Shaking Up the Legal ProfessionWednesday, November 18th, 2009
Whether the legal profession in the UK is screaming for pleasure or because of the agonizing pain is open to interpretation after two announcements today. The Legal Services Board announced and published its consultation paper on alternative business structures, titled, Alternative Business Structures: Approaches to Licensing. It’s 113 pages long so I haven’t read it yet, but the summary says:
The paper proposes removing restrictions that have, until now, prevented non-lawyers from owning legal service businesses. The new rules will mean that lawyers will have new freedoms to provide their services alongside services from non-lawyers, and for existing legal practices to attract new external investment. A robust framework of consumer protection, professional competence and commercial integrity is at the heart of proposals. The LSB is currently consulting on guidance to govern the licensing of these new models of service delivery. There are three key protections. • a test to ensure that non-lawyer owners and managers of new forms of legal practice are fit and proper; • the introduction of two new roles in every new firm: the Head of Legal Practice and Head of Finance and Administration who will ensure compliance with licence requirements; • a widening of the complaints handling system to deal with complaints about firms that do not deliver legal services in isolation but instead offer these alongside other services (for example, financial services) whilst ensuring access to the Office for Legal Complaints. The new framework aims to ensure that lawyers and non-lawyers alike have the commercial freedom to provide legal services to consumers in ways that harness commercial creativity, maximise business efficiencies, embed professional ethics and meet consumer demand. It has the potential to allow consumers to access their legal services in a variety of new different ways, for example as a part of a ‘one stop shop’ with other professional services such as insurance, tax advice and accountancy, or through existing legal practices diversifying and developing with the benefit of external investment. The guidance announced today sets out principles that new ‘licensing authorities’ will be expected to regulate in accordance with, anticipating that the first licences will be issued by mid 2011. The responsibility for ensuring that current restrictions on individual lawyers preventing them from developing new forms of practice lies with the eight Approved Regulators overseen by the LSB.The second piece of news concerns the Bar. Its regulator, the Bar Standards Board, has decided, apparently (decision due 19 November), to permit partnerships between barristers and with others. Frances Gibb of the TimesOnline reports:
Hundreds of years of tradition may be ditched today when the ban on barristers joining in partnership with other professionals is lifted.The decision, to be taken at a public meeting by the Bar Standards Board, the profession’s regulator, has provoked furious controversy because key papers have not been released in advance. At present barristers cannot form partnerships with each other or with solicitors, and neither can form partnerships with other professionals such as accountants or surveyors. The Legal Services Act paves the way for a complete shake-up in the legal market and sweeps away current restrictions.Of course the problem with Munch’s screamer was solved by its theft. But I don’t think anyone is going to steal away the Legal Services Board or the Bar Standards Board just yet. Lawyers will have to adjust and it’s not that difficult. The 21st arrived a while ago.