The Solicitors Regulation Authority (SRA) became a Licensing Authority on 23 December 2011, and expects about 20 applicants for Alternative Business Structures (ABS) initially, when it starts processing applications. Among them will be the Co-op. The first successful applications are expected to be announced in the middle of February.
ABS are a result of the Legal Services Act (2007) which will enable law firms to secure outside investment from other industries, such as retailers.
Law firms Irwin Mitchell and Keoghs have indicated their intention to seek outside investment in this way.
The accountancy firm Spofforths is likely to be one of the first Multi-Disciplinary Practice ABSs, adding probate work to its accountancy and financial planning work.
Only about 20% of clients typically return to a firm of solicitors for another piece of work, whereas the ABS model is likely to focus on retaining clients by offering a wider range of services.
The Authorised Professional Firms regime for financial services in firms of solicitors or accountants will disappear. There will be major similarities between legal and financial services regulation going forward.
