FOR IMMEDIATE RELEASE
Friday, 19 August 2016
LSB responds to the CMA interim report
The Legal Services Board (LSB) publishes today its comments on the Competition and Market Authority’s (CMA) interim report for its legal services market study.
In its response, the LSB supports the report’s findings and agrees with the initial conclusions made by the CMA.
The LSB concurs with the CMA’s analysis that there is a need for more transparency of price and service quality. The absence of such indicators inhibits consumer choice, reducing the incentives for providers to compete on price, quality and innovation.
The LSB response also notes other features of the legal services market that affect competition in the sector. Consumers tend to purchase legal services infrequently and at times of distress. In addition, there is a legacy of strong professional identities that may impact upon competition.
The LSB therefore recommends that market transparency measures should be combined with both short and long term regulatory reform to ensure that the market both works in the public interest and responds better to consumer needs.
Neil Buckley, Chief Executive of the Legal Services Board said:
“We welcome the CMA’s interim report. It provides a clear analysis of the legal services market, its strengths and weaknesses and sets out a range of proposals as to how the market needs to work better for consumers.
We believe that transparency can be improved and consumers empowered. However, we believe there are other inherent features of legal services which make it challenging to rely on consumers alone to actively shape the market.
Well-designed market transparency measures need to be advanced in tandem with regulatory reform of the legislative framework as this could contribute directly to increasing competition in this sector.
We look forward to working with the CMA to help them shape a set of transparency remedies and other measures that are practical, proportionate and consumer friendly.”
ENDS
For further information, please contact the LSB's Communications Manager, Vincent McGovern (020 7271 0068).
Notes for editors:
- The Legal Services Board’s (LSB) response to the Competition & Market Authority’s (CMA) interim report into the legal services market can be found here.
- The CMA’s interim report can be found here.
- The LSB’s February letter to the CMA regarding the statement of scope (plus annex) can be found here.
- The CMA legal services market study was announced on 13 January. For more information please see here.
- The Legal Services Act 2007 (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.
- 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 2007 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.
- As at 1 April 2016, the legal profession in England and Wales comprised 145,059 solicitors, 15,288 barristers, 6,848 chartered legal executives and 5,697 other individuals operating in other areas of the legal profession such as conveyancing. The UK legal sector is valued at £32 billion per annum (2015) which is up 23% in cash terms since 2012. For more information see here.