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FOR IMMEDIATE RELEASE
Monday, 27 July 2015

 

The case for change: legislative options beyond the Legal Services Act 2007

The Legal Services Board (LSB) today publishes a paper exploring options for reform of the Legal Services Act 2007 (the Act). The paper is the product of LSB-facilitated cross-regulator discussions over the last six months amongst all the legal regulators, chaired by Professor Stephen Mayson.

The paper, which has been shared with Ministers, describes some of the choices ahead and the regulatory tools that are available, to inform further debate and discussion.

Without attempting to provide definitive answers or positions, the paper considers a core set of issues that could frame possible future reform, such as:

  • the case for fundamental change to the Act including what should be regulated
  • the rationale for sector-specific regulation
  • the dynamics and tension between regulation of activities, individuals, entities and titles
  • regulatory independence, and
  • the shape of the regulatory infrastructure.

Legal Services Board Chairman, Sir Michael Pitt,said:

"I very much welcome the recent indication by the Lord Chancellor that he wishes to review the Legal Services Act during the lifetime of this Parliament. The paper we are publishing today sets out a series of issues and options for further discussion to help inform the design of any reform package, should the opportunity of a new legislative framework arise.

Irrespective of any future reform, however, we recognise our responsibility to maximise the potential of the existing legal framework; indeed, we want the process of regulatory reform to accelerate. Whilst there may not be a ‘burning platform’ for emergency action, there is a compelling case to introduce a new regulatory settlement for the medium-term.

Regulation has the potential to make a very real contribution to unlocking growth, increasing productivity and addressing the significant unmet need for legal services. To do so, the regulatory framework must be more efficient and effective in seeking to promote strong and fair competition. It has to be capable of responding to rapidly changing conditions in the market whilst also maintaining necessary protections for consumers and the public interest.

The LSB will continue to develop its thinking on what the key elements of such a regulatory framework might be.

I’m grateful to the legal regulators for their active engagement in helping to develop this paper. Difficult choices lie ahead, but I hope the paper is a worthwhile contribution to the ongoing debate about the future of legal services regulation."

For further information, please contact Communications Manager, Vincent McGovern vincent.mcgovern@legalservicesboard.org.uk or by calling 020 7271 0068.

 

Notes for editors:

  1. The views in the paper do not represent the views of any individual regulator, nor the simple sum of collective views.

  2. In July 2014, Ministers challenged the legal services regulators to seek further deregulation in the sector. This paper is one of the responses to this challenge. The accompanying letter to Shailesh Vara MP, Parliamentary Under Secretary of State at the Ministry of Justice, can be found here.

  3. Chaired by Professor Stephen Mayson, the cross-regulator discussions involved representatives of the Bar Standards Board, CILEx Regulation, the Costs Lawyer Standards Board, the Council for Licensed Conveyancers, the Institute for Chartered Accountants in England and Wales, the Intellectual Property Regulation Board, the Legal Services Board, the Master of the Faculties, and the Solicitors Regulation Authority.

  4. On 15 July 2015, in a session with the Justice Select Committee, the Lord Chancellor confirmed his view that there would be a review of the Legal Services Act 2007 (the Act) in the lifetime of this Parliament.

  5. Any decision on possible future reform of the legislative framework is a matter solely for Ministers and the Ministry of Justice.

  6. On 20 July 2015 the LSB published the regulators’ collective response to the cross-economy drive to find more opportunities for deregulation. This response can be found here.

  7. The Act created the LSB as a new regulator with responsibility for overseeing the regulation of legal services in England and Wales. The new regulatory regime became active on 1 January 2010.

  8. The LSB oversees nine approved regulators, which in turn regulate individual legal practitioners. The approved regulators, designated under Part 1 of Schedule 4 of the Act, are the Law Society, the Bar Council, the Master of the Faculties, the Chartered Institute of Legal Executives, the Council for Licensed Conveyancers, the Chartered Institute of Patent Attorneys, the Institute of Trade Mark Attorneys, the Association of Costs Lawyers and the Institute of Chartered Accountants in England and Wales.

    In addition, the Institute of Chartered Accountants of Scotland and the Association of Chartered Certified Accountants are listed as approved regulators in relation only to reserved probate activities.

  9. As at 1 April 2015, the legal profession comprised 142,109 solicitors, close to 500 alternative business structures, 15,237 barristers, 7,848 chartered legalexecutives and 5,678 other individuals operating in other areas of the legal profession such as conveyancing. The sector is valued at £29.2 billion per annum (total turnover in 2013).