Black Business Council accuses top law firms of resisting transformation over Legal Sector Code challenge

The Black Business Council (BBC) has thrown its weight behind theLegal Sector Code of Good Practice(LSC), which is at the centre of a legal challenge brought by several of South Africa’s largest corporate law firms. The dispute has reignited debate over how transformation in the legal profession should be implemented after the introduction of the revised LSC under the broad-based black economic empowerment (B-BBEE) Act in September 2024. The code introduces sector-specific transformation requirements for legal practitioners, including ownership targets, procurement obligations and revised scoring mechanisms aimed at reshaping the demographics of the legal profession.

The BBC said it fully supported the LSC and had aligned itself with organisations defending it in the matter under way in the North Gauteng High Court in Pretoria, including the Black Lawyers Association, Black Conveyancers Association, National Association of Democratic Lawyers, Advocates for Transformation, African Legal Professionals Association, Basadi Ba Molao Education and Training Services, the General Council of the Bar of South Africa, the Pan African Bar Association of South Africa, the South African Women Lawyers Association and the Legal Practice Council, as well as the departments of trade, industry and competition and justice and constitutional development. The legal challenge involves Bowmans, Webber Wentzel and Werksmans, which have intervened in the legal proceedings initiated by Deneys, formerly Norton Rose Fulbright, to review the LSC. The firms say they support transformation in the legal sector but argue that aspects of the framework are impractical, structurally flawed and could undermine long-term empowerment objectives.

The trade union, Solidarity, is alsoopposingthe LSC in a separate case that is being heard at the same time. In a recentjoint statement, Bowmans, Webber Wentzel and Werksmans, said a sector-specific code must be “workable and sustainable” and based on sound empirical evidence. They warned that certain provisions risked unintended consequences for both the legal profession and the broader economy.

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The firms argue that the code fails to sufficiently account for the operational realities of large corporate law firms, which function both as regulated professional partnerships and complex commercial businesses. One of their primary concerns relates to ownership targets. Under the LSC, large firms are expected to reach 50% black ownership within five years.

The firms argue that the timeline does not adequately reflect how law firm partnerships operate, noting that only practising lawyers may become equity partners and that the process typically takes a decade or more. They say equity partners often remain in firms until retirement and are personally liable for firm debt, making rapid ownership restructuring difficult even where firms are committed to transformation. The firms also object to procurement requirements obliging firms to allocate 60% of advocate spend to black advocates by year five. They argue that advocate fees are generally client-directed disbursements rather than procurement decisions controlled by firms themselves.

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