Your questions

Looking to the future

12 June 2017

Here are answers to the most common questions we have received about our work.

Read our responses to the LTTF - flexibility and public protection consultation and Accounts Rule review consultation.

We’ll continue to post answers to your questions– so keep them coming. If you have a question that hasn’t been answered, please send us your question and we’ll do our best to respond.

The new Principles

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The Code for Individuals

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The Code of Conduct for Solicitors sets out clearly the professional standards and behaviours expected of solicitors in practice. Consumers will know what they can expect irrespective of where that solicitor is employed.

The Code of Conduct for Firms aims to provide clarity to firms that we regulate about the business systems and controls that they need to have in place and what their responsibilities are as a SRA regulated business.

We think this approach is much clearer for solicitors, firms and consumers of legal services.

The Code for Firms

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Separating rules that relate to controls and systems from obligations on individual solicitors will make it easier to do this.


The Code of Conduct for Solicitors sets out clearly the professional standards and behaviours expected of solicitors in practice. Consumers will know what they can expect irrespective of where that solicitor is employed.

The Code of Conduct for Firms aims to provide clarity to firms that we regulate about the business systems and controls that they need to have in place and what their responsibilities are as a SRA regulated business.

We think this approach is much clearer for solicitors, firms and consumers of legal services.

Support for solicitors and firms

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We have already engaged with over 1,000 members of the profession to understand the issues where they may need support and how we should provide this.

If you decide to download the PDF of the SRA Standards and Regulations onto your computer, or print it, you will need to check back on our website for updates. This is because we will make some minor changes to certain rules before the new SRA Standards and Regulations come into force. There is a table on p2 of the PDF that shows where we are likely to change the rules and what the change is likely to be.

Benefits of our new approach

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We believe these changes will increase flexibility in the delivery of legal services and reduce the cost of compliance and regulation by:

  • lowering the cost of training
  • reducing compliance with information requirements which are currently spread across different parts of the handbook
  • removing the need to understand frequently changing regulations
  • removing record keeping and processes of dealing with rule breaches

Our proposals make our regulation much easier to understand and apply. The removal of unnecessary regulation means that small firms can decide how they comply with our regulation. We will also provide a range of support for small firms to help them understand and apply our changes.


Compliance and enforcement

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We are moving away from complex and overly prescriptive rules, and want to give professionals more responsibility and flexibility to decide how they comply. This will inevitably create some 'grey areas' when it comes to compliance. We will be reviewing all of our current guidance and information to determine what support is needed.
We will need to get the balance right. We do not want to try to outline all possible scenarios in guidance, and end up repeating the detailed rules of the current Handbook. This would simply undermine the flexibility we are trying to create.

If that course of action comes into question, we will assess the risk that action poses to both the public and to our regulatory objectives as set out in the Legal Services Act 2007 and then take appropriate action. We are currently working on a revised enforcement strategy, which we will consult on as part if phase 2.

If we do take action, we will make sure our reasons for doing so are clear, proportionate, targeted and transparent. Our approach to enforcement will be set out in our revised enforcement strategy which we will be consulting on later this year.

Accounts Rules

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All fees and disbursements paid in advance are considered client money until the point at which they are billed. These payments must therefore be held in a client account, unless they are the only categories of client money held by the firm and the firm takes advantage of the exemption that is set out in new rule 2.2.


If you hold monies paid in advance for fees and disbursements as well other types of client money then you will need to continue to operate a client account as now.

If the only money held or received by you is advance payment for fees and any unpaid disbursements (prior to delivery of a bill for the same) then you can choose to not operate a client account (as permitted in rule 2.2) and hold these monies in your business account.

You can also choose to continue to operate a client account even if the only client money you hold is for fees and disbursements paid in advance. You do however need to inform your client (ahead of you receiving any client money) where and how it will be held.

You must also obtain at least five-weekly statements of your business accounts (rule 8.2) and keep a readily accessible central record of bills or written notifications of cost given by you (rule 8.4).

You do not have to comply with the requirements in rule 8.1(b), 8.1(c) and 8.3.

There is no requirement on you to obtain an accountants report if the only money held by you is money that is held or received in accordance with this rule.

We will update and make additions as required. Any new guidance will be made available well in advance of the new rules coming into force.


In rule 2.3 we set out the requirements for any such agreement. The client needs to be made aware of how their money is being held and know what this means for them.

You need to ensure that you are acting in the best interest of your client (as required by our Code of Conduct) when handling client money.

The whistle blowing requirements are set out in section 34 of the Solicitors Act 1974. As such, we have removed the duplication from our Accounts Rules, but the whistle blowing duties remain in place for Reporting Accountants.

The rules now treat all money for fees equally. Provided you have given a bill of costs, or other written notification, to the client you can take any such payment for the specific sum identified into your firm's business account.


Where the only money represents payments received from the Legal Aid Agency for your costs then you do not need to hold this in a client account.


We have instead introduced a rule that allows us to require a report if we think it is necessary in order to ensure that client money has been properly dealt with when a firm shuts down and closes its client account.

We will issue guidance for the criteria and relevant risk factors we will use when making the decision to require a report to be submitted.

The rules allow you to discuss and agree with your client what arrangements work best and are in their interests. You can therefore, hold money for one client in a client account and agree to enter into a TPMA with another client.



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We have engaged extensively with a wide range of stakeholders and we want to give as many people as possible an opportunity to share their views. This will help future proof the Handbook so that we don't have to keep changing it every year. We have received a diverse range of responses to our consultation and analysing these has required careful consideration.

Obtaining approval from the Legal Services Board for changes to our regulation also takes time. Once our proposals have been approved, we also need to give people time to understand and implement them

This is a 'safe space' is for existing firms, as well as new entrants to the legal services market.

It lets you test out ideas that are likely to benefit the public in a controlled way.

Non-LSA regulated firms

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Yet the current rules mean that solicitors are banned from working in these firms. This means at the moment that anyone from a plumber to an accountant can provide non-reserved legal advice to the public in such firms, but not a solicitor.

The proposed changes would make it easier for solicitors, who are arguably best placed to provide quality services, to work in this expanding market. This could help push standards up while driving costs down. It could also help tackle the problem that many people and businesses still do not access the legal services they need. For example only 13 per cent of small businesses say that lawyers provide value for money.

But at the moment they cannot access the services of a solicitor in that market. Our proposals to allow solicitors to work in non-LSA regulated firms bring additional consumer protections to clients of alternative legal services providers and offer more choice to consumers.

Solicitors will bring their training and qualifications, ethical behaviour and standards of conduct to non-LSA regulated firms and their clients. The Code of Conduct for Solicitors would apply to them, as it would to any other individual acting as a solicitor. This will include making sure they keep their professional knowledge and skills up to date, and supervise the work of those they manage or supervise, and the work being done for clients.

As solicitors in non-LSA regulated firms will not be allowed to hold client money, we consider it disproportionate to require them to contribute to the fund.

Clients of these solicitors will be protected by existing consumer protection legislation, for example, if the work is not completed or if the firm becomes insolvent. All solicitors, wherever they work, will have an obligation to provide information to their clients about the regulatory protections available.

Consumers will have a clear choice between different types of providers and the associated consumer protections. We are committed to making sure there is very clear communications to inform that choice at an early stage. We are looking at what information, for example logos, might help consumers to navigate those choices more effectively. We will be consulting later this year on more detailed proposals for consumer information

Access to the Legal Ombudsman attaches  to services provided by 'authorised persons' - which will include solicitors working outside SRA regulated firms

This is primarily because individual solicitors are unlikely to have control over the PII coverage of their employer.

In practice, legal services providers - like many other businesses - are likely to have insurance so that they and their employees are protected from liability. This is something that solicitors will need to discuss with their potential employer.

We are aware that we need to make sure there is absolute clarity for consumers about what protections are in place for them, and are currently thinking through what information solicitors will need to provide to clients to make sure they know about the package of protections in place. The individual code requires solicitors to ensure that clients understand whether and how services are regulated (standard 8.10). Solicitors must also ensure their clients understand the regulatory protections available to them (standard 8.11).

We are also looking at what tools consumers might need to help them navigate this choice including what information can be provided at an early stage. We will be consulting later this year on more detailed proposals for consumer information.

Solicitors who are supervising others will remain accountable, and will need to effectively supervise the work being done for clients. The Code of Conduct also requires solicitors to make sure that the individuals they manage are competent to carry out their role, and keep their professional knowledge and skills up to date.

Looking to the future consultation

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In addition to the formal written consultation process, we have held workshops, focus groups and spoken to our reference groups. We have engaged widely with consumers and consumer representative bodies.

We have also engaged widely through social media and digital and online activity, such as webinars. A breakdown of the respondents to the formal consultation is provided in our response to consultation.


We have also commissioned the Centre for Strategy and Evaluation Services (CSES) and Dr Chris Decker, of Oxford University, to help us to develop an evaluation framework to measure the impacts of the changes.


Our current Practice Framework Rules go beyond the requirements of Section 15 and prevent solicitors from providing non-reserved legal services to the public unless permitted to do so. We know this is problematic for some organisations because our rules mean that they cannot respond to consumer demand or develop their business model. Our proposals to allow solicitors to provide non reserved legal services to the public through non SRA authorised organisations will better reflect S15.1

1. S15(4) allows employees (who are individually authorised) to carry on reserved legal activities for unauthorised employers provided the employer does not provide reserved legal services to the public or a section of the public as part of its business.

Our proposals are designed to ensure that the way we regulate solicitors and those organisations providing reserved legal services:

  • Is robust, clear, appropriate and easy to understand
  • Upholds standards and core professional values
  • Enables growth, access and innovation in legal services