Minister moves to strip Britain’s legal industry of self-regulation
Mr Falconer said he would go ahead with proposals to end self-regulation by the Law Society and the Bar Council.
He also indicated the so-called “Tesco law” - allowing outside companies to own and run law firms - will be given the go-ahead.
The minister said he would go ahead with the creation of a new regulator to deal with consumers’ complaints about solicitors, barristers and other legal professionals.
“A single complaints body means consistent, fair and professional handling of cases for all complainants,” said Mr Falconer.
“I reject the view that centralisation will lead to a slower service for consumers.
“The sector and, vitally, the consumer would benefit from a single complaints body.”
Professional bodies such as the Law Society and Bar Council will face being derecognised if they fail in their duties.
A new Legal Services Board (LSB) will oversee their regulatory work and will have a “sliding scale” of powers such as setting targets and imposing fines.
“Derecognising a professional body if that body fails in its duties is the nuclear option,” said Mr Falconer.
“But it will be there to be used, if needed.”
The LSB may also be able to take over one or more regulatory functions from a professional body which is deemed to be failing, he said.
Discussing the prospect of “Tesco law” Mr Falconer said: “Currently, external investment is not permitted in law firms.
“This is restrictive. It hampers the development of the practice and discourages innovation. But why, with proper safeguards, should that not be permitted? Consumers want a diversity of providers.
He said the system was also inflexible because it prevented lawyers having partnerships with non-lawyers.
“It is not unusual for a business to need legal or financial advice at the same time - quite the opposite.
CONNECT WITH US TODAY
Be the first to know the latest news and updates
