Partners involved in firms which have gone into administration could face sanctions on their practising certificate applications, the SRA has confirmed.
The regulator’s board last week approved a recommendation to allow the SRA to refuse or impose conditions on a PC application from those involved in partnerships that have entered administration but not yet been subject to insolvency or bankruptcy.
The change was one of a number of proposals included in a range of proposals and policy ideas for cutting red tape.
The SRA is already permitted to restrict or refuse a PC application following bankruptcy, insolvency or the administration of an individual.
But the regulation did not cover the situation where the applicant is a member of a partnership that has entered into administration but further financial measures are not yet in place.
A number of firms have entered pre-pack administrations in recent years, in effect lining up a buyer for the moment the administration starts, and the SRA has confirmed these will be captured by the new rules.
SRA board chair Enid Rowlands (pictured) said: ‘Where there is a pre-pack we want the powers as a regulator to put the right conditions on people going forwards.
‘If someone causes us concern about their past practices this allows us to do something.’
Responses to a public consultation on the plans were largely positive, with most people saying the proposal was logical and sensible.