EU lawyers facing risk of prosecution as establishment directive gets green light.EUROPEAN COURT OF JUSTICE: MDPs and fixed fees next in court after free movement rulingThe European Court of Justice (ECJ) has cleared the final obstacle to the European lawyers' rights of establishment directive after rejecting a challenge to its validity.

But the scene could now be set for the prosecution of several hundred European lawyers working in England and Wales.

The ECJ ruled against a case brought by the Luxembourg government that the directive - which enables EU lawyers to practise in another member state on a permanent basis - discriminated against lawyers who remained in their host state after qualification.

Luxembourg argued that lawyers entering a country under the directive would be allowed to advise on the host state law of any EU country without having to go through the training undertaken by lawyers qualified in the host state.

The ECJ rejected this on the basis that migrant lawyers are obliged to use the professional title from their home state and make it clear where they qualified, thus enabling consumers to distinguish between host and migrant lawyers.

The ECJ also rejected Luxembourg's argument that the directive should have been adopted by unanimity instead of qualified majority.'The legality of the directive has been put to rest,' said June O'Keeffe, the Law Society's Brussels representative.

Under the directive, EU lawyers working in another member state have to register with that country's law society - the deadline to do so in England and Wales was 22 November.

By that date, the Law Society had processed 14 applications and received a further 83; however it is thought that there are up to 600 European lawyers in England and Wales.

Failure to register leads to a summary conviction in the magistrates' court and a fine.

Unregistered lawyers are also not allowed to recover their fees.

Meanwhile, the ECJ will next month hear oral arguments on two other key cases affecting the legal profession: the challenge by Big Five accountants Arthur Andersen and PricewaterhouseCoopers against the Dutch Bar's ban on multi-disciplinary partnerships, and a case on the legality of fixed fees for lawyers.

In the latter case, the Italian Bar claims that professional bodies should not be subject to European competition law.

l For information on registration, call the Law Society's information service, tel: 0870 606 2555Neil Rose