The Legal Services Bill, which is now going through Parliament, will create an entirely new way for law firms to be run. Many 21st-century lawyers will be very commercially-minded. The key objective is ‘alternative business structures’. It means outside investors can, for the first time, buy into legal practices as shareholding owners. The Bill provides for regulation by the Legal Standards Board (LSB). Thus the legal profession faces a new system for legal practice with oversight by a new regulator, neither having any experience relevant to this system.
The Bill essentially leaves regulatory standards to the LSB – fitness to own, amount of outside shareholding, conflicts of interest and the protection of the public interest. There may be successful amendments which clarify some of these matters on the face of the Bill.
