Monday, 23 November 2009

The Legal Services Board Consultation Paper on Alternative Business Structures

The Legal Services Board has just issued a consultation paper on 18 November 2009 “Alternative business structures: approaches to licensing

The consultation, which has a huge impact on future of conveyancing, is to close 19 February 2010.

The consultation and invites licensed conveyancers to submit comments either to the Legal Services Board direct or the Council of Licensed Conveyancers.

The issues raised in the consultation are very important to the to the future of conveyancing and the licensed conveyancer industry as well as to the other branches of the legal profession such as conveyancing solicitors.

It's not difficult to find a licensed conveyancer practices currently have non lawyer managers or have owners who are not lawyers. All these conveyancing firms will need to become licensed bodies (also known as Alternative Business Structures) regulated by the Council of Licensed Conveyancers as one of a number of licensing authorities.

The Consultation Paper sets out in varying degrees of detail the nature of the rules it expects licensing authorities to make. For instance, as a licensing authority the CLC will require each licensed body to have a Head of Legal Practice and a Head of Finance and Administration. All Managers (principally partners and directors) and owners will have to pass a “fitness to practise” test. Other important issues are raised: requirements for governance of the practice, indemnity insurance, arrangements for compensation, reserved and unreserved services, access to justice.

The rules for ABSs will be different from the rules for licensed conveyancer practices. The Council of Licensed Conveyancers have already made it clear that their current view is that the two regulatory regimes should be very closely aligned although they will not be identical. All licensed conveyancers will therefore be affected by these changes regardless of whether or not they choose to practise in an Alternative Business Structures.

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