UK law firms are seizing new opportunities in Luxembourg following a lift of post-Brexit restrictions. With the recent parliamentary approval of a provision from the 2020 UK-EU Trade and Cooperation Agreement in June, British barristers are returning to the Grand Duchy. Mindful of the substantial revenue potential in the region, these firms are showing vigorous interest in expanding their operations, marking a revival of British legal practice in Luxembourg.
With the formal title of “Bâtonnier”, Pit Reckinger, head of the Luxembourg bar association, known in French as the Barreau de Luxembourg, confirmed that an annual meeting on 6 July set the fees for access to “Liste VII”. This allows firms and their lawyers to practice aspects of UK law or public international law in the Grand Duchy. The organisation has recently uploaded the Liste VII registration form to its website. The registration fee was set at 1760 euro.
Reckinger said the legal change will make a “big difference as otherwise, UK-qualified lawyers would be prevented from rendering any legal services.”
Financially promising
Before Brexit, the market in Luxembourg for UK legal services exports was worth about 300 million pounds a year, making this legal change “financially very interesting,” according to Lubna Shuja, president of the Law Society of England and Wales.
The legal change has opened doors, she told Investment Officer Luxembourg. “Given that the possibility to register under home title has now opened up again, subject to immigration and tax requirements, etc., lawyers can once more settle in Luxembourg.”
The Law Society has since fielded “a lot of queries about practice in Luxembourg”, she said. “Solicitors are interested in going over there to practise.
Local man
UK firm Travers Smith LLP exemplified another route. They recently recruited lawyer Loïc Bacquelaine from Elvinger Hoss Prussen, one of Luxembourg’s top law firms. Bacquelaine, now a senior associate within the financial services and markets team at Travers Smith, has been tasked with opening a Luxembourg desk.
“Loïc’s arrival will enable us to provide Luxembourg law insight across a range of matters whether through in-the-moment advice or by catalysing closer collaboration with the key Luxembourg law firms, industry associations and continental regulators,” said the firm’s spokesman, very careful to note that: “This is by no means to the exclusion of leading Luxembourg law firms with whom Travers Smith works closely.”
“The Luxembourg desk will meet the growing demand of the firm’s global alternative investment manager clients and will enable Travers Smith to better provide Lux insight across a range of matters through both in-the-moment advice and by driving closer relationships with our best friend Luxembourg law firms, Luxembourg industry associations and continental regulators,” Travers Smith wrote in a post on its LinkedIn page.
Key jurisdiction
The firm views Luxembourg as having “always been a key jurisdiction for our international alternative asset manager clients”, adding that “we have been assisting, with the help of local law firms on projects with a Luxembourg nexus for numerous years.”
“Brexit – and the need for firms to maintain a hub in the EU – and other recent developments in the industry such as “retailisation” and “democratisation” of access to alternative strategies has shown that Luxembourg continues to be a very key jurisdiction for many of our clients,” said the Travers Smith spokesman.
Before the end of the post-Brexit “transition period”, UK lawyers in the EU could requalify as European lawyers through the EU’s lawyer’s establishment directive (Directive 98/5/EC). “After Brexit, a lot of lawyers who were already present in Luxembourg requalified,” said Shuja.
European provisions
The directive requires that any EU lawyer of EU citizenship in continuous practice for three years in any European state and registered as a European lawyer in that state is allowed, sometimes subject to other criteria such as language, to requalify as a lawyer in that state. At the Luxembourg bar association, Reckinger pointed out this won’t be possible for UK lawyers under the rules of the cooperation agreement.
“Obviously, English and Welsh lawyers, well, UK lawyers in general, will no longer have access to that specific rule, given that we’re no longer part of the European Union,” said Shuja.
Any prospect of even fewer restrictions down the road “will depend on the future relationships that exist between the UK and the EU and any future agreement that takes place,” she said.
Open jurisdiction
The English and Welsh Law Society is eager to contrast the situation in the UK with the long delay in enacting the cooperation agreement in Luxembourg. “The UK is essentially seen as an open jurisdiction, and this is something that we’re very proud of, especially as it’s very easy for foreign lawyers to come over here and practice,” said Shuja.
“They can even practice certain elements of UK law here, which is something that we’re proud of, bearing in mind there are only six areas of reserved activity that only solicitors qualified in England and Wales can practise. Other than that, a Luxembourgish lawyer can come here and practise any other area of law, including their own law, EU law and certain aspects of UK law.”