Ashurst has closed its liaison office in Delhi after the Bombay High Court ruled against the practice of law by foreign firms in India.

The office closure comes after a December ruling in the long-running Lawyers Collective case, during which Ashurst's license has been annually renewed by the Reserve Bank of India (RBI) without question.

In a statement, Ashurst said: "In view of the Bombay High Court's decision, we have decided not to apply for an extension of the current licence for our New Delhi liaison office, which expires on 22 February 2010.

"We remain very committed to the Indian market and will continue to assist clients in respect of Indian business in full compliance with Indian law."

The liaison office was initially set up in 1994 to advise for clients on the ground.

White & Case and Chadbourne & Parke followed suit, before the Lawyers Collective brought a case against all three to ban their formal presence in India.

The initial case was dismissed with evidence produced by the RBI citing the practices as purely advisory, with a prolonged appeal process ongoing ever since.

Ashurst senior corporate partner Richard Gubbins told Legal Week: "In July last year I travelled to India, coming at it afresh and taking a good hard look at our presence there.

"Its purpose served in the 1990s, when you needed physical bodies on the ground, had expired, and since then we have been looking at closing. The ruling comes as confirmation of a decision that had already been made."

Gubbins added that he hopes India will become more open to the international market, citing the inconsistency of foreign banks and accountants being allowed to practise in the country.

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