Ban on MDPs 'discriminatory'

A ban on multi-disciplinary partnerships (MDPs) is discriminatory, anti-competitive and against European law, the European Court of Justice (ECJ) has been told.

In an oral hearing on a case brought by Big Five accountants Arthur Andersen and PricewaterhouseCoopers just before Christmas, the firms also argued that the Dutch Bar's ban on law firms being managed by accountancy practices was arbitrary.

Dutch law firms are allowed to have relationships with patent agents, notaries and tax consultants, they said, while the Bar has guidelines on relationships between lawyers and professions other than accountants.

The accountants contended that fee-sharing between lawyers and non-laywers is not a threat to confidentiality.

At first instance, a Dutch court ruled that the Bar's MDP ban is a restriction on the freedom to provide services but that it is, however, justified in the public interest.

The accountants asked the ECJ to apply competition rules in coming to its decision, a move opposed by the Dutch Bar and the countries which intervened in the case: Germany, France, Luxembourg, the Netherlands and Sweden.

The Council of Bars and Law Societies of Europe (CCBE) and the European Commission also made submissions that the Dutch Bar does not come within competition law as it is not a competitive body, nor an 'association of undertakings' as required by the Treaty of Rome art.

81(1).It is understood that Arthur Andersen lobbied the UK government intensely to intervene in the case, but that it declined, partly because of the Law Society's gradual moves towards MDPs.

There was alsosupport for banning MDPs where there is joint control and fee-sharing by non-lawyers and lawyers.

The next step is for the Advocate-General to give his initial opinion, which is usually then followed by the ECJ.

This is expected in the next couple of months.

The ECJ also held an oral hearing on whether fixed fees in the legal profession are anti-competitive after a reference over the Italian National Bar's fixing of binding tariffs for the professional activity of lawyers.

Neil Rose