I sometimes think international law firms are a little like sheep, one sets up in a country and many more follow. But I suspect this is the same in any industry when new markets open, someone is first in but the others soon follow.

The current trend is clearly the BRIC (Brazil Russia India and China) economies, with many firms already established in China and Russia it was Brazil’s turn to be the current destination of choice.

That was until last week when the Brazilian Bar ruled against associations with foreign law firms. This decision isn’t the eviction of all the international firms yet, but it’s a possible step in that direction. As with the continued block on foreign law firms praticing in India it seems a tale of two halves in BRIC. China and Russia happy to accept the foreign law firms, India and Brazil not.

So who’s got it right?

Clearly from a free market point of view, China and Russia are right. And it’s suggested that merger activity in the trans-atlantic market is being driven by the lure of China. But clearly India and Brazil are using the infant industry argument for protectionism. Can this work though for a service firm? In a globalised world won’t business in these countries suffer through lack of access to the global reach of international law firms?

My personal view is that the markets need to open up.

The main asset of a law firm is the lawyers, whichever market the big law firms go into they will need lawyers and most of the time it’s local lawyers that will be used along with a few lawyers transferred to the country. So I think that the access to knowledge in these global firms will accelerate the development of the local lawyers in these markets. And eventually lead to experienced local lawyers leaving and setting up their own Indian and Brazilian firms. Using the knowledge of global markets they have gained they will be better prepared when they decide to expand and set up shop in London and New York.

India should really look at their own IT industry as an example, it’s now the development centre of many global IT organisations (Microsoft employs about 5000 people in India and even Legal IT provider Autonomy has an R&D centre in Bangalore). This has led to a rapid growth in the IT sector in India, not just in global firms but home grown enterprises.