Alternative business structures

Indian legal process outsourcers see “a fat, complacent and profitable market place” in England and Wales “and they want a piece of it”, solicitors were warned last week. Mark Jones, former managing partner of Addleshaw Goddard, described legal process outsourcing as “a game changer for all of us” – 25% of Slaughter and May’s work is outsourceable, as is 50% of his own firm’s and maybe 100% for firms outside the top 50.

The body representing senior council lawyers has called on local authority legal departments to make “a step change” in the way they work as they face up to the so-called age of austerity and the opportunities offered by alternative business structures – including the possibility of management buy-outs.

Daniel Curran looks at how ABSs could improve the offering in the wills and probate market, and where probate genealogists fit in with the mix. On the face of it, he says, this should be one area where the benefits of the ongoing reform of legal services regulation should be most keenly and most beneficially felt by consumers.

It is “absolutely inevitable” that criminal legal aid practices will need to morph into a cross between a solicitors’ firm and barristers’ chambers, one of the founders of a groundbreaking firm in the north-east of England has claimed.

The Bar Standards Board (BSB) will become a specialist regulator of entities providing advocacy services, if proposals set out today are approved. Under the plans, BSB-regulated entities could not have passive investors, would need a majority of managers who can practise as advocates in the higher courts, and could only have a maximum of either 10% or 25% of non-lawyer managers.

Volume conveyancers are reaching out to all “serious” conveyancing practitioners in a bid to form a new representative body for the sector. The Conveyancing Association – which has grown out of the Direct Conveyancing Association – launches today with a rallying call against restricted lender panels and for conveyancers to respond to the impending challenge of alternative business structures.

Our weekly round-up of other relevant news from elsewhere finds alternative business structures on the minds of virtually everyone, whether in England, Scotland, Canada or the USA. If one theme emerges, it is that everyone is waking up to the threats and possibilities inherent in them.

The second part of our interview with Professor Richard Susskind on the publication of an updated edition of his book, The End of Lawyers?, looks at ABSs, the threat of legal publishers entering legal services, and why he is next training his sights on the professions generally.

The Cabinet’s reducing regulation committee has given alternative business structures (ABSs) the green light and they will happen on 6 October 2011, justice minister Jonathan Djanogly confirmed today. Mr Djanogly said “no one should be under the illusion that I wish to delay ABS introduction, and all lawyers should be preparing for its introduction”.

There is a £15bn market in consumer and small business legal services and big brands “have the potential to dominate” it in the future, a senior representative of Royal Bank of Scotland (RBS) said this week.

Some of the biggest brand names in the UK will shortly have access to a legal advice and assistance package for their customers costing around £50 a year, Legal Futures can reveal. CPP Group plc, which provides services via over 200 businesses worldwide – including Tesco, Marks & Spencer, Barclays and HSBC – has developed a product which will give consumers access to everyday consumer advice, a range of legal services, and relevant membership discounts and offers.

The Solicitors Regulation Authority is to revisit at its next meeting the question of whether to relax its rules on preparations in advance of the launch of alternative business structures next October.

West Midlands law firm Forum Law is planning to give legal advice over the Internet after buying Capita Assistance’s legal helpline business. Called Legal Assistance Direct (LAD), the service already had contracts to provide legal advice to over five million client customers of various institutions. It currently receives around 35-40,000 calls a year.

Law firms preparing to become alternative business structures should not enter into binding contractual agreements with prospective external owners, the Solicitors Regulation Authority is likely to warn this week.

The Legal Services Board has continued making contingency plans to regulate alternative business structures itself if none of the current approved regulators are up to the task, it has emerged from a consultation on the arrangements for appeals against the decisions of ABS licensing authorities.