Rules concerning the carve-up of regulation between the Law Society and SRA are to be rewritten. The oversight regulator, the Legal Services Board, confirmed today it will also produce new guidance to accompany the redrafted Internal Governance Rules (IGR). The actual content on the redrawn rulebook is yet to be decided.
The LSB is required by the Legal Services Act to make IGR setting out the requirements of approved regulators (which include the Law Society) relating to the independence of regulatory functions. Consultation began last November with a view to changes that might enhance regulatory independence.
In its response published today, the LSB demands ‘greater clarity’ on the oversight role of an approved regulator that has both regulatory and representative functions. ‘Significant’ problems across the legal sector have been uncovered by the consultation, including ‘multiple’ disagreements between approved regulators and their regulatory bodies, and the new rules aim to reduce those disputes.
The LSB said it took into account a separate investigation concluded earlier this year, which resulted in the Law Society being censured for breaking IGR between 2014 and 2017.
The LSB plans to rewrite the IGR so they set out principles and are more outcome-focused, but there will not be a definition of regulatory independence in the new IGR.
Neil Buckley, chief executive of the Legal Services Board said: ‘Independent regulation ensures that consumers, providers, investors and society as whole can be confident that legal services operate in the public interest and in accordance with the rule of law. Our aim in reviewing the internal governance rules is to enhance regulatory independence within the current legislative framework.’
Consultation on the specifics of new IGR and draft guidance will take place this autumn, with approved regulators starting transition to the revised rules next spring.
Responding today, Law Society president Christina Blacklaws said: 'We hope new internal governance rules will help approved regulators strike the right balance between regulatory independence and regulatory assurance.
'Clear, targeted IGRs would support both approved regulators and frontline regulators to discharge their roles effectively, which will in turn improve and underpin public confidence in legal regulation. We look forward to working with the LSB and the SRA to this end.'