1 The word seamless is one widely adopted by law firms themselves as may be indicated by using a search engine to find material on ‘seamless legal service’– as to why such a standard might be important to them see Le Goff, P Global law: a legal phenomenon emerging from the process of globalisation’ (2007) 14(1) Indiana Journal of Global Legal Studies 119 CrossRefGoogle Scholar.

2 For a comparative perspective, see SM Worth ‘The transnational practice of law: staggering growth in spite of economic and regulatory barriers to entry’ (2003–04) 7 Gonzaga Journal of International Law, available at http://www.gonzagajil.org/content/view/96/26/.

3 An earlier Legal Services Directive, 77/249/EC, sought to facilitate cross-border legal services but somewhat narrowly defined and with a limited list of the types of lawyers to which it applied. A second Directive, 89/48/EC, allowing mutual recognition of professional qualifications, applied equally to lawyers but is now less significant in this sphere because of Directive 98/5/EC. These are explored below.

4 Directive 98/5/EC of the European Parliament and of the Council of 16 February 1998 to facilitate practice of the profession of lawyer on a permanent basis in a Member State other than that in which the qualification was obtained [1998] OJ L77/36 (the Establishment Directive).

5 See Directive 2005/36/EC of the European Parliament and of the Council on the recognition of professional qualifications [2005] OJ L255/22, replacing Council Directives 89/48/EEC and 92/51/EEC as well as Directive1999/42/EC on the general system for the recognition of professional qualifications together with a host of Directives covering particular occupations.

6 Gromek-Broc, K The legal profession in the European Union – a comparative analysis of four member states’ (2002) 24 Liverpool Law Review 109 CrossRefGoogle Scholar.

7 Quinn, JP The right to practice law in the European Union: an American perspective 2004] 1 Macquarie Business Law Journal 113 Google Scholar.

8 See RS Thomas, SJ Schwab and RG Hansen ‘Megafirms’ (2001) 80 North Carolina Law Review 115 at 151, who state that ‘the driving force behind these international mergers (of law firms in Europe) is the increased demand by clients for legal services on a global basis’.

9 Vagts, DF Professional responsibility in transborder practice: conflict and resolution’ (2000) 13(4) Georgetown Journal of Legal Ethics 677 Google Scholar.

10 Since the early 1990s by virtue of Directive 1989/48, any lawyer qualified in the EU could seek to re-establish in any other EU country, in line with Art 52 of the Treaty and principles of freedom of establishment, and to re-qualify as a local lawyer assisted by the system of mutual recognition of diplomas. However, linguistic barriers and differences in the underpinning legal system may make this more problematic than, say, between states in the USA.

11 Gromek-Broc acknowledges in her article that there are further reforms that could be undertaken to extend cross-border practice in the EU; however she suggests that the remaining challenges lie within the ambit of nation states, rather than at EU level.

12 Council Directive 77/249/EEC of 22 March 1977 to facilitate the effective exercise by lawyers of freedom to provide services [1977] LJ L78/17 (the Services Directive). Not to be confused with Directive 2006/123/EC of 12 December 2006 on services in the internal market [2006] OJ L376/36, which is referred to below.

13 Case 2/74 Jean Reyners v State of Belgium[1974] ECR 631.

14 See Art 4 of the Services Directive.

15 Nagel, MT Double deontology and the Ccbe: harmonizing the double trouble in Europe’ (2007) 6 Washington University Global Studies Law Review 455 Google Scholar.

16 Ibid, at 461. See also Hellwig, H-J The legal profession in Europe: achievements, challenges and chances’ (2003) 4(3) German Law Journal 263 Google Scholar.

17 J Goldsmith Cross-border Practice in the EU Paper given at ABA International Law and Practice Section Conference on Regulation of Cross-Border Legal Practice (Brussels, 17 October 2003), available at http://www.abanet.org/intlaw/hubs/programs/Fall0311.01-11.04.pdf.

18 Etherington, L and Lee, R Ethical codes and cultural context: ensuring legal ethics in the global law firm’ (2007) 14(1) Indiana Journal of Global Legal Studies 95 CrossRefGoogle Scholar.

19 Council Directive 89/48/EEC of 21 December 1988 on a general system for the recognition of higher-education diplomas awarded on completion of professional education and training of at least three years' duration [1989] OJ L19/16 (the Mutual Recognition of Diplomas Directive); Directive 2005/36/EC has now consolidated into a single text, this and two other Directives on the general system for the recognition of professional qualifications, together with a host of other sectoral Directives. However, these do not include services and establishment directives applicable to lawyers, since they concern the recognition not of professional qualifications but of the authorisation to practise.

20 It may be that a Member State would in any case be obligated to take into account a lawyer's knowledge and experience and evaluate this as against national requirements for entry in order to fulfil obligations on free movement in accordance with the Treaty: Case C-340/89 Irene Vlassopoulou v Ministerium für Justiz Bundes-und Europaan-gelegenheiten Baden Wurttemberg[1991] ECR 2357.

21 In the years 1995–2005 16% of solicitors admitted in England and Wales had first qualified in some other jurisdiction – see Solicitors Regulation Authority Requirements for Lawyers Qualifying as Solicitors in England and Wales (SRA, 2008).

22 Above n 4.

23 A process that may vary in length and complexity depending upon the Member State in question – see Guermonprez, Y Conquering the continent’ (2003) May, The Trainee 28 Google Scholar.

24 Article 10 of the Directive.

25 Though this may include EC law.

26 A good example is that of fees in litigation with conditional fees supported in England and Wales and levied in the event of success, as are ‘honoraire’ premiums for success in France and ‘palmario’ for successful representation in Italy, whereas other jurisdictions would frown upon success fees – see Maurer, V, Thomas, RE and DeBooth, PA ‘Attorney fee arrangements: the Us and Western European perspectives’ (1998) 19 Northwestern Journal of International Law and Business 272 Google Scholar.

27 Lonbay, J Legal ethics and professional responsibility in a global context’ (2005) 4 Washington University Global Studies Law Review 609 Google Scholar.

28 But Slaughter and May in the English market have historically pursued this approach with great success – see Chambers, M and Rose, C Slaughter and May's international strategy’ (1997) November/December, Commercial Lawyer 20 Google Scholar.

29 Silver, C Regulatory mismatch in the international market for legal services’ (2003) 23 Northwestern Journal of International Law and Business 487 Google Scholar.

30 Stephen, FH The European Single Market and the regulation of the legal profession: an economic analysis’ (2002) 23 Managerial and Decision Economics 115 CrossRefGoogle Scholar

31 Stephen uses the term ‘technology’ while making it clear that he is concerned nonetheless with human capital; the idea of process re-engineering perhaps better captures how legal services can be commodified under forces of competition to realise efficiency gains.

32 Stephen, above n 30, at 118.

33 Though clearly Frankfurt may have an independent lure as a financial centre.

34 Each of which has at least 50 fee earners and with the top four much larger than that.

35 Legal 500, Finland Country Overview, available at http://www.legal500.com/books/lfe.

36 Although Scandinavia has been covered here, there are fascinating other examples of international expansion. Wolf Theiss which has offices in Albania, Bosnia and Herzegovina, Croatia, Romania, Serbia, Slovenia and the Slovak Republic was named ‘Austrian Law Firm of the Year’ and ‘Czech Republic Law Firm of the Year’ by the International Financial Law Review in 2008.

37 For some support for this view, see Nelson, L Independent streak’ (2009) May, Commercial Lawyer 30 Google Scholar.

38 European Commission (DG Competition) Stocktaking Exercise on Regulation of Professional Services (COMP/D3/MK/D, 2004) at para 41.

39 Abel, R English Lawyers between Market and State: The Politics of Professionalism (Oxford: Oxford University Press, 2003) p 96 Google Scholar.

40 Ogus, A Regulation: Legal Form and Economic Theory (Hart, 2004)Google Scholar ch 3.

41 Darby, M and Karni, E Free competition and the optimal amount of fraud’ (1973) 16 Journal of Law and Economics 67 CrossRefGoogle Scholar.

42 Stephen, F, Love, J and Paterson, A Deregulation of conveyancing markets in England and Wales’ (1994) 15(4) Fiscal Studies 102 at 103CrossRefGoogle Scholar.

43 This phenomenon is often referred to as a ‘lemons market’ following a famous essay: Akerlof, G ‘The market for “lemons”: quality uncertainty and the market mechanism’ (1970) 84 Quarterly Journal of Economics 488 CrossRefGoogle Scholar.

44 For a review of this argument see Dingwall, R and Fenn, P ‘A respectable profession’? Sociological and economic perspectives on the regulation of professional services’ (1987) 7 International Journal of Law and Economics 51 Google Scholar.

45 N Garoupa Regulation of Professions in Portugal: A Case Study in Rent Seeking Banco de Portugal Conference Proceedings on Portuguese Economic Development in the European Union (2004).

46 This is a problem that bedevils legal aid provision – see Bevan, G Has there been supplier-induced demand for legal aid?’ (1996) 5 Civil Justice Quarterly 98 Google Scholar; Cape, E and Moorhead, R Demand Induced Supply? Identifying Cost Drivers in Criminal Defence Work (London: Legal Services Commission, 2005).Google Scholar

47 L Rubalcaba Services in European Policies Bruges European Economic Policy Briefings Paper 16 (2007).

48 For a recent example of this, see the consultation document proposing the much tougher regulation of immigration advisers: UK Border Agency, Oversight of the Immigration Advice Sector (May 2009).

49 This is so notwithstanding the reluctance of such clients to resort to litigation as the relational contract theorists point out – see, eg, Macauley, S An empirical view of contract’ (1985) Winsconsin Law Review 465 Google Scholar.

50 See text at n 16, above.

51 Above n 39.

52 Abel, R England and Wales: a comparison of the professional projects of barristers and solicitors’ in Abel, R and Lewis, Psc (eds) Lawyers in Society: The Common Law World (Beard Books, 1988)Google Scholar.

53 R Lee Firm Views: Work of and Work in the Largest Law Firms Research Paper No 35 (Law Society, 1999).

54 Above n 39.

55 European Commission Competition in Professional Services COM (2004) 83 final.

56 C Cox and S Foster The Costs and Benefits of Occupational Regulation Bureau of Economics Staff Report to the Federal Trade Commission (1990) pp 26–27.

57 European Commission, above n 55, para 50 and see Moorhead, R, Sherr, A and Paterson A, A Contesting professionalism: legal aid and non-lawyers in England and Wales’ (2003) 37 (4) Law and Society Review 765 CrossRefGoogle Scholar.

58 R Moorhead Lawyer Specialisation – Managing the Professional Paradox Working Paper No 5 (Cardiff Law School, 2008).

59 All examples given here are taken from the Commission study, above n 38.

60 FH Stephen The Market Failure Justification for the Regulation of Professional Service Markets and the Characteristics of Consumers Proceedings of the EU Competition Law and Policy Workshop (European University Institute, Florence, 2004).

61 Marcos, F The storm over our heads: the rendering of legal services by audit firms in Spain’ (2000) 7(1) International Journal of the Legal Profession 7 CrossRefGoogle Scholar.

62 Council of Bars and Law Societies of Europe CCBE Responses to the Questions of the European Commission on the Future of the Internal Market (14 July 2008), available at http://www.ccbe.org/fileadmin/user_upload/NTCdocument/ccbe_responses_inter1_1182240992.pdf.

63 The Honourable JJ Spigelman, AC Are Lawyers Lemons? Competition Principles and Professional Regulation (Sydney: St James Ethics Centre, 2002)Google Scholar.

64 HB Olesen and CK Nielsen The Legal Profession Competition and Liberalisation January 2006, available at http://www.copenhageneconomics.com/Admin/Public/DWSDownload.aspx?File=%2FFiles%2FFiler%2FPublikationer%2FThe_legal_profession.pdf.

65 It should be noted that Hadfield argues that the willingness of corporate clients to pay the necessary price for success means that legal resources are skewed towards the business segment of the profession and towards efficiency and away from individual justice goals. See Hadfield, GK The price of law: how the market for lawyers distorts the justice system’ (2000) 98 Michigan Law Review 953 CrossRefGoogle Scholar.

66 This accords with the finding that sector-specific expertise remains the single most important factor for clients when they select a law firm, followed by ‘previous experience of using that law firm’. See the FTSE Client Satisfaction Report Legal Week Intelligence (2008).

67 See Moorhead et al above n 57.

68 R Van den Bergh Towards Efficient Self-Regulation in Markets for Professional Services Proceedings of the EU Competition Law and Policy Workshop (European University Institute, Florence, 2004).

69 The comparative competence of solicitor advocates has been an issue of recent controversy in England and Wales. See C Baksi ‘Law Society complains over judge's remarks on solicitor advocates’Law Society's Gazette 30 April 2009, available at http://www.lawgazette.co.uk/news/law-society-complains-over-judge-s-remarks-solicitor-advocates.

70 Antony Ogus has suggested this type of solution: Ogus, A Rethinking self-regulation’ (2005) 15 Oxford Journal of Legal Studies 97 CrossRefGoogle Scholar. It might be argued that this is the de facto position in Europe, except that there is not complete freedom of movement and the spatial localised nature of certain services means that the model does not transfer easily to cross-border legal services.

71 LS Terry et al Transnational Legal Practice (2008) available at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1265120.

72 Clementi, D Report of the Review of the Regulatory Framework for Legal Services in England and Wales (London: Department of Constitutional Affairs, 2004)Google Scholar.

73 Hadfield, above n 63; McChesney, F Rent extraction and rent creation in the economic theory of regulation’ (1987) 26 Journal of Legal Studies 101 CrossRefGoogle Scholar.

74 Bennett, RJ and Robson, PJ The role of trust and contract in the supply of business advice’ (2004) 28(4) Cambridge Journal of Economics 471 CrossRefGoogle Scholar.

75 Almost two-thirds (62%) of FTSE companies have panels in place, but relatively few commit themselves to using only their panel firms and the role of procurement professionals in FTSE companies doubled in 2 years prior to 2008. See FTSE Client Satisfaction Report, above n 66.

76 Liu, Sida Client influence and the contingency of professionalism: the work of elite corporate lawyers in China’ (2006) 40 Law and Society Review 751 CrossRefGoogle Scholar.

77 B Arruñada Managing Competition in Professional Services and the Burden of Inertia Universitat Pompeu Fabra Working Paper 827 (2005) argues that where such solutions are adopted they outlast their usefulness and are difficult to displace.

78 Marty Lipton of Wachtell Lipton Rosen & Katz is said to have invented the ‘Warrant Dividend Plan’ (the so-called poison pill) in late 1982 but its use in 1984 by Household Corporation resulted in heated litigation that went to the Supreme Court in Delaware in 1985. Once its legality was upheld, its use became pervasive and any advantage to Lipton was lost: see S Appleton ‘Poison pills, thrills and heavyweights’Global Counsel 3000 (May 2002).

79 This looks set to change judging by early indications from the Hunt Review of Legal Regulation. See D Hunt Initial Response to Evidence (5 May 2009).

80 F Stephen The Market Failure Justification for the Regulation of Professional Service Markets and the Characteristics of Consumers Ninth EU Competition Law and Policy Workshop: The Relationship between Competition Law and (Liberal) Professions (European University Institute, Florence, 11–12 June 2004).

81 And research suggests this is still a significant factor in the relationship between firm and client. See Uzzi, B and Lancaster, R Embeddedness and price formation in corporate law markets’ (2004) 69(3) American Sociological Review 319 CrossRefGoogle Scholar.

82 Though this model is changing post-Clementi through the use of a designated Head of Legal Practice (HoLP) who is approved by the licensing authority as a fit and proper person as part of an alternative business structure for legal services' provision. See the Legal Services Act 2007.

83 Lamb, A and Littrich, J Lawyers in Australia (Sydney: Federation Press, 2007) p 109 et seqGoogle Scholar.

84 See Hunt, above n 79.

85 Smedley, N Review of the Regulation of Corporate Legal Work (London: SRA, 2009)Google Scholar.

86 A point not pursued further here is the extent to which non-reserved areas of work should be the subject of regulation – if at all.

87 Conseil des Barreaux de l'Union Européenne Code of Conduct for Lawyers in the European Union (Brussels: CCBE, 1988 as amended 1998 and 2002)Google Scholar.

88 It is accepted that the parameters of the large firm would need to be fixed in a manner not open to abuse, but this is a task that in any case is thrown up by the Hunt Review.

89 Lawyers would need to remain conscious of the differing views taken by their commercial clients on the extent to which conflicts of interest might be tolerated. See Griffiths-Baker, J Serving Two Masters: Conflicts of Interest in the Modern Law Firm (Oxford: Hart, 2002)Google Scholar.

90 Ogus, above n 70.

91 Directive 2006/123/EC of 12 December 2006 on services in the internal market [2006] OJ L376/36.

92 European Commission Report on Competition in Professional Services COM (2004) 83 final at para 8.