TNAG-2438-FCO40-3543-Hong-Kong-judiciary-appointments-1992 — Page 5

RESTRICTED

XCR(92)11

15

(b)

a scheme of control over foreign lawyers should be instituted, regulating their admission to practise foreign law in Hong Kong and regulating such practice.

The Law Society has acknowledged that the legal profession will undergo changes in the future, and recognized the need for a liberalization of its rules in respect of foreign lawyers and foreign law firms. This significant change in attitude and a willingness to accept greater flexibility has been brought about by a number of factors -

(a)

(b)

(c)

a significant number of leading Hong Kong firms see the necessity for and benefits from flexible commercial arrangements with foreign law firms in order to service local and foreign clients. For instance, to compete for the legal work generated by large scale developments such as PADs, they must be in a position to offer clients advice and service in local and international legal matters;

the Uruguay Round Negotiations for a General Agreement on Trade in Services (GATS), if concluded, will require Hong Kong to put in place non- discriminatory regulatory arrangements; and

Europe in 1992 is forcing England and Wales to open its doors; other countries are also following this trend. The Law Society sees the benefits from a larger market place for legal services, and must be in a position to reciprocate.

In response to these pressures, the Law Society re-examined its stand over foreign lawyers and foreign law firms, and in October 1991 produced the two Reports at Annexes A and B.

Regulation of Foreign Law Firms

16

The "Outline Proposals for the Regulation of Foreign Lawyers and Foreign Law Firms" (Annex A), will apply to all foreign lawyers and foreign law firms, including those from the United Kingdom, which at present are automatically admitted to practise Hong Kong and foreign law. The Report proposes to -

(a)

regulate foreign lawyers and law firms practising law in Hong Kong;