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Consultation on next round of SRA Red Tape Initiatives

The Solicitors Regulation Authority (SRA) has announced that it will be consulting on a second round of 'Red Tape Initiatives', aimed at cutting back on bureaucracy in line with a risk-based approach to regulation. If agreed, the proposed changes would be implemented in the October 2013 update of the SRA Handbook.

The SRA launched its Red Tape Initiative in November 2012, which was followed by a formal consultation that ran from December 2012 - February 2013. Ten proposals resulting from this consultation were approved by the LSB and incorporated in Version 7 of the SRA Handbook on 1 April.

Those responding to the first consultation were asked to make suggestions for further regulatory rule-changes. Of these, two key proposals were given the green light for consultation by the SRA Board at its meeting on Wednesday, 24 April.

The first proposal is to remove the requirement, currently imposed on Compliance Officers for Legal Practice and for Finance and Administration of recognised bodies and recognised sole practitioners, to report non-material breaches to the SRA as part of the annual information gathering exercise. However, the requirement to report material breaches as soon as reasonably practicable - and to record all breaches for production on request to the SRA - will continue unchanged. (The obligation of ABS firms to report non-material breaches cannot be removed because of the full reporting obligations imposed on them by the Legal Services Act 2007.)

SRA Executive Director, Richard Collins said: 'Removing the requirement for recognised bodies and sole practitioners to report non-material breaches strengthens the outcomes-focused approach of the SRA by allowing it to focus its resources on material breaches. The continued recording by all firms of non-material breaches will allow firms to identify and manage their own risks.'

The second proposal relates to solicitors and European lawyers who are required to declare certain events, such as disciplinary sanctions, under Regulation 3.1 of the Practising Regulations when they apply for a practising certificate or registration as a European lawyer. The details of the proposal are to:

  • Remove the requirement, where Regulation 3 does apply, to start the application process six weeks before the due date for renewal;
  • Confirm that a solicitor or European lawyer will not be subject to Regulation 3 of the SRA Practising Regulations 2011 if they ceased to be a manager of an authorised body or an authorised non-SRA firm or director of a company or a member of an LLP at least 36 months prior to an insolvency event;
  • Clarify that a previously declared historic event need not be declared again, once an application has been granted free from any conditions in respect of that event (Regulation 3 would no longer apply, unless there is a new event to report).

Richard Collins explained: 'The effect of this proposal will be to reduce the number of solicitors and European lawyers becoming subject to Regulation 3 unnecessarily and will reduce the administrative burden, saving time and money for both individual applicants and the SRA.'

The formal consultation is expected to commence in early May.  

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