New Developments

Effective 1 January 2019 – Legislation Governing Out-Of-State and Foreign Attorney Representation in International Arbitrations Held In California

California law now explicitly provides a statutory right for out-of-state and foreign attorneys to represent parties in international arbitrations in California.

In February 2017, a Working Group of distinguished practitioners and academics was formed at the request of California Chief Justice Cantil-Sakauye to consider representation by foreign and out-of-state attorneys in international commercial arbitrations held in California. The Working Group recommended — and the California Supreme Court endorsed — the proposal that California adopt an approach based on the ABA’s Model Rule for Temporary Practice by Foreign Lawyers (also known as a “FIFO” or “fly-in, fly-out” rule) allowing out-of-state and foreign lawyers to represent parties in international commercial arbitrations without any filing, registration, or fee requirements.

The proposal, drafted as Senate Bill 766 (“SB 766”), was sponsored by State Senator Bill Monning, unopposed in the California legislature, and signed into law on 18 July 2018 by Governor Jerry Brown. SB 766, codified as Article 1.5 of the California International Commercial Arbitration and Conciliation Act (Title 9.3 of the California Code of Civil Procedure (“Cal CCP”), § 1297.11 et seq.), commencing with Cal CCP 1297.185, takes effect on 1 January 2019.

SB 766 allows a foreign or out-of-state attorney to participate in a California seated arbitration if any one of five broad conditions is met:

1. The services are undertaken in association with an attorney who is admitted to practice in this state and who actively participates in the matter.
2. The services arise out of or are reasonably related to the attorney’s practice in a jurisdiction in which the attorney is admitted to practice.
3. The services are performed for a client who resides in or has an office in the jurisdiction in which the attorney is admitted or otherwise authorized to practice.
4. The services arise out of or are reasonably related to a matter that has a substantial connection to a jurisdiction in which the attorney is admitted or otherwise authorized to practice. [or]
5. The services arise out of a dispute governed primarily by international law or the law of a foreign or out-of-state jurisdiction.

Out-of-state and foreign attorneys representing parties in international arbitrations in California are required to comply with the same professional standards as attorneys admitted in California. (CCP 1297.188(a).)

With the passage of SB 766, California has eliminated the previously existing uncertainties surrounding out-of-state and foreign attorney representation in California international arbitrations, and enacted one of the most welcoming FIFO laws of any jurisdiction in the world.

You can read the full text of the new legislation here