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Don’t allow standalone foreign firms: Bar Council

PETALING JAYA, 23 April 2009: The government must address issues affecting the domestic legal services market before allowing foreign law firms to practice in Malaysia on a standalone basis, the Bar Council said.

“There is no point making Malaysia welcoming to foreigners if we have not yet put our own house in order,” Bar Council president Ragunath Kesavan said in a press statement today.

The Bar Council expressed its worry over Prime Minister Datuk Seri Najib Razak’s decision to allow “up to five top international law firms with expertise in Islamic Finance” to practice in Malaysia, without the need for such firms to enter into any joint ventures with local firms.

“By permitting foreign law firms to set up on a standalone basis, there is no necessity for such foreign law firms to share or transfer any technology or knowledge to Malaysian practitioners,” Ragunath noted.

He added that such a move would be counter-productive to the Malaysian legal services market in the long run.

Ragunath also stressed that this course of action would run counter to Malaysia’s commitments to the World Trade Organisation, as well as to various bilateral free trade agreement negotiations currently underway.

Ragunath said a level playing field was necessary for Malaysian law firms to remain competitive.

“Free trade cannot be said to exist in Malaysia if Malaysian practitioners are still required by the banking industry and government-linked companies to comply with bumiputera equity and staff quotas,” he noted, adding that such policies should be abolished if there is to be true liberalisation of the legal services market.

“The Bar Council’s position is that a managed system of liberalisation, in which foreign law firms are required to enter into joint ventures with Malaysian law firms, represents the best of both worlds,” Ragunath said. He stressed that there were sufficient Malaysian practitioners with expertise in Islamic Finance at an international level.

According to Ragunath, the Bar Council had made its preference known to the government since November 2004, and had even prepared the relevant amendments and rules and regulations.

He revealed that the Bar Council had met with Bank Negara Malaysia (BNM) since September 2006 to discuss the national bank’s wish to bring in five mainly London-based firms as part of the Malaysian International Islamic Finance Centre (MIFC) initiative.

“BNM is hopeful that that these five firms, once established here, will bring their foreign clients and their Islamic Finance business to Malaysia. We are not convinced this will be the case,” Ragunath said.

“We are therefore extremely disappointed that the views of BNM have prevailed,” he added.

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3 Responses to “Don’t allow standalone foreign firms: Bar Council”

  1. Gopal Raj Kumar says:

    The worst offence that can be committed in a democracy is the offence of censorship. To deny a constituent member of society the right to expression is a Jesuit offence.

    Where is the posting of mine on this subject?

    Editor’s note: It is The Nut Graph’s policy to moderate all comments. We publish on weekdays, and hence the work done to moderate the comments is normally done during the week – comments are moderated on weekends only when there is an editor on duty.

    The more comments we have, and the longer the comments are, the longer it takes for them to be moderated. Comments are moderated according to The Nut Graph’s commenting guidelines, which are available for the public to view on the website.

    In your case, some of your comments are long and repeated, and have been truncated or edited for length. This is par for the course, and applies to every commenter. All other comments that comply with our policies will be published to the best of our ability.

    Shanon Shah
    Columns and Comments Editor

  2. Gopal Raj Kumar says:

    Why is the bar council so sacrosanct that comments that challenge their monopoly cannot be published?

    If you are to be merely an extension of anti-government propaganda just for the sake of being anti-government, believing your actions to be democratic in doing so then you are a disappointment.

    Be brave and lets have the other side of midnight as well.

    Gopal Raj Kumar

  3. Gopal Raj Kumar says:


    Your response to a criticism directed at your blog or publication appears to have elicited a prompt response defying your own stated barrier of the weekday – weekend syndrome you suffer from (not you personally) as postulated here.

    There was a longer (and I have to hold my view), more worthy comment which you clearly have not responded to or published on the subject. How that becomes repetitive is beyond the pale of common sense or reason.

    It would appear that you did receive my complaints and a very short note that followed it today.

    Hmmm. Still have not answered the query as to why my post of last week (not weekend) has been with-held from publication. It is very much in the public interest to have the topic of the opening up of the legal services sector debated openly.

    Whether my comments are long or short, the decision to edit it (as should be the case with the comments of all others) should be based on its relevance and not necessarily its perceived extra length or what you term repetition.

    Like many of your readers I too do not have the luxury of writing for a living and do it during my lunch breaks or during a break from my usual chores.

    Perhaps again we are being witness to “tolerance” or “freedom of expression” fatigue?

    Gopal Raj Kumar

    Editor’s note: You are free to kindly resubmit your comment, and whoever is on duty will eventually go through it. At the moment, you do not provide enough details for me to recall what your comment was about, and it really just could have been human error on our part. But without the relevant details, we can’t really pinpoint what the problem was.

    If you have a direct grievance with The Nut Graph team, kindly contact us at [email protected].

    Shanon Shah
    Columns and Comments Editor

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