European Court of Justice oral hearing on the German ban of third-party ownership of law firms

On April 30, 2024, the oral hearing regarding the German prohibition of third-party ownership in law firms took place before the Grand Chamber of the European Court of Justice (ECJ). The case (Halmer ./. Rechtsanwaltskammer München) concerns a decision made by the Munich Bar in 2021, when the latter revoked the admission of the law firm Halmer to the bar due to the fact that an Austrian non-lawyer owned company had acquired 51% of the law firm’s shares. On appeal by the concerned law firm against this decision, the Bavarian Bar Court (BayAGH) referred the question to the ECJ for a preliminary ruling as to whether the German professional rules prohibiting third-party ownership in law firms violate European law. In its judgement, the Bavarian Bar Court questioned whether the old version of Section 59e of the German Federal Lawyers Act (Bundesrechtsanwaltsordnung- BRAO) is compatible with, amongst others, the EU-rules on free movement of capital and free movement of services.

In the oral hearing, the representatives of Germany, Austria, Croatia, and Slovenia supported the legal position of the Munich Bar. The European Commission, however, while emphasising the importance of the independence of lawyers, suggested the possibility that non-lawyer investors could be shareholders provided they have no voting rights. The Advocate General Manuel Campos Sanchez-Bordona will submit his conclusions on July 4, 2024.

Read the full story here. (in German, with English translation available)

ICLR news and events.

Brought to you by ICLR.