IBA Warns That Non-US Lawyers Confused By Sarbanes-Oxley

by Glen Shapiro, LawAndTax-News.com, New York

18 September 2003

A survey recently conducted by the International Bar Association (IBA) and legal information provider, Lexis Nexis has revealed that many non-US lawyers are concerned and confused with regard to the repercussions of the Sarbanes-Oxley corporate governance act.

Of the 600 lawyers questioned on the subject (from the UK, Canada, France, Germany, Australia, Argentina, and Chile), four out of five believed that clients are likely to be less open with their legal representatives as a result of the legislation.

Concerns were also expressed with regard to the likely impact of the code of conduct rules recently adopted by the US Securities and Exchange Commission (SEC), which stipulate that lawyers must report violations of securities laws or fiduciary duties to top-level management, or to the board of the company, if a suitable response is not forthcoming.

Speaking following the release of the survey, head of the IBA's business law section, Fernando Pelaez-Pier explained that the non-US lawyers questioned, especially those representing subsidiaries of US firms in other countries, feel that they are being put in an untenable position:

'The people least able to report infringements of law - lawyers from other countries - have been given the responsibility to report infringements,' he explained.

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