More than two years after a group of Bulgarian lawyers lodged their objection to foreign firms practising in Bulgaria under their internationally-recognised names, in breach of Bulgarian legislation, Parliament is set to put the issue to rest by amending the Bar Act.

On June 9, lawmakers approved the first reading of the amendments, the key provision being one that will allow foreign lawyers to set up subsidiaries of law firms registered in other European Union member states.

Previously, the Bar Act required law firms to register explicitly as such, stipulating that the names of the law firms could only be composed of the names of the partners registered in one of Bulgaria’s bar associations.

Foreign lawyers fiercely opposed the provision, arguing that being able to operate under their respective firms’ internationally-recognised names was vital to the success of their business. As such, foreign law firms were registered as commercial enterprises, drawing accusations of unfair competition from their Bulgarian counterparts.

The amended law would implement EC directive 98/5/EC, which allowed foreign lawyers to practise in EU member states under the name of their office or national law firm. Furthermore, foreign lawyers will now be allowed to practise themselves, rather than having to be represented by a Bulgarian lawyer.

Bulgaria’s Supreme Bar Council and regional bar associations would be required to keep registers of foreign lawyers, who would be issued certificates allowing them to practise law in Bulgaria.

Adopting the amendments would "overcome gaps in regulating the practice of law" and "bring Bulgarian legislation in line with EU law", according to the Cabinet’s explanatory note on the amendments.

DLA Piper Weiss-Tessbach, CMS Cameron McKenna, CMS Reich-Rohrwig Hainz, Wolf Theiss and CHSH Cerha Hempel Spiegelfeld Hlawati asked the European Commission in November 2008 to step in on the dispute, filing a formal complaint and accusing several Bulgarian institutions, including the Supreme Bar Council, Sofia Bar Council and Commission for Protection of Competition (CPC) of effectively dismissing the supremacy of European law.

The EC sided with the foreign law firms, asking Bulgaria in February 2009 to submit its observations on "a number of problems identified regarding the application of EU law". Bulgaria was expected to be taken to the European Court of Justice if it failed to amend its Bar Act to ensure free competition.

Ironically, in July 2008 the CPC imposed fines worth a total 150 000 leva on four of the five claimants, Wolf Theiss being the exception, citing exactly unfair commercial practices.

According to reports in the Bulgarian media, the appeal to have the fines overturned or have the case referred for clarification to the European Court of Justice was dismissed on two occasions by Bulgaria’s Supreme Administrative Court. That was done by a three- and a five-judge panel of the court, but it was not immediately clear whether the case could be appealed further before a seven-member panel.