The legal profession around the world faces an unprecedented period of change, much of it caused by developments beyond its control and outside of the legal profession.
Like other professional groups in the services industry, the legal profession in Malaysia has had to adapt and reshape itself to keep up with changing global trends.
This is more so since the Legal Profession (Amendment) Act 2012 and the Legal Profession (Licensing of International Partnerships and Qualified Foreign Law Firms and Registration of Foreign Lawyers) Rules came into force in June 2014, permitting foreign law firms to apply to set up joint ventures with Malaysian firms or to practice in permitted areas specifically-related to Islamic finance.
In addition, foreign practitioners are permitted to fly-in-and fly out of Malaysia to render services for a period of up to 60 days in a calendar year. Notable also is that arbitration, offering an alternative form of dispute resolution in Malaysia, is now open to foreign lawyers.
But is the pace of liberalisation a bit too slow?
Not according to Christopher Leong (pic), president of the Malaysian Bar Council. In an interview after the Bar Council hosted the International Malaysia Law Conference last September, he defended the graduated manner in which the legal profession is being liberalised, arguing that the process has to be carefully managed in order to achieve the desired outcomes.
The changes introduced are, in his view, quite progressive and a step in the right direction. No jurisdiction in the world would allow a free-for-all market.
He conceded that liberalisation is inevitable and admitted that the majority of law firms have yet to feel the impact of the changes introduced since June 2014, as many have neither the interest nor the capacity to practise in the permitted areas. However this does not lessen the need for lawyers to prepare to seize opportunities beyond Malaysia’s shores.
The Bar Council takes the lead in promoting its members’ interests by taking measures to assist and prepare them to operate in a liberalised market, and to grow the legal services sector year-on-year in line with the government’s goal to enlarge the service industry’s contribution to the nation’s GDP to 65% by 2020.
The Bar Council aspires also to do its part to promote Malaysia as a premier business destination. After all as Leong pointed out: “A vibrant business environment needs the support of a vibrant legal profession.”
The IMLC provides the ideal platform for Bar Council members and other lawyers to share and exchange knowledge with delegates from around the globe. Lawyers are encouraged to assess their own potential to take on high yield work from foreign clients or even to spread their wings within the region or beyond.
“It is essential to awaken their realisation and widen their world view”, the Bar Council president elaborated.
At the IMLC the topic Global Trends in the Legal Profession: the Drivers and the Disruptors attracted considerable interest from among the 900 delegates present. Since the global financial crisis in 2008 and with regionalisation and globalisation, the delegates were told the “trade flow of goods, capital and know-how has shifted at unprecedented levels”. Moreover the Internet provides easy access to new markets, market information and customer demands.
It was further pointed out that regulators are becoming better resourced and assertive especially in advanced economies. In order to stay relevant and successful, law firms must build up their capacity to understand the potential extraterritorial impact of laws and navigate the regulatory maze.
Data privacy, anti-competition and anti-bribery are just a few examples of laws that have an impact beyond the borders of the countries where they were originally enacted.
The IMLC delegates were also informed of the recent trends in the United Kingdom where there has been a shift away from the law partnership model towards law businesses owned by listed companies, private equities, retailers and even local authorities. Large accounting firms are also beginning to offer legal services in fields related to their areas of expertise.
The legal profession around the world faces an unprecedented period of change, much of it caused by developments beyond its control and outside of the legal profession. Recognising this, Leong reiterated that the Bar Council has to ensure its members are not just legally competent, but also proficient in business and politics.
It is clear that the legal profession in Malaysia has to adapt to an increasingly globalised environment where gaining an understanding of what is happening beyond Malaysia’s shores would enhance the quality of its service levels.
With the right knowhow, law firms too can chase the money by following wherever the investors go. In a borderless world the opportunities are there to be explored.