The Legal Services Board has approved an application for the Council for Licensed Conveyancers (CLC) to become a licensing authority for alternative business structures.
With this approval, the CLC becomes the first ABS licensing authority.
Its scope is limited to probate, reserved instrument activities and the administration of oaths, those areas in which it is already an approved regulator.
But it has made a further application, which the LSB will consider later in the year, to allow it to extend its reserved activities to include advocacy and litigation.
The LSB said: ‘The executive has concluded that the CLC has developed the required licensing rules to regulate ABSs, and has done so in accordance with both LSB guidance and the requirements of the [Legal Services] Act.’
‘Whilst we recognise that there is some development work to do in terms of how the proposed arrangements will operate in practice, we are satisfied that the CLC has the capacity to be a competent licensing authority for its existing reserved activities,’ it said.
The Lord Chief Justice Lord Judge, one of the LSB’s mandatory consultees, had opposed the application due to his concerns over the question of multiple regulators, the competence of the CLC compared with other regulators, and the implication of extending its reserved legal activities.
In a letter to the LSB in March 2011 Judge said: ‘I must register my firm opposition to the CLC being granted the status it seeks in this application.’
‘Whilst the CLC has some experience of regulating entities which are owned or managed by non-authorised persons, the numbers are small and the type of activities undertaken by those entities is far narrower in scope than what is proposed ultimately by the CLC,’ he said.
Judge said there should be a limited number of regulators, with the more established initially permitted to regulate ABSs due to the wider knowledge and experience.
Judge said he is ‘strongly opposed’ to the CLC being entitled to regulate the reserved legal activities of litigation and advocacy in civil matters.
‘Both lie far outside the scope of the recognised work of a conveyancer; neither bears any resemblance to the types of activities for which the creation of the CLC was conceived.’
He said also that he feared the protections offered by the CLC in respect of the protection of the public interest and the support of the constitutional rule of law ‘lack substance’.
And added: ‘There is a real risk that regulatory standards would differ across regulators operating in the same field, leading to confusion and inefficiency both for the administration of justice and the consumer.’
The CLC currently regulates approximately 10-15% of the residential conveyancing market. Its regulated community is made up of 1103 licensed conveyancers, 301 managers and 215 practices.
A quarter of those practices are owned or managed by non-authorised persons.