Bosnia & Herzegovina may be light on new projects as politics continues to eclipse the economy, but one reform is quietly reshaping the legal market, according to Law Office Dizdar Founder Slaven Dizdar, who spotlights the Federation’s new Law on the Legal Profession, its first comprehensive overhaul in two decades.
"Unfortunately, as in much of the region, Bosnia & Herzegovina has been experiencing a prolonged period with relatively few new projects or major investments, as the political situation continues to overshadow the economic one," Dizdar begins. "Still, one major change, and one that hasn’t received enough public attention, is the new Law on the Legal Profession in the Federation of Bosnia & Herzegovina."
As Dizdar reports, the new law was adopted in January 2025, and while not all secondary regulations have been issued yet, the core framework and the new attorney fee tariff are already in force. "These apply only within the Federation, meaning roughly half of the country’s territory, but they bind both domestic and foreign lawyers appearing before courts in that jurisdiction. It is the first comprehensive reform in over twenty years; the previous law dates back to 2002, and the old tariff to 2004, so this update was long overdue," Dizdar explains.
Focusing on the key changes, Dizdar reports that, for the "first time in two decades, legal fees more accurately reflect the real value of legal services. Just as importantly, the provision that previously capped fee recovery from the losing party has been abolished, meaning clients who win their cases can now recover full legal costs, making the system fairer and more in line with commercial reality." Furthermore, the new law introduces structural improvements, including "better regulation of continuing professional education, clearer procedural rules for bar governance, and more transparency in disciplinary and administrative matters." However, a particularly significant innovation is the regulation of cooperation between Federation-based lawyers and foreign firms. "The law now explicitly prohibits arrangements that create the illusion of a permanent presence by foreign law firms that are not formally registered in Bosnia & Herzegovina," Dizdar stresses.
"For nearly two decades, it was common practice for major regional firms to advertise a 'presence' in BiH through local consultants or affiliated lawyers, without maintaining an actual office here," Dizdar says. "These setups often led to unfair competition, as such firms could market regional capabilities without being fully subject to local regulation or taxation." As a result, Dizdar reports that many regional firms have already adjusted, "changing their office names or formally registering local entities, while local lawyers previously labeled as 'affiliates' are now presented as 'independent attorneys in cooperation with' those firms."
Speaking to the rationale behind introducing these restrictions, Dizdar explains that the idea was "to protect the integrity of the local profession and ensure that services provided within Bosnia & Herzegovina are genuinely delivered by locally qualified teams. The Minister of Justice of the Federation and the Bar Association of the Federation worked jointly on this reform, and in spite of various pressures pushed it through in its intended form." As Dizdar puts it, "everyone recognizes that Bosnia’s legal market is small and that regional cooperation is inevitable. However, over time, some cross-border structures became mere facades; the real work was done abroad, while local lawyers were engaged pro forma." Moreover, Dizdar underlines that such a business model created "inconsistencies, higher costs, and delays because local lawyers often had to correct errors or reinterpret regulations applied by those not fully embedded in the local system."
Looking ahead, Dizdar shares that he believes that cooperation across the region will continue, "but on healthier, more transparent terms. The goal is not isolation but balance: if someone claims to have a presence in Bosnia & Herzegovina, that presence should be genuine, with real local lawyers delivering the work. That’s the spirit of the reform, progress through fair competition and professional equality." Ultimately, the "essence of the new law is to give local lawyers greater autonomy and to reaffirm the way of practicing law that fits the local legal culture, one built on genuine presence, accountability, and professionalism," Dizdar concludes.
