LSB calls for input on regulation of alternative business structures
The Legal Services Board (LSB) is calling for responses from the profession on the regulatory framework for alternative business structures (ABS), launching its consultation on the issue at the Legal Week Future of Legal Services Forum.LSB chairman David Edmonds used his keynote address at the conference, held in Central London last week (14 May), to issue a discussion paper to help build a regulatory framework for ABS, the radical new model which will allow legal services to be provided outside traditional partnerships.
By Claire Ruckin|May 21, 2009 at 12:15 AM
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LSB chair addresses plans for new business structures at Future of Legal Services Forum
The Legal Services Board (LSB) is calling for responses from the profession on the regulatory framework for alternative business structures (ABS), launching its consultation on the issue at the Legal Week Future of Legal Services Forum.
LSB chairman David Edmonds (pictured) used his keynote address at the conference, held in Central London last week (14 May), to issue a discussion paper to help build a regulatory framework for ABS, the radical new model which will allow legal services to be provided outside traditional partnerships.
Edmonds told delegates: “We need to scale back outdated restrictions on ownership, management and financing.”
He added: “[The discussion paper] is one which moves debate to the next level – practical implementation, not economic theory. That debate will, in turn, identify the key opportunities and unique risks posed by ABS.”
Questions in the paper ask whether the target launch date of mid-2011 is desirable and achievable, how complaints handling would work, how the legal services market will change as a result of opening up the market and what impact new structures could have on diversity. It also goes into detail on practical licensing and regulation issues of approved regulators.
Responses are due by 14 August, 2009, with a more detailed consultation on the content of licensing rules set to be issued later this year.
The LSB is working to a robust framework for implementing ABS, which will allow for external ownership of law firms. The model is set to be up and running from mid-2011.
A key issue will be the awarding of licensing powers to regulators to approve applications to provide legal services through an ABS. Edmonds said the LSB is aiming to take applications from approved regulators to becoming licensing bodies for ABS from 2010, with the Solicitors Regulation Authority (SRA) already indicating its interest in securing licensing powers.
The timetable for the changes, which will see a shift to entity-based regulation rather than focusing on individual practitioners – by approved regulators such as the SRA – has already provoked controversy with the Law Society concerned at the pace of implementation.
Future of Legal Services Forum: Talking heads
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