The SRA’s proposal to allow solicitors to work in unregulated businesses has been approved by the Legal Services Board. A sackful of dire predictions from almost every quarter can be found in the SRA’s collection of Consultation Responses. So it only remains to sit back and wait to see whether the doomsayers –including ourselves –are proved wrong. In two years’ time the abuses we fear may have started to come out of the woodwork: criminals controlling enterprises in the business of law, alternative legal services providers operating out of shell companies without effective insurance and without proper regulation, consumers confused by well-crafted notepaper employing the word ‘solicitor’.
The LSB have also approved the SRA’s revised Code of Conduct, the third rewrite in 11 years. It is less prescriptive, and our prediction is that the sacrifice of certainty will expose the profession to … uncertainty. Guidance is promised, but solicitors risk being at the mercy of the SRA, to whom the new Code delivers a broad latitude in interpretation.
In the meantime, the next seismic event likely to shake the legal world is in incubation: the UCL Faculty of Law’s independent review into the regulatory framework for legal services in the UK, led by Professor Stephen Mayson. It was prompted by theCompetition and Markets Authority’s ‘Legal Services market study’ (December 2016). We anticipate that the ‘reserved legal activities’ will be swept away and replaced by a more rational approach to what legal services need to be regulated. And we expect a recommendation that the multiplicity of regulators should be rationalised.
For now, we are already seeing some impact from the CMA’s report in the shape of the SRA Transparency Rules 2018, which come into force on 6th December 2018. Broadly, a law firm must publish on its website pricing information about certain of the legal services it offers, namely ones that private individuals and small businesses typically buy (even if your clients are wealthy individuals and multi-national corporations). To compare prices properly, you also need to compare the service being provided, but the occasional user cannot test-drive legal services. Branding may rise up the agenda for smaller firms. Consumers’ legal work may go to the biggest brand with the lowest price. That formula has not been an unmitigated success in other service sectors.
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