Rule 16: European cross-border practice
Introduction
The purpose of rule 16 is to apply the provisions of the CBBE Code to European cross-border practice. This is necessary to provide a system of mutual professional understanding for professional relations between lawyers of different CBBE states. Although the CBBE Code contains a large number of requirements, rule 16 contains only those requirements which are not replicated elsewhere in these rules.
Rule
16.01 Definition and application
Definition
- (1)
- (a)
European cross-border practice is:
- (i)
any professional activity in a CBBE state other than the UK, whether or not you are physically present in that CBBE state; and
- (ii)
any professional contact with a lawyer of a CBBE state other than the UK.
- (i)
- (a)
- (b)
For the purposes of this rule professional contacts and professional activities taking place within a firm or in-house legal department are not European cross-border practice.
Application of this rule
- (2)
- (a)
If you are a solicitor this rule applies to your European cross-border practice from an office in, or outside, England and Wales.
- (b)
If you are an REL this rule applies to your European cross-border practice from an office within the UK.
- (c)
If you are an RFL and you are a partner in an MNP, a director of a recognised body which is a company, or a member of a recognised body which is an LLP, this rule applies to your European cross-border practice from an office in England and Wales.
- (d)
This rule applies to a recognised body incorporated in England and Wales in relation to its European cross-border practice from an office in, or outside, England and Wales; and
- (e)
This rule applies to a recognised body incorporated outside England and Wales in relation to its European cross-border practice from an office in England and Wales.
- (b)
- (a)
16.02 Occupations considered incompatible with legal practice
- (1)
If you act in legal proceedings or proceedings before public authorities in a CBBE state other than the UK, you must, in that state, comply with any rules regarding occupations incompatible with the practice of law, as if you were a lawyer of that state, whether or not you are based at an office in that state.
- (2)
If you are a solicitor based at an office in a CBBE state other than the UK, you must respect any rules regarding participation in commercial or other activities not connected with the practice of law, as they are applied to lawyers of that state.
16.03 Fee sharing with non-lawyers
- (1)
You must not share your professional fees with a non-lawyer situated in a CBBE state other than the UK except:
- (a)
within a firm which is permitted under rule 12 (Framework of practice); or
- (b)
with your retired partner or predecessor, or the dependants or personal representatives of your deceased partner or predecessor; or, in the case of a body corporate, a retired director, member or shareowner, or the dependents or personal representatives of a deceased director, member or shareowner.
- (a)
- (2)
If you are practising from an office in a CBBE state other than the UK, whether or not you are physically present at that office, you must not share your professional fees from that practice with a non-lawyer, except:
- (a)
within a firm which is permitted under rule 12 (Framework of practice); or
- (b)
with your retired partner or predecessor, or the dependants or personal representatives of your deceased partner or predecessor; or, in the case of a body corporate, a retired director, member or shareowner, or the dependents or personal representatives of a deceased director, member or shareowner.
- (a)
16.04 Co-operation between lawyers of different CBBE states
- (1)
If you are approached by a lawyer of a CBBE state other than the UK to undertake work which you are not competent to undertake, you must assist that lawyer to obtain the information necessary to find and instruct a lawyer capable of providing the service asked for.
- (2)
When co-operating with a lawyer of a CBBE state other than the UK you must take into account the differences which may exist between your respective legal systems and the professional organisations, competencies and obligations of lawyers in your respective states.
16.05 Correspondence between lawyers in different CBBE states
- (1)
If you are practising from an office in a CBBE state and you want to send to a lawyer in a different CBBE state (with the exception of the UK) a communication which you wish to remain "confidential" or "without prejudice", you must, before sending the communication, clearly express your intention in order to avoid misunderstanding, and ask if the lawyer is able to accept the communication on that basis. When you send the communication you must express your intention clearly at the head of the communication or in a covering letter.
- (2)
If you are the intended recipient of a communication from a lawyer in another CBBE state which is stated to be "confidential" or "without prejudice", but which you are unable to accept on the basis intended by that lawyer, you must inform the sender accordingly without delay. If the communication has already been sent you must return it unread without revealing the contents to others. If you have already read the communication and you are under a professional duty to reveal it to your client you must inform the sender of this immediately.
16.06 Paying referral fees to non-lawyers
You must not pay a fee, commission or any other compensation to a non-lawyer as a consideration for referring a client to you:
-
- (a)
if the non-lawyer is situated in a CBBE state other than the UK; or
- (b)
if you are practising from an office in a CBBE state other than the UK, whether or not you are physically present at that office.
- (a)
16.07 Disputes between lawyers in different member states
- (1)
If you consider that a lawyer in a CBBE state other than the UK has acted in breach of a rule of professional conduct you must draw the breach to the other lawyer's attention.
- (2)
Before commencing any form of proceedings against the other lawyer, you must inform the Law Society and the other lawyer's bar or law society in order to allow them an opportunity to assist in resolving the matter.
Guidance to rule 16 – European cross-border practice
- 1.
Since 1990 the CBBE Code, interpreted in the light of article 1 of the CBBE Code and the CBBE's Explanatory Memorandum, has been binding upon solicitors in relation to their European cross-border practice. The current version of the CBBE Code applies in relation to all the CBBE states and their legal professions, which are as follows.
Austria Rechtsanwalt Belgium avocat/ advocaat/ Rechtsanwalt Bulgaria advokat Croatia odvjetnik Cyprus dikegóros Czech Republic advokát Denmark advokat Estonia vandeadvokaat Finland asianajaja/ advokat FYRO Macedonia advokat France avocat Germany Rechtsanwalt Greece dikegóros Hungary ügyvéd Iceland lögmaður Ireland solicitor; barrister Italy avvocato Latvia zvērināts advokāts Liechtenstein Rechtsanwalt Lithuania advokatas Luxembourg avocat/ Rechtsanwalt Malta avukat; prokuratur legali Montenegro advokat Netherlands advocaat Norway advokat Poland adwokat; radca prawny Portugal advogado Romania avocat Serbia advokat Slovakia advokát/ advokátka Slovenia odvetnik/ odvetnica Spain abogado/ advocat/ abokatu/ avogado Sweden advokat Switzerland Rechtsanwalt/ Anwalt/ Fürsprecher/ Fürsprech/ avocat/ avvocato/ advokat Turkey avukat Ukraine advokat United Kingdom solicitor; barrister/advocate
- 2.
If you comply with these rules in relation to your practice generally, and with rule 16 in relation to European cross-border practice, you will also comply with the requirements of the CBBE Code, as interpreted in the light of article 1 of the CBBE Code and the CBBE's Explanatory Memorandum.
Incompatible occupations – 16.02
- 3.
Subrule 16.02(1) prohibits you from pursuing any occupation prohibited to local lawyers as incompatible with the practice of law, in another CBBE state in which you act in legal proceedings or proceedings before a public authority. This does not prevent you from pursuing such an occupation in the UK if it is permitted under these rules, or in another CBBE state where it is allowed.
- 4.
Subrule 16.02(2) requires you to "respect" the rules regarding incompatible occupations in a CBBE state where you are established. If you are registered under the Establishment Directive any such local rule will apply to you directly. If you are established in a CBBE state, but you are not subject to the Establishment Directive, you may not be subject to the host state rule but rule 16 will apply. "Respect" for a rule is not the same as an obligation to comply with that rule, but the Board of the Solicitors Regulation Authority would expect you to comply with the spirit of such a rule where it is not unreasonable to do so.
Fee sharing – 16.03
- 5.
Although 8.02 (Fee sharing with other non-lawyers) allows you to share fees with a non-lawyer "fee sharer" in some circumstances, this is prohibited under rule 16 in respect of European cross-border practice.
- 6.
Interpreting how the prohibition applies to a firm in the UK sharing fees with a non-lawyer fee sharer operating in more than one CBBE state, and how it applies to a firm of solicitors practising in more than one CBBE state, may be complex. For example:
- (a)
rule 16 would prohibit your firm from sharing fees with a non-lawyer company whose principal place of business is in a CBBE state other than the UK, or with a non-lawyer company's branch establishment in a CBBE state other than the UK; and
- (b)
if your firm has its main office in the UK and a branch office in another CBBE state, the fees of the branch office cannot be shared with a non-lawyer, so the firm cannot share a percentage of its fees as a whole with a non-lawyer. However, the firm could share a percentage of the fees of its UK office, and of any office in a state which is not a CBBE state, with a non-lawyer fee sharer, provided:
- (i)
the fee sharer is situated in the UK or in a state which is not a CBBE state; and
- (ii)
the requirements of 8.02 are met.
- (i)
- (a)
Correspondence between lawyers in different CBBE states – 16.05
- 7.
Subrule 16.05 reflects the requirements of article 5.3 of the CBBE Code. Differences between the ways in which client business is conducted in different states can give rise to misunderstandings between lawyers, and this provision is designed to help avoid such misunderstandings. Terms such as "confidential" and "without prejudice" are not of universal application.
- (a)
"Confidential"
In some states all communications between lawyers (written or by word of mouth) are automatically regarded as not to be produced in court and as not to be disclosed to others, even the lawyers' clients. In other states such communications must be marked "confidential" before they are to be regarded in this way.
On the other hand, in some states, including the UK, the lawyer has to keep the client fully informed of all relevant communications from the lawyer acting for another party, and marking a letter "confidential" is no more than a reminder to the recipient that it is not to be disclosed to anyone but the other lawyer's client.
- (b)
"Without prejudice"
In some states, if a lawyer wishes to indicate that a letter is sent in an attempt to settle a dispute, and is not to be produced in court, the lawyer should mark the letter as "without prejudice".
These important national differences give rise to many misunderstandings, so you need to be careful in conducting cross-border correspondence.
- (a)
- 8.
Where 16.05 applies, you must ask in advance whether your communication can be accepted on the basis you intend, and you must express your intention clearly at the head of your communication or in a covering letter.
- 9.
If 16.05 applies and you are informed that a communication is to be sent to you on a basis which you are not able to respect – for example, that it must not be disclosed to your client – you must inform the other lawyer immediately so that the communication is not sent. If it has already been sent you must return it to the sender unread and without revealing its contents or referring to it in any way. It can happen that, as a result of misunderstanding between sender and recipient, the recipient has already read the communication. If this happens to you, you may be under a professional duty to reveal the contents to your client, either under these rules or under rules of an Establishment Directive state in which you are registered. If so you must tell the sender immediately.
Referral fees – 16.06
- 10.
Although rule 9 (Referrals of business) allows you to have an arrangement for the referral of clients with a non-lawyer, and, subject to disclosure, to pay the introducer, such payments are prohibited under rule 16 in respect of European cross-border practice.
- 11.
As with the prohibition on fee-sharing with a non-lawyer, there are complexities involved in interpreting how the prohibition applies to a firm practising in more than one state, and to an arrangement with a non-lawyer introducer operating in more than one state. For example:
- (a)
rule 16 would prohibit your firm from paying for a referral from a non-lawyer company whose principal place of business is in a CBBE state other than the UK, or from a non-lawyer company's branch establishment in a CBBE state other than the UK; and
- (b)
if your firm has its main office in the UK and a branch office in another CBBE state, the branch office cannot pay for referrals from a non-lawyer, but the UK office, and any office in a state which is not a CBBE state, could do so provided that:
- (i)
the introducer is situated in the UK or in a state which is not a CBBE state; and
- (ii)
the requirements of rule 9 (Referrals of business) are met.
- (i)
- (a)
Disputes between lawyers in different CBBE states – 16.07
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