The Solicitors Regulation Authority (SRA) has granted KPMG 12 waivers from the rules governing solicitors, in what appears to be a work-around ahead of proposed new rules that will make it easier for multi-disciplinary practices (MDPs) to become alternative business structures (ABSs).
They look to be the most wide-ranging series of waivers that the SRA has yet given an ABS.
KPMG said yesterday that it would use its ABS licence to become an MDP rather than set up a standalone legal practice, while the Legal Services Board is currently considering an SRA application for rule changes around the way it licences MDPs.
These include not regulating unreserved legal activities where the work of the business is already overseen by another regulator.
KPMG has been licensed to carry out five reserved legal activities – rights of audience, litigation, probate, reserved instrument activity (conveyancing) and the administration of oaths.
The SRA granted KPMG a waiver from its Code of Conduct as it applies to all activities within the firm which are not reserved activities for as long as KPMG is regulated by the Institute of Chartered Accountants in England and Wales.
This is subject to a few exceptions, including “the duty to keep client information confidential when it is supplied as part of carrying out SRA-regulated activity will apply across the whole firm”. KPMG will also be obliged to inform clients whether and how the services it provides are regulated and how this affects the protections available to them.
As well as the waivers, there is a condition attached to the licence that where a KPMG solicitor is handling unreserved legal work, “then he or she should not act for a client where there is a conflict of interest unless the client has given informed consent and appropriate safeguards can be put in place that are consistent with the SRA principles and maintain the confidentiality of the affairs of that client”.
Unreserved work will still be subject to the jurisdiction of the Legal Ombudsman, but there are waivers from various other rules as they apply to unreserved activities.
The SRA has also waived the need for KPMG to take out indemnity insurance that complies with its minimum terms and conditions on the basis that it already carries sufficient cover. The Compensation Fund Rules 2011 will largely not apply to KPMG on the basis that it does not hold client money in relation to any reserved activity.
Other waivers include an exemption for KPMG solicitors who are applying to reinstate their practising certificates from their CPD obligations for the 2013/2014 practice year, and from KPMG having contractual arrangements in place for the SRA to obtain information from, or enter the premises of, a third party providing outsourced legal services to KPMG or other services critical to the delivery of legal services.
The full list of waivers can be seen here.