News In Focus
23 February 2010
October next year for ABS in England & Wales
New forms of legal practice will operate in England & Wales from 6 October next year, the Legal Services Board confirmed today.
The announcement sees a firm timetable for completion of the reforms under the Legal Services Act 2007, which will permit multi-disciplinary practices and externally owned legal firms, collectively known as alternative business structures (ABS).
Businesses hoping to provide legal services will be able to apply for licences from mid-2011.
Legal Services Board Chairman David Edmonds described the timetable as "challenging, but realistic". He commented: “Today’s announcement is a significant milestone. It gives certainty to the approved regulators, the firms they regulate and to potential new entrants alike. Moreover, it paves the way for real benefits to be delivered to consumers on the fastest possible timetable."
Flexibility
Mr Edwards said the schedule gave time for regulators to prepare their licensing framework for ABS, and promised to ensure "focus on outcomes for consumers, rather than over-complicated rules that stifle innovation and better value".
He added: "We have been clear that we want traditional firms to have similar flexibility as well. So we welcome the commitment of the Solicitors Regulation Authority to move ahead with outcome-focused regulation on a similar timetable.
"But we will also work with all potential licensing authorities to ensure that they have not just the framework, but also the skills and infrastructure in place to monitor these new businesses to give consumers confidence that necessary safeguards are in place.”
The LSB will shortly publish guidance explaining how applications for becoming licensing authorities for ABS from approved regulators will be evaluated, following a consultation exercise. This will be followed by final guidance to potential licensing authorities on the content of their regulatory frameworks.
These documents will allow the LSB to consider applications from those seeking to become licensing authorities later this year.
Scottish challenge
Similar reforms for Scotland are currently under consideration at Holyrood under the Legal Services (Scotland) Bill. The Law Society of Scotland is currently facing a challenge to its support for the bill from the Scottish Law Agents Society, which has announced it is to requisition a special general meeting on the question whether external ownership of legal practices should be permitted.