26 August 2011

LSB gives green light to barristers joining ABSs

The Legal Services Board (LSB) has approved changes to the Bar Code of Conduct that will allow barristers to become partners and employees of alternative business structures (ABSs).

The bar’s rulebook would not prohibit barristers from holding an ownership interest in an ABS but as currently drafted would prevent them from working for one, as either an owner or non-owner.

The Bar Standards Board (BSB) is considering whether specific rules or guidance need to be developed to manage any conflicts of interest that arise from barristers’ involvement in ABSs, but in the meantime will advise barristers to have regard to the guidance in relation to potential conflicts arising out of ownership interests in legal disciplinary practices (LDP).

These focus on disclosing the barrister’s interest if receiving instructions from the LDP or referring a client to the LDP.

The LSB said: “We encourage the BSB to see how the regulatory arrangements work in practice before they decide whether additional rules or guidance are needed.

“Before making further alterations to its regulatory arrangements, the BSB would need to be satisfied that these are needed and do not duplicate existing conflict provisions in its Code of Conduct. The BSB would also need to consider any potential conflicts with other regulators, particularly the licensing authorities that will identify and address potential conflicts of interest as part of the licensing regime.”

Tags: ABS, Alternative business structures, bar standards board, LDP, legal disciplinary practice, Legal Services Board