Draft Laws

ADVOCATES’ PROCLAMATION NO…/2019 (Draft)

Article 40

Name and Documents

  1. The partners of a law firm have the right to choose and adopt any word or words as the name of their law firm.
  2. The name of a law firm chosen by the partners could be prohibited from use by the Federal Bar on one of the following grounds:
    1. where the chosen name is confusingly similar with the valid name of another law firm; or
    2. where the chosen name is contrary to law or public morality.
  3. The name of a law firm shall contain the words “Limited Liability Partnership” or “LLP”.
  4. All documents issued by or in the name of a law firm shall clearly contain its full name with an indication of its limited liability nature.

Article 41

Requirements and Procedures for Establishment

  1. A law firm shall be established by registering in the Federal
  2. The following documents shall be submitted to the Federal Bar for establishing a law firm:
  1. a completed application form;
  2. a memorandum of association signed by the partners;
  3. copies of the licenses of the advocate partners; and
  4. the proposed name of the law firm.

 

3. The Federal Bar shall accept the application and register the law firm within 15 working days following the submission of the application if the application and the documents are consistent with this Proclamation and any other applicable law.

4. If the Federal Bar concludes that the application or the documents contravene this Proclamation or any other applicable law, it shall reject the application and notify the applicant of the specific contravention that served as the ground for the rejection of the application within 15 working days following the submission of the application.

5. An applicant whose application for registering a law firm has been rejected in accordance with Sub-article 4 of this Article has the right to resubmit its application to the Federal Bar by rectifying the ground for the rejection of his pervious application.

6. If an application resubmitted pursuant to Sub-article 5 of this Article is rejected by the Federal Bar, the applicant has the right to submit his case for review by the Federal First Instance Court or the competent regional court.

Article 42

Memorandum of Association

  1. The memorandum of association of a law firm shall include the following information:
  1. the names, address and nationalities of all partners;
  2. the name of the law firm;
  3. the head office and, if any, branch of the law firm;
  4. the objectives of the law firm;
  5. the types and amounts of contribution made by the partners and the methods of their valuation;
  6. the share of each partner in the profit and loss of the law firm;
  7. the appointment of a manager of the law firm as well as his powers and responsibilities;
  8. the duration of the partnership; and
  9. other matters that are required to be included by law or the agreement of the partners.

2. Any provision of the memorandum of association of a law firm that is contrary to the mandatory provisions of this Proclamation and any other applicable law shall be of no effect.

Article 43

Types and Amounts of Contribution

  1. The skills of partners of a law firm shall be the principal type of contribution.
  2. The partners shall make their other contributions in cash or any other type of property that could be contributed for the purpose of establishing a partnership.
  3. The amount of contribution of the partners of a law firm shall be adequate for achieving the objectives of the law firm.
  4. A contribution made by a partner of a law firm in any form other than in cash shall be valued based on the agreement of all the partners.

Article 44

Rights and Obligations of Partners

  1. Each partner of law a law firm has the right to:
  1. participate and vote in the meetings of the law firm;
  2. take from the profits or the net proceeds of the winding-up of the law firm in proportion to his shares as determined in the memorandum of association or this Proclamation;
  3. evaluate the operations of the law firm and inspect its financial and other documents; and
  4. benefit from other rights and interests provided in a memorandum of association, this Proclamation, any other law or arising out of the nature of partnership.

2. Each partner of law a law firm has the obligation to:

  1. pay on time the contribution required from him;
  2. diligently work for attaining the objectives of the law firm at all times;
  3. refrain from any act or omission that compromises the interests of the law firm whether or not to benefit himself; and
  4. discharge his other obligations as stipulated in a memorandum of association, this Proclamation, any other law or arising out of the nature of partnership.

Article 45

Profit and Loss Sharing

Unless otherwise stipulated in a memorandum of association of a law firm, partners shall equally share its profit, loss or net proceeds of its winding-up.

Article 46

Changes in Partners

  1. Without prejudice to restrictions under any other applicable law, a partner of a law firm shall be paid the value of his shares on the day of his withdrawal.
  2. The benefits of the shares of a partner of a law firm shall be transferred to his heirs or tutor upon his death or incapacity. Unless expressly permitted by the decision of other partners, the heirs or tutor of a partner of a law firm are not entitled to continue as partners in the law firm.

Article 47

Ownership and Structure

  1. Licensed advocates shall own a minimum of three-fourth of the capital of a law firm.
  2. Non-advocates are allowed to own up to one-fourth of the capital of a law firm. The particulars for the application of this Sub-article shall be determined in a regulation to be issued by the Federal Bar for the implementation of this Proclamation.
  3. The details of the structure of a law firm and the rights and duties of advocates who work in a law firm shall be determined in a memorandum of association and the internal rules of a law firm.

Article 48

Prohibitions on Advocates Working in a Law Firm

Any advocate who works in a law firm is prohibited from engaging in the following activities during the currency of his employment or partnership:

  1. directly or indirectly becoming a partner or an employee of another existing law firm; or
  2. directly or indirectly assisting or cooperating with another existing law firm in any other way, except as may be required for the purpose of carrying out his duties in the law firm in which he works; or
  3. practicing law as an advocate on his own account.

Article 49

Management

  1. A law firm shall be managed by one or more managers appointed by the partners in a memorandum of association or the decision of the partnership.
  2. The manager of a law firm shall be liable towards third parties that arise out of his management.
  3. Joint managers of a law firm shall be jointly and severally liable.

Article 50

Duties of the Manager

  1. The manager of a law firm shall ensure that all employees of the law firm and the law firm itself are compliant with this Proclamation and other applicable laws.
  2. Sub-article 1 of this Article shall not affect the duties of the manager of a law firm as specified in a memorandum of association, the decision of the partnership, the internal rules of a law firm and other applicable laws.

Article 51

Decisions of the Partnership

  1. Unless otherwise stipulated in a memorandum of association of a law firm or any other applicable law, the decisions of a law firm shall be made in the presence of the holders of all voting shares of the firm.
  2. Unless otherwise stipulated in a memorandum of association of a law firm or any other applicable law, the decisions of a law firm shall be taken by the votes of the holders of at least three-fourth voting shares of the firm.

Article 52

Taxation

  1. A law firm shall not be required to pay corporate tax as a corporate body.
  2. A law firm passes through its taxation to its partners. Each partner shall report his share of the firm’s profit or loss.

Article 53

Perpetuity and Dissolution

  • The existence of a law firm shall not be affected by the death, withdrawal, incapacity, bankruptcy of or any other change affecting any partner.
  • A law firm shall be dissolved on one of the following grounds:
  1. the agreement of the partners to terminate the partnership; or
  2. the law firm is declared bankrupt; or
  3. the licenses of all the partners are revoked; or
  4. the number of advocate partners has reduced to one, unless another licensed advocate becomes a new partner.
  • Upon the dissolution of a law firm, it shall be deregistered from the registry kept by the Federal
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