The Indian Legal Services Market and GATS

The Indian legal service market is still aloof and not open to foreign law firms opening offices in the country. This is not so in case of other sectors like banking, education, hospitality etc. A reading of the provisions of the Advocates Act, 1961 shows that only natural persons who shall be enrolled by any State Bar council and have a law degree from a recognized University and are citizens of India can practice law as a profession. This has been a major hindrance in the entry of foreign law firms into the country. Though, India is a member country of the General Agreement on Trade in Services (GATS), it has not taken enough steps to liberalize the legal service sector. Interaction with foreign firms will definitely help Indian law firms to gain a good reputation and lead to increased pay packages for Indian lawyers. Moreover, Indian firms can stay ahead by outsourcing the foreign firms a part of their operations. Therefore, the time has come for India to open its legal services market for foreign firms.

National Treatment

The national treatment obligation in the General Agreement on Trade in Services (GATS) is wider in scope but more limited in application than that in the General Agreement on Tariffs and Trade (GATT). It is wider in scope because, while national treatment under GATT is concerned with measures affecting products per se, the domain of this obligation in the GATS includes not only measures affecting services products, but also measures affecting service suppliers. It is more limited in application because, while national treatment under the GATT applies across the board, under the GATS it applies only to scheduled sectors, and there too may be subject to limitations. These differences were intended and are well known. An elaboration of the concept of National Treatment would help us gain a better understanding of the reasons behind this approach.