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Rule changes permit law firms to own separate businesses offering non-reserved legal services
4 June 2015

The Solicitors Regulation Authority is removing restrictions on solicitors having links with outside businesses.

Changes to the Separate Business Rule—which mean that solicitors can own or be connected to separate businesses providing non–reserved legal services—were agreed by the SRA Board at its meeting yesterday (Wednesday, 3 June). The original purpose of the Separate Business Rule was to prevent solicitors having links to separate businesses outside the remit of regulation.

The opening up of the legal market already allows other types of businesses to own law firms and deliver innovative services. By changing the Separate Business Rule, all law firms can own separate businesses, allowing them to compete on a level playing field with alternative business structures (ABSs). As part of the same package of reforms, the rules on what activities can be undertaken within solicitors firms have been relaxed, making it easier for those firms to create one-stop shops for professional services.

A wide-ranging consultation on these proposals took place from November until February. The SRA Board debated the analysis of comments from stakeholders at its meeting and agreed to the changes.

Paul Philip, SRA Chief Executive, said: “We are levelling the playing field for all types of law firms, encouraging innovation and growth, while ensuring appropriate consumer protection. This follows on from changes we made last year to open up the market to different business models and ‘one-stop shop’ services.

“We are now looking into what more we should do to give solicitors even more flexibility in future.”

The changes need the approval of the Legal Services Board. If agreed, they will be part of Version 15 of the Handbook when it goes live on 1 November.

Further information on the changes to the Separate Business Rule can be found here:

Go to the Separate Business Rule consultation page

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