Editors Blog
Raising the level of the playing field
30 Oct 09
Legal Services Bill could mean extra rules for all
Achieving a level playing field has been a consistent demand from the legal profession as Government has moved towards relaxing the restrictions on non-lawyers being involved in providing legal services.
In other words, we don't fear competition as long as they too have to offer professional indemnity insurance cover, observe rules regarding client funds and so on.
Now that we have sight of the Legal Services Bill, it seems that the Government may have taken this more seriously than the profession bargained for: so much so that there are rules proposed for the new licensed legal services providers (legal services businesses owned partly or wholly by non-lawyers) which have no equivalent in the current rules governing the solicitors' profession.
There are provisions requiring the officers to be appointed to these services providers essentially to fulfil a whistleblowing function - to report their own firm to its regulator if they discover it has been in breach of any of its regulatory duties. Similarly if it runs into financial difficulties or there is otherwise a threat to it continuing to provide client services.
These duties are not to be found in solicitors' professional rules at present - so the profession faces the choice of upping its game in response or risking being seen to be less well regulated than its competitors.
Curiously, should a legal firm decide it wants to take advantage of the new regime and register as a service provider, it cannot do so as the bill is drafted without taking on at least one non-lawyer member or partner - and that of course instantly disqualifies it from being a legal firm as currently understood. Would a true level playing field not set out to avoid such demarcations?