Ireland closes backdoor EU route for City law firms

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Dublin
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Lawyers based in England and Wales who have gained qualifications to practise in Ireland may no longer be allowed to ply their trade in the Republic and EU.

Last month, a review by the Law Society of Ireland decided lawyers based in England and Wales would not be entitled to practising certificates unless they had a presence in the Republic.

In the wake of the 2016 Brexit vote, many firms had been registering their lawyers to practise in Ireland. It is thought that some of the City’s largest law firms have wasted hundreds of thousands of pounds requalifying lawyers in Ireland in a bid to maintain EU practice rights after Brexit.

The Law Society of Ireland said the issue of practising certificates to solicitors outside the jurisdiction “may create the erroneous impression” that the Society permitted practice outside the country – it stated it wished to make it clear that no such practice was allowed.

In 2019 the society released figures showing record numbers of England and Wales solicitors being admitted to the roll in Ireland.

Just shy of 2,000 new solicitors represented a 163% increase on new entrants in 2018 as legal firms in England and Wales sought to get their lawyers dual-registered.

This brought the overall number of admissions from England and Wales since 2016 to 4,000, representing more than 10% of all lawyers registered in Ireland.

Scottish lawyers have always faced more difficulty in gaining Irish certification, having to sit the Law Society Ireland Qualified Lawyers Transfer Test (unless dually qualified with the Law Society of England and Wales).

According to The Times, five of the City’s so-called magic circle – Allen & Overy, Clifford Chance, Freshfields Bruckhaus Deringer, Linklaters and Slaughter and May – had spent thousands on fees to requalify hundreds of lawyers.

In January, it was reported that Allen & Overy alone had nearly 300 solicitors admitted to the roll in Ireland, with more than 180 taking the extra step and paying for practising certificates.

The decision from the Irish society came as an unwelcome surprise for City firms, who had been working on the assumption that gaining a certificate in Dublin would enable lawyers to continue practising across the EU under a mutual “recognition of professional qualifications” directive.

However, some senior lawyers have always been aware that there was the possibility that the situation could change. In 2018, Julian Acratopulo, a partner at Clifford Chance, told the Irish Times: “It remains to be seen how this will play out in practice, but these rights for solicitors are thought to flow from the professional admission to the roll and adhering to the ethical obligations rather than from having a physical presence [in Ireland].”

Among other leading English firms that have aimed to use the Dublin route to protect EU practising rights include Eversheds Sutherland and DLA Piper. The London offices of Latham & Watkins and White & Case also devoted resources to requalifying their London lawyers in the Republic.

The Irish Times estimated that the fees from Allen & Overy alone would have generated nearly £490,000 for the Irish society’s coffers.

The Irish society also said that it would require any London law firm solicitors moving to Ireland (to gain EU access) to have local professional indemnity insurance.

City firms that have offices in the Republic mostly use local lawyers. It is not considered there is now enough time for law firms to establish new offices in the Republic, particularly with Covid travel restrictions adding a further layers of difficulty.

The Law Society in London described the move as “a huge disappointment”. President David Greene, added: “We will have to consider the changes in depth but for some time practitioners have been seeking certainty from the Law Society of Ireland on the rights attached to their practising certificate for solicitors based outside of Ireland, and more specifically in England and Wales.”

A spokeswoman for the Irish society said: “The vast majority of solicitors originally qualified in England and Wales looking to Ireland since Brexit have only sought admission to the roll of solicitors here, at a small, one-off administrative cost, and have not taken the additional step of taking out practising certificates.”

Professional and financial services expert Professor Sarah Hall, said that following the UK’s exit from the EU, there would be bilateral agreements between the UK and individual EU countries allowing lawyers to practise more freely: “Quite a lot of the success of English legal firms stems from English common law which is seen as good for doing business.”

Her comment echoes those from many law specialists who see English law as remaining the predominant choice governing company contracts – a factor that London has in its favour.