Foreign law firms in India: evolution, regulation and the road ahead

Pintu Babu

Nishith Desai Associates, Mumbai
p.babu@nishithdesai.com

For over three decades, the debate on whether foreign law firms should be allowed to practice in India has been central to the discussions on the liberalisation of India’s legal sector. India’s fast-growing economy and its increasing integration with leading global markets have created demand for the provision of sophisticated legal services. The Indian legal sector market is estimated to be worth around $2.49bn in 2025 and is forecast to grow to about $3.37bn by 2030, at a compound annual growth rate (CAGR) of approximately 6.2 per cent.[1]

Yet, regulatory and professional resistance, largely driven by protectionist concerns within the domestic bar, has historically limited foreign participation in the provision of legal services and various Indian court rulings have reinforced this approach. During the past few years, however, a fundamental shift has occurred. As of 2025, foreign law firms and foreign lawyers are permitted to practice foreign or international law in India, subject to certain conditions. This article examines the evolution of this policy shift, analyses its regulatory contours and assesses its implications for the future of India’s legal sector.

The background

India’s economic liberalisation, which began in the early 1990s, opened the country up to foreign investment that created a growing need for cross-border legal expertise. In response, several foreign law firms applied for and obtained the Reserve Bank of India’s (RBI) approval to establish liaison offices in order to carry out business development activities in the country.[2]

However, in 1995, the Lawyers Collective, an Indian public interest organisation, filed a petition[3] before the Bombay High Court challenging the entry into the country of such foreign law firms. The case, which took nearly 15 years to reach a final judgment in 2009, held that the practice of law in India, whether litigious or transactional, was reserved only for Indian enrolled advocates under the Advocates Act 1961, the main law which governs the practice of law in India, and that the foreign firms in question had violated that law.

Interestingly, while the Lawyers Collective litigation was underway, certain foreign law firms simultaneously began searching for ways to engage with the Indian market without formally entering into it. A number of firms set up India-focused desks located in global hubs, such as Singapore and London,[4] using these offices to provide advice on India-related work. Other firms established best friend or referral-based partnerships with Indian law firms. These arrangements highlighted both the commercial pull of the Indian legal sector and the constraints imposed by the regulatory framework, showing that, even in the absence of market liberalisation, foreign law firms were willing to innovate in order to establish a presence in India.

The rulings and the formulation of policy

The debate on market liberalisation was effectively restarted in 2012 by the Madras High Court’s landmark judgment in the A.K. Balaji case,[5] where the Court held that foreign law firms cannot practice Indian law, whether in regard to litigious or non-litigious matters, unless they are enrolled as advocates pursuant to the Advocates Act. Notably, at the same time, the Court recognised a limited opportunity for foreign lawyers who can fly in and fly out (FIFO) of the country on a temporary basis to advise on foreign or international law, provided such activity does not amount to regular practice or the establishment of a systematic presence in India. This framework was subsequently affirmed by the Supreme Court of India in the 2018[6] A.K. Balaji judgment, which held that the Advocates Act strictly prohibits foreign lawyers from practising Indian law. This time, the Court permitted the narrow FIFO exception and expressly left the issue of the broader entry of foreign lawyers into the country to the Bar Council of India (BCI),[7] the apex statutory body that regulates the legal profession in India.

Following the 2018 A.K. Balaji judgment, the legality of the entry of foreign law firms into India was settled to a certain extent; however, any further formal policy formulation was left to the BCI. Based on feedback from the legal fraternity in India and abroad, the BCI subsequently undertook extensive stakeholder consultations on the matter.

In March 2023, the BCI notified the Bar Council of India Rules for the Registration and Regulation of Foreign Lawyers and Foreign Law Firms in India 2022 (the ‘2022 Rules’),[8] which in principle allowed foreign lawyers to practice foreign law, international law and international arbitration in regard to non-litigious matters in India on a reciprocal basis, subject to their registration with the BCI. However, subsequent parliamentary clarifications[9] and a lack of detailed procedures to implement the new rules meant that only a few foreign law firms actually showed any interest in taking up the opportunity and, hence, the 2022 Rules were widely seen as under-implemented. In response to representations from Indian and foreign law firms, the BCI decided to revisit the 2022 Rules and, accordingly, constituted a committee to address the concerns raised. The said committee has submitted its report to the BCI; however, is the report has not been made public yet.[10] In parallel, the BCI has floated the draft Advocates (Amendment) Bill 2025,[11] which proposes to confer control over the entry of foreign law firms into the country to the central government. This proposal was subsequently withdrawn, following opposition from the legal community.

Against this backdrop, in May 2025, the BCI notified and brought into force the amended Bar Council of India Rules for the Registration and Regulation of Foreign Lawyers and Foreign Law Firms in India 2022 (the ‘2025 Amended Rules’),[12] which expressly limits foreign lawyers and law firms to the conduct of non-litigious work related to foreign and international law (including international arbitration) on a reciprocal basis and introduces a more prescriptive regime involving mandatory registration, the requirement for government and home-jurisdiction no-objection certificates, detailed disclosure obligations (including the pre-arrival disclosure of the client’s identity, as well as the nature and duration of the work), a capped FIFO presence of 60 days in any 12-month period, as well as a categorical prohibition on the practice of Indian law and a prohibition on the appearance of foreign lawyers before Indian courts and tribunals.

After the 2025 Amended Rules came into effect, the regulatory regime became significantly more interventionist. In August 2025, the BCI issued a press release[13] naming specific Indian firms that were alleged to have been involved in unauthorised collaborations with select foreign law firms. However, facing a writ petition in the Delhi High Court, the BCI withdrew that press release. Subsequently, in October 2025, the BCI issued a new press release[14] warning that any Indian law firm – foreign law firm tie-ups, joint branding, co-branded marketing or integrated practice, presented to the public as unified global platforms, would be considered a violation of the 2025 Amended Rules, unless the foreign entity is formally registered pursuant to the new regime. This clarification marked the first authoritative articulation by the BCI of what constitutes an impermissible impression of the integration of domestic and foreign legal services. These developments have triggered heightened awareness of compliance within both Indian and international law firms.

A further layer of uncertainty emerged in November 2025, when the Delhi High Court questioned the BCI’s power to frame the 2022 Rules and 2025 Amended Rules.[15] The proceedings arose from a petition filed by an Indian law firm that had recently announced its collaboration with a UK-based firm and subsequently received a BCI show cause notice alleging that the announcement amounted to an unapproved integration of such services.

The impact

Within the Indian legal sector, these developments have received a mixed response. On one hand, the 2025 Amended Rules have created hope for foreign law firms hoping to explore opportunities in India through permissible channels, such as advising on foreign law, participating in India-seated arbitrations or establishing India desks in their home jurisdictions. Some international firms are also evaluating the regulatory advantages offered by the Gujarat International Finance Tec-City, otherwise known as GIFT City, where dispute resolution infrastructure is being rapidly expanded. On the other hand, the BCI’s October 2025 press release[16] has made Indian law firms significantly more cautious about any future collaborations with foreign law firms. Foreign law firms, too, appear to be taking a cautious approach, with many delaying decisions on India desk strategies, as we are yet to see the first registration of a foreign law firm under the 2025 Amended Rules.

The most immediate and tangible impact of the liberalisation is likely to be seen in the field of international arbitration. The 2022 Rules and 2025 Amended Rules expressly permit foreign lawyers to advise and appear in arbitration proceedings seated in India, which aligns with India’s efforts to position itself as a global arbitration hub. This goal is supported by broader institutional reforms within the international arbitration landscape in India. Additional empirical indicators reinforce the centrality of Indian parties in global arbitration: the Singapore International Arbitration Centre (SIAC) has consistently ranked Indian parties among its top users for several years[17] and the International Chamber of Commerce (ICC) has repeatedly noted that India is among the top five jurisdictions, according to the number of parties involved in ICC arbitration cases.

India’s regulatory trajectory has also drawn comparisons with other Asian jurisdictions that have undertaken the liberalisation of the legal services market gradually. China, for instance, began by only allowing representative offices of foreign law firms, restricting them strictly to the provision of foreign law advice, before expanding permissions in phases within the Shanghai Free-Trade Zone. Singapore followed a structured licensing model that evolved from the issuance of foreign law practice licences to the more expansive qualifying foreign law practice (QFLP) and joint law venture (JLV) frameworks, allowing the controlled participation of such entities in certain areas of Singapore law. South Korea similarly implemented phased liberalisation as part of its free trade agreements (FTAs) with the European Union and the United States, progressing from the granting of advisory rights to limited rights as part of joint ventures with Korean firms.

India’s present approach strongly resembles the initial stages of the models seen elsewhere, where reciprocity, limited practice rights and stringent oversight are used to balance market openness with professional control. Depending on how the relevant policy and judicial developments unfold in India, the 2025 Amended Rules may ultimately be seen not as an endpoint, but as a second step in a longer, phased process of market liberalisation.