Alternative business structures

Alternative business structures could be decisive in helping smaller charities access legal advice with fixed fees, according to research which shows many lack understanding of their legal needs and cannot afford solicitors.

America last week moved a major step closer to introducing a version of legal disciplinary practices (LDPs), while ruling out multi-disciplinary practices. The American Bar Association has noted the “remarkable” growth of LDPs in England and Wales.

The Solicitors Regulation Authority will begin accepting licensing applications for alternative business structures from 3 January 2012, with the first successful ones announced within around six weeks, it announced today.

The ambitions of larger firms of accountants to offer legal services have become more complicated after the European Commission announced plans to stop auditors offering non-audit services. If it becomes law, the move will lead to the break-up of the ‘big four’ accountants into audit and consultancy businesses.

The first business to announce its intention to invest in law firms has already spoken to more than 25 interested practices, it has revealed. However, In-Deed’s half-year results have revealed a very slow start to its online conveyancing business, with only 120 instructions in four months.

Legal expenses insurer DAS has taken the next step in its preparations to become an alternative business structure by acquiring online legal services company Everything Legal, which owns legal advice website Law on the Web. It will give DAS a strong direct route to market.

A regional firm of accountants is planning to become an alternative business structure (ABS). Becoming an ABS will allow Spofforths to improve the private client service currently provided by an in-house legal team and in time become a legal brand in its local market.

Lawyers complaining about the Legal Aid, Sentencing & Punishment of Offenders Bill have not considered the impact of ABSs in changing the way the legal profession works, justice minister Lord McNally said yesterday. However, the second reading of the bill raised the possibility of a concession over removing clinical negligence from legal aid and of further regulation of third-party funding.

The final legislative obstacle to the Solicitors Regulation Authority licensing alternative business structures was removed on Tuesday when the House of Lords approved secondary legislation on non-lawyer owners’ disclosure of criminal convictions and appeals against ABS licensing decisions.

Profit margins among all but the elite of the top 100 law firms have dropped significantly over the past five years, new research has revealed, with the introduction of alternative business structures set to pressure them even more.

It is essential for law firms to offer better public legal education – including getting into schools, according to the Master of the Rolls – while alternative business structures could help pro bono provision, it was claimed at the launch of National Pro Bono Week on Monday.

Co-operative Legal Services has issued a major signal of intent by recruiting two leading solicitors to launch a family law service next year: Jenny Beck and Christina Blacklaws of TV Edwards, who both hold significant roles in the profession.

Claims management companies looking to create legal arms as ABSs could fall foul of Solicitors Regulation Authority rules, a former SRA director has warned, while a leading insurance lawyer cautions over a loophole in the referral fee ban.

A large majority of partners at mid-sized law firms believe their practices need to grow by at least a third over the next three to five years to remain competitive, with many open to the idea of external investment, a recent survey has shown.

Top City law firm DLA Piper has invested in a prospective alternative business structure (ABS) that promises to introduce a “market-disrupting” new approach to providing businesses with legal advice, Legal Futures can reveal.