Brexit will not create opportunities for law firms to expand into new markets abroad and instead could make it harder, MPs on the justice select committee have been warned.
Asked whether opportunities would arise through trade deals with non-EU countries, Andrew Walker, chair of the Bar Council, said: “Legal services come at the absolute bottom of the list in free trade agreements. Legal services markets are the hardest to break into.
“The EU has not stopped us trying to break into these markets and we’ve been trying for years. Take the example of India – Brexit does not make it easier. The short answer to the question is no.”
Also speaking at the committee’s latest hearing on the implications of Brexit for the justice system, Kate Gibbons, a finance and capital markets partner at Clifford Chance, said Brexit could make it harder to break into new markets.
“It’s a case of a bird in the hand is worth two in the bush. We currently have a marvellous and successful opportunity to operate in a very large market near us, and that is the EU.
“We’re giving up a thriving market now, in the hope that at some stage something will work. It would be naïve to assume that all these doors are going to open immediately.”
Ms Gibbons added that Brexit “means a lot of hard work to get to where we started, with no certainty of that.”
Simon Davis, vice-president of the Law Society, attempted to be more upbeat, saying that the fate of the legal sector after Brexit would depend on business activity in the UK.
However, he said that unlike financial services, legal services would not benefit from any reduction from EU-wide regulation, as the legal profession was regulated differently in each country.
He described contingency planning by law firms for Brexit as “all cost”, a cost which large international law firms could accommodate much more easily than smaller ones.
He gave the example of an SME firm which did a lot of work in Spain and was now contemplating setting up an office there as part of its contingency planning.
“It is impossible to put a price on uncertainty,” Mr Davis said.
He added that, if nothing was agreed before March next year, and family lawyers were forced to rely on the Hague Convention, it would add a “wholly unwelcome” feature to cross-border divorces and disputes.
On criminal law, Mr Walker said: “The mood music is that the government has achieved a great deal on criminal justice and security, but that doesn’t tell us very much.
“It is very, very difficult to know what we will end up with. If there is nothing, it will be a very difficult world in which to live.”
Mr Walker said it should not be as hard to achieve an agreement on criminal justice as on civil justice and family law, but “we just don’t know”.
He went on: “What they need to do is to have an equivalent regime that rolls over into the transition. It’s not an opportunity for improving things, it is an opportunity to try and preserve what we have, and as much of it as we can.”
He added: “Because we haven’t got any concrete outcome yet, everything we have said about what we feel and what we would like in an ideal world remains the case.
“The only real change is that we’re having to move further and further back as we see less and less that is likely to go into any agreement.”