30 May 2007FICPI Loch Lomond2 Subtitle “I'm from the LSB, and I'm here to help you!”
30 May 2007FICPI Loch Lomond3 Bill – vital statistics 123 Pages 203 Clauses 24 Schedules (totalling 212 pages) Never mind the quality, feel the width...
30 May 2007FICPI Loch Lomond4 Why, What and How? Why a Legal Services Bill? What does it seek to do? – and to and for whom? What does it say? How will it work? (if – Self- regulation – complaints - ABSs Who will pay? What will it mean to the rest of the world?
30 May 2007FICPI Loch Lomond5 Why a Legal Services Bill? “The British legal system is the envy of the world” (1 st popular myth) “But it's fuddy-duddy and out-of-date” (2 nd popular myth) “There are far too many complaints about lawyers, and they're not dealt with fairly” “We can fix this by legislation!”
30 May 2007FICPI Loch Lomond6 Objectives A better deal for 'consumers' - through: A fair, rational, effective and uniform system for regulating lawyers By supervised self-regulation An efficient and independent complaints system More competition – by liberalising rules
30 May 2007FICPI Loch Lomond7 From the bill... The Regulatory Objectives (S1) a) The rule of law b) Access to justice c) Interests of consumers d) Competition e) Independent strong diverse effective profession f) Public understanding of rights and duties g) The 'professional principles' AND h) The public interest
30 May 2007FICPI Loch Lomond8 The Professional Principles “Authorised persons” should: Act with independence, integrity and in client's best interests; Maintain work standards Persons exercising a right of audience have a duty to the Court to act independently in interests of justice Clients' affairs must be kept confidential
30 May 2007FICPI Loch Lomond9 Authorised person?...is someone authorised to carry out reserved legal activities And 'reserved legal activities' are...? (s12.1) Exercising a right of audience Conducting litigation Reserved instrument activities (drafting deeds) Notarial and probate activities Administering oaths
30 May 2007FICPI Loch Lomond10 Who gets regulated? All 'lawyers'... More specifically: Barristers; Solicitors; Legal executives; Notaries; Licensed conveyancers; Commissioners for Oaths; Immigration advisers (see also Schedules 1- 24) AND Registered patent and trademark attorneys
30 May 2007FICPI Loch Lomond11 How will it work? By supervised self-regulation Existing professional bodies will be appointed as Front-line Regulators (FLRs) (the Law Society, the Bar Council, CIPA, ITMA...) FLRs will be overseen by a Legal Services Board (LSB)
30 May 2007FICPI Loch Lomond12 Legal Services Board (LSB) Makes rules for FLRs Must promote the 'regulatory objectives' Regulation to be 'transparent, accountable, proportionate, consistent' - and 'targeted only at those cases where action is needed' To have a Consumer Panel – but no Professional Panel LSB is Regulator of Last Resort
30 May 2007FICPI Loch Lomond13 “Approved regulators” (FLRs) (such as the Law Society, CIPA, etc) How do you regulate yourself? By separating regulatory and representative functions as far as possible independently “regulatory decisions to be taken as far as possible independently of representative..” representation The LSB may not interfere with representation
30 May 2007FICPI Loch Lomond14 Please explain... What is 'representation' and what is 'regulation'? Can they be completely separated? Is there anything else? How independently? – Different premises? – Different staff? – Different members? – Can 'reps' set policy?
30 May 2007FICPI Loch Lomond15 'Regulatory arrangements' (S20) Arrangements for: Authorising people to carry on reserved legal activities; for indemnification; for compensation; Rules for: practice; conduct; licensing; qualifying (exams); Any other arrangements not made “to represent or promote the interests of persons regulated.. ”
30 May 2007FICPI Loch Lomond16 CIPA and ITMA The Bill appoints both Institutes as FLRs How will they operate? Extra expense.. Aim: Two FLRs that beat as one! Formally distinct, practically (almost?) identical... - Common rules - Common membership - Common support - A single practice fee? How will 'the FLR' relate to the two Institutes?
30 May 2007FICPI Loch Lomond17 Complaints Should be most efficiently dealt with by the relevant FLR? This theory disproved by the Law Society So – FLRs allowed no role in complaints at all All 'authorised persons' must have complaints procedure New “Office of Legal Complaints” (OLC) will hear all unresolved complaints Lawyer will pay, regardless of finding
30 May 2007FICPI Loch Lomond18 ABSs – 'Walmart law' cAlternative Business Structures Promoting competition – too many inhibiting professional rules Cautious partial liberalisation
30 May 2007FICPI Loch Lomond19 Licensing of ABSs Bodies may be licensed to perform reserved legal activities (and other activities) By the LSB or an approved FLR Registers of licensed bodies
30 May 2007FICPI Loch Lomond20 ABSs must have... A Head of Legal Practice –who makes sure the body keeps the legal rules – and reports if it doesn't A Head of Finance and Admin – who makes sure the body keeps the accounting rules (and reports if it doesn't)
30 May 2007FICPI Loch Lomond21 Ownership of ABSs (Part-)Owners who are not 'authorised persons' are subject to approval (Sch 13) Must be 'fit and proper person'; not compromise 'regulatory objectives' OLS will make rules (about probity, financial position, associates, etc, etc)
30 May 2007FICPI Loch Lomond22 Time-line Passed through House of Lords Goes to Commons in early June Royal Assent end July (???) Appointments start with Royal Assent LSB opens for business Spring 2010 (?) OLC opens for business Summer 2010 (?)
30 May 2007FICPI Loch Lomond23 Who pays? (and how much?) The legal professions pay - on behalf of their users - both for FLR (internal) and LSB/OLC (external ) Government will not contribute either to start- up or running costs Registration fee (now $150) may go to $1500 - $2000 Separate fee for bodies
30 May 2007FICPI Loch Lomond24 How will life change? Two views: Polyannas Cassandras
30 May 2007FICPI Loch Lomond25 Polyannas say: More regulation is a good thing – must encourage higher standards New bodies will act sensibly and proportionately The new complaints procedure will save effort The estimated costs are maxima, and anyway not unreasonable - 'rebalancing' ABSs are a definite advantage Why all the fuss?
30 May 2007FICPI Loch Lomond26 Cassandras say: –The nature of the profession will change - we're losing control of our affairs – We can't even ensure our independent FLR will act sensibly, let alone the LSB or OLC –Attorneys don't need to register –The fewer people register, the more the costs will escalate and fewer still will register –The complaints system is crazy, as the OLC knows nothing about our business –ABS regulations will impose extra burdens on existing firms
30 May 2007FICPI Loch Lomond27 Who is right? Time will tell... Some existing attorneys will surely deregister - (sole practitioners – industry employees) Perhaps not enough to undermine the system EPAs can practice with minimum of regulation 'Professional privilege' may be decisive
30 May 2007FICPI Loch Lomond28 What will it mean to the rest of the world? A more highly regulated UK profession - may be good or bad Lower costs – because of competition? Higher costs – because of over-regulation? (effects might spread) Commercial opportunities from ABSs? Lower CIPA membership fees?