The Solicitors Regulation Authority (SRA) is considering whether to offer a number of schemes to help those in unregulated legal services, as part of a submission to the Competition and Market Authourity.
The SRA has revealed it could offer “activity-based licenses”, enabling lawyers to provide individual reserved legal activities.
The SRA said:
“We have found that through implementation of our reforms that they can be institutional resistance when trying to ease longstanding restrictions and requirements to be more flexible and proportionate. Such a change could therefore assist regulators with creating a more flexible and proportionate regulatory framework.”
But it continued that more could be done under the existing regulatory framework.
“For example, the development of activity-based licences (allowing individuals to provide individual reserved legal activities) has the potential to help address the issue of ‘all or nothing’ regulation raised in Professor Mayson’s report.
“This is something that we may explore in the future. We would explore benefits and disbenefits, with any proposals being subject to consultation.”
Another scheme being considered includes legal regulators offering voluntary regulation for those in the legal sector who are currently unregulated.
“Regulators could set requirements for providers wishing to be ‘accredited’ by them.”
The SRA acknowledged that the shorter-term idea of extending access to the Legal Ombudsman to the clients of unregulated legal services providers – as recommended by Professor Mayson and supported by the ombudsman – would provide a minimum safety net.
But this would “not be without its challenges”, the regulator said, such as in defining what was meant by legal services, agreeing a funding model and in bringing all providers within the scheme.
The SRA added:
“There are also risks in terms of the additional costs of regulation being passed on to consumers and the potential impact of additional regulation on the pace of innovation.
“Even a low level of regulation has the potential to dampen innovation. Further, there is no guarantee that additional regulation will improve consumer confidence in the wider unregulated legal services market.”
This article first appeared in Legal Futures.
