New ABSs critical of application process
The Solicitors Regulation Authority has too few resources to handle the licensing of alternative business structures (ABSs) and should ‘triple in size or work 24 hours a day,’ the senior partner of one of the four firms licensed this week told the Gazette.
The four new ABSs are two-partner Lancashire firm Mulderrigs; four-partner Manchester firm Amelans; 18-partner Swansea firm John Collins & Partners (JCP); and 40-partner City firm Winckworth Sherwood.
Mulderrigs managing director Paul Mulderrig said his firm had converted to an ABS to ‘protect the value of a family asset’ by enabling his wife to have an interest in the firm. He told the Gazette: ‘Until now, if I dropped dead, Mrs Mulderrig would have had to have a fire sale of the business that I’ve devoted 20 years to building.
‘The ABS allows her to have an interest in the firm. It is a joint asset now – and that thought gives me peace of mind. I’m surprised more high street firms are not going down the ABS route.’
‘We are not actively seeking external funding, but if a hedge fund happens along and offers us a couple of billion, we’ll give it serious consideration.’
Amelans and JCP had both become legal disciplinary practices in order to make non-lawyers members equity partners, and are therefore required to convert to ABS status.
Amelans senior partner Andrew Twambley said: ‘Becoming an ABS has given us a whole new outlook on how we can go forward, using our ABS status as a springboard.’
Muderrig and Twambley criticised the application process. Mulderrig said the paperwork was a ‘disgrace’ but he praised the ‘thorough and helpful’ SRA staff.
Twambley complained about the ‘long drawn-out process’ and said: ‘People don’t realise how deeply the SRA goes into detail. We are a four-partner firm. What must the process be like for a complex, multi-tasking, multinational firm?
'The SRA needs more resources - it needs to triple in size or work 24 hours a day,’ he said.
Nobody was available for comment at Winckworth Sherwood.