The Bar Standards Board (BSB) has today begun licensing alternative business structures (ABSs), making it the fifth body granted the power.
As with its regime for lawyer-only owned entities, it will specialise in ‘advocacy focused’ ABSs.
The BSB follows the Council for Licensed Conveyancers, Solicitors Regulation Authority, Intellectual Property Regulation Board and Institute of Chartered Accountants in England and Wales in permitting non-lawyers to own legal businesses.
The BSB has been regulating entities since 2015, and has approved 72 to date; these will now be called authorised bodies. Last week we reported on a personal injury practice that claimed to be the biggest of those 72.
A new edition of the BSB Handbook has been published today to reflect the new regime of what are officially known as licensed bodies.
The original plan was for ABS licensing to begin on 1 June 2016, but this slipped during the process due to the various approvals that were needed, the final one of which was Parliament.
The BSB has played down expectations of how many ABSs may choose its regulatory regime, saying previously that it expected to regulate around 20 in each of the first three years and that they will come from similarly sized and structured entities to authorised bodies – generally small firms.
This caution likely reflects its experience with authorised bodies, of which it had originally expected 400 by the end of 2015.
Oliver Hanmer, BSB director of regulatory assurance, said: “Although we are cautious about the number of ABSs that may choose to be regulated by us, we believe this development encourages further innovation in the provision of legal services.
“Being a specialist in regulating advocacy-based services, our announcement today allows barristers and other lawyers to partner with other business professionals to bring new skills and fresh perspectives to this sector of the market.”