Regulation of Legal Services (Scotland) Bill

Graeme Johnston / 24 July 2023

Submission I made today to the Scottish Parliament’s Equalities, Human Rights and Civil Justice Committee for its inquiry into the Regulation of Legal Services (Scotland) Bill.

The background to the legislative proposal can be seen from Brian Inkster’s blogposts on the topic.

Question 1a What are your views on the principal recommendation of the Roberton Review that an independent regulator should be created to regulate legal professionals?
It was a strong recommendation for the reasons given by the Roberton team and supported by the CMA.
I’ve no doubt of the sincerity of the arguments made by the Law Society and Faculty of Advocates against the proposal, but

  • There is a huge conflict of interest in acting as both regulator and union.
  • There are significant problems of inadequately met legal need which are only going to get worse in Scotland if the current state of affairs remains in place. The Roberton recommendations would have created some capacity to tackle that problem by creating an independent regulator not controlled by service providers.
  • The most significant argument against the Roberton principal recommendation – state interference with lawyers’ independence – is not trivial but experience sought of the border suggests that it is greatly exaggerated.
  • The other main argument against the Roberton principal recommendation – expense – can be addressed by adopting a simpler structure than south of the border, as Roberton indicated.

Question 1b What are your views on the Scottish Government’s decision to “build on the existing framework” rather than follow that principal recommendation?
It is a missed opportunity. In some ways it’s worse than that, in that it gives the existing bodies some of their asks (e.g. regulating the lawyer title) without any balance.

Question 1c What are your views on whether there is a risk that the proposals could raise concerns about a potential conflict of interests?
See 1a above.

Question 2 What are your views on the current regulatory landscape for legal services in terms of complexity or simplicity?
Over-complicated. A single legal regulator with jurisdiction over all types of legal services and a complaints division would be better.

Question 3 What are your views on the proposed division of regulators into two categories and the requirements which these regulators will have to comply with, as set out in Part 1 of the Bill?
Over-complicated – see 2. above.

Question 4 Section 19 of the Bill gives Ministers the power to review the performance of regulators’ regulatory functions. Section 20 sets out measures open to the Scottish Ministers. What are your views on these sections?
It’s not clear to me what these really add of importance given that the Government already sought the Roberton committee and the CMA’s views on these topics then rejected their main recommendation.

Question 5 What is your understanding of the experiences of other jurisdictions, for example England and Wales, where independent regulators have been introduced to regulate legal services?
There has been real progress in E&W since the LSA 2007 came into effect, and legal services there continue to grow dynamically. They are well placed to deal with the next round of changes which can be expected from technological and economic change. The main problem is that there are too many regulators, which has created some excessive complication and expense in the system. But there are some steps to remedy that (e.g. folding CILEX Regulation into the SRA) and, in any case, the Roberton proposal was to learn from that and create a simple system for Scotland.

Question 6 What are the main deficiencies in the current complaints system and do you believe the proposals in the Bill are sufficient to address these issues?
The system is over-complicated and ultimately lacks independence. The failure to accept the principal Roberton recommendation limits the ability to fix this.

Question 7a What do you consider the impact of the Bill’s proposed rules on alternative business structures might be generally?
The proposed new minimum % of regulated professionals is not likely to achieve anything useful. It just creates additional complication and hence cost. It would have been better just to abolish it.

Question 7b What do you consider the impact of the Bill’s proposed rules on alternative business structures might be in relation to consumers of legal services?
It must be less attractive to go into a market as an ABS when the incumbents control the regulator.

Question 8a What are your views on the provision of “Entity regulation” (as set out in Part 2 of the Bill)
Useful in principle, but undermined by the rejection of the principal recommendation.

Question 8b What are your views on the provision of title regulation for the term “lawyer” (section 82)?
I’m not convinced that a strong case for this was really made out. If it is to be done, it would be better to offer it as part of a balanced package including acceptance of the principal Roberton recommendation.

Question 9 Do you have any further comments on the Bill and any positive or negative impacts of it?
I find the Bill frustrating because there are significant opportunities for legal services to expand and do better for citizens, society and business. The regulators in England & Wales get that and are actively pushing things in the right direction, including increasing steps to safeguard and promote lawyer independence. The lawyer representative bodies (e.g. Law Society, Bar Council) still exist and are free to campaign and support members. For Scotland to adopt a much more conservative, defensive approach in contrast to what’s happening on its southern doorstep would be a poor choice, in my opinion.


Image: Calton Hill, Edinburgh. By Peter Cordes on Unsplash.



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