Personal injury firms will be expected to retain records and management information from next Monday to prove that payments for cases do not fall within the referral fee ban.
Definitive rules for the ban will be published when the SRA Handbook is changed to coincide with the rule coming into force on 1 April.
The Gazette understands that the new rules will be almost identical to those revealed to firms in January, and will make it clear that firms paying into pooled marketing schemes must have systems in place to make sure they do not amount to the payment of unlawful referral fees.
The SRA has also confirmed it will publish case studies when they become available for payment models that both breach and do not breach the ban.
The regulator has already made it clear there will be no ‘safe harbour’ guidance or pre-approvals of business models.Definitions of ‘prohibited referral fee’ and ‘payment’ will be added to the Handbook in an effort to clarify what is allowed under legislation.
Last week, David Edmonds (pictured), chair of umbrella regulator the Legal Services Board, said he remained concerned about the ‘unintended consequences’ of a ban.
Edmonds said the organisation had not found any evidence that referral fees caused an increase in claims and that the policing of the ban would be challenging.
‘I am protective and defensive of our stance on referral fees. It’s incredibly difficult to make something stick. I worry it will end up in a situation worse than the one we have at the moment,’ he told the House of Commons justice committee.