News release

Looking to the future

We began the process of changing how we regulate two years ago.

Since then, we have directly engaged with more than 11,000 solicitors and members of the public to find out their views on our proposals. There was broad support for the overall approach of cutting bureaucracy and simplifying the Handbook.

Simplifying our Codes, Principles and Accounts Rules

We have announced the first phases of changes to the Handbook. The first phase of revisions creates shorter, clearer principles and codes, as well as much simpler Accounts Rules. For instance, the new rules have been reduced from forty-one to seven pages by focusing on the protections that really matter, specifically, keeping clients' money safe.

We have moved beyond pages and pages of detailed rules to a focus on principles and maintaining the high, consistent professional standards that the public expect and that offer them the best possible protection. This sharp focus on professional standards, means we can give you greater flexibility, and moves regulation away from being a tick-box exercise, putting more trust in your professional judgment.

A move towards two codes

We want to make sure that every solicitor is absolutely clear about their personal obligations and responsibility to maintain the highest professional standards, whether they work in-house, or inside or outside a "Legal Services Act regulated" firm. So we have created a separate code for individual solicitors.

There will be a separate code for firms, so they will have clarity about the systems and controls they need to provide good legal services for consumers and the public. 

Responding to feedback

In addition to broad support for making the Handbook simpler, we received lots of useful feedback on the detail.

We have made changes in response. For instance, we recognised that proposals around greater flexibility on client money could have had cost implications for some firms. So we have amended the definition of client money, so the vast majority of firms with a client account can continue as they are.

Giving you more choice where you work

We have also committed to getting rid of barriers to solicitors working freely in the legal sector, including in the growing number of "non Legal Service Act regulated" firms providing legal services such as will-writing and resolving employment disputes. Changing outdated rules constraining access to solicitors will give you more choice about where you work and make it easier for people to benefit from your expertise and high standards.

We recognise these plans are contentious for some. There has been strong support from organisations such as the Competition and Markets Authority and consumer groups, but opposition from the Law Society and some of its members. We believe change in this area is important but recognise the concerns, in particular around the potential for consumer confusion.

We are committed to making sure there is very clear communication about the extent of the more limited protections for those using a solicitor in a non-LSA regulated firm.

Next steps

We will consult later this year on proposed changes to other parts of the Handbook including the Authorisation Rules and the Practice Framework Rules, and on a new enforcement policy. The new arrangements will not be introduced any earlier than autumn 2018.

Find out more about Looking to the future.