Law Society Council approves plan to become ABS licensing authority

The Council of the Law Society has agreed to apply to become a designated licensing authority for alternative business structures ahead of introduction of the new regime later this year.

The application was prepared by the Solicitors Regulation Authority. On the current Legal Services Board timetable, ABSs will be able to start operating from 6 October 2011. The Law Society said it would issue a practice note on the issue in May.

Law Society chief executive Desmond Hudson said: “The Law Society believes it is right that we should seek to regulate ABS and we want to be certain that the regulatory framework guarantees the same levels of probity and consumer protection that has been the tradition of the solicitors profession.

“The Law Society Council has examined the proposals from the SRA very carefully and voted to put forward the application to the Legal Services Board.”

Hudson said that with the introduction of ABS, law firms would have to consider what the best structure for their business would be.

“An ABS business model will not suit every firm, and over the coming months the Law Society will run a programme of national road shows offering advice and support for the profession,” he added.

Charles Plant, chairman of the SRA Board, said: "We are delighted that the application for the SRA to become a licensing authority for alternative business structures has been approved.”

He insisted that the SRA remained on track to receive applications from potential ABS from August, and to enable the first ABS to operate from 6 October.

Plant added: "The application is the culmination of a determined effort by the SRA, working with consumer groups, the Law Society and other professional organisations, the Legal Services Board, and others to deliver a rigorous regulatory system which enables wider choice for consumers while preserving high professional standards. It demonstrates the SRA's ability to deliver a reformed regulatory system to a demanding schedule."

Chancery Lane's move towards becoming an ABS licensing authority has been sharply criticised by the Solicitor Sole Practitioners Group, which previously threatened to call a postal ballot of all solicitors if the Law Society Council backed the application.