According to Article 9of the Lawyers Law,persons who cannot be granted certificates to practise law include those who have no capacity or limited capacity for civil conduct ;who have been subject to a criminal penalty (with the exception of a crime of negligence);who have been dismissed from public employment or whose certificate to practise as a lawyer has been revoked.
In face of the problem that many government officials moonlight as lawyers,Article 13of the Lawyers Law prohibits employees in government institutions from acting concurrently as practising lawyers.Article 36requires that lawyers who were formerly judges or procurators must not serve as agents ad litem or defence counsel within two years of leaving their post in courts or procuratorates.In practice,many practising lawyers have a background of having worked in a court or procuratorate.There is strong support for restricting their engagement in litigation because their background and network may harm the normal legal practice and endorse judicial corruption.In a popular Chinese TV series entitled “Single Parent Families”,a female judge resigned from the court in order to become a lawyer to defend her friend at the same court where she had worked.Indeed,under such a situation her relationship with the judges may raise doubts concerning fairness for the opposing party.Implementation of Articles 13and 36continuously face problems as governmental officials and former judges and procurators conduct the same activities but under the guise of “legal consultants.
Law firms
For a lawyer to practise law,association with a law firm is an absolute requirement.A lawyer cannot accept a case in his or her own name;instead,law firms accept cases in a uniform manner and conclude contracts with their clients (Article 23).
The following criteria which must be met to establish a law firm are not complicated:name,address and articles of association,assets of more than 100,000yuan and at least three full-time lawyers (Article 15).
The Lawyers Law classifies law firms into three types of:state-funded,co-operative and partnership.
State-funded law firms are those established by judicial administrative organs with state funds,which carry out legal business operations independently,and assume limited liability for the debts of the firms with their whole assets .A lawyer’s salary is based on an efficient flexible system,taking into account the years that a lawyer has worked in a law firm,experience,quality and the quantity of cases handled,etc .State-funded law firms were the first organisations in which Chinese lawyers practised law after the resumption of the lawyer system in 1979.Initially,lawyers enjoyed civil servant status and received a fixed salary from the state.From 1983,reforms have been framed to make them financially self-sufficient.By June 1995,of the 5,500state-funded law firms which account for 76.4%of total law firms,2,674(48.6%)no longer rely on government financial support .
Co-operative law firms are set up by partners on a voluntary basis with assets owned equally by all lawyers.The law firms bear limited joint liability for the debts of the firm on the basis of their entire assets.A lawyer’s income is based on the same principle as that applied in state-funded law firms .Originally,such firms were instituted by lawyers who had resigned from state-funded law firms and who felt confident that they would have a sufficient number of cases to generate a reasonable income.
Partnership law firms were also initially set up by lawyers who had resigned from state-funded law firms.The firm’s property is provided by the partners and belongs to the firm.Partners bear unlimited joint liability for the debts of the firm .The total income of such a firm,after deduction of costs,taxes and reserved funds,is divided by the partners according to arrangements made between them.Lawyers hired to work for such a firm receive a beneficial salary.Details of remuneration are stipulated in an agreement between the partners and the hired lawyers.
By the end of 1997,there were approximately 5,519state-funded law firms,1,014co-operative and 1,851partnership law firms,accounting for about 70%,10%and 20%respectively of total law firms in the PRC .State-funded law firms are the mainstay,generally because the other two types of firm involve a measure of risk.Politically speaking,even though the central government has announced its determination to develop a socialist market economy with the intention of privatising many sectors,concerns about the policy change have not completely disappeared .State-funded law firms have offered some privileges,such as job security and other government-subsidised treatment,including housing,medical insurance and child-care,even though these privileges are gradually disappearing as economic reform deepens.Most private law firms are located in the most economically developed areas as the economic boom has provided fertile soil for their growth.
Because of the controversial opinions expressed in the process of its drafting,the Lawyers Law avoids mentioning individual law firms,though in reality many such firms exist,particularly in the Special Economic Zones.For instance,in June 1996the Standing Committee of the People’s Congress in Hainan province passed the Regulations of the Hainan Special Economic Zone on Practising Lawyers.The Regulations were the first in local law to legitimise individual law firms.In 1997,there were 34state-funded,38partnership and 14individual law firms in Hainan province .Recently,a number of Chinese lawyers,after years of studying and working abroad,have returned to China to open private law firms.Such firms deal mostly with foreign-related commercial and civil cases.Some firms have earned domestic as well as international reputations,such as Duan &Duan Law Firm in Shanghai .
Most Chinese law firms undertake a general legal practice.Only since the 1990s in economically developed cities have some law firms become specialised in foreign-related legal business,intellectual property rights,securities,real estate,international tourism ,and so forth.
In China,practising law in certain fields requires an extra licence.For instance,if a lawyer wants to engage in securities,he needs approval from the China Securities Regulatory Commission and the Ministry of Justice.After obtaining a permit,the lawyer can practise securities law in a law firm where two other lawyers have the same permit.There are now about 1,655lawyers holding such a qualification and 322law firms are qualified to engage in securities .In addition,in 1997,the Ministry of Justice,the State Commission on Science and the State Bureau for the Administration of State-owned Property provided a training course for lawyers wanting to engage in demarcating the property rights of collectively-owned hi-tech enterprises.This resulted in about 800lawyers passing the examination to qualify in dealing with legal matters in this field .
Most law firms are on a small scale,consisting of between 10and 30lawyers,only a few have more than 40or 50lawyers .The larger firms may have various departments:international commerce,real estate,banking and securities,company and taxation,shipping and marine insurance,intellectual property,litigation and arbitration.In recent years,the Ministry of Justice has encouraged law firms to increase their competitiveness at the international level by mergers between them.On June 26th 1998the first inter-regional firm,Guo Hao Law Firm,opened in Peking.It is a large co-operative law firm established by three existing well-known law firms (i.e.,Zhang Yongtao Law Firm in Peking specialised in finance,Wanguo Law Firm in Shanghai specialised in securities,and Tangren Law Firm in Shenzhen specialised in investment and company mergers).It remains unclear whether large-scale law firms will be a trend encouraged by the government.If the government believes such a firm structure would be beneficial in strengthening the international competitiveness of Chinese law firms,measures to foster mergers can be anticipated.
