ABSTRACT
This chapter shows that the residency requirements effectively protect German attorneys from competition, and that they must soon be moderated owing to European Union and international pressures. The rules governing legal ethics in Germany have at times been challenged as unethical. The legality of the residency requirements have been called into question after the European Court of Justice decided Commission v. Germany in 1988. The establishment of branch offices has been one of the most intensively debated issues involving the residency requirements since the decision of the European Court of Justice in Commission v. Germany. In the meantime, under certain conditions a law firm may maintain offices in more than one German city. This was first permitted by the Federal High Court of Justice in 1989 and has since been reaffirmed. The core of the argument is that the intimacy allegedly created by the residency requirements facilitates the flow of and access to information about the market participants.
