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Code of Business Practices: What Problems There Are between the In-House Lawyers and Consultants

The conflict of cooperation between the in-house lawyers and consultants has taken shape in the legal community. The experts have come to the conclusion that it's high time they developed necessary rules of conduct. In other words, the standards of the legal profession, which can regulate matters of dispute. The participants of the session “In-house and Consultant: Walking Together!” discusses this topic within the framework of the IX St. Petersburg International Legal Forum.

The session was moderated by the President of the Russian Corporate Counsel Association Aleksandra Nesterenko. Managing Partner of Baker McKenzie Sergey Voitishkin, Board Member – Vice President for Corporate and Legal Affairs of PJSC MTS Ruslan Ibragimov, Managing Partner of Attorneys at Law KIAP Andrei Korelsky, Managing Partner of Infralex Artem Kukin, Legal Director of PJSC ROSBANK Polina Lebedeva, Deputy Minister of Justice of the Russian Federation Denis Novak, Managing Partner of Pepeliaev Group Sergey Pepeliaev, President of the Russian Federation Chamber of Lawyers Yuriy Pilipenko, Managing Director on Legal Risks and Compliance at Moscow Exchange Aleksandr Smirnov, Partner of Brian Cave Leighton Paisner LLP Evgeny Timofeev participated in the discussion.

According to moderator Aleksandra Nesterenko, the today’s discussion stems from the discussions of the previous years at SPILF that demonstrated that we couldn’t turn away from the problem of the professional society anymore. “Last year, we started with the interaction between the legal consultants and in-house company lawyers. We discussed the issues of confidentiality of the conflict of interests, the process of invoice creation, submission and payment, work in the time of sanctions and other problems that had accumulated between consultants and lawyers of the internal legal departments, who are members of the corporate lawyer association. Gradually we understood that the topic touches upon not only internal relations between consultants and in-house, it also involves external participants: taxation and law enforcement bodies. In light of this, everybody came to the conclusion that it is necessary to develop the code of conduct, which we call Code of Business Practices”, Aleksandra Nesterenko said.

 

Board Member – Vice President for Corporate and Legal Affairs of PJSC MTS Ruslan Ibragimov reported, how this work started and what burning issues the experts managed to identify. “We understood that a number pf problems have accumulated between in-house and consultants, related to the service quality. The lawyers of the internal legal departments of the companies drew attention to it. On the other hand, the consultants held claims against their opponents, speaking, in particularly, about the non-transparency of bidding procedures and long terms of payment for the legal services. It’s hard to escape the conclusion that this dissatisfaction needs to be tackled in this or that way, because it does not make sense to accumulate it any longer. We are all representatives of the same profession, star-crossed for cooperation. Thus, we need to come to understanding and agreement in order to resolve the problem. It was a departure point to start working”, Ruslan Ibragimov explained.

The experts brought together all the problematic questions between the parties to implement what was intended. “There were so many of them that the questions were classified: pre-contract cooperation, contract execution, service quality and billing culture, sanctions, bankruptcy cases and so on. At the end of the day, we addressed the leading law firms to create a platform for discussion. This work will take not a year, but several years. We started with the most burning issues: billing culture and conflict of interests”, the expert explained.

The participants also recalled the imminent changes in the legal sphere at the level of legislation. Managing Partner of Baker McKenzie Sergey Voitishkin spoke about it. “Yesterday at the Forum, they gave a green light to make a reform of the legal profession. Thus, in this chaos there is a feeling of a common disaster and a hope for finding rescue measures. That’s why our task is to work on those rules of regulation of our profession, which all of us will be happy with. We need to join our efforts with lawyers, small and medium business, so that the result of the reform could give us an additional driving force to improve the service quality and market operation and we wouldn’t end up in the situation when we adopt some rules and then come to senses and try to make them acceptable”, Sergey Voitishkin concluded.

Deputy Minister of Justice of the Russian Federation Denis Novak noted that we shouldn’t delegate anybody with the development of standards, no matter what. “I believe that we should do our best to develop the standards of the legal profession but I want to warn you about the following: the standards shall be developed based on the principle of the independency of the legal profession. Thus, any initiatives, related to the fact that the Ministry of Labor, for example, needs to set some professional standards, are very dangerous, because they won’t be developed by the representatives of the legal society. If you delegate the Ministry of Labor with the development of professional standards, or, perish the thought, to the Ministry of Justice, what is going to happen then? The state will take control over the independent legal profession. That’s why, by no means shall we wait that someone else develops these standards instead of the representatives of the legal society”, Denis Novak concluded.

St. Petersburg International Legal Forum takes place in the Eastern Wing of the General Staff Building of the State Hermitage from May 14 to 18. It is organized with the support of the President of the Russian Federation and the Ministry of Justice of the Russian Federation.