Looking to the Future: completing SRA reforms of regulation Crispin Passmore – Executive Director, Policy

Modernising regulation

SRA Innovate Competitive legal services market SRA Innovate Educate Supporting new business models Innovation Space Streamlining the waiver process www.sra.org.uk/innovate

Handbook reforms: phase 1 In June 2013 our Board committed to the above phase one decisions, including allowing solicitors to provide non-reserved legal services from unregulated firms

What are the aims of phase 2? Review our rules and make them clearer Reduce unnecessary bureaucracy Implement phase one decisions As in phase one, we have sought to: reduce unnecessary regulation - we have removed prescriptive drafting to produce requirements that: are clearer and more accessible, with duplication removed are easier to understand in terms of purpose and effect are targeted at the issues that really matter operate at a higher level so are less detailed and prescriptive, providing flexibility to apply to changing circumstances. moved guidance and detailed internal processes to sit outside our rules (where possible) and have simplified reduced the length of the glossary reorganising how we present our rules to give a more logical and coherent structure eg rationalising our appeals provisions, so that there is only one centralised set 'future proof' the new rules This approach means our Handbook should be well placed to adapt to any changes in the market.

What areas are covered by phase 2? Authorisation – firms and individuals Discipline and enforcement How we keep rolls and registers Overseas practice Ongoing practice Financial services Existing rules that have been reviewed as part of phase two: Practice Framework Rules & Practising Regulations Regs on Admission, HRA and QASA Authorisation Rules Keeping of the Roll Regulations Regs on Training, Qualification and Providers, and QLTS regs Suitability Test 2011 Indemnity Rules Compensation Fund Rules Rules on Disciplinary procedures, interventions and cost of investigations Overseas and Cross-border Practice Rules Property Selling Rules Financial Services Rules

Our approach to enforcement Looking to the Future Policy Statement 2015 Question of Trust What the public, profession and we think is serious Review of enforcement Revised Enforcement Strategy Updated sanctions & controls table moving away from enforcing compliance with prescriptive rules, towards a model which seeks to enforce standards through a transparent framework that those we regulate can clearly understand we set standards that establish clear expectations but also build in appropriate flexibility as to how solicitors meet those standards public will be better able to understand our rationale for taking or not taking enforcement action in any case or circumstances clarity about how seriously we view different behaviours will help solicitors and firms to understand what constitutes a serious, reportable, breach of our requirements Enforcement Strategy: provides clarity about how, and when, we will enforce (or not) aims to help staff and the profession better understand the risks posed by different behaviours facilitates proportionate action by outlining the aim behind different outcomes

CMA report Specific recommendation to the SRA to remove regulatory restrictions to allow solicitors to practise in non-SRA regulated firms Recommendations for regulators to: - improve transparency and help consumers compare the quality and price of different providers - reduce regulatory burdens in areas where they are not justified by risks to the consumer or public interest Recommendation for Ministry of Justice to review the independence of the front line regulators

Better information, more choice Legal services seen as expensive, hard to access and confusing Lack of competition and innovation in market Information we could publish: regulatory data, enforcement action, complaints data Information firms could publish: price, services, regulatory protections, insurance details, complaints details Consultations closes on 20 December

Positive impacts of our reforms Reduced information asymmetry Increased consumer participation in the market A more competitive market Opportunities for innovation and growth

Next steps Consultations close December 2017 Board decisions May 2018 Implementation no earlier than autumn 2018