China’s Liberalization of Legal Services Under the ChAFTA: Market Access or Lack of Market Access for Australian Legal Practices

Abstract

This article explores China’s commitments to liberalizing legal services under the recently concluded China – Australia Free Trade Agreement (ChAFTA). While China’s ChAFTA commitments extend beyond its commitments on legal services under the World Trade Organization and under most of China’s other Free Trade Agreements (FTAs), we argue that the degree of liberalization under the ChAFTA has been over-stated. The ChAFTA does not create additional market access for Australian legal practices as it merely recognizes the existing practice in the Chinese market and the same market access granted to Australia has been extended to all other foreign legal practices by initiatives launched in the Shanghai Free Trade Zone. Further, the ChAFTA fails to lift the major regulatory barriers to foreign legal practices in China. Consequently, Australian law firms will continue to compete with other foreign law firms in the same regulatory environment. China is likely to continue to unilaterally liberalize its legal services market via the free trade zones; but such liberalization is likely to be applied to all foreign legal practices. Towards this end, the benefits that the ChAFTA would bring to Australian legal practices are likely to be two-fold: (1) increased business opportunities in cross-border transactions, and (2) strengthened confidence in doing business in China.