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Supreme Court of Puerto Rico Authorizes Non-Attorney Ownership in Law Firms

On June 17, 2025, the Supreme Court of Puerto Rico (the “Supreme Court”) approved new Rules of Professional Conduct of Puerto Rico (“Rules of Professional Conduct”), which are scheduled to take effect on January 1, 2026. Among the most noteworthy changes is the adoption of Rule 5.4(b), which will authorize non-attorneys to hold ownership interests in law firms, provided certain conditions are met.

REQUIREMENTS UNDER RULE 5.4(b)

A non-attorney may hold an ownership interest in a law firm only if the following conditions are met:

(i) The law firm must commit to providing pro bono legal services to indigent individuals.

(ii) Non-attorney owners must ensure that the firm is solely operated by a Puerto Rico-licensed attorney, who must: (1) represent the non-attorney owner in the exercise of all voting rights and other matters regarding to the legal office, (2) ensure compliance with the Rules of Professional Conduct, (3) notify the Supreme Court once an investment from a non-attorney has been received, and (4) submit on January 15th of each year an annual sworn statement to the Supreme Court Clerk detailing the attorney headcount, date and amount of the investments made by the non-attorney owner and the revenues received by the non-attorney for the previous calendar year.

(iii) Non-attorney owners nor their agents may not practice law.

(iv) Non-attorney owners may only contribute money in exchange for ownership interest, not services (including but not limited to marketing services).

(v) Non-attorney owners may not interfere with the attorneys’ professional judgment or the attorney-client relationships.

(vi) Client information must be protected in accordance with the confidentiality provisions established in the Rules of Professional Conduct.

(vii) The agreement between the firm and the non-attorney must comply with the attorney’s fees provisions of the Rules of Professional Conduct.

(viii) Clients must be informed of any non-attorney ownership interest.

(ix) Non-attorney ownership may not exceed 49% of the firm’s ownership interests.

The Rules of Professional Conduct establish that the Supreme Court will conduct an evaluation of the effectiveness of Rule 5.4(b) within three years after it takes effect. As Puerto Rico joins a small but growing number of U.S. jurisdictions allowing limited non-attorney ownership of law firms, we will be closely watching how these changes unfold in practice. While Rule 5.4(b) introduces new opportunities for innovation and non-attorney investment in legal services, it also raises important and profound questions about professional independence and ethical oversight that will certainly need to be carefully pondered and balanced. It is an open question whether this model will serve as a blueprint for broader adoption or will require significant recalibration and adjustments, but it undoubtedly signals a change in thinking on how legal practice and business may increasingly interact.

about 15 hours ago

Alfredo Alvarez Ibañez

O'Neill & Borges LLC, Member | Corporate

O'Neill & Borges LLC