ABA Commission on Ethics Recommends Changes To the Model Rule Governing In-House Counsel

The ABA Commission on Ethics 20/20 recently submitted for comment several proposed changes to the Model Rules of Professional Conduct (“Model Rules”). One was to Model Rule 5.5, which governs the unauthorized practice of law. The proposed changes to Rule 5.5 would permit foreign in-house counsel to work for their employers from an office in the U.S.

The change is intended to deal with the recent increase in “transnational legal practice driven by technology and globalization.” According to the Ethics 20/20 Commission, “the realities of 21st century legal practice have resulted in an increase in foreign lawyers seeking to provide legal services to their clients in the U.S. (as well as concurrent increase in the efforts by U.S. lawyers and law firms to do the same abroad).” In addition, “the number of foreign companies with U.S. offices or operations in the United States has increased since 2002, as has the number of U.S. companies with foreign offices or operations.

” The proposed addition, Rule 5.5(e), requires that the foreign lawyer permitted to serve as in-house counsel in the jurisdiction be a “member in good standing of a recognized legal profession in a foreign jurisdiction, the members of which are admitted to practice as lawyers or counselors at law or the equivalent.” The proposal also amends Rule 5.5(d) to protect clients by requiring that, if the foreign lawyer provides advice other than on international law, he or she must do so in “consultation with a U.S. lawyer authorized to provide such advice.” Proposed Rule 5.5(d)(1).

Massachusetts has adopted the Model Rules and Massachusetts is home to many companies with foreign headquarters and / or foreign offices. Sanofi-Aventis’ acquisition of Genzyme is an example of a now foreign-owned company with a large Massachusetts presence. The new proposed Rule 5.5 would, if adopted by the ABA and Massachusetts, more easily permit a French Dyfenseur, a German Rechanswalt or an English Solicitor to re-locate to the Commonwealth and continue to advise their company.

Comments are being solicited regarding the proposed Rule 5.5. You can comment and read the full text of the proposed rule and report (as well as other recent proposals made by the Ethics 20/20 Commission) by clicking here.