Restrictions Placed on International Law Firms in China Hurt China’s Legal Services Market(Excerpts)

• Author: Chinalawdigest

International law firms are important in terms of facilitating technology transfers to China and importing international techniques, legal precedents and expertise in various areas. They have been and still are a training ground for young Chinese lawyers. Further steps to open up the market and allow greater competition can help China establish itself as one of the world’s leading legal services markets as well as encouraging more liberalized international trade worldwide.

Due to a number of restrictions, international law firms in China face significant challenges in the legal market. While these policies are directed against international law firms, those hardest hit by these restrictions are Chinese lawyers, the Chinese legal system and clients of both international and domestic Chinese firms.

Under current regulations, lawyers qualified to provide advice on Chinese law are not encouraged to join international firms. If they do join, the license that authorizes them to practice law in China will be suspended for the duration of their employment with the international law firm.

This regulatory restriction prevents Chinese citizens who have spent many years studying the Chinese legal system and passing the Chinese bar exam from pursuing a career in the China offices of the many international law firms. Moreover, it limits international law firms’ ability to transfer technology and know-how to Chinese lawyers as well as lawmakers in the country. The ability to legally practice Chinese law within an international firm would afford Chinese lawyers broader employment opportunities and...