As the profession prepares for the advent of legal disciplinary partnerships, a balance must be struck between the need for public protection and greater flexibility.

The new types of legal firm that we have been talking about for so many years will shortly start to become reality.

The advent of legal disciplinary partnerships (LDPs) next spring will mark the beginning of two very significant shifts in legal services. The first will be an increasing focus of regulation on the firms or entities solicitors work in – though individual solicitors will remain accountable for their actions. The second, for those practices that want to embrace the flexibility offered by the Legal Services Act 2007, will be towards greater professional diversification within firms.

The Solicitors Regulation Authority’s work on implementing the act is dominated by the need to balance the need for public protection with the desire for greater flexibility and the avoidance of unnecessary controls.

New model

LDPs give firms an opportunity to recognise and retain people who contribute to their success. All sizes of practice can do this. Even sole practitioners will be able to take on as partners other types of legal professional, such as legal executives and licensed conveyancers.

If you have not yet considered whether to take advantage of the new rules, a good starting point might be to visit the Legal Services Act section of our website, www.sra.org.uk. It includes a 'frequently asked questions' section.

The SRA has now made the new rules for LDPs. We have consulted extensively on them – again, all the details are on our website. We are extremely grateful for the many responses, as a result of which we made significant changes to the details of the rules.

Playing by the rules

The rules are now going through the statutory approval process – involving, among others, the Secretary of State for Justice, the Lord Chief Justice, the Master of the Rolls and the Office of Fair Trading. We remain hopeful that this will be concluded in time for us to implement LDPs and firm-based regulation from 1 March 2009. At that point, existing partnerships will be ‘passported’ to become recognised bodies. However, all new partnerships setting up will need to get recognised before they start to practise.

There will be a separate system for sole practitioners. Existing sole practitioners will be ‘passported’ to become recognised sole practitioners, in much the same way as existing partnerships. However, from 1 July 2009, anybody wanting to start to practise as a sole practitioner will need to be authorised by the SRA as a recognised sole practitioner. This is so we can regulate them in the same way as recognised bodies. Solicitors wishing to set up a new sole practice will need to give the SRA notice, but we do not yet know how long that will have to be.

Necessary bureaucracy

I suspect all this might prompt a chorus of: ‘Not more pointless bureaucracy!’ If it really was pointless, I assure you that the SRA would have made representations to the government to rethink the Legal Services Act. However, a fundamental purpose of these requirements is to prevent rogues, or those wholly ill-equipped, from setting up legal practices. These precautions will enhance public confidence in the legal profession and contain the cost of dealing with and compensating for dishonesty.

The SRA will do its utmost to ensure that the registration process is as streamlined and painless as possible. We have carried out a confidential survey of 5,000 firms to assess the likely level of interest in LDPs, so that we can try to devote the right level of resource to the processing of applications.

The changes have implications not only for those planning the creation of new firms, but also those involved in the sudden dissolution of a partnership. At the moment, solicitors involved in partnership disputes can set up as a new firm immediately and inform us after the event. That will not be possible from March 2009. Under the new arrangements, it would be sensible to try to agree a planned, orderly dissolution so you can register your new firms, rather than suffer an abrupt, immediate break.

You will have to bear in mind that the non-lawyers in LDPs will need to be individually approved. This will involve a Criminal Records Bureau check – the time this will take to complete will be outside the control of the SRA. So, again, it will be important to think ahead.

We are currently working on the forms and guidance notes that will be needed. All will be available from our website. Although there is the potential for this work to be affected by changes to the draft rules, we currently expect to be able to accept applications from January.

In future, the renewal process for all recognised sole practitioners and recognised bodies will run alongside the annual PC renewal exercise.

Big bang

Although many clients may not realise that the solicitors’ firm they are dealing with has become an LDP, this exercise is in many ways a dress rehearsal for what could well be the legal profession’s equivalent of the financial world’s Big Bang – the advent of alternative business structures (ABSs). ABSs could bring about changes that could be very obvious to consumers and radically change how lawyers are perceived by them.

Our key priorities in the coming months will be to explain the changes to the profession clearly, to keep the form-filling to an absolute minimum and to process your applications as smoothly as possible. We will do our best.

Peter Williamson is chairman of the board of the Solicitors Regulation Authority.