Would a US-EU trade deal be good for lawyers?

I have written before about how the current economic crisis is leading to a radical rethinking of structures that impact on lawyers. Here is another initiative which could lead to significant consequences in years to come.

There are some who believe that one way out of the impasse facing the euro and the dollar is for the two economies, EU and US, to co-operate more closely. The suggestion is that a reduction of barriers in services, among other things, would lead to a growth in trade and jobs. There are very interesting statistics, running into the trillions, of how dependent the two large economies have become. We are each other’s largest trading partners in services. At the EU-US summit in Washington (28 November) ‘opportunities to grow trade and jobs’ are on the agenda. The US Chamber of Commerce has written to the White House in the run-up to the summit to suggest that, rather than have a large EU-US bilateral trade agreement where disagreement on one item can hold up the whole package, there should be smaller single deals running in parallel, including one on liberalising cross-border trade in services.

I am concerned here only with how this might affect lawyers. You might think that there is not much more liberalising that can be done that could affect lawyers between the US and EU. But you would be wrong. Our mutual wishes regarding liberalisation more or less mirror each other. We want to be able to practise wherever we wish in the US, and not just in those states which are currently relatively open such as New York or California. Similarly, they want to practise not just in London, Brussels or Paris, say, but in any member state of the EU (and each member state has different restrictions on practice by foreign lawyers). We want an easier route to qualification as a US attorney, taking into consideration our existing status as a European lawyer – and they would like that in the EU, I have no doubt. The one thing that they have included on past wish-lists is to take advantage of our EU directives on the free movement of lawyers, from which they are currently excluded (since they are not EU lawyers) ... and from which we would like them to remain excluded. But will this be up for grabs in any new liberalisation negotiation?

There is now a discussion in Brussels about the wisdom of proceeding down the single issue route. There are some large questions at stake. For instance, what impact will such a deal have on other free trade agreements, and on the multilateral system? Most of the service sectors already have open market access to the US, and so what would be the added value of this new proposal? And, maybe most significantly from the lawyers’ point of view, the majority of the remaining difficulties for service sectors in doing business in the US are of a regulatory nature, principally due to the federal structure, and the fact that many service sectors – including lawyers, who are regulated by the state supreme courts – are regulated at sub-federal level: how could such an agreement deliver removal or reduction of these state-level obstacles? The latter is a particularly big hurdle for EU lawyers, since the US doctrine of states’ rights has always meant that it is almost impossible for there to be a consistent US-wide agreement on regulation of foreign lawyers.

Of course, I suspect that as usual we will have no control over our fate, which will be decided – like nearly everything nowadays – by economic forces well beyond us. But the CCBE is beginning to discuss its position on these matters.

Finally, as a bonus for those who have read so far, I will provide a rare and useful guide, in a few sentences, as to where the main sources of essential information on international trade in legal services can be found. The prime document is a World Trade Organisation note from 2010 on legal services, with fascinating insights. US statistics and other related material on legal services can be found here. Australian statistics and other material can be found here. EU statistics on the movement of European lawyers across borders can be found here. What more do you need by way of Christmas holiday reading?

Jonathan Goldsmith is secretary general of the Council of Bars and Law Societies of Europe, which represents about one million European lawyers through its member bars and law societies. He blogs weekly for the Gazette on European affairs