One (small) step toward globalization

Two cheers — but no more — for the American Bar Association! Three of the resolutions that the ABA passed at its meeting in Dallas last week make it somewhat easier for in-house foreign lawyers to practice in the US without taking a bar exam. Last October, ACC sent its comments to the ABA’s 20/20 Commission, which proposed the rules. Back then, we wrote that we like the road that ABA was heading down, but we wish that they would go faster and further.

But the ABA’s car somehow got even slower. Expecting some fierce opposition, the ABA dialed back its proposals on the margins, making them even less strong. For instance, the draft from last year stated that if a foreign in-house lawyer working in the US needed to work on US legal issues, she had to do so “in consultation” with foreign lawyers. Now, that requirement is even stricter, requiring that the foreign lawyer’s advice be “based on the advice of a lawyer licensed and authorized by the jurisdiction to provide that advice.” One part of that new language — “based on the advice” of a US lawyer — essentially treats the foreign lawyer as a second-class counsel.  And the other part of the new language  — “a lawyer licensed and authorized by the jurisdiction to provide that advice” — in effect means that the foreign lawyer must base her counsel on the advice of a lawyer with a law license from the relevant state. In other words, while a US lawyer with a license from any state can usually give advice about the law of another state, the foreign lawyer who works with that same US lawyer can give counsel only about the law of the state that issued the law license. Even if the foreign lawyer can still offer counsel on federal law with the US lawyer, that’s a pretty big limit.

Here’s another example of a problem with the resolutions. During the ABA debate, a floor manager for one of the resolutions offered an illustration to try to explain what the resolution would do. It’s simple, he said — just imagine a company with legal offices in France and the US, which wants to move an in-house counsel from the French office to the American one. The resolutions, he said, will offer a set system to let the company move the lawyer. Sure sounds nice.

But the resolution doesn’t do that. Because for the resolution to apply, the foreign lawyer must be “a member in good standing of a recognized legal profession in a foreign jurisdiction . . . and subject to effective regulation and discipline by a duly constituted professional body or a public authority.” And in France, in-house counsel must resign from the bar before moving in-house.  So the resolution doesn’t actually cover the very example that the floor manager used. Probably an innocent mistake. But it does show the limits of the resolutions. Oh – and ACC mentioned precisely this problem in our letter to the ABA last fall.

Despite its flaws, the ABA’s 20-20 resolutions mark a small step in the right direction. Now, each of the 50 states will need to decide whether to adopt the ABA’s model rules.  And they still might decide to go further down the road than the ABA.