Foreign-qualified lawyers are to be allowed to work as in-house counsel at US companies in all 50 states for the first time, the American Bar Association (ABA) has resolved.
The association’s commission on ethics last week voted to lift the rule which currently bars foreign lawyers from practising as in-house counsel in all but seven states.
The reform is a response to the increasing number of foreign companies with operations in the US. But the ABA stressed that the amendment would provide only ‘limited authority’ to practise and did not amount to full admission. Lawyers will still not be able to advise on US law without consulting an authorised US attorney.
The ABA commission rejected criticism that the amendment would ‘open the floodgates’ to unlimited practice by foreign lawyers in the US.
‘Foreign lawyers are already engaged as in-house counsel within the US, but are subject to relatively little oversight,’ said the commission.
‘Adding foreign lawyers enables organisational clients to meet their needs with counsel of their choice, while ensuring foreign lawyers are identifiable, subject to monitoring, and accountable.’
It added that, in the seven states which currently permit foreign in-house counsel, there have been no adverse consequences.
The rule change was among several resolutions adopted when the ABA’s House of Delegates had its mid-year meeting. Lawyers in the UK welcomed the change.
Nina Barakzai, chair of the Commerce and Industry in-house group, said: ‘Often, organisations work with external counsel in multiple jurisdictions to build robust training programmes which highlight variations. This reform will strengthen that collaboration and recognise the immense value all in-house teams derive from working collaboratively.’