Oral answer by Minister for Law, K Shanmugam, to Parliamentary Question on Foreign Law Firms
Mr Lim Biow Chuan (Mountbatten SMC)
To ask the Minister for Law in light of claims by a foreign law firm on being a full service law practice in Singapore offering litigation advice (a) whether foreign law firms in Singapore are allowed to practise litigation in Singapore; (b) whether litigation remains a ring-fenced practice area of Singapore law firms; (c) whether he can clarify the intent and scope of formal law alliances; and (d) whether foreign law firms are allowed to practise domestic litigation through formal law alliances.
1 The Member’s question may have been prompted by a recent article in the Legal Business magazine, published on 8 July 2013. It quoted a partner of Clifford Chance as saying that it is “the first full service firm in Singapore offering litigation advice”. A similar statement was repeated in an 8 July 2013 press release by that firm. This, and an earlier 11 December 2012 press release, promoted the firm’s Formal Law Alliance (FLA) with a Singapore law practice, Cavenagh Law, as “the first international firm with a full service, integrated law practice in Singapore”. The statements could be read to mean that a foreign law firm can now practice litigation in Singapore. That would not be accurate.
2 Singapore Law Practices (SLPs) and Foreign Law Practices (FLPs) based in Singapore may collaborate as two free standing firms under an FLA. This enables co-branding and billing, and the sharing of office premises, resources and client information. In addition, partners of the firms within an FLA may, subject to the Attorney-General’s approval, hold concurrent partnerships in the SLP and FLP. However, foreign participation in the SLP is subject to an overall one third cap. In addition, both firms should remain separate and distinct entities, and may only provide such legal services as they are respectively permitted to provide.
3 The legal services sector operates in a global and increasingly competitive market. Our recent changes over the last few years have been beneficial to our economy and to our legal sector which have grown quite well. It gives Singapore firms greater flexibility to collaborate with FLPs to enhance their international competitiveness and grow. It also gives Singapore lawyers access to a greater range of opportunities and work.
4 However, strict conditions continue to be imposed vis-à-vis the practice of Singapore law. Specific areas of domestic law work, such as litigation, criminal law, family law and conveyancing, are “ring-fenced” and can only be handled by Singapore law firms, through lawyers called to the Singapore Bar. In these areas of law practice, the SLP must use its own letterhead and file court papers in its own name. These areas remain and must remain the province of Singapore lawyers and Singapore law firms.
5 My senior officials have called in the partners of Clifford Chance and the local law firm, Cavenagh Law, and told them that their statements conveyed an inaccurate picture and should be stopped.
6 SLPs and FLPs which have entered into FLAs with each other must exercise restraint in their publicity and refrain from overstating the facts. Their representations to the public and media should be clear as to what their FLA is and is not. I think clever word game should be avoided. We will also not condone arrangements where the SLP is, for all intents and purposes, a proxy of the FLP. All collaborations must comply with the spirit as well as the letter of the law.