Alternative business structures

Lawyers expect the opening up of the legal market to lead to more multi-disciplinary professional services companies, offering consultancy, business and legal advice, research has shown.

Law firms should be able to provide accountancy and other services without setting up separate businesses to help them compete with alternative business structures, the Solicitors Regulation Authority has proposed.

Regulated lawyers should be viewed in the future as “a small part of an increasingly diverse ecosystem”, the Legal Services Consumer Panel has said in a report being launched at today’s Legal Futures Annual Conference.

Almost one in four top-250 law firms are considering securing some form of external equity investment, according to a survey. The highest proportion said they would look to raise between £5m and £20m, many to fund acquisitions.

The Bar Standards Board has apologised for the “inordinately slow” progress in implementing Legal Services Act changes that will enable barristers to practice in novel ways, as it set out a timetable for broadening its reach into entity regulation.

The grant of licences to alternative business structures (ABSs) should be contingent on firms agreeing to undertake pro bono work, a Liberal Democrat peer suggested last night.

City firm Kennedys has become the second largest law firm to become an alternative business structure (ABS) after being awarded a licence by the Solicitors Regulation Authority. The firm said the licence will allow greater opportunities for growth.

Lord Judge, the former Lord Chief Justice, has warned criminal law barristers that the “old-fashioned chambers structures must be reconsidered” and they must not dismiss alternative business structures “out of hand”.

The first firm of accountants to become an alternative business structure (ABS) licensed by its own regulator is planning to extend the range of legal services it offers, its senior partner has revealed.

The Legal Services Board has backed a new “flexible” approach by the Solicitors Regulation Authority aimed at making it easier for multi-disciplinary partnerships to become licensed as alternative business structures.

Leading ‘dispersed’ law firm Keystone Law has taken £3.15m investment from boutique private equity firm Root Capital in return for a 35% stake in the business. It will in part be used to buy out founding partner Charles Stringer.

Kent Legal Services – the legal division of Kent County Council – has formally launched its bid for outside investment by issuing a tender for a commercial partner with which it will form a joint venture/alternative business structure.

Admiral Law – the alternative business structure (ABS) joint venture between Admiral Insurance and national law firm Lyons Davidson – made a gross profit of nearly £3m in its first seven months of trading, the company’s first accounts have revealed.

The Legal Services Board has attacked the “arbitrary nature” of the separate business rule used by the Solicitors Regulation Authority, and said the list of what is permitted and what is not is “confusing”.

Competition from alternative business structures and non-solicitor organisations is of increasing concern to law firms, Law Society research has revealed. At the same time, compliance with Solicitors Regulation Authority rules remains the main problem identified by solicitors.