The Gazette 1991

JULY/AUGUST 1991

GAZETTE

Code stipulates that the partners of an MDP have to respect the functions reserved to certain professions (the giving of legal advice except in tax matters and the appearance in certain courts are reserved to lawyers by statute, auditing is a function reserved to auditors by statute - these restrictions also apply in MDPs). Statistics on MDPs do not exist either for Germany or the Netherlands, but it is estimated that less than 10 per cent of partnerships in Germany are MDPs. MDPs have existed in both Germany and the Netherlands since the early seventies and in both countries for a longer time with the related profession of notaries. In both countries there are no plans to abolish them. Both countries report that so far they have had no problems with MDPs. MDPs are prohibited: (a) by statute in Ireland (for solicitors), France, Greece, Luxembourg, Portugal and Sweden (in Sweden with the possibility of exemption by decision of the Board of the Swedish Bar Association). (b) by rules or regulations set up by the Law Society or a similar body in Ireland (for barristers), France, Denmark, Luxembourg, Belgium, Norway and Finland. (c) Luxembourg also refers to unwritten rules and tradition and Belgium to bar decisions on the independence of lawyers. In Ireland, Greece, Luxembourg, Portugal, Belgium and Sweden there is no discussion about the intro- duction of MDPs. There is a discussion in France, but MDPs have been rejected. There is little discussion in Denmark. The argument in favour of the admission of MDPs is the advantage of one-stop- shopping for the client. The opponents argue that MDPs might jeopardise the inde- pendence of lawyers. The discussion of MDPs in Norway is similar to the one that took place in the United Kingdom.

MDPs have been discussed in Finland. An argument made there in favour of MDPs is that they would facilitate the cdmpetition against financial institutions. The argument made there against MDPs is that the different code of ethics, the fee- regulations and the preservation of the personal client-lawyer relationship might lead to difficulties. In all articles on MDPs, the Netherlands and Germany are mentioned as the countries in Europe which allow MDPs, but it is important to understand the background against which these MDPs exist. In Germany, there are principles of reserved functions for the various professions. An MDP must honour this principle. Therefore the partner from each discipline only does work which is reserved by statute to that discipline. There is, therefore, very little overlapping of f unc t i on. No such clear demarcation exists in Ireland "In Germany, there are principles of reserved functions for the various professions." where accountants, for example, practice in many quasi-legal areas. An MDP (with some parties), such as exists in Germany, would not necessarily operate in such a distinct manner in Ireland, where the lack of demarcation of services would undoubtedly cause certain difficulties. In the Netherlands, MDPs are not permitted between auditors or accountants and lawyers. The MDPs which are allowed in the Netherlands are restricted to notaries, patent lawyers and other independent professions who have disciplinary rules comparable to the rules pertaining to lawyers. It would therefore be dangerous to believe that the experience of the Netherlands would be relevant to a general system of MDPs which would encompass such diverse professions as lawyers and accountants. 2. United Kingdom Comparisons In the United Kingdom, MDPs

Denis C. Guerin New York A t t o r ney at Law 6 2 43 Br oadway Suite A 26 Riverdale, New York 10471.

Native Killarney, County Kerry.

Solicitor, Incorporated Law Society of Ireland, 1981.

Legal a d v i ce a nd a s s i s t a n ce in t he USA. C o n t r a c t s, Wills, Trusts, Personal Injury, C o r p o r a t i o ns etc.

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are allowed under statute but both the Bar Council and the Law Society of England and Wales have the power to decide w i t h whom solicitors may practise. In practice, therefore, the English/Wales Law Society can control the entire position in regard to MDPs. In addition, the Courts and Legal Services Act has permitted litigation and advocacy to come under separate distinct rules. In Scotland, the professional rules have been much more difficult to challenge. At the moment, MDPs do not appear to be on the agenda for discussion by the Scottish Legal Profession. In Northern Ireland, the situation of MDPs has not been progressed. At the moment a consultation paper has been prepared but there has not been great impetus toward change. 3. CCBE No decision has been taken, either for or against MDPs by the CCBE (Association of European Bar Associations). However, much work has been done to prepare the groundwork for the debate. Examination is being undertaken by the CCBE as to the problems incurred. Addition- ally, a set of draft rules is being drawn up which will allow a more concrete discussion to take place. 4. Principal Arguments in favour of MDPs The principal arguments for

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