November 2, Urquiola de Palacio Palacio & Asociados Lawyer and Arbitrator. UIA 57º ANNUAL MEETING - MACAO November 2, Urquiola de Palacio
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1 November 2, 2013 Urquiola de Palacio Palacio & Asociados Lawyer and Arbitrator. November 2, Urquiola de Palacio 1
2 1. Introduction. We are confronted with a number of concerns facing lawyers against the backdrop of regulatory and economic developments that affect the legal profession and its essential values: independence, professional secrecy, conflict of interest rules and respect for the right to make full answer and defense. Why is the case of Spain interesting? A new draft law on Services and Professional Associations- might lead to a fracture in the profession. November 2, Urquiola de Palacio 2
3 There are two current intiatives in Spain which have very different (and in places conflicting) approaches to the regulation of the legal profession: General by-law of the Spanish Lawyers Draft Law on Services and Professional Associations November 2, Urquiola de Palacio 3
4 2. General by-law of the Spanish Lawyers: Reasons for the adoption of a new by-law: a) Adjust the present wording to the new regulatory framework, which directly affects the organization and professional practice of lawyers. b) Adjust the current wording of the competence framework taking into account the new Statutes of Autonomy and jurisprudence of the Constitutional Court and of the Supreme Court. c) Upgrade the current wording and content. November 2, Urquiola de Palacio 4
5 The new statute is in accordance with: Spanish laws transposing Directive 2006/123/EC of the European Parliament and Council of 12 December 2006 on services in the internal market: Law 17/2009 of November 23, 2009 on Freedom of Access to Service Activities and the Exercise thereof. Law 25/2009 of December 22, 2009 amending Various Laws for the Adaptation to Law 17/2009. November 2, Urquiola de Palacio 5
6 Some features of the new by-law. Regulation of professional ethics is incorporated into the by-law. It includes deontological norms which protect the rights of the clients as well as the general interest. Seeks greater autonomy to the Professional Associations. Argues in favor of democracy, transparency, quality and responsibility of all corporations, placing an emphasis on their social role. November 2, Urquiola de Palacio 6
7 Summary: The new General by-law governing the Spanish legal profession devotes itself to: Promoting core values and guiding principles of the legal profession: independence, dignity, integrity, confidentiality and commitment to the recognition and defense of human rights. Defining the basic institutional organization of the legal profession. November 2, Urquiola de Palacio 7
8 3. Draft law of Services and Professional Associations: A. Distinction between the two elements of the Draft law: Regulation of Professional Services: Adjusted to European legal norms and the real conditions of the market for professional services. Regulation of Professional Associations: Regulation departs from established practices & standards and introduces inadequate rules. November 2, Urquiola de Palacio 8
9 B. With regards to the regulation of the professional associations, I will address: Fracture within the legal profession. Other issues that reflect a lack of knowledge about the realities of the profession: a) Geographical scope. b) Control exerted by the competent public administrations. c) General Council of various Professional Associations d) Freedom in business communications. e) Professional Liability Insurance. f ) Obligations of professional associations which require compulsory membership. November 2, Urquiola de Palacio 9
10 Fracture within the legal profession. - Draft law: Limits the membership to those lawyers practicing before courts and to those who provide legal assistance and have no employment relationship with the client. Comment: The draft law s proposition goes against the Organic Law on the Judiciary and the jurisprudence of the Supreme Court. Should the lawyer not be a member, this could have negative repercussions such as no deontological or disciplinary control. November 2, Urquiola de Palacio 10
11 Proposal: Membership should be mandatory for the provision of any service inherent to the profession, regardless of the legal nature of the relationship between the lawyer and his client. November 2, Urquiola de Palacio 11
12 Other issues which reflect a lack of knowledge of the reality of the profession. Geographical scope: Draft law: when a profession requiring compulsory membership is organized by regional professional associations, the incorporation of one of them to practice would give the member access to all Spanish territory. Proposal: the incorporation of the professional association must be done at the Autonomous Community where the member-to-be has its main place of business. November 2, Urquiola de Palacio 12
13 Control of the competent public administration: Draft law: The competent public administration temporarily assumes the management of the correspondent public functions or even intervene and adjudicate in the dissolution of the respective Governing Board. Proposal: This system is disproportionate and excessive. This vast scope for intervention clashes with the configuration of the professional associations as organizations with constitutionally guaranteed autonomy (this may be of dubious constitutionality). November 2, Urquiola de Palacio 13
14 General Council of various Professional Associations: - Some of the articles in the draft violate the existing distribution of powers between the State and the Autonomous Communities, and can be a burden for the future practical application of the norm. - Proposal: The text should be fully compliant with the constitutional distribution of competences to avoid an eventual declaration of unconstitutionality of some of its articles. November 2, Urquiola de Palacio 14
15 Freedom in commercial communications: - Draft law: Any partial restriction to the freedom of commercial communications must be established by law. - Proposal: As this is deemed contrary to the Directive 2006/123/EC of the European Parliament and the Council, it is proposed that there be specific provisions with regards to advertising that take into account the independence, dignity and integrity of each profession as well as the professional secrecy. November 2, Urquiola de Palacio 15
16 Professional civil liability insurance. - Draft law: All members of the professional association are not obliged to have a Professional civil liability insurance. - Proposal: Insurance should be put in place to ensure the rights of consumers and users to adequately cover the liabilities incurred by professionals (at least those incurred by members of a professional association). November 2, Urquiola de Palacio 16
17 Obligations of professional associations who require compulsory membership: - Draft law: imposes on those professional associations who require compulsory membership the deduction of fees for those professionals who prove to be unemployed. - Proposal: Alternative criteria should be applied to ensure consistency across the profession (age, experience, income level). November 2, Urquiola de Palacio 17
18 Thank you! November 2, Urquiola de Palacio 18
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