Liberalisation of law firm ownership in the UK - has anything changed?
Two weeks have passed since the introduction of the Legal Services Act in the UK – legislation that promised to overhaul the way that law firms do business by opening them to investment outside the traditional partnership structure.
The introduction of the legislation did not, however, precipitate immediate change in the industry, since the Solicitors Regulation Authority was not ready to begin licensing alternative business structures. The SRA is not expected to begin licensing until January or February next year.
The changes remain controversial and many lawyers, including the Solicitor Sole Practitioners Group, claim that the shift will undermine the independence of the legal profession.
Others are on board and eager for the licensing to begin, such as virtual practice Everyman Legal, which intends to become an ABS and later seek admission to Sharemark, a junior stock exchange. The Everyman founder James Hunt said: "Starting out on a smaller market such as Sharemark is a great way to build profile and get to grips with the practical challenges of being a traded company. It will also enable us to start the process of forming relationships with potential investors and analysts, while the low cost and regulatory burden will not weigh us down. This move is also evidence that smaller law firms can take advantage of the Legal Services Act."
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