Multi-jurisdictional licensing: U.S. & Canada vs. U.K. & Australia

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Imagine you are a licensed professional living in Maine. Let’s say you wanted to travel to, say, Canada, and practice your trade there. Though it may seem like a simple matter of packing your bags, booking a flight, and securing a place to work, in reality the process can be a bit more complicated.

What is multi-jurisdictional licensing?

When doctors, lawyers, and other professionals seek to travel and practice in other countries, they face bureaucratic obstacles that vary in density depending on their destination and country of origin. Sometimes they deal with state, provincial, and federal governments all at once. Multi-jurisdictional licensing is a regulatory concept that grants these professionals free movement to work and practice across a given number of territories.

Multi-jurisdictional licensing can be seen to have two obvious benefits:

  • It increases supply
  • It expands employment opportunities
 

More workers and licensed professionals coming across the border to practice means more competition for businesses, which results in lower prices for consumers. More competition can lead to expanded employment opportunities for workers, but it can also drive wages down. The influx and outflux of professionals also create challenges for regulators in retaining control over their industries.

This potential loss of control is one of the main reasons multi-jurisdictional licensing can have negative outcomes for regulators. If regulators exist to create and enforce boundaries — ostensibly to protect the public interest — opening their professions up for multi-jurisdictional practice works against their theoretical aims. A middle ground can potentially be found in the concept of mutual recognition.

What is mutual recognition?

The U.S. and Canada have what is called “mutual recognition” of professional qualifications. This means each country recognizes the accreditations of professionals attempting to enter and practice from the other. The two countries do not, however, enjoy free movement of labor. Even though you as an American professional may have your qualifications recognized by the Canadian federal government, you still may have to apply for a visa and/or a work permit to live and work there.

Because the U.S. and Canada are divided respectively into states and provinces, professionals seeking entry to work must also deal with smaller governments and their specific sets of regulations. Between this additional bureaucracy and the visa/work permit signup process, regulators are granted some degree of power in determining who can enter to practice — more power than they would enjoy under a free-movement model.

Multi-jurisdictional licensing in the U.K. and Australia

In June 2021, the U.K., in the wake of its recent exit from the E.U., struck a free trade agreement with Australia. The agreement in principle promises a new and “highly liberal” approach to trade in services between the two countries. At first glance, this can appear to be a significant step forward in terms of professional labor mobility and multi-jurisdictional licensing, but the reality of the situation is not necessarily so simple.

Though the flow of goods between the two countries may increase under the new agreement, professional mobility will mostly operate the same way it always has. The U.K. government asserts that qualifications for professionals such as lawyers to practice in Australia will be recognized “with more clarity and certainty,” but the two countries already have a mutual recognition policy. Professionals seeking entry to practice may also still be subject to the existing travel visa/work permit signup process.

Domestically, professionals in the U.K. and Australia enjoy more freedom of mobility than they do in the U.S. and Canada. Because there are only national requirements and not state or provincial requirements to practice in the former two countries, professionals can move around and work as they please. This also makes traveling to practice between the U.K and Australia slightly easier than it is in the U.S. and Canada — one only must deal with the federal regulators.

Multi-jurisdictional licensing in the E.U.

An interesting model to consider with regards to multi-jurisdictional licensing is that of the European Union. Within the E.U., there is an overarching framework that allows professionals to travel and practice freely between its constituent countries. A nurse who is qualified in Bulgaria would face no obstacles practicing in France beyond simply registering with the French government.

Unfortunately, even a forward-thinking multi-jurisdictional model can fail in its effort to protect the public interest. In 2009, a German medical practitioner was working in the U.K. when he administered a fatal dose of painkiller medication to a 70-year-old patient. He was advised by his local employment agency to return to Germany immediately, where he faced prosecution from the U.K. government.

Though the doctor was convicted and barred from practice in the U.K., the municipal government in Arnsberg, Germany, chose not to withdraw his license to practice, allowing him to continue working freely back home. Cases like this illustrate the ever-present need for thorough cooperation and communication between regulators, even under more liberal multi-jurisdictional frameworks.

The future of multi-jurisdictional licensing

The future of multi-jurisdictional licensing will likely be driven, as it always has been, by a conflict between regulators and business interests. An increase in supply of professionals can lead to more competition and lower prices for consumers, while regulators can potentially lose some control over their respective industries. Even self-regulated industries have their own unique motives in this conflict.

While models like that of the E.U. may offer a more liberal vision of the future, the exit of the U.K., which can be seen as part of a larger recent shift in developed countries toward nationalistic foreign policy, demonstrates the constant push and pull between governments, business interests, and consumers that underpins the discussion and progression of multi-jurisdictional licensing.

Thentia Cloud makes powerful
regulatory software to help you
manage your board. Learn more

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