Transparency and Trust DAY 2 – October 5th 11:15-12.45 hrs

MODERATOR Philip Yelland Executive Director of Regulation Law Society of Scotland

PANELISTS Neil Buckley Rebecca Marsh Philip Yelland Michal Masior Chief Executive Legal Services Board England and Wales Rebecca Marsh Chief Ombudsman Legal Ombudsman Service Engaland and Wales Philip Yelland Executive Director of Regulation Law Society of Scotland Michal Masior Phd Student Warsaw

Trust and transparency Reliance on the integrity, strength, ability, surety, etc., of a person or thing; confidence. Transparency - Clear/unambiguous

The regulatory architecture Legal Services Board

Regulatory performance LSB’s regulatory performance framework includes five standards: Regulatory approach Authorisation Supervision Enforcement Well-led: Governance and Leadership WL: GL3: The regulator is transparent about its own: decision-making; regulatory approach; the risks it and its regulated community faces and how these are being mitigated; performance; regulated community and related markets; financial costs.

Public trust in lawyers Source: Legal Services Consumer Panel’s annual tracker survey 2011-18

LAW FIRMS THAT DISPLAY PRICES ON THEIR WEBSITES Market transparency 17% x2 SMEs THAT CONSIDER LAW FIRMS ARE TRANSPARENT ABOUT COSTS ARE TWICE AS LIKELY TO OBTAIN LEGAL ADVICE LAW FIRMS THAT DISPLAY PRICES ON THEIR WEBSITES

“Truth isn’t truth”

LeO in England and Wales Jurisdiction – Regulated service providers: Solicitors Barristers Conveyancers Statutory body  Legal Services Act Legal ombudsman Complaints about service: Costs Communications Delay Complaints brought by: Consumers Charities and trusts Micro-enterprises

Trust & Confidence: ombudsman Role of Ombudsman Remedy and reassurance Feedback and learning

Trust & Confidence: sector Trust requires honesty “I don’t want perfect I want honest!” Transparency is vital throughout Good complaints handling

What is important to consumers Consumers views 62% 60% 48% 35% 33% Solicitors views 35% 45% 23% 17% 64% Regular updates on progress Clear cost information Clear explanation of process Plain English / clear communication Positive outcome (Research into the experiences and effectiveness of solicitors first-tier complaints processes, 2017, London Economics)

Questions Prices: low, transparent, proportionate to value Role of price transparency in building trust for lawyers vs. other factors (like professionalism) Lack of incentives to communicate prices Types and scope of price regulation and their rationale Effectiveness of regulatory tools to enforce transparency in prices or to hinder it Role of supervisory agencies and market-oriented regulation Other factors: shocking events, Price differentiation and cross subsidizing; internal anti-competition lobby Types: fixed fees, minimum, maximum, recommended, none. Scope: type of cases Changes in time

Law Society of Scotland Professional Body – Helps and supports members and regulates Trust through open regulatory processes Use of non solcitors in those processes all decision making sub Committees 50/50 solcitors and non solcitors Regulatory work overseen by Regulatory Committee chaired by non solcitor (created through Legal Services (Scotland) Act 2010 Public polling Price Transparency – Key current issue Being persued by consumer bodies Some legal services can be commoditised – domestic house buying for example Challenges of the complex – court actions Problem of the uninformed consumer and the ability to get pricing certainty around many other services

Public information about prices of legal services Germany: allowed (§ 6 Berufsordnung) France: allowed (art. 10.1 of Règlement Intérieur Nationale) Spain: allowed (art. 25 of Estatuto General de la Abogacía Española in force) Poland: prohibited for advocates (§ 23a of Kodeks etyki adwokackiej), but allowed for legal advisers (art. 31 of Kodeks etyki radcy prawnego) Europe, transnational services: allowed (art. 2.6 of the Code of Conduct for European Lawyers)

Price regulation in commercial cases and pactum de quota litis Germany: fixed fees and minimum fees, pactum de quota litis forbidden (§ 49b of Bundesrechtsanwaltsordnung) France: none, quota litis allowed as supplementary (art. 10 of loi n° 71- 1130) Spain: none, quota litis forbidden (art. 44.3 of Estatuto General de la Abogacía Española) Poland: none, quota litis allowed as supplementary (§ 50(3) KEA, art. 29(3) KERP) Europe, transnational services: none, quota litis forbidden unless complies with official fee scale or is under control of an authority (art. 3.3 of the Code of Conduct for European Lawyers)

Dynamics of legal services’ prices in Germany (2006-17) Administered prices – RVG (most services) Minimum prices – fee agreement Regulated prices for legal services (RVG) rose (were increased) more than less regulated (fee agreement): 22% to 13% in 2006- 2017 Role of competition Source: Statistisches Bundesamt (Destatis) Indices of business producer prices, table 61361-0001 Base for 2006=100

Lunch break DAY 2 – October 5th