Rough trade?

There is little in the Office of Fair Trading (OFT) report that should come as a surprise to the bar. Although dressed up in the language of competition and market regulation, the central question posed is whether a single business structure should continue to be the sole vehicle by which barristers are able to offer legal services. That structure is entirely the product of the bar's self-imposed rules, so it may take a lot to convince the public that the restrictions are designed to safeguard public interest, rather than self-interest.

There are many within the profession who are equally sceptical about the utility of the bar rules and the view that their abolition would threaten the existence of the independent bar, or degrade the service it provides. The main recommendations of the report – that partnerships among barristers should be permitted and that they should be allowed to take direct instructions from the public and be able to conduct litigation – might well be seen as evolutionary rather than as heralding any legal revolution.

The present bar rules were developed when there was no direct competition between the two branches of the legal profession. Each provided complementary services which the other could not supply. None of this now holds true for solicitors who can undertake any of the tasks traditionally reserved for the bar. The bar has responded by gradually extending the circumstances in which direct access is available, although clearly not quickly enough for the OFT.

The OFT's proposals are not, as the Bar Council's response suggests, aimed at "forcing barristers into partnership", nor does it oblige them to accept direct instructions or to conduct litigation. Its objection is to the professional rule denying freedom of choice.

For many barristers, partnership will remain an unattractive option. While the conflict rules remain, most barristers engaged in commercial litigation and advisory work will have a strong incentive to maintain independent status. The issue is whether this is true of all areas of practice, or whether it needs to be reinforced by a restrictive rule.

The same observations can be made in relation to direct access and the conduct of litigation. There is clearly no purpose in allowing members of the public to instruct the bar directly if barristers are not then allowed to manage ensuing litigation. For most purposes the bar is ill-equipped to go on the record and certainly could not do so without a substantial increase in its overheads and thus of its fees.

Even so, enshrining the present characteristics of sole practice in restrictive rules is arguably unnecessary and prevents the development of flexible responses to changing legal markets. An example is the introduction of conditional fee agreements (CFAs) in personal injury cases. The OFT refers to emerging evidence that solicitors enjoy a competitive advantage over the bar as a result of direct access to claimants. This gives them the ability to retain the commercial benefits of CFAs while sharing the risks with the bar. This is precisely the sort of area in which a group of barristers, involved largely in claimant work, might consider partnership.

The question for the Bar Council in the 12-month grace period allowed by the OFT is whether the "one size fits all" approach of the existing Conduct Rules remains an indispensable requirement of practice. In the end, this may be jettisoned in favour of a more flexible approach, allowing barristers and sets of chambers to develop business models which are responsive to changing circumstances.

The OFT's attack on the institution of silks is also a more measured one than might be supposed from the strength of initial reaction. The core conclusion is "that the system is secretive and, as far as we can tell, lacks objective standards". Anyone who has attempted to explain the system to a member of the public might well find it difficult to disagree with this.

The report does not argue against a quality mark to distinguish expert practitioners. It simply points out the anomalous position of the bar in requiring Government intervention rather then objective features, such as examinations or peer reviews. While the Bar Council's response rightly points out that the area was considered in detail by the Peach Report, it might be added that the recommendation of that report for professional examinations has not been implemented.

The matter is largely out of the bar's hands, given that the rank of QC remains a Government appointment, but this does not mean that the bar should not respond constructively. It has made great progress in recent years. The BarMark scheme offers an objective measure of administrative excellence between chambers. It should be possible for the modern bar to implement its own objective system for designating practitioners who have achieved distinction.

Perhaps the most controversial of the OFT's proposals relates to professional privilege. No one who has practised for any length of time would doubt the fundamental importance of protecting communications between lawyer and client, even if that has some anti-competitive effect. However, the Bar Council's response paints a much bleaker picture of the proposals than might be justified. In fact, the report appears to contemplate an extension of the privilege to other professionals. There seems little prospect of the right to confidential communication being eroded.

In this respect, as in others, the report ought to be regarded, not as a legal call to arms to defend existing institutions and practices, but as an opportunity to change and adapt them.

Derek Sweeting is a barrister at 7 Bedford Row