A regulator to oversee all legal professional bodies, an office of legal complaints (OLC) and legal disciplinary practices (LDPs) that can be owned by non-lawyers were the central recommendations of the long-awaited Clementi report this week.

Following an 18-month review of the regulatory framework of legal services, Sir David Clementi plumped for model B+, describing it as 'co-regulation'. He said a legal services board (LSB) should be created 'to provide consistent oversight of the front-line bodies, such as the Law Society and Bar Council'.


Regulatory powers currently spread around the likes of the Lord Chancellor, Master of the Rolls and others would be vested in the LSB, with powers to devolve regulatory functions to the front-line bodies, which would need clearly to separate out their representative roles. The LSB would have a lay majority.


Sir David criticised the current system for lacking clear objectives and focusing on the standing of providers, rather than the interests of consumers.


However, he said there were also strengths in the system which meant there should be reform rather than a new structure altogether.


Ending the role of the Lord Chancellor would enable the profession to benefit from greater independence, he added.


The OLC would provide a system for dealing with consumer complaints against all lawyers that is independent, has a single point of entry, and brings greater consistency. Matters of conduct would be referred to the professional bodies'.


The overall cost of the system will be broadly the same as now, he predicted.


LDPs would allow non-lawyers, such as heads of finance, to become partners, so long as a majority are lawyers. Sir David said non-lawyers - subject to passing a 'fit to own' test - should be able to own legal practices. However, there would be conflict of interest rules and other restrictions to prevent interference.


He added that LDPs could pave the way for multi-disciplinary partnerships, but that issues of regulation would have to be overcome.


The Lord Chancellor, Lord Falconer, welcomed the recommendations and said the government 'is committed to taking this forward as a matter of paramount importance'. A White Paper is likely to be published in summer 2005 with legislation following 'as soon as parliamentary time allows'.


Law Society President Edward Nally said the report would produce a better deal for consumers. 'We're glad Sir David has agreed that solicitors and the Law Society should remain involved in regulation. We have no problem with scrutiny by an independent board.' On complaints, he said the Society saw 'a strong case' for the OLC.


Bar Council chairman Stephen Irwin QC repeated his opposition to non-lawyer ownership of LDPs, predicting that the OLC 'will reduce the quality of service to clients' of barristers, and said the bar's track record on self-regulation 'is a good one' and that any proposed changes must pass the public interest test.