Over the years, the regulation of the legal profession has been a relatively controversial subject in Scotland. Although there are a range of viewpoints, two main strands of thought are:
Those who take the view that the current regulatory system, where professional bodies also have a regulatory role, overly favours solicitors and advocates and that this approach does not benefit consumers. They argue that there should be an independent regulator and that there should be more room for innovation and new forms of business.
Those who take the view that the current system provides high quality legal services and that risks lie more in the market for unreserved legal services which are not subject to the same regulatory obligations as solicitors and advocates. They stress the importance of the independence of the legal profession and the judiciary from government.
In addition, there have also been arguments that the current complaints process does not work effectively, and that much of the legislation regulating the profession is outdated and in need of consolidation and renewal (for details see the background section of the briefing).
In April 2017, the former Minister for Community Safety and Legal Affairs, Annabelle Ewing MSP, invited Esther Roberton to Chair an Independent Review of Legal Services Regulation in Scotland.
The Chair’s Report, ‘Fit for the Future – Report of the Independent Review of Legal Services Regulation in Scotland’(“the Roberton report”) made 40 recommendations intended to reform and modernise the current regulatory framework.
The main recommendation was that an independent body should be set up to regulate legal professionals (similar to the situation in England and Wales), with the professional bodies only retaining their role as representatives of the profession. The new system would be financed by a levy on practitioners.
The Scottish Government consulted on these proposals, but ultimately decided not to follow the Roberton report's main recommendation to set up a single independent regulator. The Scottish Government's response to the consultation analysis on 22 December 20221Scottish Government. (2022, December 22). https://www.gov.scot/publications/legal-services-regulation-reform-scotland-scottish-government-response-findings-consultation-analysis-report/pages/1/. Retrieved from <a href="https://www.gov.scot/publications/legal-services-regulation-reform-scotland-scottish-government-response-findings-consultation-analysis-report/pages/1/" target="_blank">https://www.gov.scot/publications/legal-services-regulation-reform-scotland-scottish-government-response-findings-consultation-analysis-report/pages/1/</a> [accessed 13 June 2023] concluded that it wished to, "build on the existing framework" and that,
"the existing regulators should retain their regulatory functions, with a greater statutory requirement to incorporate independence, transparency and proportionate and risk-based accountability."
The Bill reflects this position and amends and builds on the existing framework (albeit with some more fundamental changes) rather than following the more radical approach proposed in the Roberton report of setting up an independent regulator.
The main changes proposed by the Bill are as follows:
The setting up a framework whereby regulators can be assigned as either a category 1 regulator (consumer facing) or category 2 regulator (less consumer facing and more specialist areas of law). The Law Society of Scotland (regulator of solicitors) is assigned as a category 1 regulator. The Faculty of Advocates (regulator of advocates) and the Association of Commercial Attorneys (regulator of commercial attorneys) are assigned to category 2.
New rules which allow professional bodies to apply to become a category 1 or category 2 regulator. The policy aim is to allow for the expansion of regulated professionals which could provide legal services and, potentially, to provide opportunities to widen the scope of those who qualify to practise law in Scotland (para. 184 of the Policy Memorandum )
Rules aimed at increasing transparency. For example, Category 1 and 2 regulators will have to report annually on performance. The work of regulatory committees of category 1 regulators would also become subject to freedom of information requests under the Freedom of Information (Scotland) Act 2002.
The introduction of powers for the Scottish Ministers to review the regulatory performance of category 1 or 2 regulators. The Law Society has argued that these powers, "risk seriously undermining the independence of the legal profession from the state."2Law Society of Scotland. (2023, April 21). New Bill to reform legal services regulation 'seriously risks undermining the independence of the legal professions from the state'. Retrieved from <a href="https://www.lawscot.org.uk/news-and-events/law-society-news/legal-services-regulation-reform-bill-introduced/" target="_blank">https://www.lawscot.org.uk/news-and-events/law-society-news/legal-services-regulation-reform-bill-introduced/</a> [accessed 19 June 2023] The Scottish Government's view is that they balance the public interest in regulation and the independence of the legal profession (para. 142 of the Policy Memorandum).
The updating of the legislation on the regulatory objectives and professional principles for those providing legal services.
The regulation of legal businesses ("entity regulation") in additional to individual solicitors. Both the Roberton report and the Law Society recommended this approach arguing that it would improve quality standards, create a level playing field for different forms of business and provide better protection for consumers.
Updating the current rules on alternative business structures (ABS) with the aim of increasing the number of business and other bodies which can operate as ABSs.
Making it an offence to use the title of ‘lawyer’ with intent to deceive in connection with providing legal services to the public for a fee, gain or reward. The term ‘solicitor’ is a already a protected title. Both the Law Society and the Roberton report argued that similar rules should apply to the term 'lawyer' which is currently not protected.
Updating and modernising the way in which complaints about legal services are handled with the aim of benefiting both consumers and legal practitioners.
Allowing charities to directly employ legal professionals to undertake reserved legal services (e.g. representation in court proceedings).
Allowing legal services providers to apply to their regulator for a direction that certain rules do not apply or may be modified in a specific case. The aim is to allow for new services and legal technology to be trialled, thus leading to more innovation.
The Lord President (Head of the Scottish Judiciary) will retain his/her regulatory role in the new system including oversight of admission to the profession, approving professional practice rules, and conduct and discipline matters.