Alternative business structures

Alternative business structures will enable law firms to explore new ways of organising their businesses,and allow external investment.

The Legal Services Act, which received Royal Assent on 30 October 2007 will allow for Alternative Business Structures, which will enable law firms to explore new ways of organising their businesses to be more cost-effective, permit different kinds of lawyers and non-lawyers to work together, and allow for external investment.

Now commonly referred to as Tesco law, alternative business structures should mean a relaxation of the ownership restrictions that currently exist on law firms.

The Law Society is concerned that, should commercial interests play too large a role, the independence of the legal profession could be harmed.

On Thursday (24th March 2011) The Law Society decided that the Solicitors Regulation Authority, which is the independent regulatory body of the Law Society of England and Wales, should apply to regulate alternative business structures as well. The decisions was not without reservations and it seems there may be a special general meeting of the Law Society followed by a poll of solicitors regarding their support for ABS's.

The aim will be to introduce healthy competition, and a few well known High Street names have already expressed their interest. Amongst these are the Co-Op, AA, Saga and the Halifax. Some of these names are already offering some form of advice service and there are activities which do not, by law, have to be handled by qualified lawyers.

Some of the changes brought about by the introduction of  the ABS are that:

Lawyers and non lawyers can now work together in the same legal business;

legal business can include barristers and solicitors;

non-lawyers can own legal business;

legal businesses can operate as companies.

 

Legal executives bid for ABS regulation

Alternative Business Structures | Law | The Guardian

 

 

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