LEGAL SERVICES (Measures to ensure availability)

LEGAL SERVICES:

(Measures to ensure availability): 1.

Ms Indranee Rajah asked the Deputy Prime Minister and Minister for Law in view of the restructuring and consolidation of the legal services sector in recent years, as well as the changing market for legal services, whether his Ministry is considering the measures needed to ensure that the required legal services are available to support the strategic services of our economy.

Column: 1175

The Deputy Prime Minister and Minister for Law (Prof. S Jayakumar): As I have said in this House before, our legal system, legal services and legal expertise are important to our economy. We have seen the demand for more specialised legal services growing in recent years as our economy and the regional economy develop. To meet this new market demand, our legal services sector needs lawyers with the requisite knowledge and skills. But because Singapore is a small jurisdiction we need to be able to tap the expertise of lawyers from around the world.

In 1999, we launched schemes to allow local law firms to enter into Joint Law Ventures (JLVs) or Formal Law Alliances (FLAs) with foreign law firms. We wanted to provide a convenient and efficient mode for delivery of legal services in cross-border financial transactions. At that time, we agreed to review the Schemes in 2005.

Accordingly, a Review Committee, headed by the Attorney-General, recently completed a review of the Schemes.

They found that the range of legal services in foreign laws and in Singapore law available in Singapore is satisfactory and meets the current legal needs of the strategic service sectors of the economy. In addition, the Review Committee found the Schemes to be structurally sound and appropriate to their objectives. They have achieved the objective of providing an adequate 'one-stop shop' service in foreign laws and Singapore law in cross-border financial transactions in the region.

With this legal framework for collaboration between local and foreign firms firmly established, the Review Committee has proposed that we can now expand the scope of practice of JLVs and FLAs. Looking ahead, this will enable JLVs and FLAs to provide the necessary legal support for the emerging strategic

Column: 1176

service sectors of the economy. The new areas proposed are arbitration, intellectual property law and maritime law. Arbitration, Sir, is a very fast growing area of law practice and Singapore is an ideal venue for international arbitrations. Singapore is also an IT and maritime hub in the region. We will develop and support these areas by including them in the JLV and FLA schemes. Furthermore, the Review Committee has also proposed JLVs or FLAs for any or a combination of these practices will also be considered on a case-by-case basis.

To help Singapore law firms grow their practices abroad, the Review Committee also considered how they can acquire in-house foreign law expertise. Some foreign lawyers with the skills and experience that we need may not find a consultancy relationship with a local firm to be satisfactory, even if the compensation package is high. To ensure that we can continue attracting experienced and talented foreign lawyers to work in Singapore law firms, the Review Committee has recommended that foreign lawyers be permitted to own equity shares in local law firms, subject to an aggregate limit of 25% of the total equity shares or profits of the local law firm. Sir, this will help our local firms to expand their capabilities and reach out to the region. This proposal, I believe, will also help Singapore law firms in the region, especially in China, to grow by giving a stake to local lawyers.

The Government has accepted these recommendations of the Committee and we are working to implement them as soon as possible. The Government has also agreed that the Attorney-General be given the discretion to grant a JLV or FLA licence for any other area of law practice either as a complementary or principal practice of a JLV or FLA if it enhances the quality of legal services in Singapore or supports the development of Singapore. This way, we will give flexibility to include

Column: 1177

other areas of law practice for which there may be future demand for legal services.

Apart from this recent review of the JLV/FLA schemes, let me say that we are also addressing the question whether we will have enough lawyers for our future needs. My Ministry has set up a Committee, which is headed by the Attorney-General, to look into the supply of lawyers. We will work closely with the Ministry of Manpower and the Ministry of Trade and Industry and the report of this Committee should be completed by the middle of this year.

Let me end, Sir, by saying that our existing framework for admission to the Singapore bar is primarily based on a Singapore law degree. For the purposes of admission, however, we have recognised certain specific LLB degrees obtained by our citizens and permanent residents from some universities in England, Australia and New Zealand. In order to encourage the creation of a more diverse generation of lawyers here in Singapore, we will soon give our students more choice by adding to the list the Juris Doctor degrees from four US universities, namely, Columbia University, Harvard University, New York University and the University of Michigan. This is pursuant to the US-Singapore Free Trade Agreement.

Finally, Sir, my Ministry will continue to work closely with the various legal institutions and organisations to develop the legal services sector in Singapore.

Ms Indranee Rajah (Tanjong Pagar): I have three supplementary questions, Sir. First, is on the opening up of the JLVs and FLAs to cover arbitration. I would be grateful if the Minister for Law could explain the rationale behind extending it to arbitration, given that foreign law firms are already able to conduct arbitration in Singapore, whether under SIAC or any other mode of arbitration.

Column: 1178

The second question: DPM and Minister for Law mentioned that foreign lawyers would be allowed to own equity shares in local firms. I would like to know whether the foreign lawyers would also be required to be admitted to the Singapore Bar and, thereby, practise Singapore law, or whether by virtue of their admission through equity in a local firm they can automatically practise Singapore law.

The third question: for the Juris Doctor degrees, in the US, of course, it is a post-graduate degree. What I want to know is whether people who get degrees from the US and want to come back to Singapore to practise would also be required to undergo the Singapore Diploma conducted by the NUS, something that students who graduate from the UK and other countries are required to undertake before they can practise.

Prof. Jayakumar: The Member is right about our laws permitting foreign lawyers to practise arbitration. We are not just looking at foreign lawyers/counsels flying in when retained to appear for specific cases. What we are trying to encourage really is full service firms that specialise in arbitration, especially in specialist fields. So, Singapore law firms can form such an association to boost their capabilities. Foreign law firms would be able to establish a presence or base here, so to speak, to serve the region, bring dispute resolution work from various parts of the region to Singapore.

The firms that may be interested in this may not be the same firms that are already here for international financial transactions. So, we are thinking that collaboration with Singapore law firms could allow the foreign firms become more competitive in terms of pricing their services for work involving Singapore law - China work, India work, perhaps. So the FLA, local and foreign partners,

Column: 1179

through that mechanism, can then market their arbitration service as a global service, as it were, that includes Singapore law services in arbitration.

Her next question was about the proposal to allow foreign lawyers to have an equity stake in Singapore law firm - whether that foreign lawyer who takes such a stake can, by the very act, practise in Singapore. The answer is, no. That person will have to comply with whatever requirements that already exist for practice of Singapore law.

The third question is with regard to the four degrees in the United States that would be recognised for the purpose of admission. Students who have obtained their degree from the universities, like students who have obtained their degree from other scheduled universities, will have to comply with the requirements for admission to the Singapore Bar.

Assoc. Prof. Chin Tet Yung (Sembawang): I would like to ask the Minister why only four American universities are selected and why some of the more notable and major US universities with respectable law degrees, like Yale and UCLA, are excluded.

Prof. Jayakumar: We have this issue, whether it is with United Kingdom, Australia and New Zealand, as to why certain universities are included or not included. Let me say that these four universities are arrived at after consultations with the United States authorities.