46Decree 28 involved detailing and guiding

the implementation of a number of articles of the Law on lawyers, pursuant to June 29, 2006 Law No. 65/2006/QH11 on

Lawyers and pursuant to the National Assembly's Resolution No. 65/2006/QH11 of June 29, 2006, on the

implementation of the Law on Lawyers. More details on practice of foreign lawyers including registration were included

but the practice remained broad.

When Decree No 28/2007/ND-CP came into force, the previous decrees ceased to be effective which included: the

Government's Decree No. 94/2001/ND-CP of December 12, 2001, detailing the implementation of the Ordinance on

Lawyers; Decree No. 87/2003/ND-CP of July 22, 2003, on law practice by foreign lawyers' organizations and foreign

lawyers in Vietnam; the Justice Ministry's Circular No. 02/2002/TT-BTP of January 22, 2002, guiding a number of

provisions of the Government's Decree No. 94/2001/ND-CP of December 12, 2001, detailing the implementation of the

Ordinance on Lawyers; and Circular No. 06/2003/TT-BTP of October 29, 2003, guiding a number of provisions of the

Government's Decree No. 87/2003/ND-CP of July 22, 2003, on law practice by foreign lawyers' organizations and foreign

lawyers in Vietnam.

More recently, Decree No. 123/2013/NĐ-CP dated October 14, 2013 was promulgated by the Vietnamese Government

detailing some provision and methods to implement the Law on Lawyers.47This Decree detailed regulations for lawyer

training centers, legal aid of lawyers, fostering participation obligations required of lawyers, regulations on law-

practicing organizations, fees for lawyer when attending in proceedings in criminal cases, lawyers’ socio-professional

organizations, activities of law-practicing organizations in overseas, foreign lawyers in Vietnam.

This Decree 123 took effect from November 28, 2013 and replaced Decree No. 28/2007/ND-CPstatus1 dated February

26, 2007, Decree No. 131/2008/ND-CPstatus1 dated December 31, 2008 and Article 3, Article 5 of the Decree No.

05/2012/ND-CPstatus2 dated February 2, 2012, all of which expired from the date of Decree 123.

45APEC economy: Vietnam; Jurisdiction: Vietnam. At http://www.legalservices.apec.org/inventory/vietnam.html.

46 Decree No 28/2007/ND-CP dated 26 Feb 2007. At

http://moj.gov.vn/vbpq/en/Lists/Vn%20bn%20php%20lut/View_Detail.aspx’ItemID=4159

47 Decree No. 123/2013/NĐ-CP dated October 14, 2013 of the Government detailing some provision and methods to

implement the Law on lawyer. At http://thuvienphapluat.vn/archive/Decree-No-123-2013-ND-CP-detailing-

implementation-measures-of-the-Law-on-lawyers-vb217284.aspx

Decree 123 introduced some limitations in the scope of practice of foreign lawyers. Under Decree 123 Article 31,

foreign lawyer practicing organizations in Vietnam may not: a) certify photocopies and translations of documents issued

by Vietnamese state agencies and Vietnamese organizations; b) perform procedures in adoption, marriage, civil status

and Vietnamese citizenship; c) perform services of notary public, bailiff and other services which are only permissible

for Vietnamese lawyer practicing organizations, Vietnamese notary practicing organizations and Vietnamese bailiff

practicing organizations.

Otherwise, the scope of practice under Decree 123 appears to basically follow the scope set forth in Article 70 of the

Amended Law on Lawyers, which in turn follows the commitments of Vietnam on market access for legal services upon

her accession to WTO (Vietnam’s WTO Commitments, Oct 27, 2006)48, which states:

“Branches of and foreign lawyer practicing organizations in Vietnam may provide legal consulting services and other

services, but shall not have their foreign lawyers and Vietnamese lawyers to participate in legal proceedings in the

capacity of representatives, defenders or protectors of rights and benefits of the main parties before the courts of

Vietnam nor provide legal documentation and certification services related to the laws of Vietnam, [branches of and

foreign lawyer practicing organizations] may have their Vietnamese lawyers to provide legal consultancy on the laws of

Vietnam.”

Essentially, Decree 123 does not make substantial changes in the scope of practice of foreign lawyers which were not in

previous versions of the Amended Law on Lawyers or in the commitments of Vietnam within the WTO and US-Vietnam

Bilateral Trade Commitments. Specifically, the on-going discussions and arguments as to the scope of practice of foreign

lawyer practicing organizations mainly dwell on the contexts that (i) foreign lawyer practicing organizations are not

permitted to provide legal documentation services related to the laws of Vietnam and (ii) what should be regarded as

such a legal documentation for this purpose.49

Some Vietnamese firms had lobbied the government to introduce restrictions on the practices of foreign law firms. A

provision stipulating that ‘legal documentation’ would include commercial contracts as being off-limits to foreign law

firms could have prevented Vietnamese lawyers working in foreign law firms from drafting contracts.50 This

protectionist move raised great concerns from many sectors because foreign law firms depend a lot on Vietnamese

lawyers who work in these foreign firms to draft contracts and business charters in international commercial trade and

investment deals.

For now, the proposed restrictions were not passed at the Vietnamese National Assembly,with international firms

warning that the restrictions would not only be adverse to the operations of foreign firms, but also that such a

protectionist policy could discourage foreign investors.

48Schedule of WTO Working Party on the Accession of Vietnam.Specific Commitments in Services. Document 06-5203.

WT/ACC/VNM/48/Add.2, October 2, 2006. At https://docs.wto.org/dol2fe/Pages/FE_Search/FE_S_S009-

DP.aspx?language=E&CatalogueIdList=58832,73186,79722,69189,35890,34226,81439,19189,49647,27347&CurrentCata

logueIdIndex=0&FullTextSearch=

49 Lawyer Vu Le Bang & Cao Tran Nghia. Scope of practice of foreign law firms remains unclear under new Decree.

Vietnam Law & Legal Forum 19 Dec 13. At http://vietnamlawmagazine.vn/news/scope-of-practice-of-foreign-law-firms-

remains-unclear-under-new-decree/0d7e5b9e-3476-4bd9-ab05-91e63b1f1d3a.html.

50Leanne Mezrani. Globals fight protectionist lawyer law. Lawyers Weekly. 28 November, 2012. At

http://www.lawyersweekly.com.au/news/globals-fight-protectionist-lawyer-law.

In Vietnam, there are currently major International and regional law firms in operation, including large firms mainly from

the U.S. and smaller firms from Singapore, Korea and Europe. Most of the offices are located in Hanoi and Ho Chi Minh

City, typically employing 10 lawyers in each office and smaller firms may have 2-5 lawyers per office. The clients of these

foreign law firms are mainly foreign companies investing or trading in Vietnam and conduct advisory and transactional

work. The presence of these law firms has had a dramatic positive impact on the local legal profession, employing local

law graduates under the new rules. These graduates undergo training under foreign lawyers and are exposed them to

legal services at international standards. When later law allowed foreign law firms to hire Vietnamese lawyers to advise

on Vietnamese law, these local lawyers had the opportunity to provide the quality of legal services that were expected

of top international lawyers. In turn, the business community had increased level of expectation of the services

provided by law firms in the Vietnamese legal market.51

Overall, the opportunities for legal services by foreign law firms appear promising. Foreign direct investments to

Vietnam have been increasing and are expected to increase further with several upcoming partnerships. Foreign

investments into Vietnam would be further stimulated when the Trans-Pacific Partnership is signed, with the finalization

of several bilateral treaties with individual countries, and the implementation of theRegional Comprehensive Economic

Partnership (RCEP), the ASEAN Framework Agreement in Services (AFAS) along with the ASEAN Economic Community

(AEC).52 As with Singapore and Malaysia, the presence of international law firms in Vietnam supplying the greatly

needed legal support services for international transactions would bolster confidence among global and ASEAN

investors, as Southeast Asia faces the economic impact of eliminating tariffs and encouraging the free flow of goods and

services.

If the laws regulating the practice of foreign lawyers in Vietnam continue to be supportive and to shy away from

protectionist measures and if Vietnam can maintain the momentum of global interest with increasing incoming FDIs -

these factors, along with GDP growth of over 5.5%, a young dynamic population,a rising middle class, and a vibrant

manufacturing sector53–all point to encouraging prospects for the legal market in Vietnam provided by both foreign and

local law practitioners and firms.

51

E. Ann Black and Gary F. Bell p205. Law and Legal Institutions of Asia: Traditions, Adaptations and Innovations, Cambridge

University Press, Jan 25, 2011

52Kent Wong, Trends in Vietnam’s legal market. VCI Legal. Sep 6, 2014.

53J. Grimley, A Comprehensive Guide to the Asia-Pacific Legal Markets, Ark Group, London, 2014, pp. 114-115.

Cross-Border Practice of Law in the European Union

It is tempting to presuppose that the cross-border practice of law in the European Union is more straight-forward

compared to the situation in ASEAN. Some of these presumptions may be based on the perception that compared to

ASEAN, the EU is more homogeneous in contrast to the diversity of cultures and legal traditions of countries in ASEAN

and that in the EU,with a supranational authority with directives covering cross-border practice of law, transnational

mobility of legal professionals is smoother compared to ASEAN which operates more by consensus. The implications of

these presumptions could be that comparisons between ASEAN and EU in the flow of legal services are not valid, that

ASEAN does not wish to be like the EU and that if the pace of cross-border practice of lawin ASEAN is grindingly slow or

has not proceeded, it is understandable because ASEAN is …well… just different.

This paper looks at the background of cross-border law practice in the EU, the influence of the diversity in national

backgrounds, culture, languages and legal traditions, the long and complex process of promulgation of directives, and

the significance and application of these directives to the memberstates.It then examines the reasons why the

presumptions about the EU indicated above may not be supported by facts.

Directly to the issue of cross-border law practice in the European Union, there are a number of observations that

highlight the complexity and diversity in the scope of legal practice, activities and professional stance, linguistic

differences, legal traditions, and evolutionary paths of legal activitiesin the countries of the European Union. These

factors point to the difficulties and the long, arduous process involved in trying a develop a unified approach to the

cross-border practice of lawyers in the EU, raising doubts early on about the feasibility of a unified approach at all - in

the midst of such diversity. The discussions and references are in the later sections but some of the major points

regarding the EU and their relevance to ASEAN are summarized here:

1. Although the provisions on the free movement of persons insofar as they concern those who are economically

active, the freedom of establishment and the freedom of movement of services were all found in the original

Treaty of Romein 1957, some EU member states interpreted the provisions on the freedom of movement of

services to apply to professionals EXCEPT legal professionals.

2. The exclusion of legal professionals from the provisions on the free movement of professionals and services had

to do with theTreaty of the EC signed in Rome in 1957, written in French, where Article 48 of the Treaty on the

free movement of workers, specified in Section 4 – The provisions of this Article shall not apply to employment

in the public service– (“l'administrationpublique”). This was further amplified in Article 55 – that the exclusion

from right of establishmentexcluded those involved in activities…connected, even occasionally, with the exercise

of official authority, - (“même a titreoccasionnel, à l'exercice de l'autoritépublique”)–and that this exclusionary

clause included legal services and professionals.

3. The exclusion of legal professionals was the result of different interpretations of the application of the exclusion

clause, complicated by diversity - the wide differences between member states in the scope of legal practice,

differences in approach tospecific legal activities versus the legal profession as a whole, the linguistic differences

applied to the titles and functions of legal practitioners, the differences in training, structure and function of

legal practitioners, the differences in legal traditions that had many centuries of history, and the divergent paths

of evolution of legal practice and separations of legal functions in different countries of the EU. The perception

that in some countries, legal practitioners were involved in the “exercise of official authority” – led to the

opinion by some member states that the Article 55 exclusion from freedom of establishment in the EU applied

to the whole of the legal profession.

4. It took 20 years after the Treaty of Rome, for case law to defeat the claims that the lawyers’ profession fell

within the Article 45 exception of official authority - in the Rayners judgment by the European Court of Justice

(ECJ) in June 1974, and for the lawyer’s profession to be considered within the scope of freedom of

establishment.

5. Eventually in 1977, the European Community legislators adopted a Legal Service Directive that applied to the

lawyers from any Member State when providing services in any other state than their home Member

State.More than 10 years after the first Directive, the Directive on Mutual Recognition of Diplomas of lawyers

was passed in 1989 and much later, the Freedom of Establishment Directive was passed in 1998 and

implemented in 2000.

6. Directivesin the EU are the result of lengthy deliberations, discussions, exchanges of opinions from each of the

member states – and thus the result of achieving consensus and agreement by the Member states through their

representatives. They became Directives because the Member states wished them to be so. Still, Directives

leave the choice of form and methods to the Member States to achieve a result. Efforts to scrutinize, debate

ordetail fine points in Directives arenot productive in speeding up the acceptability and implementation of the

legislation they cover. Ultimately, it is up to the Member States and their representatives to agree upon a

common body of principles, and to reflect these principles in their national rules and institutions. It is not having

a supra-national authority that will put these principles into practice.

7. Similarly, the countries of ASEAN, through their representatives, can agree upon a common goal to facilitate the

cross-border practice of lawyers, including the mechanisms, methods and monitoring tools for its

implementation, without having to invoke the need for an over-arching supranational body. The issues boil

down to: Do the ASEAN member states consider: - that cross-border practice of lawyers can facilitate

integration of the ASEAN Economic Community? - that cross-border practice of lawyers can lead to greater

understanding among ASEAN members of each other’s legal structures and practices while respecting diversity

and sovereignty of the member states? – that cross-border practice of lawyers can help bring out synergy in

trade and commerce and allow ASEAN countries to more fully realize the benefits of building an Economic

Community? - that the participation of lawyers in the free flow of services would be an important, or in fact

critical, accompaniment to the free flow of goods?- that in the era of globalization of legal practice in the face of

globalization of trade and investments, the cross-border practice of lawyers could expand the opportunities

instead of threatening the practices of lawyers in individual countries of ASEAN? If the benefits of cross-border

practice of lawyers are clear, what should or could impede its implementation in ASEAN? If there is a common

will, there are ways to implement the cross-border practice of lawyers in ASEAN.

A very important expression of this common will in ASEAN was to agree to have one, and only one, official language –

English – despite the myriad of major languages and dialects of the 10 member countries in ASEAN. ASEAN

representatives of the past have to be congratulated for this merciful decision, for their pragmatism that had risen over

national pride and stubbornness.

Diversity of Language and Culture and their impact on the Law of the EU

In contrast to ASEAN, the EU has 24 official languages! Even though strong reasons have been expressed repeatedly in the

past to have only one official language or at least a few, this is not likely to happen in the EU in our lifetime. The official

languages are the result of unanimous decisions by the Council of the EU, where all EU Member States are

represented – currently 28 member countries with the accession of Croatia in 2013and with 6 more candidate

countries in process. Before accession into the EU, the future Member State indicates which language it wishes to

use as an official language for purposes of the EU. Subsequent to this, any change, such as adding a new official

language or removing a current language — requires the unanimous approval by all Member States in the Council

of the EU.54

The current budget of the EU Administrative offices in translations alone – has reached more than 1 billion euros a year

and the demand in the translation industry in the EU countries as a whole has grown from 8.4 billion euros in 2008 up to

10 billion euros by 2012.55Even the European Commission itself employs around 3000 staff translators and

interpreters.But the seriousness of this linguistic diversity is far more than the euro cost alone. The diversity of language in

the EU, itself a product of and a reflection of diversity of culture and legal traditions, affects the promulgation and

interpretation of legislation.56

The circuitous path to cross-border practice of lawyers in the EU – Effect of Diversity of

Language and Legal Traditions

To illustrate, we can trace the process of the cross-border practice of lawyers in the EU - particularly the impact of

differences in linguistic structure and Interpretation, the effect of these linguistic differences on legislation on the cross-

border practice of law, the numerous factors - including long held legal traditions, attitudes, and national character that

affected the cross-border practice of law and the inextricable links between language, culture and the law.

Starting with the Treaty of the EC (TEC) or Treaty of Rome signed in 1957, this was written in French and otherwise only

available in Italian and Dutch.57The Treaty of Rome, Title III, Chapter 1, Article 48 on the Freedom of Movement of

Workers, included a provision in Section 4 – “Les dispositions du présent article ne sont pas applicables aux

emploiedansl'administrationpublique” – The provisions of this Article shall not apply to employment in the public service.

Furthermore, in Chapter 2, on the Right of Establishment, Article 55 states “Sontexceptées de l'application des dispositions

du présentchapitre, en ce qui concernel'Etatmembreintéressé, les activités participant

54Languages in Europe, EU Business 26 September 2013. At http://www.eubusiness.com/topics/Languages/languages-

day-13.

55 The Translation Industry and the European Union Dublin City Univ. Industry News, Language, Translation, 13 Sep

2013.At http://dculs.dcu.ie/dcu-language-services-news/the-translation-industry-and-the-european-union/

56DesislavaSlavcheva. Translation in the European Union- Facts and Figures. At http://one-europe.info/translation-in-

the-european-union-facts-and-figures.

57Treaty of Rome. At http://www.cvce.eu/en/obj/treaty_establishing_the_european_economic_community_rome_

25_march_1957 -en-cca6ba28-0bf3-4ce6-8a76-6b0b3252696e.html; At http://ec.europa.eu/archives/emu_history/

documents / treaties/rometreaty2.pdf

danscetEtat, même a titreoccasionnel, à l'exercice de l'autoritépublique” - The provisions of this Chapter shall not apply,

so far as any given Member State is concerned, to activities which in that State are connected, even occasionally, with the

exercise of official authority.

These articles were later embodied as Article 45 and Article 51 in the Treaty on the Functioning of the EU (TFEU) in the

Treaty of Lisbon (2007) and the consolidated TFEU version of 2012. 58In this paper, we will continue to refer to this

exclusionary clause as the “Article 55 Exclusion.”These provisions revolved around the meanings of the terms

l'administrationpublique,” “l'autoritépublique”and “même a titreoccasionnel” –that led to the exclusion of the legal

profession as a whole in the clauses on freedom of movement in the Treaty of Rome.

The complexity of linguistics and juridical interpretation can also be found in the 1977council directive 77/249/CEE to

facilitate the effective exercise by lawyers of freedom to provide services, also written in French: “Directive du Conseil du

22 mars 1977 tendant à faciliterl'exerciceeffectif de la libreprestation de services par les avocats.59”

The operative word – “avocat” – was defined in French, as signifying in different countries the different legal practitioners.

If translated into English, would read as follows: 'Lawyer' means any person entitled to pursue his professional activities

under one of the following designations:

Belgium –Advocat, Advocaat; Denmark – Advokat; Germany – Rechtsanwalt; France – Avocat; Ireland – Barrister,

Solicitor; Italy – Avvocato; Luxembourg – Avocat-avoué; Netherlands – Advocaat; United Kingdom – Advocate,

Barrister, Solicitor.

At the time Directive 77/249/EC was being formulated, there were differences in interpretation that seemed irreconcilable

- partly linguistic and partly juridical. But at an even more fundamental level, it raised the question of whether there was

such a thing as a “European legal profession” at all.60The Directive assumed that a profession of “avocat” and its

equivalent existed in all the Member States. At first glance this could have been a reasonable assumption since the same

or similar word to “avocat” was used in most of the member states. In Scotland and Denmark, the legal profession came

from similar avocat roots. The role of the English and Irish barrister could be analogous to the French avocat dating back

to pre-revolutionary France, with limited access to clients, whereas the solicitor would be more analogous to the old

French avoué. However, since the 1970s in France, the role of the avoué was fused with the avocat, while the French

avocats may act as avocatplaidant (litigators, trial lawyers) and avocat-conseil (advising lawyers, legal consultants). This

left the English and Irish “solicitors” at a loss of analogies under the Directive.

In Germany, the “Rechtsanwalt” act as general lawyers with the ability to plead at all courts. An exception is the practice

of lawyers of the Federal Court of Justice (Bundesgerichtshof) who may not plead at other courts, deal almost exclusively

with litigation, and usually are brought in by a lawyer who represented the client in the lower courts. These differences do

not apply for the German Rechtsanwalt in the EU court system, criminal cases, or in pleadings at courts in administration,

labor, taxation and social services.

58Consolidated Treaty on the Functioning of the European Union as amended by the Treaty of Lisbon (2007). At http://eur-

lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:12012E/TXT&from=en;

http://www.eudemocrats.org/fileadmin/user_upload/Documents/D-Reader_friendly_latest%20version.pdf.

59Council Directive 77/249/EEC of 22 March 1977 to facilitate the effective exercise by lawyers of freedom to provide

services. At http://eur-lex.europa.eu/legal-content/EN/ALL/?uri=CELEX:31977L0249.

60David Edward. The legal profession in the community. 1983. At http://www.law.du.edu/documents/judge-david-

edward-oral-history/1983-legal-professional-in-the-community.pdf.

But particularly problematicwas the “public role” of the Rechtsanwalt because the training, structure and functions of the

profession of the Rechtsanwaltwere within a system organized by the state. As a result, under Directive 77/249/EC, the

profession as a whole was considered to fall within the terms of Article 55 exclusion, which excludes from application of

the Chapters dealingwith freedom of establishment and services,"activities. ..connected, even occasionally, with the

exercise of official authority" – under the meaning of l'administrationpublique” and “ l'autoritépublique.”

Case of Reyners v Belgian State – defeating nationality as a bar to cross-border practice of

law. It took 20 years after the Treaty of Rome, for case law to eventually challenge and defeat the claims that the lawyers’

profession fell within the Article 45 exception due to exercise of official authority. The case of Jean Reynersv Belgian State

in 1974 involveda lawyer who was denied the right to practice law in Belgium because of his nationality - he was not a

Belgian citizen.61Plaintiff Reyners was born in Brussels of Dutch parents and retained Dutch nationality. He had been a

resident in Belgium, educated in Belgium and obtained the degree of “Docteur en DroitBelge” - Doctor of Laws in

Belgium. However, the respondent Belgian State did not allow Reyners to practice the profession because he was not of

Belgian nationality. Under Belgian national law since year 1919, no one may hold the title of avocat nor practice that

profession unless he is a Belgian citizen. Moreover, on the freedom of establishment exclusion under Article 55, the

Belgian State argued that the avocatsfall under that exclusion so that Dutch nationals cannot be recognized as having the

freedom to establish themselves as ‘avocat’ in Belgium.

For Mr. Reyners, a dispensation from the requirement of Belgian nationality could have been granted by the King, on the

advice of the General Council of the Ordre des avocats, which Mr. Reyners failed to obtain. He then brought an action for

annulment of state provisions of requirement of nationality on the grounds that they violated Articles 52 to 55 of the

Treaty of Rome. Under Chapter 2 - The Right of Establishment, Article 52 - “… restrictions on the freedom of

establishment of nationals of a Member State in the territory of another Member State shall be progressively abolished in

the course of the transitional period.” Since the case of Reyners involved interpretation of EU law, the Conseild’État of

Belgium (Supreme Court of Belgium) brought the case before the European Court of Justice on two questions:

Question 1: What is to be understood by ‘activities which in that State are connected, even occasionally, with the

exercise of official authority’ within the meaning of Article 55 of the Treaty of Rome?

Question 2: Is Article 52 of the Treaty of Rome….. a ‘directly applicableprovision’, despite, in particular, the absence of

directives as prescribed by Articles 54 (2) and 57 (1) of thesaid Treaty?

Answer to Question 1: “Article 55 refers not to professions but only to activities. The concept of activities connected with

the exercise of official authority relates to activities involving particular powers of public law, which arenormally vested

61Jean Reyners v Belgian State. Judgment of the Court of 21 June 1974. At http://eur-lex.europa.eu/legal-

content/EN/TXT/PDF/?uri=CELEX:61974CJ0002&qid=1421507615370&from=EN

only in public officials, but which can in certain cases likewise be accorded to otherpersons. These powers of a legislative,

executive or judicial nature generally involve a certain power ofdecision or of issuing orders and entail obligations and

responsibilities; their exercise is controlled andcircumscribed with guarantees; the grant of these powers normally takes

place by nomination orappointment by the public authority. The normal activities of the avocat do not satisfy these

criteria andcannot therefore be regarded as connected with the exercise of official authority.”

Further: “The fact that the avocat may occasionally be called upon to exercise a part of official authority is irrelevant, since

these activities are not at all necessary for the practice of the profession.. Finally it must be considered that an avocat can

practise his profession normally even if he cannot exercise certain functions of official authority.”

Answer to Question 2: “…the question of the direct effect of Article 52 relates only to the condition of nationality as a

restriction on the freedom of establishment. …. Article 52 is a clear, precise and unconditional provision; ….it has become

directly applicable and replaces measures which should have been taken to eliminate the discriminations which it

prohibits. …The second question must therefore receive an affirmative reply as regards the prohibition on discrimination

based on nationality.”

The Court of Justice comments further:

“The condition of nationality as a condition for access to the profession of avocat is in truth founded on

the fear of foreign competition.”

The Reyners case was instrumental in reversing the exclusion of lawyers from the provisions on the free movement of

persons, the freedom of establishment and the freedom of movement of services and paved the way for cross-

border practice of lawyers in the EU.

The process of “Co-Decision” for promulgation and interpretation of legislation in the EU. At its foundation, the EU Treaties reflected the overall goals of EU member states to form an integrated community

based on the rule of law. Every action taken by the EU is founded on treaties that have been approved voluntarily and

democratically by all EU member countries.

The process of developing legislation in the form of regulations, directives and decision reflects the will of the member

states. Clearly the EU at various levels also operates as a consensual body. Specifically, the EU Directives, including

those covering the cross-border practice of law, were the result of extensive discussions and opinions from the different

member states and became Directives only because it was a common decision of representatives of the member states.

The EU’s standard decision-making procedure known as 'Ordinary Legislative Procedure’ (or "codecision") under the

Treaty of Lisbon was signed in 2007. This process of “co-decision” required that the directly elected European

Parliament along with the Council of the European Union (the governments of the 28 EU countries)62 approve drafts by

the European Commission in the process of developing EU legislation.

EU case-law is made up of judgments from the European Union's Court of Justice, which interpret EU legislation.

In addition, the EU Court of Justice (ECJ) is assisted by Advocates-General, a system taken from the French legal

process. The EU has eight Advocates-Generalwho deliver reasoned opinions on the cases brought before the ECJ and

must do so in an open and impartial manner. Advocates-General have the same qualifications as the Judges in the

Court of Justice. Their opinions are structured in the same way as a judgment, but are not binding on the parties to

62

Not to be confused with: European Council – which is another EU institution, where EU leaders meet around 4 times a year to discuss the EU’s political priorities and the Council of Europe – which is not an EU body at all. Council of the European Union. At http://europa.eu/about-eu/institutions-bodies/council-eu/index_en.htm.

the dispute or on the Judges of the ECJ. However, these opinions carry considerable weight and ECJ judges tend to

follow those opinions.63

In the landmark case of Reyners v Belgian State on the issue of nationality in the cross-border practice of law, the

‘reasoned and impartial opinion” of Advocate-General Mayras was clearly followed in the ultimate judgment of the

ECJ.64

Traditionally, lawyers practice law in the country where they completed their legal studies. This traditional practice of

legal professionals is slowly being reformed in the EU (European Union) legal setting gearing towards a slow economic

integration of EU Member States. EU lawyers believed that they will highly benefit such integration as they will be able

to practice their profession in an EU Member country in addition to the country where they have obtained their legal

education and license.

In reality this mobility through integration was difficult to achieve in the EU because it required a great harmonization of

different legal and ethical standards amongst EU member countries. The Treaty of Rome written on March 25, 1957by

representatives of the founding states was the result of an agreement and affirmation of the creation of a unified and

solid alliance of countries in EU. The treaty established a primary goal of the EU - the creation of an internal market

without internal frontiers where goods and services are traded freely and easily. It is ironic that although the Treaty of

Rome clearly saw the movement of services and professionals as a necessary accompaniment of the free flow of goods,

the diversity of legal traditions led to the exclusion of legal practice and lawyers from movement of services andright of

Establishment. Case Law and directives that followed soon corrected the course to include lawyers and law firms in the

free mobility of professionals and services.65

Directives on cross-border practice of law in the EU.

After the landmark Reyners case in 1974 recognizing that the legal profession was part of the freedom of movement of

professionals and freedom of establishment, three directives were passed on mobility of legal services and

professionals.

I. In 1977, the Community legislator adopted a Legal Services Directive (77/249). The directive applied to the

temporary provision of cross-border services within the EU (but did not address the permanent

establishment in another Member State) The two activities of ‘services’ and ‘establishment’ are mutually

exclusive; a lawyer operating in another Member State must be within one or the other category, but

cannot be simultaneously in both.This directivecoveredthe situation of the lawyer undertaking only

temporary and occasional legal work, without permanent establishment of an office in the other Member

State.

63T. Tridimas, The role of the Advocate General in the development of community law: some reflections, in 34 Common

MARKET Law Review, 1997, pp. 1349-1387; What is an Advocate-General. At http://www.eu-

oplysningen.dk/euo_en/spsv/all/51/

64Opinion of Mr Advocate General Mayras, 28 May 1974. At http://eur-lex.europa.eu/legal-

content/EN/TXT/?qid=1421632428342&uri=CELEX:61974CC0002.

65Evaluation of the Legal Framework for the FreeMovement of Lawyers Final Report. Project number: BA03973

European Commission, DG Internal Market and Services (MARKT/2011/071/E), November 28, 2012

II. Next, in 1989 the Council adopted Directive (89/48) on the Mutual Recognition of Diplomas, which among

others also applied to the lawyer’s profession. The directive ‘mutual recognition’ relates to the recognition

of the lawyer’s home qualifications in the process of admission to the bar, or the acquisition of the lawyer

title in the other Member State, without necessarily moving to that State. The basic conditions in the

directive included completion of at least three years education and the necessary professional training. The

recognition of diplomas was not automatic but this directive allowed lawyers to acquire the professional

title of lawyer in another Member State more easily than before, where instead of having to re-qualify fully

for the Bar or Law Society in that other Member State, the migrating lawyer would only have to pass an

aptitude test given by the relevant professional body in order to acquire the title of lawyer in that state.

III. The previous two directives still left unanswered the implementation of the right to establishment under the

Treaty of Rome by lawyers crossing borders in the EU. During this period, the need to respond to the

growing demand for lawyers to establish their law practices across borders in the EU became clear as

illustrated in several ECJ cases,particularly: the Gullung casein 1988 involving a French-German national

where the court decided that a member-State whose law requires advocates to become members of a Bar

may require the same of advocates from other member-States who use the right of establishment

guaranteed by the EEC Treaty to establish themselves as advocates in that State66 ; and the Gebhard case in

1995 involving a German national and ‘Rechtsanwalt’who carried out professional legal activities in Italy on a

permanent basis while using the title of ‘avvocato.’ The court’s opinion distinguished legal practice in

another state which is temporary (covered by provisions on services) and those carried out on a stable and

continuous basis (under the provisions for ‘establishment’) as being subject to different rules.67Eventually,

after 20 years of controversies, the Establishment Directive (98/5)was adopted in 1998. The term

‘establishment’ referred to the permanent transfer of the lawyer to anotherMember State to carry outstable

and continuous legal work there. Under the provisions of this directive, qualified lawyers may establish legal

practices in other Member Statesusing their home Member State title without any examinations or control

of competencies. These established lawyers from another Member State are then permitted to practice

home law, host law and third country law. A lawyer from another Member State may appear before the

courts of the host state, but they may be required to be accompanied by a local lawyer, if such appearance

under host court rules is reserved to lawyers in the host Member State.The directive also opened another

path for lawyers coming from another Member-State: they may apply to be included into the host Member

State’s legal community after havingregularly practiced law in that state. The Establishment Directive(98/5),

on top of the two previous directives, pushed further the liberalization of legal services across the borders of

individual countrieswithin the EU.

66

Claude Gullung v Conseil de l’Ordre des Avocat de Colmar etSaverne. At http://www.biicl.org/files/1974_c-292-86.pdf.

67Gebhard v Consigliodell’OrdinedegliAvvocati e Procuratori di Milano.At http://eur-lex.europa.eu/legal-

content/EN/TXT/PDF/?isOldUri=true&uri=CELEX:61994CJ0055.

Legal, Cultural, Ethnic and Religious Diversity in the EU. The development of cross-border practice of law in the EU addressed in treaties, directives and case law is

quite a monumental achievement considering the wide diversity in legal, linguistic, cultural, ethnic, religious

and political characteristics of the 28 countries currently in the EU. The differences in legal traditions in

Europe are much deeper than the often discussed differences between common law vs civil law traditions.

The European countries havea long history of evolution and divergence over centuries, creating unique

combinations of dominant legal influences and local legal structures in city -states, dating back from the legal

system of ancient Rome,68 and the legal developments spanning over a thousand years of jurisprudence, from

the Roman civil law before 700 BC, to the 12 Tables in 449 BC, to the Corpus JurisCivilisin AD 529,69continuing

to middle ages and the modern era and reflected in the continuing use of Latin in legal terminology. 70

The Greek legal system has its roots in the law, decrees and customs dating back to 1000 BC that laid the

foundations of democratic systems that flourished around 500 BC with three main institutions including an

Assembly of citizens, a Council of government officials, and a People’s Court.71 Legislation was developed by

both the Assembly and the Council, with ad hoc Boards of Lawmakers. The Court system had its rules and

procedures for trials in civil and criminal matters, and rules on introduction of evidence. The ancient Greek

legal systems also introduced dispute settlement through mediation or arbitration between the

parties.72Conflicts between states were put through a system of arbitration to maintain peaceful coexistence

and cooperation. Treaties signed between states typically included arbitration clauses. The ancient Greek

legal system already had characteristics that resemble modern international law. The influence of the Greek

system continued throughout the decline of the Roman system in the Byzantine Empire (331–1453), that led

for the first time in history, the codification of laws during the reign of Emperor Justinian in 527 AD and the

organization and simplification of Civil Codes during the reign of Emperor Leo VI of the Macedonian Dynasty

in 892 AD, such that in 7th century onward, the legal language in the East was Greek.

In the mid-15th century, Greece along with several countries in South-Eastern Europe (including some countries now part

of the EU - Hungary, Romania, Bulgaria, and Croatia and some countries now candidate for EU accession –Turkey,

Macedonia, Serbia, Montenegro, Herzegovina, and Bosnia) were part of the Ottoman Turkish dynasty that fought on

behalf of the Islamic faith. During this period, the Ottoman Empire became the most powerful Islamic state.

68

Peter Stein, Roman Law in European History. Cambridge University Press, 1999.

69JenőSzmodis: The Reality of the Law—From the Etruscan Religion to the Postmodern Theories of Law; Ed.

Kairosz, Budapest, 2005.

70David B. Goldman. Globalization and the western legal tradition.Recurring patterns of law and authority. Cambridge Univ. Press.

2008.

71Christopher W. Blackwell, Athenian Democracy: a brief overview. inAdriaanLanni, ed., “Athenian Law in its Democratic Context”

C.W. Blackwell, ed., Dēmos: Classical Athenian Democracy (A. Mahoney and R. Scaife, edd. edition of February 28, 2003. At

http://www.stoa.org/projects/demos/article_democracy_overview?page=all

72Maria Panezi. A Description of the Structure of the Hellenic Republic, the Greek Legal System, and Legal Research. Hauser Global

Law School Program, New York University School of Law, March 2013. At http://www.nyulawglobal.org/globalex/greece1.htm

Being a theocratic state, the Ottoman Empire was governed by Muslims according to Islamic Law. The form of

governance was based on the millet system, which was part of the Islamic religious legal system. The millet system also

involved religious tolerance and allowed for peaceful coexistence of different nationalities and religious groups,

including Christians and Jews. As long as they were obedient and paid taxes, the non-Muslim populations were allowed

to continue their religious practices, maintain their legal structures and traditions and to administer their own affairs.

Thus the millet system itself was a highly heterogeneous mix of legal and religious structures that influenced the

traditions of many countries that are currentlyMember-States of the EU and that carried influences from Islamic Law

dating back from the middle ages.73

This is the same Ottoman empire that stretched its influence to Southeast Asia –particularly the ASEAN countries of

Indonesia, Malaysia, Brunei, Singapore and the southern parts of Thailand and the Philippines. Ottoman records

document that in the 16th century, military personnel were sent to Aceh in Sumatra to help in the fight against the

Portuguese. Many Malay pilgrims from Southeast Asia went to countries under Ottoman control dating back from the

early 16th century. Malay states turned to Islamic Turkey for support during the period of European colonial expansion

in the 19th century. Demands for intervention from Southeast Asia were thought to have a role in the Ottoman policy of

Pan-Islamismand the promotion of Muslim solidarity worldwide.74

The influences of Islam on European legal history were partly the result of Islamic territorial rule over major parts of

Europe, extending to Sicily and Spain, and partly due to economic interests in transnational commercial law. Islam as a

factor in European legal history, dates back to the 10th century, extending its influence in the development of

international law, transnational contract law and the law of trade relations.75 Thus, in addition to the various forms of

legal structures that combined local national legal systems with Greco-Roman traditions, Islamic legal principles and

legal terms contributed further to the rich diversity of European law. The Norman conquest of Sicily in the 1060s, led to

the adoption of a new mix of Arab-Norman law which is thought to have extended its influence to England through the

administrators in Norman England. The extent of Islamic influence on British law is currently being discussed by legal

historians.76

Aside from South-Eastern Europe, waves of migration of Muslims extended into Western Europe in succeeding eras, so

that currently, it is estimated that the total Muslim population, including immigrant and native born, in Western Europe

is about 20 million of the EU's 500 million residents. The EU countries with the largest estimated percentages of

Muslims are France at 8 percent, Netherlands at 6 percent, Germany at 4 percent, and the UK at 3 percent of the

population. Some major EU cities have Muslim populations that exceed 20 percent.77

73

Richard Potz. Islam and Islamic Law in European Legal History. Original in German. European History Online, 21 Nov 2011. At

http://ieg-ego.eu/en/threads/models-and-stereotypes/from-the-turkish-menace-to-orientalism/richard-potz-islam-and-islamic-law-

in-european-legal-history.

74Andrew Peacock and Annabel Teh Gallop. From Anatolia to Aceh: Ottomans, Turks, and Southeast Asia. Proceedings of the British

Academy Vol. 200. January 2015

75Alex Metcalfe. Norman conquest of muslimsicily. Edinburgh University Press, 2009.At

https://www.academia.edu/3024957/The_Muslims_of_medieval_Italy_5_the_Norman_conquest_of_Sicily.

76MukulDevichand. Is English law related to Muslim law? New Magazine UK. 24 Sep 2008. At

http://news.bbc.co.uk/2/hi/uk_news/magazine/7631388.stm

77Toni Johnson. Europe: Integrating Islam. Council on Foreign Relations. July 25, 2011 At

http://www.cfr.org/religion/europe-integrating-islam/p8252

If Turkey, a candidate for EU accession, succeeds in entering the EU, that by itself would mean a 70 million increase in

the Muslim population of the EU. It is a great challenge for the EU community to address the integration of Muslims

into society and to respond to the calls for the use of Sharia law in Europe.78

Lawyers crossing borders within the EU, have to deal with the great diversity in legal systems, linguistics,

culture, ethnicity and religion. Thus, many of the issues involved in ASEAN integration are not alien to the EU,

including Islamic law. The different legal traditions of major European countries, especially England, France, Spain,

Portugal, and the Netherlands that had long histories of colonizing many of the countries in ASEAN, exertedmajor

influences on the legal structures of many of the ASEAN member countries themselves. In the case of the Philippines, the

influence of the legal and administrative structure of Spain was further influenced by the US legal structure, which in turn

had its roots in England. It is only stands to reason that the understanding of these differences between the major legal

traditions of Europe and the US also gives us some insights of where individual countries in ASEAN were in the past, and

where they may be headed in the future.

Experience of cross-border practice of lawyers in the EU. The experience of the EU in cross-border practice of law, which by now has spanned more than twenty-five years, has

been, to date, a positive one.79Even considering the controversial cases, some of which were outlined above, there have

no serious disciplinary, ethical or other problems that have arisen out of the transnational practice of lawyers and law

firms in the EU. There are peripheral issues such as those related to professional indemnity insurance across borders,

and the conflicting rules of ethical conduct that affect EU lawyers whenever they cross a national borders and carries the

potential for lawyers to face disciplinary action both in their home and host jurisdictions - the concept of ‘double

deontology’, which is being tackled by the CCBE (now known as Council of Bars and Law Societies of Europe).80

The EU experience issimilar in some ways to the cross-state movement of US attorneys in that the lawyers concerned

are regulated by different authorities in both cases. However, as outlined above, the situation in the EU is much more

complicated, with different languages, different legal systems, different cultural approaches, different historical roots

and different sovereign countries involved.

78Zdenek Kuhn. The Judiciary in central and western Europe. Mechanical jurisprudence in

transformation.MaritnusNijhoff Publishers. 2011.

79 Cross-Border Practice in the European Union: Jonathan Goldsmith, Secretary-General, CCBE, Brussels. In

Transatlantic Dialogues in Law and Practice, American Bar Association Section of International Law and Practice,

Brussels, October 17, 2003. At http://apps.americanbar.org/intlaw/hubs/programs/Fall0311.01-11.04.pdf

80 Matthew T. Nagel. Double Deontology and the CCBE: Harmonizing the Double Trouble in Europe. 6 Wash. U. Global

Stud. L. Rev. 455, 2007. At

http://openscholarship.wustl.edu/cgi/viewcontent.cgi?article=1143&context=law_globalstudies.

In spite of the complexity, apprehensions expressed in the process of liberalization that cross-border practice of law

would lead to serious ethical problems and unregulated or uncontrollable practice patterns have been proven to be

unfounded. When there were cross-border disciplinary issues, discussions between bar officials of countries involved

were effective in resolving these matters.81The three Directives on mobility of legal services and practitioners outlined

above also provided for professional rules being applied and led to development of cooperation between bars in

different EU Member States.82

The experience of the EU in handling diversity with respect to thecross-border practice of law emphasizes the fact that

the process of decision making through consensus of all the member states is very much a characteristic of the EU. As a

matter of principle, the EU is based on “the rule of law: everything that it does is founded on treaties, voluntarily and

democratically agreed by all member countries.83”

But integration in the EU did not mean erasing the distinct cultural and linguistic identities of the individual member states. On the

contrary, the EU actively promotes regional specialties and seeks to maintain the rich diversity of Europe’s traditions and cultures.

The statements about ‘regional specialties’ are not mere empty words because it goes to the heart of the Principle ofSynergy in

economic terms.

Based upon their economic analyses of the consequences of economic integration in the EU, Hacker et al noted that the

positive effects of synergy can take place only under the following conditions: 1) High Permeability or openness of cross-

border transfer of goods and services, and 2) Asymmetry (in specializations, costs, development level, etc.) between two

sides of the border.84 They conclude that even when the borders have high permeability but the asymmetry between

areas is low, the contribution of the border itself as an economic factor of growth - is simply neutral. These are

important lessons for ASEAN in achieving synergy for optimizing economic growth in the region. Diversity (or

‘asymmetry’), rather than being a hindrance, can be used to promote synergistic effects by alignment towards common

goals for promotion of economic growth.

Interestingly, the principles of permeability and asymmetry have long been observed in chemistry, pharmacodynamics,

cancer chemotherapy, molecular biology and cell biology. To achieve synergy, the components have to interact strongly

and be differentbutcomplementary in their contributions to the desired effect.

81JulijaLaureckaite The Exercise of freedom of establishment by lawyers within the EU. Univ. of Lund. 2006. At

http://www.researchgate.net/publication/41783675_The_Exercise_of_Freedom_of_Establishment_by_Lawyers_within

_the_EU.

82 S.J.F.J. Claessens et al. Evaluation of the Legal Framework for the Free Movement of Lawyers: Final Report to the

European Commission. Zoetermeer, Nl. 28 Nov 2012. At

http://ec.europa.eu/internal_market/qualifications/docs/studies/2013-lawyers/report_en.pdf.

83European Union, How the EU works. 2013. http://europa.eu/about-eu/index_en.htm.

84 R. Scott Hacker, Borje Johansson and Charlie Karlsson. Emerging Market Economies and European Economic

Integration p 50. Edward Elgar Publishing Ltd. UK, 2004.

The economic contribution of the legal sector

The growth and economic significance of the legal services sector in the European Union has been reported in 2012 by

the Regulatory Policy Institute in the EU.85 Sustained growth in the legal services market over the past 10 years

accompanied the increase in international trade and greater economic links between countries. In most Member States

of the EU, there has been a significant increase in the number of legal services practitioners with the number of legal

professionals estimated at 1 million in 2010, compared to an estimated 1.2 million lawyers in the United States in 2010.

The growth of legal practitioners in the EU is expected to increase steadily past 2015. There were more than 492,000

legal enterprisesin the EU, estimated in 2009. The estimated value of the legal services market in Europe, as measured

by the total revenues received by law firms, was €113.6 billion in 2010. Total revenues increased by an estimated 10%

(or €10.4 billion) over the five-year period 2005-2010. By 2015, it is estimated that the size of the European legal market

will reach €148.2 billon, representing growth of over 25% compared to 2010 estimates. During this period, the UK had

the largest share of the European legal services market followed closely by Germany. The UK and German legal services

markets accounted for almost 50% of the total estimated revenues of the legal services market in Europe.

The average revenue per lawyer at the EU level was estimated at €110,270in 2010, with the UK and France showing

higher revenues per lawyer compared to the EU average. The total revenues from legal services amounted to about

1.1% ofGDP in 2010 in the five largest European markets, compared to about 1.8% contribution of the legal services

sector to the US economy.86

In the UK, the direct economic contribution of the legal services sector constituted 1.5% of the UK's GDP and provides

wide support of business community. It is estimated that for every 100 jobs in the legal services sector, an additional 67

jobs are supported in other areas of the economy. In 2010, every £1 of output of the UK legal services sector bolster

another £2.39 of output in the UK economy as a whole.87

The ASEAN would do well to monitor the contribution of the legal services sector in economic growth. In particular, the

impact of liberalization of legal services on economic indices including foreign direct investments should be carefully

followed to guide future policies. Empirical research data should be the foundation of decision making, developing into

an “evidence-based legal policy.”

85 George Yarrow and Christopher Decker. Assessing the economic significance of the professional legal services sector

in the European Union. Regulatory Policy Institue, August 2012. At

http://www.ccbe.eu/fileadmin/user_upload/NTCdocument/RPI_study_Yarrow_D1_1348650358.pdf.

86 Id.

87 Robert Bourns. The economic contribution of the legal sector. Policy Exchange, Future of the City Conference, Law

Society 2 Sep 2014. At http://www.lawsociety.org.uk/news/speeches/the-economic-contribution-of-the-legal-sector/

Conclusion:

The goal of ASEAN to proceed with an integrated economic community would need transnational legal services that

facilitate cross-border transactions from within ASEAN and from outside ASEAN. The free flow of goods and services

requires a corresponding mobility of legal services and legal professionals. With economic integration and increased

multinational commercial transactions, the legal consultations, drafting of agreements, legal documentation and

resolution of disputes must also have a multinational dimension. Nationality as a condition for the practice of

commercial law in member countries represents an impediment to the delivery of efficient legal services in support of

economic integration.

The EU has a positive experience of cross-border practice of lawyers spanning more than 25 years, despite great

diversity in language, legal tradition, culture, ethnicity and religion. Diversity can be a strong factor in achieving synergy

in economic terms and in opportunities for cooperation between legal practitioners from different countries. Although

the operation of the ASEAN community is clearly different from the EU, it is not the details of the structure and process

that are most important. Rather, the focus and emphasis should be on the principles underpinning the decision making

process that apply not only to the EU but also to ASEAN: that having an integrated economic community is beneficial to

the individual countries of ASEAN; that the process of integration and achievement of cross-border synergy will require

facilitating free flow of goods and services; that the mobility of legal services and professionals is critical in addressing

the legal support and resolution of disputes that will necessarily increase as a result of increased transnational

commercial activities. If there is a common understanding leading to a common will, the country representatives can

find a way to agree upon the rules and regulations governing the cross-border practice of law in ASEAN.