SRA Handbook

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Chapter 12: Separate businesses

This The purpose of this chapter deals with your obligationsis to ensure clients are protected when you have links tothey obtain mainstream legal services from a firm regulated by the SRA. This is accomplished by restricting the services that can be provided through a separate business that is not authorised by the SRA or another approved regulator.

You can be a manager or employee of This chapter addresses two kinds of services:

1. those which you cannot offer through a separate business. However, you cannot practise as a solicitor, REL or RFL in a ("prohibited separate business except as activities"). These are "mainstream" legal services which members of the public would expect you to offer as a lawyer regulated by the SRA or another approved regulator; and

those which you can offer either through a separate business ("a permitted by Rule 4 (In-house practice) of the SRA Practice Framework Rules (see also Rules 1-3).separate business"), or through an authorised body. These are the kind of services a member of the public would not necessarily expect to be provided only by a lawyer regulated by the SRA or another approved regulator, but which are "solicitor-like" services.

Clients of a permitted separate business will not have the same regulatorystatutory protections as clients of an authorised body and it is important that this is clear to clients of the separate business, particularly where they are being referred from one business to the authorised body or cases are being divided with the authorised body. other.

The outcomes in this chapter show how the Principles apply in the context of separate businesses.

Outcomes

You must achieve these outcomes:

O(1.1)

you ensure,do not:

own; or

actively participate in,

a separate business which conducts prohibited separate business activities;

if you are a firm you are not:

owned by; or

connected with,

a separate business which conducts prohibited separate business activities;

where you:

actively participate in;

own; or

(a)

are a firm and owned by or connected with,

O(12.1)

a permitted separate business, you have safeguards in place to ensure, that clients are clearnot misled about the extent to which the services that you and the separate business offer are regulated;

O(12.2)

you do not represent, directly or indirectly, the any permitted separate business as being regulated by the SRA or any of its services activities as being regulatedprovided by the an individual who is regulated by the SRA;

O(12.3)

the separate business does not carry on:

(a)

reserved legal activities; or

(b)

immigration work unless that work is regulated by the Office of the Immigration Services Commissioner;

O(12.4)

you only

O(1.1)

refer, recommend or introduce a you are only connected with reputable separate businesses;

you are only connected with a permitted separate business which is an appointed representative if it is an appointed representative of an independent financial adviser.

Indicative behaviours

Acting in the following way(s) may tend to show that you have achieved these outcomes and therefore complied with the Principles:

(a)

ensuring that client to the information and records are not disclosed to the permitted separate business;

IB(1.1)

put your , without the express consent of the client and ;

(b)

complying with the SRA Accounts Rules and not allowing the client account to be used to hold money for the permitted separate business in touch with each other; or;

(c)

divide, or allow to be divided, where you are referring a client's matter between you and theclient to a permitted separate business, informing the client of your interest in the separate business;

where the client has given informed consent terminating any connection with a permitted separate business where you have reason to doubt the integrity or competence of that separate business.

In-house practice

The outcomes Outcomes 12.1 and 12.3 to 12.6 in this chapter apply to your in-house practice.

Notes

It is important that clients are not misled or confused about the regulatory status of a permitted separate business, the services it provides and the people working within it. Particular care needs to be taken regarding:

the name or branding of the separate business;

misleading publicity; and

the proximity of the permitted separate business to your firm, particularly if you share premises.

This chapter should be read in conjunction with:

Chapter 3 (Conflicts of interests)

Chapter 6 (Your client and introductions to third parties); and

Chapter 8 (Publicity).