Return to ELP Seminar Participants' Papers 1999- http://www.uiowa.edu/~cyberlaw/elp02/priorpap.html
 

I. Table of Contents 1
II. Introduction 2
III. Legal Advising by Lawyers 3
IV. Bar Requirements in the United States and Japan 7
V. Practicing in a Foreign Jurisdiction 11
VI. Policy Reasons for Bar Requirements 14
VII. Solutions for Multijurisdictional Limitations 16
VIII. Conclusion 19
IX. Endnotes 20

The changes in the nature of legal services have placed pressure on the hundreds of legal systems throughout the world to address this issue.  The changes to the legal system needed to enable lawyers to practice freely in multiple jurisdictions are not forth coming.  One of the main goals of all legal systems is the desire to competently represent each client.  The technological advances make it possible for billions of transaction to takes place each day between citizens of the world.  Some of these transactions require legal services to span the intricacies of two or more countries.  By not allowing lawyers to practice the law of a foreign land even though he may be competent in the jurisdiction, the legal systems of the world are creating an enormous disservice to their participants.

I begin with the roles that legal professions play throughout the world.  The roles included in this paper are a small subset of vast possibilities of roles that a lawyer may play.  Next, I will discuss the requirements set forth by both the American and Japanese legal systems before a layperson can designate themselves as a legal professional.  Along with theses requirements I will look into the barriers facing legal professional attempting to adequately serve his clients.  Each legal system prescribes policy reasons why foreign lawyer are not allowed to represent a client in a foreign jurisdiction.  And finally I will propose solutions that will further one of the main goals of the legal system, how best to ensure clients in need of legal assistance, obtain competent legal services.

Legal Advising by Lawyers

In a society where people thousands of miles away interact each and every day, lawyers around the world have their backs against the wall.  One underlying theme in almost all legal systems is the requirement to serve one's clients to the best of their ability.  The American Bar Association guides lawyers to zealously represent their client's interest.1  With so many barriers to practicing in a foreign jurisdiction, lawyers are unable to seamlessly serve their clients' needs in a global society.  Lawyers are asked to fill a multitude of roles for their clients.  These roles range from advising local clients on local matters to advising foreign clients on foreign laws.

Clients having a connection with a particular jurisdiction other than one that their current lawyer is licensed to practice can be a nightmare.  An American lawyer cannot advice a client on legal matters outside of the lawyer's jurisdiction, unless the need arises out of an emergency.2  The time, money and effort spent finding and establishing a trusting relationship with a new lawyer can be overwhelming.  In some cases this demand could possibly discourage an individual in need from seeking competent legal services.

Lawyers, no matter what jurisdiction they reside, complete virtually the same work.  To complete work requested by a client they usually resort to similar resources for guidance in addressing the legal issues, rely on previously encountered similar situations or seek advice from a colleague.  A lawyer is trained to be able to recognize the issues, research and interpret the law.  Upon completion of the legal analysis the lawyer will communicate their findings and provide recommendations to their client.

Typically, lawyers provide legal assistance to clients dealing with subject matter of the their domestic jurisdiction.  This is the type of advising that lawyers repeat on a daily basis.  Specialization in a particular area of law is becoming more and more prevalent in the industry.  This specialization allows some lawyers to become experts in a particular subject matter, not only in their domestic jurisdiction, but also in foreign jurisdictions.  The knowledge gained of a foreign jurisdiction allows the lawyer to become just as competent if not more so than a domestic lawyer in that foreign jurisdiction.

Advising clients on foreign law can be complex and difficult.  A lawyer must be able to read and understand the law as written in the foreign jurisdiction own language or have it interpreted.  Gaining knowledge in a foreign jurisdiction's law is many times no more difficult than interpreting one's own domestic law.  If a lawyer is able to provide a service to his clients and the clients are satisfied with the end product, lawyers should not be limited to the geographic boundaries of their own jurisdiction.

Lawyers do not simply act as legal advisors to their clients, but will take on other roles, such as an arbitrator or mediator.  Arbitration is a procedure in which a dispute is submitted, by agreement of the parties, to an arbitrator or to a tribunal of several arbitrators who give a decision on the dispute that is binding on the parties. In contrast to mediation, once the parties have freely agreed to submit a dispute to arbitration, a party cannot unilaterally withdraw from the arbitration.

These roles are unique in that they do not always require domestic clients to submit to the procedure established by their domestic jurisdiction.  The New York Arbitration Convention and the Swiss Arbitration Convention are two of the most widely used systems of arbitration throughout the world.  Clients use lawyers to arbitrate and mediate disputes based on procedures established by foreign jurisdiction, because these procedures are flexible and provide substantial value over some client's domestic arbitration procedures.

 Lawyers are increasingly taking proactive positions regarding their clients' needs.  They are acting as watchdogs for law being created and for newly enacted law.  These proactive types of service that lawyers are offering their clients add tremendous value.  If a lawyer is limited to advising the clients on the laws of the lawyer's jurisdiction, they will be disserving their clients.

 Multinational companies hire lawyers to serve as in-house general counsel.  Their responsibilities are to provide legal advice on every aspect of the companies operations.  This could entail the lawyer to give advice on a contract to sell widgets to Chile or on a real estate deal in China to build the widget factory.  Legal expenses would be astronomical if the in-house counsel could only practice the law of the jurisdiction in which they hold a license.  This would require multinational firm to hire hundreds of in-house counselors (one from each jurisdiction they do business with).

Lawyers in a global marketplace cannot be limited to advising clients on the laws of their particular jurisdiction.  Lawyers take on roles from advisors to arbitrator, to proactive watchdogs.  Clients demand that a lawyer provide the advice requested when sought.  If a lawyer has to repeatedly tell their clients they must seek out new legal counsel each time an issue with implications of a foreign jurisdiction arise, clients may all together stop asking for the necessary legal advice.  This could lead to many unnecessary suits that could have been headed off by their domestic lawyer completing research on the issue of the foreign jurisdiction and rendering the advice.

Bar Requirements in the United States and Japan

The United States and Japan both require a particular process be completed before an individual can render legal advice.  The two systems have their similarities and difference.  Each requires appropriate schooling, the passage of certain test and admittance to a bar association.  This process is designed to ensure that clients are served competently.  Lawyers in Japan as well as in the United States are trained to interpret laws and render advice to their clients competently and efficiently.  Below are the procedures required by the United States and Japan to establish oneself as a lawyer in the respective jurisdictions.

American lawyers normally begin their legal educational process during the summer before their final year of undergraduate education.  This summer entails studying for the Law School Admission Test (LSAT), which is required by almost all law schools before a candidate is considered for admissions.  Law school candidates are not required to complete any specific undergraduate program or pre-law course of study.  The American Bar Association does not recommend or provide guidance as to a particular undergraduate major, or courses, that should be taken to prepare one for admissions to law school.3  Once admitted to a law school, normally one accredited by the American Bar Association, students must complete a defined curriculum in their first-year and are allowed to explore other areas that may interest the them in the remaining two years.  After the student successfully completes a minimum number of credit hours and minimum number of residency semesters, the student is conferred with the degree of Juris Doctrate.4

A graduate of a legal program is not licensed to practice law until he meets particular state bar admissions requirements.  Admission requirements typically include an application process; followed by a knowledge examination; testing on professional ethics and a swearing in ceremony.  The application process ensures that a candidate has met the educational requirements and good moral character.  After the application of the individual is reviewed, normally by a state Supreme Court committee, he will receive a certificate of good standing.  Typically a state bar examination consists of three sections; state law essays; multistate performance questions; and multistate bar examination section.5  The Multistate Profession Responsibility Examination (MPRE) is designed to measure a candidate's knowledge and understanding of established standards related to a lawyer's professional conduct.  Each state establishes a standard for what constitutes a passing grade on the MPRE.6  In addition to the MPRE exam each state administers a state bar examination.  Once all the requirements of admission are met and passed, the candidate is sworn in and given a license to practice law.

 A lawyer must be licensed in each state they provide or offer representation in legal matters to clients.  Each state normally requires a person wanting to represent clients in their state to pass the state bar.  Reciprocity is the ability for a state to provide a license to foreign lawyer without requiring the lawyer to complete all bar admission requirements.  A lawyer may request reciprocity from one state to another.  Each state has their own reciprocity standards.  The reciprocity requirements of North Dakota and Minnesota are the least restrictive, in that if you are licensed to practice in another state you can simply apply for a license in the state which will be granted.7 California is one of the most restrictive of states and requires that a person wanting to represent clients in that state complete the entire bar application and testing.8

The process to become an attorney (or bengoshi), public prosecutor or judge in Japan, begins with a candidate successfully passing the National Bar Examination.  The National Bar Examination is very similar to the America version of the LSAT.  The main difference is that in order to enroll in a legal program in Japan a person must first pass this exam.  The exam's pass rate is approximately 2.9 percent or 990 candidates per year.9

Upon successfully passing the exam the candidate must attend a two-year training course at the Legal Training and Research Institute, or Shihou Kenshuusho.  The Institute is similar to law school, but the course of study is substantially different.  The first 6 months at the institute provides practical training in the classroom.  A student must decide during this time whether they want to be a lawyer, judge or public prosecutor.  Each role is very distinct and no person can hold more than one status at a time.  The next 8 months are spent with a district court gaining experience in civil and criminal law.  Upon completion with the district court a student will spend 4 months at a law firm before completing their final 6 months at the institute.  During this time students are trained in the ethical standards of the Japanese legal profession.  Once training is complete students must register with the Registration for Practicing Attorneys, or Bengoshi Meibo.  Japans Federation of Bar Associations controls the registration process for each bar.  Each candidate is screened by the Admission Council, similar to many states' certificate of good standing.  An attorney must also register with one of the local bar associations.  Each judicial district has their own local bar associations, which a lawyer must choose from.  By joining a local bar association the attorney is limited to a single office within the corresponding district.  However, unlike state restrictions a Japanese attorney may practice in any jurisdiction.

Alternative ways of becoming an attorney in Japan is by, 1) being appointed a Supreme Court Justice; 2) work for five-plus years in a law-related job and pass the National Legal Examination; or 3) work five-plus years as a law professor.10

Practicing in a Foreign Jurisdiction

 A foreign lawyer has basically three options if they wish to practice law in the United States.  First they may seek dual admission through the same process as an individual wanting to become a lawyer in the United States.  Second they could be employed by or consult for either a law firm or company.  Finally they can seek licensing as a foreign legal consultant.
It is impractical for a lawyer seeking to advice a client on a lease in the United States to go through the procedures required by a state bar association for licensing.  The second method is more practical because there are no special licenses or schooling required.  The foreign lawyer will be limited to advising clients on legal matter pertaining to the lawyer's domestic jurisdiction only.  However if the foreign lawyer wants to develop a long-term association as an attorney the first or third solution is preferable.

The foreign attorney may consider obtaining a license and establishing themselves as a foreign legal consultant.  This is a desirable because one does not have to take the bar examination of the state that they are advising clients in.  They are limited in the responsibilities they may undertake.  The designation as a foreign legal consultant is limited to fifteen states and the District of Columbia.11  Another limitation to this designation is placed on US lawyers hiring or forming associations with a foreign legal consultant by the ABA Model Rules 5.5 that prohibits lawyers from assisting a person in the unauthorized practice of law.  It is not clear whether the rules would prohibit these relationships, when the rules do not prevent multijurisdictional associations among lawyers admitted to different states.

 United States licensed lawyers wanting to serve clients' interests in Japan were for the most part impossible until recent years.  The only way foreign lawyer could work in a legal capacity in Japan was as a legal trainee in a Japanese law office.  The title of gaikokuho jimu bengoshi or foreign office-work attorney was created in 1986.12

 The Japanese legal system places many restrictions on foreign attorneys such as, limiting lawyers to advising clients only on the laws of their own country; prohibiting them from representing clients in court or in arbitration; barring the formation of a partnership with Japanese firm; preventing foreign lawyers from hiring bengoshi; mandating foreign lawyers have at least five years of legal practice in their home country.  In addition to these restrictions the Ministry of Justice and Nichibenren (Japan Federation of Bar Associations) must approve all foreign lawyers.  The latest change to restrictions placed upon foreign lawyers came in 1994.  Foreign lawyers are still limited to advising clients on the law of their own country, but are allowed to establish joint ventures with a Japanese firm.13  These special joint companies are referred to as tokutei kyodo jigyo.  The joint companies can hire both foreign and domestic lawyers.  Japan has come along way in providing a foreign lawyer with the opportunity to meet their clients' needs in a global society, from the closed door policy of the past.

Policy Reasons for Bar Requirements

Lawmakers and judges in the united States are concerned with the public's well-being if foreign attorneys were allowed to provide legal services.14  Are we really protecting the public's best interest?  The public is best served when they can seek out the most competent product or service in the market place for the money they are willing to spend.  A individual with a legal issue concerning a contract between herself and a Japanese company, would not likely look for a contract lawyer who just understands the law of his jurisdiction, but would rather use a lawyer who is knowledgeable and competent in both jurisdiction's contracting laws.  A foreign attorney not licensed in the domestic jurisdiction, but having superior contracting legal skills would better serve the client than the lawyer who is only familiar with the domestic law.  The problem is that the client will not have this opportunity available to them because the foreign non-licensed lawyer would be unable to give advice on the client's domestic law.

The World Trade Organization has acknowledged the need for less regulation on lawyers working in foreign jurisdictions for the purpose of, "making it easier for lawyers and law firms to provide services . . . to clients in international transactions."15  It has also stated that the obstacles of multijurisdictional lawyering as, "the basic problem stems from the national character of each country's legal system and the need to demonstrate knowledge and competence in the law of the jurisdiction in order to become licensed."16  A lawyer may be an expert in the law of both jurisdictions in a particular area, but without complying with the licensing requirements of each jurisdiction, it is illegal for him to provide legal services to his clients outside his own jurisdiction.

The majority of jurisdictions have as the most prevalent restriction limiting foreign based on the idea that only domestic lawyers can competently serve the client on matters of domestic law.  This is an understandable concern that should always take priority in establishing licensing requirement.  However some jurisdictions have non-competency limitations that make no sense whatsoever.

Many jurisdictions do not give credit for training received prior to seeking admission in a foreign jurisdiction.  Japan for example limits foreign lawyers from practicing if the lawyer has not practiced for at least five years in the jurisdiction that he is licensed in.  A lawyer who was licensed in Iowa and after 4 years was working out of a London office for 10 years would not be allowed to seek admission as a gaikokuho jimu bengoshi.  No jurisdiction has been able to point to any statistical evidence that foreign-trained lawyers commit more legal malpractice than do domestic lawyers.17

It is not just non-US licensing groups that are guilty of non-competency requirements.  State bar associations in some jurisdictions still require that the lawyer establish a presence in the state by opening an office within the jurisdiction.18  Until 1985, some state bar associations went even further requiring lawyers wishing to practice in the particular jurisdiction to meet a residency standard.19  The New Hampshire residency standard, later struck down by the state Supreme Court, required that a lawyer be a resident of the state.  This meant that a person living just over the boarder in Vermont and being a resident of Vermont could not serve as legal counsel for his neighbor residing in New Hampshire if the subject matter pertained to New Hampshire law.

[Added 20021107:

B) Effective Disciplinary Procedures

In the event that a lawyer misbehaves while practicing multijurisdictional law, two questions are raised.  Who will determine if his behavior constitutes misconduct and how will he be disciplined?  Bar associations have established a code of conduct that legal professionals are expected to follow.  For example, the American Bar Association has prescribed a set of guidelines that is recommended to be adopted by each state called the Model Rules of Professional Conduct.  The cannons of ethics were the first attempt to establish standard guidelines to practicing law.  The cannons were short and not very detailed.  Simply a way to establish a standard and not a formal system of rules.  These cannons developed into the Model Code a more formalized set of guidelines.  The Model Rules are a newly updated system of conduct that is designed to replace the existing Model Code of professional Conduct.  The Model Code had been adopted with little change by all states.  The majority of states have adopted the Model Rules, an updated version of the Model Code.

Each state is responsible for enforcing their version of the Model Rules/Code that has been adopted by the Supreme Court of that state.  In recent changes to the Model Rules a rule was added in an attempt to deal with multijurisdictional practice of law.  Model Rule 8.5 was enacted, but is extremely limited to dealing with interstate questions of law and not transborder questions.   The enactment of this Model Rule shows a realization that a problem exists among the individual states.  This type of action needs to be expanded to encompass transborder multijurisdictional practice of law.

The communication of these concerns by the legal profession is a step in the right direction.  The seriousness of these concerns are only going to grow as clients demand legal advice on a range of multijurisdictional issues from their domestic lawyer.  The legal profession must seriously consider solutions to the mutlijurisdictional issue before these concerns become a daily reality.  The next section of this paper provides possible solutions to the multijurisdictional problem.

VI) Solutions for Mutlijurisdictional Limitations]

By now you understand the problems clients and lawyers are facing in our global society.  Bar Associations around the world are extremely slow in establishing licensing procedures for foreign lawyers, to allow clients the choice in legal counsel.  Some solutions are already in place, but are very tedious, like meeting the licensing requirements through the formal process of schooling and examinations.  Yet others solutions are out there and waiting to be explored.  The remaining pages of this paper will briefly present a few of the possible solutions.

 The first possible solution that is available to a jurisdiction and used readily in the United States is that of a temporary license.  This temporary license would be broader than that permitted in the United States.  Many states allow an American lawyer from another state to represent a client in that foreign jurisdiction without many limitations.  However this temporary license is not available to foreign lawyers not licensed in another state.  If this temporary license were to be expanded to include foreign lawyers, yet limited to specific legal matters, jurisdictions would be satisfying the particular needs of the client while limiting the scope of the foreign lawyers activities.  A jurisdiction may even place competency requirements on the ability to obtain the temporary license.  These competency requirements could be related to the subject matter to which the lawyer has particular expertise in or has the ability to gain the necessary knowledge required.  The American Bar Association Model Rules allow a lawyer to undertake representation of a client in a particular subject matter that the lawyer has no knowledge of, if that lawyer can gain the knowledge necessary to adequately meet the clients needs.20

Secondly, a world wide legal association could be formed to act as a local bar association, with the ability to license a lawyer to practice in multiple jurisdictions.  The organization could establish standardized test that a lawyer would need to pass to demonstrate the necessary aptitude to serve clients.  These aptitude tests could be limited to subject areas, similar to patent bars in many countries.  A lawyer who could demonstrate the required competency would be licensed to practice in that area of the law only.  This would allow foreign legal systems to have control over foreign lawyers, alleviating the worries associated with giving foreign lawyers free reign to represent clients on any legal matter.

Until recently Japan had not allowed foreign lawyers to partner with Japanese lawyers (Bengoshi).  Partnering is an extremely successful option.  By allowing foreign and domestic lawyers to partner, jurisdictions do not have to worry about incompetent lawyers, because there would be lawyers of the domestic jurisdiction available to oversee the work of foreign lawyers.  This would also meet the client's needs, by allowing the trusted relationship to continue, seamlessly across offices and not force the client to waste time and money finding competent legal assistance or leveraging the present lawyers network for the fulfillment of their current needs.

Conclusion

In a global society clients demand lawyers to act as guides and navigate them through the legal systems of the world.  Transactions are no longer isolated to particular geographic areas, but can touch multiple jurisdictions around the world simultaneously.  The barriers to practice in the Japanese and American legal systems have decreased in recent years, but still are inadequate to meet the ever changing needs of global clients.  Bar associations have valid and invalid concerns, which perpetuate the existence of barriers to the practice of law.  Through solutions that are being tested today and the solutions explored in this paper, the concerns that are present can be guarded against and overcome.  As with any system of regulation, if it does not change with the times, the safety provided by the regulations may cease to be effective and actually become fatal to the public and legal professionals.

1. "The lawyer should act with dedication and commitment to the client's interests and with zeal in advocacy on the client's behalf." Comment to ABA Model Rule 1.3.

2. "In an emergency, a lawyer may assist a client, . . . if referral to or consultation with another lawyer would be impractical. The assistance should not exceed what is reasonably necessary to meet the emergency." Comment to ABA Model Rule 1.1.

3. American Bar Association Website, at http://www.abanet.org/legaled/prelaw/prep.html#Preparation for Legal Education (discussing the students preparation t for law school).

4. American Bar Association Standard 304: Course and Residence Credit, available at http://www.abanet.org/legaled.

5. Iowa Judiciary Website, at http://www.judicial.state.ia.us/regs/barinfo/barexam.asp (discussing the Iowa bar examination format).

6. National Conference of Bar Examiners Website, at http://www.ncbex.org/tests/mpre_set.htm (discussing the minimum passing score for each state requiring the MPRE).

7. North Dakota State Bar Association's Website, at http://www.court.state.nd.us/Rules/Admission/frameset.htm and Minnesota State Bar Association's Website, at http://www.ble.state.mn.us/rules.htm (discussing foreign lawyer reciprocity requirements).

8. California State Bar Association's Website, at http://www.calbar.org/admissions/doc/2admrule.htm (discussing the admission requirements to obtain a license to practice in California).

9. Japan Today Website, at http://www.japantoday.com/gidx/news155562.html (statistic on Japan's National Bar Examination passage rate).

10. See generally, http://www.kitahama.or.jp/English/Legproj.htm (discussing alternative means than schooling in obtaining a license as a bengoshi).

11. Alaska R. Ct. 44.1; Cal. R. Ct. 988; Conn. R. Ct. § 24A-24F; D.C. Ct. App. 46(c)(4); Fla. Sup. Ct. R. 16; Ga. Sup. Ct. R. D; Haw. Sup. Ct. R. 14; Ill. Sup. Ct. R. 712, Mich Board of Law Examiners Rule 5(E); Minn. Sup. Ct. R. VII; N.J. Sup. Ct. R. 1:21-9; N.Y.R. 521; Ohio Sup. Ct. R. XI; Or. R. 10.05; Tex. Ct. XVI; and Wash. R. Ct. 14.

12. Susan MacKnight, Big Could Be Bigger: U.S. Farm And Food Sales To Japan, JEI Report No. 28A, (July 26, 1991).

13. Douglas Ostrom, Yaohan Goes Bankrupt, JEI Report No. 37B, (October 8, 1993).

14. Fla. Bar v. Brumbaugh, 355 So. 2d 1192 (Fla. 1978).

15. World Trade Organization Council for Trade in Services, Special Session, Communication from the United States on Legal Services, Doc#00-5557, S/CSS/W/28, (Dec. 18, 2000), available at http://docsonline.wto.org/gen_search.asp.

16. Id.

17. Wayne J. Carroll, Innocents Abroad: Opportunities and Challenges for the International Legal Advisor, 34 VAND. J. TRANSNAT'L L. 1097, 1130 (Oct. 2001).

18. Mary C. Daly, Resolving Ethical Conflicts in Multijurisdictional Practice-Is Model Rule 8.5 the Answer, An Answer, or no Answer at All?, 36 S. TEX. L. REV. 715 (1995).

19. The Piper case essentials brought an end to the residency requirement in the United States.  Supreme Court of New Hampshire v. Piper, 470 U.S. 274 (1985).

20. "A lawyer may accept representation where the requisite level of competence can be achieved by reasonable preparation." Comment to ABA Model Rule 1.1