The Solicitors Regulation Authority has announced it will fast-track lower-risk applications for an alternative business structure licence.
The authority has responded to criticism that the authorisation process takes too long with new guidance and a fresh approach to existing law firms.
The fast-tracking will particularly apply to LDPs that are becoming an ABS without changing their business model, or firms that want to add a non-lawyer to the management structure.
SRA executive director Samantha Barrass said: ‘We reviewed our processes after the first year of licensing and have now brought the individual authorisation teams together to ensure a more consistent approach to recognising all entities. We will also be fast-tracking lower-risk applications.
‘We will continue to give full and thorough consideration where more complex applications are involved and we make no apology for that.’
The new guidance states that in many cases, applications are relatively straightforward; they may involve partners from existing firms who have split away from or merged with another firm, all of whom have a clean track record, with a strong business plan and evidence of appropriate systems and controls. In these cases, there is ‘limited risk’ to the public.
However, there may be cases where the proposed ownership structure is complex and opaque, or where a proposed business would be run by people with a poor regulatory history. In these cases, the SRA says, investigation and analysis will be required.