Accountancy Body to Hand Designated Legal Regulatory Powers to CILEx

The Association of Chartered Accountants (ACCA) in England and Wales is to withdraw from legal services regulation in a UK first. The legal activities that are exercised by its members will now be regulated in a new partnership by CILEx Regulation (CRL), the regulatory body for Chartered Legal Executives. Under the Legal Services Act 2007 (LSA), probate was listed as a reserved legal activity, meaning that regulators who administered the right to provide probate services could be approved as legal service regulators, by the overarching regulator, the Legal Service Board.

The ACCA was approved to regulate probate in 2009, but only began actively regulating in 2018. Under the LSA, there has always been the option for any of the regulatory bodies to regulate multiple different professions, however, the transfer to regulation by CRL, which will take place over the coming months, marks the first time this will have happened in practice. This transfer will allow the 52 ACCA accredited firms to continue to practice, however, it will not affect the 300 firms regulated by the ICAEW.

The move came in the light of new governance rules that have been put in place by the LSB, as well as the fact that the ACCA was not licensed to regulate alternative business structures, and obtaining the licence would ultimately prove too costly. They, therefore, stated that “Against that backdrop and that the provision of legal services sits as an adjunct to general practice, we believe partnering with another legal services regulator provides a pragmatic and cost-effective way to support practitioners to diversify their service offerings”.

Carilyn Burman, chief executive of CILEx Regulation, said she was confident that it could offer “a number of benefits, including an opportunity for ACCA probate practitioners to join forces with other legal and non-legal professionals as ABSs, which will further encourage competition and diversity within the legal services market”.

Dr Helen Phillips, chair of the LSB, has said: “Enhancing regulatory independence has been a long-term strategic priority for the LSB and I am pleased the regulators are now able to confirm they have the appropriate separations in place between regulatory and representative functions. This is a significant achievement and means consumers can have increased certainty that decisions made by regulators are independent.”

Read more about the decision or see more about the regulatory structure in England and Wales

 

0

Utah to be First US State to Trial Non-Lawyer Ownership

Utah has become the first state in the US to allow non-lawyer ownership of legal services providers. This month the State Supreme Court unanimously voted in favour of approving a 2-year sandbox programme which would licence new forms of legal services ownership.

The move has come about in the face of continued concerns over access to justice, particularly in the face of the ongoing COVID-19 pandemic. The courts have cited the reasoning that regulation should focus primarily on serving the consumer, and acting in their best interests, with Utah Supreme Court Justice Deno Himonas saying “changes will enable individuals and entities to explore creative ways to safely allow lawyers and non-lawyers to practise law and to reduce constraints on how lawyers market and promote services. New forms of providers could include partnerships, corporations and companies and non-profit organisations partnering with other entities to offer legal services.”

Whilst the Utah profession is comparatively small, with 26 lawyers per 10,000 residents compared with 92 in New York and 43 in California, the result of the sandbox will be closely watched by other state bars, particularly in the light of similar moves being discussed in California, and calls by the ABA for other states to follow suit.

Read more about the decision or view the standing order.

0

Philippines Authorises Video Notarization in Quarantined Areas

The Philippines Supreme Court has released updated rules that allow video conferencing software to be used for the notarization of documents in areas under quarantine due to public health concerns.  The authorisation is contained in A.M. No. 20-07-04-SC, otherwise known as the 2020 Interim Rules on Remote Notarization of Paper Documents.

The Rules shall be limited to the notarization of paper documents and instruments with handwritten signatures or marks through the use of videoconferencing facilities. However, they shall not apply to the execution of notarial wills.

Read more about the changes or view the updated rules.

0

The future of legal services in England and Wales – reviewing regulation, consumer protection and responding to innovation

Tuesday, 15th September 2020
Online

Leader of the review Professor Stephen Mayson, Centre for Ethics & Law, UCL is a keynote speaker at this conference.

The report makes recommendations for the future of legal services, including:

  • a single independent regulator for the legal sector – the Legal Services Regulation Authority – to replace the current arrangement of ten front-line regulators with additional oversight by the Legal Services Board regulator
  • replacing the current reserved legal activities, by categorising all legal services and regulating them to different degrees according to the risk to public interest of the work
  • all legal services providers being registered and regulated – thereby moving away from regulating lawyers by their professional title and, instead, towards the work they undertake
  • measures for ensuring those who are unable to afford a regulated lawyer are not left without access to legal advice
  • the provision of a single point of entry for all consumer complaints

Also making keynote contributions are: Clare Hayes, Deputy Director of UK Legal Services & Innovation, Ministry of Justice; Peter Rowlinson, Head of UK Legal Services Policy, Ministry of Justice; and Rachel Wood, Executive Director of Regulation, Law Society of Scotland.

Find out more and register

0

LSB plans to review regulatory structure

A paper by Steve Brooker, head of policy development and research at the Legal Services Board, released on the 4th of June, has suggested that the LSB should review the regulatory structure, including the reserved legal activities within its current powers. The report comes in the wake of indications from the UK’s Ministry of Justice suggesting that legislative reform of legal services is currently not on the table. The report, therefore, suggested to the LSB that work should be done to investigate the current efficacy of the reserved legal activities, and how they could be changed within the boundaries of the current act. The report stresses that currently the reserved activities are based on historical need, and do not accurately reflect modern legal practice, leaving many providers unregulated, often wishing to be formally regulated, but unable to as they do not fall within the act.

Read the full LSB paper (PDF).

0

Mayson Report: Final report published

The highly anticipated denouement of the Independent Review of Legal Services, which was first launched in October 2018, was published on the 11th June. The 340-page report which has been informed by a number of working papers, as well as an interim report, which has been fed into by a variety of actors in the legal sector is entitled Reforming legal services: Regulation beyond the echo chambers.

Professor Mayson has suggested in the report that all providers of legal services, should be registered and regulated by a single regulator, whether they are legally qualified or not. He suggested that regulation should move from the regulation of lawyers to the regulation of legal services, with different levels of regulation being applied depending on the public risk inherent in the work. By extension, this would mean that traditional legal qualifications would no longer be the sole entry point into the profession.

The report has been submitted to the Lord Chancellor, however, the Ministry of Justice in the UK has suggested that they currently do not plan to review the Legal Services Act 2007. Professor Mayson has therefore suggested shorter-term measures that can be introduced, as he feels that action must come sooner rather than later.

Professor Mayson suggested that especially as demand has moved online, the public are increasingly unaware of their rights in relation to regulated professionals, whilst lawyers are operating under a system where only a small percentage of their work is covered under the regulatory regimes they are supposed to work under. “The conclusion of this review is that the regulatory framework should better reflect the legitimate needs and expectations of the more than 90% of the population for whom it is not currently designed,” he wrote. The new framework would also allow for new provides such as lawtech providers to act within a regulated sector. 

Professor Mayson also described the current arrangement of 10 front-line regulators plus an oversight regulator as “cumbersome”, and recommended replacing it with a single, independent regulator – the Legal Services Regulation Authority (LSRA). “The requirement for flexibility, consistency, coherence and coordination across regulation within the legal services sector necessarily leads to a single regulator,” the report said.

Download a full copy of the report (PDF).

The response from regulators has been mixed with CILEx (read the CILEx response) and the Association of Costs Lawyers (read the Association of Costs Lawyers response) backing professor Mayson’s report, and the LSB (read the LSB response) saying that they will carefully consider his recommendations in relation to their ongoing work in reforming legal regulation. Whilst the Law Society (read the Law Society response) has suggested that given the ongoing COVID-19 crisis, now is not the time to discuss reforms.

Also see the article at Legal Futures for a further breakdown of the regulatory responses.

0

Two COVID-19 Lessons that Were Long Overdue to Kenya’s Justice Sector

Abstract

The two decisions made by policymakers in Kenya’s because of COVID-19 were timely but were bound to happen. they are direct economic benefits for reducing the prison population and use of technology in courts. If the Prison population is reduced at least by 10%, the prison population will reduce by 22,372 prisoners. Using the GDP Per Capita as of 2018, we estimate that income gained would be equivalent to Ksh 4.3 billion whereas a 30% prison population reduction would be 67,115 prisoners and equivalent to Ksh 12.9 billion. The mechanism of technology must allow for more accountability.

Citation
Kemboi, Leo Kipkogei, Two COVID-19 Lessons that Were Long Overdue to Kenya’s Justice Sector (June 12, 2020).

Available from the SSRN site.

1+

Law Society of New South Wales welcomes electronic witnessing of legal documents

Richard Harvey, President of the Law Society of New South Wales, has welcomed changes implemented by the NSW government and Attorney General, allowing for electronic witnessing of legal documents.  The move has come about as a temporary reaction to the ongoing COVID-19 crisis, and has been added to the Electronic Transactions Regulation 2017.

Mr Harvey has said:

“As a result of COVID-19 restrictions, many solicitors contacted the Law Society expressing concern about the difficulties that the restrictions have created for the witnessing of legal documents.  The Law Society immediately raised these concerns with the NSW Government, and I would like to thank the Attorney General for moving so quickly to enact these provisions.  I am pleased that solicitors now have a practical alternative for the witnessing of documents in the coming weeks and months.”

For more information click here.

 

0

California Bar moves towards regulatory sandbox

The Board of Trustees of the State Bar of California took a 9-2 decision on the 14th May 2020 to form a working group to look into forming a regulatory sandbox in which innovative legal service providers would be subject to fewer regulations. This could include limiting unauthorised practice of law rules, as well as removing limits on fee sharing and partnership between lawyers and non-lawyers.

The decision is a major step forward in a potential move towards innovative business structures in California, following a vote to delay the decision by the Board in March, with board members saying they needed more time to consider the proposals.

Following the board meeting, which was held over Zoom, Chairman Alan Steinbrecher (who as Chairman did not vote) said: “This is a significant step and I think it will lead to an exciting future,”.

For more information see:

0

AI Regulation in Europe

Abstract

With the regulation of Artificial Intelligence (AI), the European Commission is addressing one of the central issues of our time. However, a number of core legal questions are still unresolved. Against this background, the article in a first step lays regulatory foundations by examining the possible scope of a future AI regulation, and by discussing legal strategies for implementing a risk-based approach.

In this respect, I suggest an adaptation of the Lamfalussy procedure, known from capital markets law, which would combine horizontal and vertical elements of regulation at several levels. This should include, at Level 1, principles for AI development and application, as well as sector-specific regulation, safe harbors and guidelines at Levels 2-4. In this way, legal flexibility for covering novel technological developments can be effectively combined with a sufficient amount of legal certainty for companies and AI developers.

In a second step, the article implements this framework by addressing key specific issues of AI regulation at the EU level, such as: documentation and access requirements; a regulatory framework for training data; a revision of product liability and safety law; strengthened enforcement; and a right to a data-free option.

Citation
Hacker, Philipp, AI Regulation in Europe (May 7, 2020). 

Download the full paper from the SSRN

0