Seow Zhixiang

In September 2007, the Committee to Develop the Singapore Legal Sector, headed by Judge of Appeal Justice V K Rajah, released its Final Report. The Final Report addressed a wide range of issues affecting the legal sector and made a number of progressive recommendations in relation to legal education and access to justice, among other things. Of particular note are the Committee’s favourable opinions on class actions and contingency fees. Careful study of the Final Report, it is suggested, will dispel any misconception about the conservatism of the Bench and the Bar.

A key recommendation by the Committee is the liberalisation of the domestic legal market. As part of the liberalisation process, a limited number of foreign law firms will be able to practise in Singapore on their own without having to tie-up with local firms in joint law ventures.

The entry of foreign law firms and the resulting increase in competition will no doubt raise the quality of legal services here. Local practitioners will also become, through interaction with foreign lawyers, more aware of international standards of practice. The presence of foreign law firms will also intensify competition for legally trained persons - law students’ lingering suspicions, no doubt untrue, that their starting salaries are ruthlessly depressed by shadowy cartels, will be finally dispelled.

However, there is a discordant note in the liberalisation process - the Final Report recommended that “the practice of criminal law, retail conveyancing, family law, and administrative law as well as all aspects of criminal and commercial litigation be ring-fenced”. (Interestingly, constitutional law was left out of the “ring-fence”.)

The reason for such “ring-fencing” is not easy to fathom, especially in light of the Committee’s observations about the acute shortage of litigators (pp. 26-7). The Committee itself blandly stated that “there is no reason to allow [foreign law firms] to engage in any aspect of litigation, at least certainly not in the initial phase of liberalisation” (para. 7.54).

If foreign lawyers are less sensitive to local conditions, this will naturally disadvantage them when they interact with the Courts and their clients, without the need for formal barriers. Moreover, in the case of litigation, the introduction of foreign perspectives may be positively beneficial. The Courts regularly and naturally refer to foreign laws in developing all aspects of Singaporean jurisprudence (even, it should be noted, constitutional jurisprudence), exhibiting a keen awareness that independence does not mean insularism. The presence of foreign lawyers may therefore sharpen the Courts’ appreciation of these foreign legal developments.

If the concern is the discipline and regulation of foreign lawyers, appropriate reforms can be introduced to bring these lawyers under the aegis of the Law Society, with refinements to reflect the fact that errant foreign lawyers may be more mobile than local lawyers. The Law Societies of Hong Kong and England and Wales, for example, supervise the foreign lawyers practicing in those jurisdictions was a fact which was noted by the Singapore Law Society in its response to the Final Report. Moreover, disciplinary and regulatory concerns are not particularly convincing reasons for the ring-fencing, since such concerns obtain with equal force in the sectors that have been liberalised.

It seems then that what underlies the ring-fencing is a protectionist policy, motivated perhaps by similar closed-door policies in other countries (noted by the Committee at para. 7.55). However, while ring-fencing may be justifiable under present circumstances, the countervailing arguments must not be forgotten. Protected sectors will be unable to reap the benefits of international competition. Local competition is likely to be more limited, given the small size of domestic practice. This might result in the protected sectors being regarded as the poorer cousins of liberalised sectors, aggravating phenomena such as the shortage of litigators and the commoditisation of conveyancing.

The interaction between these considerations depends of course on the precise circumstances, which may change over time. As policymakers continue to find the balance, it may be instructive to recall Lord Justice Denning’s admonition: “[If] the law stands still while the world moves on, that will be bad for both.” So too for the practice of law.

Zhixiang is a third year law student. He is now on exchange to New York University.