Law Society warns that new Japanese regulations may harm future investment

PRACTISING RIGHTS: Foreign lawyers in Japan incensed at local bar's handling of debate

Foreign lawyers incensed at recent Japanese moves restricting their practising rights have complained to the president of the Japan Federation of Bar Associations (JFBA).Late last month a meeting of the JFBA passed a regulation which prevented foreign firms from using a new corporate vehicle - similar to limited liability partnerships.A letter from John Kakinuki - a US lawyer with Baker & McKenzie's Tokyo office - to the president of the JFBA, complained that due process was not afforded to foreign lawyers at the meeting.

At that meeting a number of foreign lawyers had completed proxy forms and given them to Mr Kakinuki, but he was told that these forms were invalid.The contentious item on the agenda - providing that legal professional corporations may not use foreign law firm names - was only heard late in the evening, and Mr Kakinuki tabled a question asking why foreign lawyers were not allowed to vote on the matter.When Mr Kakinuki raised his hand to speak during debate on the issue, he was told by the chairman of the meeting to sit down, and that he was not entitled to speak.Law Society president David McIntosh said that, despite having a good relationship with the JFBA, 'we are extremely disappointed at the passing of the resolution', adding: 'I find it astonishing - at a time when everyone with an interest in Japan recognises the need for the services of international and financial lawyers - the vested interests of a few, who wrongly see them as a threat, are prevailing.'He said the development threatened to delay and undermine the recovery of the Japanese economy: 'Because it is precisely the lack of those debt recovery, restructuring and insolvency skills brought by lawyers which deters banking and commercial entities - which might otherwise invest in Japan - from doing so, because they are incapable of getting their due diligence work to the standards required and achieved in other G8 countries.'Clifford Chance's Tokyo head Robert Burley, said: 'This whole business has been an unfortunate retrograde step, and we are all extremely disappointed.'Jeremy Fleming