Practitioners grapple with issues of ABS-led future
8 November 2010 | By Katy Dowell
15 August 2014
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With just a year to go before the implementation of the Legal Services Act, The Lawyer’s conference on alternative business structures (ABSs) today (8 November) looks set to highlight the key issues, with contributions from influential players in the debate.
The three keynote speeches will include presentations from Legal Services Board CEO Chris Kenny, Law Society director of government relations Russell Wallman and Solicitors Regulation Authority (SRA) chairman Charles Plant.
Plant’s speech will examine the SRA’s latest position on its proposals for ABSs. In its recent strategic review the SRA declared that one of its objectives was to be the lead regulator for ABSs.
Plant will explore a number of challenges, including the extent of the SRA’s jurisdiction and its relationship with other regulators. He will say that the SRA’s objectives in defining the regulatory regime for ABSs are to achieve the same degree of consumer protection for clients as with traditional law firms and to facilitate movement between two statutory regimes for recognised and licensed bodies.
Perhaps the most vigorous debate of the day is likely to come from a panel of managing partners including Bird & Bird’s David Kerr, Clarke Willmott’s David Sedgwick, Russell Jones & Walker’s Neil Kinsella, Berwin Leighton Paisner’s Neville Eisenberg and Altman Weil consultant Ward Bower.
Eisenberg notes that the debate about ABSs is part of a wider shift in the profession.
“The market for legal services has become extremely competitive in the past few years,” he says. “A mixture of client pressures on firms to provide more value for money and overcapacity in the market has resulted in firms having to review some fundamental aspects of the traditional model, including pricing and resourcing.
“The introduction of ABSs will provide opportunities for firms or investors to adopt accelerated strategies in the quest to address clients’ needs effectively.”
Eisenberg and his peers will be listening closely to Plant’s presentation.
“One of the worries is that regulators will introduce new regulation, which will require firms to commit significantly more resources to compliance,” notes Eisenberg.
While City firms are publicly lukewarm on ABSs, Co-operative Legal Services managing director Eddie Ryan will be extolling their virtues.
Along with DAS head of legal services Kathryn Mortimer and Abstract Legal managing director Darren Werth, Ryan is a participant on a panel of new entrants who will give their perspective on the subject - a debate that has been heightened in the past week with the announcement by the AA and Saga that they are jointly preparing to enter the consumer legal market.
“One of the criticisms levelled at the changes is that small firms will go bust,” says Ryan. “But ’twas ever thus. It’s a finite market. Some smaller firms may be subsumed into larger firms.
“Of course, our brands are not synonymous with legal services. Our brands are based on trust and ethical values, and they translate quite quickly into legal services.”
Although the conference deals with both consumer legal services providers and the reaction of commercial law firms to regulatory change, Ryan warns that City firms should not consider themselves immune to these developments.
“We’re a consumer-facing organisation and as such we’re not a threat to any major law firm,” he says. “But they’ll face their own threats from competitor firms who’ll take on external investment.