The Impact of Globalization and Cross-Border Mergers & Acquisitions on the Legal Profession in India

Abstract

Cross-border mergers and acquisitions (M&A) in India are of recent vintage as they began in right earnest only since its economy was opened up in 1991. While the initial thrust was by way of inbound acquisitions by foreign companies, the later period witnessed frenetic activity by Indian companies engaging in outbound acquisitions. The goal of this paper is to analyze through qualitative methods and interview-based evidence the impact of globalization and cross-border M&A on the Indian legal profession.This paper finds that the Indian legal profession has undergone a major shift within the span of two decades. Through constant interaction with international law firms and international clientele, there has been a transfer of knowledge, systems and practices to Indian law firms, such that they are able to undertake a larger role in cross-border transactions like M&A. The boundaries between international law firms and Indian law firms in this space are being redrawn on an ongoing basis.However, the Indian legal profession also faces crucial challenges that need to be addressed before it can fully benefit from the effects of globalization. The lawyers’ role is shifting from that of a legal technician to one of a “trusted advisor” with commercial flair and managerial skills to effectively handhold the client during the deal-making process. Given that cross-border transactional practice is relatively recent in India, this study finds the lack of widespread availability of these skills and the required sophistication within the corporate legal profession in India, which generates significant pressure on star lawyers. From a normative perspective, this paper finds a greater need for policy reforms that would grow the cross-border market for M&A in India, and for rapid institutionalization of India’s corporate legal profession.