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Reform of the regulatory framework for legal services

12 September 2016

The Council for Licensed Conveyancers reacted to the publication today by the Legal Services Board of A vision for legislative reform of the regulatory framework for legal services in England and Wales.

 Chair of the CLC, the Rt Hon Dame Janet Paraskeva said:

 ‘The CLC is very encouraged that the Legal Services Board (LSB) has recognised the strengths of activity-based regulation. We have long argued that this model should be retained and extended under any new arrangements for the regulation of legal services. A risk-based approach in place of the current, haphazard system of ‘reservation’ of certain legal services also has our support as we believe it will deliver benefits to consumers and legal service providers alike. Likewise, a sharper focus on regulation in the regulatory objectives will provide clearer goals and so reduce the overall regulatory burden.

‘It is our view that the Legal Services Board already has powers to deliver independence of regulation from representation and I urge the Board to use those powers now in line with its views as set out in its paper. Securing the independence of regulation is a vital first step in the further reform of legal services and in fact should be seen as unfinished business from implementation of the Legal Services Act.

‘The LSB has published a very useful paper providing leadership on reform of regulation of legal services. As a wholly independent regulator with a thirty-year record of protecting consumers, supporting innovation and fostering competition through tailored, specialist activity-based regulation, we look forward to taking part in the debate and providing the CLC’s unique insight into the Board’s preferred future model.

‘Commentary on the LSB’s proposal is likely to focus on the question of whether there should be one regulator or many but this should not distract us from the more important questions raised in this paper. We agree with the Legal Services Board that whether there should only be one regulator can only flow from answers to the prior questions about how we ensure independence and move to a risk-based approach and regulation by activity.’

In summary, the LSB's paper makes the following proposals. 

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Help to Buy ISA

24 August 2016

There has been some confusion about the operation of the Help to Buy ISA scheme. The Treasury's guidance for conveyancers sets out that the draw-down of the Help to Buy ISA bonus should take place immediately prior to completion. The savings themselves can be withdrawn by the homebuyer earlier to use as part of the deposit on their new home. This process was set up to avoid any difficulties that would arise in the event of a house purchase that fell through at any earlier stage. It is important that all intermediaries, from the ISA providers themselves, mortgage brokers and lenders to conveyancers are clear with the home-buyer about when and for what purpose the ISA savings and bonus can be used.

Find out more 

CLC cuts regulatory fee rates, reports on a successful PII round

28 July 2016

The CLC, the specialist property law regulator, has today confirmed that it will reduce regulatory fees rates for firms by 20% with effect from 1st November 2016. The announcement follows a consultation on the proposed reduced rates and a formal decision by the governing Council. The proposals will now be passed to the Legal Services Board for approval.

The fee rate cut has been made possible by restructuring of the CLC’s operations, staffing, processes and IT support as well as a move to new, more appropriate premises. Together, these have reduced the CLC’s cost base in a sustainable way while maintaining and improving services consumers and the regulated community.

The CLC today also published a review of the operation of the professional indemnity insurance round. Firms had to renew their insurance by 1st July under new terms which built in automatic run-off cover to no cost at the point of a firm’s closure.  This was also the first PII renewal round through a fully open market, following the end of the CLC’s Master Policy scheme.

Feedback from the profession was overwhelmingly positive, with 84% of respondents finding the process easier or the same as the previous year and more than two-thirds saying they were ‘satisfied’ or ‘very satisfied’ with the new arrangements.

Overall, premium rates remain very competitive despite the addition of automatic run-off cover to the minimum terms. All firms that sought cover secured it.

The CLC will discuss the survey findings with insurers to ensure that points raised about the operation of the process are taken account of in planning the 2017 renewal round.

Sheila Kumar, Chief Executive of the CLC said: ‘The success of the 2016 Professional Indemnity Insurance renewal round and the announcement of 20% reductions to regulatory fees for firms set the seal on a very successful twelve months for the CLC. In a recent independent survey, three-quarters of CLC lawyers said that regulation by the CLC provides value for money and supports innovation and growth in their business. The Legal Services Board gave us a very strong report too, giving us the best assessment of any regulator.

‘PII premium rates for CLC-regulated firms remain very competitive. The new automatic run-off provisions are a benefit to firms as well as reducing what had been a risk to consumers and the Compensation Fund in the event that a firm closed without purchasing run-off cover.

‘Reducing the costs of regulation is an important part of our mission to foster competition and innovation in conveyancing and probate. The ongoing review of our regulatory arrangements has a sharp focus on even tighter tailoring of our approach to the proportionate regulation of specialist property lawyers.’

Find out more

The CLC’s review of the 2016 PII renewal round is available here.

The CLC’s Stakeholder and Regulated Community Perceptions Report 2016 was carried out by independent research firm IFF. More information is available on our website.

The Legal Service Board’s report on the CLC’s Regulatory Standards gave the CLC a better overall rating than any of the other legal services regulators. More details are available here

New apprenticeships in law planned for Wales

26 July 2016

Aspiring lawyers in Wales will soon have a new way to begin their careers as apprenticeships in conveyancing and probate are due to go live in early 2017.

Three qualifications will be on offer.  The first two lead to recognition by the CLC as a Conveyancing Technician or a Probate Technician. It’s a great start to a legal career as well as an excellent way for people with a lot of experience in conveyancing firms, but who are not qualified lawyers or do not want to be, to polish their skills and demonstrate their value to current and potential employers.

The third qualification leads to eligibility to become a Licensed Conveyancer, a fully authorised lawyer regulated by the CLC, the specialist property law regulator, with the same status as a solicitor within their area of specialism. That can be a follow on from becoming a Conveyancing Technician, or apprentices can aim for the higher qualification from the beginning.

Licensed Conveyancers are specialist property lawyers who work in firms with other Licensed Conveyancers, Solicitors and other lawyers or in-house for large organisations and who can set up their own firms if they wish.  Over the past four years, firms regulated by the CLC have quadrupled their turnover, having begun to recover from the last downturn sooner and faster than the rest of the market.

Chief Executive of the CLC Sheila Kumar said: ‘There is strong demand for more qualified Licensed Conveyancers and CLC Probate Practitioners because of the overall strength of the sector we regulate.  These new apprenticeships in Wales are an excellent way to begin a career in law, earning while you learn. The CLC supports Licensed Conveyancers who are finding new ways to meet the expectations of buyers and sellers and provide innovative new services. We expect the Welsh Government will approve them so that the first apprenticeships can begin in March 2017.’ 

Exciting roles on our governing Council

21 July 2016

We are looking for new members for our governing Council to fill roles that will soon become vacant as members come to the end of their maximum terms. The majority of the new roles will begin in April 2017.

There are vacancies for two lay (non-lawyer) members and three lawyer members. The lawyer members will need experience in the conveyancing and probate fields. Recruiting to the non-lawyer roles, the CLC is especially interested in people with experience in marketing or consumer affairs. Full details are available on the here.

The CLC has achieved some notable successes in recent years, securing the power to issue stand-alone probate licences, receiving a very positive assessment from oversight regulator the Legal Services Board, and achieving very significant shifts in already positive perceptions of it by the profession and its stakeholders. Three-quarters of CLC lawyers believe that being regulated by the CLC is either ‘extremely’ or ‘mostly’ beneficial to their business, that it provides value for money and supports innovation and growth in their business.

 

The regulator has this year overhauled its professional indemnity insurance regime, achieving major improvements in the interests of regulated firms, consumers and reducing risk to the Compensation Fund that it operates on behalf of the profession. It is also completing the handover of the delivery of education to licence as a CLC lawyer to SQA while it retains control of the standards of entry to the profession.

Now the CLC is looking for new Council Members who can continue to drive the organisation forward.  A major review of regulatory arrangements is underway to ensure that the CLC is in a strong position to continue its original mission to foster competition and innovation in legal services provision.

Chair of the CLC, Dame Janet Paraskeva said: ‘The CLC has made significant progress in the past few years, delivering tailored regulation of specialist property lawyers in a more streamlined and cost-effective way. The turnover of firms we regulate has more than doubled in the past four years after they recovered sooner and quicker than other firms from the 2008 downturn. But there are always new challenges in a fast-changing sector that underpins a major part of the economy. Serving on our governing Council is a chance to drive positive change in an innovative organisation that will have far-reaching impact.’

Making the most of the Legal Services Act 2007

14 July 2016

The Council for Licensed Conveyancers today urged the SRA to dismantle a major barrier to firms exercising freedoms created by the Legal Services Act 2007.

Responding to the SRA’s consultation, ‘Removing barriers to switching regulators’ the CLC welcomed proposals for waivers of the automatic requirements for run-off cover to be purchased when a firm transfers from SRA regulation to another front-line regulator. The specialist property law regulator pressed the SRA to ensure that it then dismantles barriers completely as part of its review of professional indemnity insurance that is promised for later this year.

Chief Executive of the CLC, Sheila Kumar said: ‘The SRA’s proposals, which will enable firms to exercise a choice that was given to them by Parliament in the 2007 Act, are very welcome. Requiring firms that transferred from SRA regulation to take out run-off cover when they were continuing in business and had ongoing indemnity insurance was not justifiable. It has acted to stop practices being able to choose a regulator that is tailored to their work. These changes come in the wake of the CLC’s own improvements to its PII regime which now includes run-off cover free at the point of closure for all firms under the new Participating Insurers Agreement and so further enhances consumer protection.’

The CLC’s response to the SRA’s consultation is available on the CLC’s website and the consultation itself is available on the SRA website

CLC Commentary in Legal Press

06 July 2016

The Chair of the CLC, Dame Janet Paraskeva and Chief Executive, Sheila Kumar, have had articles published in the legal press that look at regulation, market entry and competition. 

The articles look at the regulatory burdens placed on lawyers by a range of organisations that are not subject to the rigour of oversight by the Legal Services Board and the need to respect the Regulatory Objectives of proportionality, fostering competition in particular. 

You can read the piece by Dame Janet on the Times website (behind their paywall)

The piece by Sheila Kumar is on Legal Futures

Council for Licensed Conveyancers consults on changes to education and training

28 June 2016

The Council for Licensed Conveyancers (CLC) has today launched a consultation on proposals that will see delivery of education and training move away from the regulator. The Council will continue to set the standards to be achieved to apply for a licence to practise as a Licensed Conveyancer or Licensed Probate Practitioner. The CLC has appointed SQA, a leading Awarding Organisation, to oversee the delivery of education.

The numbers training to become a CLC lawyer have increased substantially in recent years and further growth is targeted to help meet demand in the sector for more trained and qualified specialist property lawyers.

The CLC has further responded to employer demand by creating new qualifications that are standalone but may be used as a stepping stone to full licence. These qualifications will provide employers and consumers with an understanding of the level of legal training of individuals delivering legal services under the supervision of a fully qualified lawyer. They have been created in direct response to demand from firms and potential and past students. Candidates with or without prior legal education will be able to train to be recognised as a Conveyancing or Probate Technician.

As well as classroom and distance-learning, CLC qualifications will also be delivered as apprenticeships.  Those apprenticeships have been developed by employer-led consortiums supported by the CLC.

Chief Executive of the CLC, Sheila Kumar, said: ‘Formalising these new arrangements will cement a major step forward by the CLC by supporting qualifications that lead to licence as a Licensed Conveyancers or Probate Practitioner or recognition as a Conveyancing or Probate Technician. They respond to employer demand for more trained and qualified specialist property lawyers. Delivery of education under SQA will ensure a contemporary and engaging student experience and ensure that the numbers entering the profession will continue to increase.  Apprenticeships offer an especially accessible route to a career in the law and we expect that they will be popular with both potential lawyers and their employers. We hope also that many already working in the sector will take up these new opportunities.'

Find out more

New CLC Professional Indemnity Insurance Framework approved by the Legal Services Board

15 June 2016

CLC-regulated firms can now purchase PII cover from insurers that have signed up to the CLC’s Participating Insurers Agreement.  That agreement sets out the minimum terms and conditions of PII cover.  These have been enhanced to include run-off cover of £2m at no cost at the point of closure of a practice.

These changes take effect from the beginning of the next PII year, 1st July 2016.  Insurers have already been issuing quotations on this new basis in anticipation of the LSB’s approval, which was granted on 14th June.  

The new approach

  • Ends the master policy scheme with its opt-out provision and move to a more open-market approach
  • Improves consumer protection by ensuring that closed practices will automatically have run off cover in future
  • Removes the financial obstacle to orderly closure of firms presented by large run off premiums payable at the point of closure
  • Provides firms with improved choice of insurance through a Participating Insurers Agreement
  • Reduces the compliance burden on firms by removing the requirement to seek an opt-out from a Master Policy Scheme at PII renewal time
  • Streamlines internal regulatory processes at the CLC, making better use of resources

Currently, two brokers have signed up to the Participating Insurers Agreement.  

Chief Executive of the CLC, Sheila Kumar said: ‘We are delighted that the Legal Services Board has acted so quickly to approve our proposals. This means that firms and their clients will benefit from the new PII policy terms from the point of insurance renewal this month. Any firms that have not yet submitted proposal forms should do so without delay.’ 

Profession says CLC provides value for money, supports innovation

06 June 2016

The Council for Licensed Conveyancers is publishing today, Monday 6th June, the findings of its Stakeholder Perceptions Report 2016.  The report tracks changes in views about the specialist property law regulator since the last survey in 2014. The survey was carried out by independent research firm IFF.

CLC lawyers reported that the CLC’s performance has improved significantly on all measures over the past two years. Key findings include:

  • three-quarters of CLC lawyers think that regulation by the CLC provides value for money and supports innovation and growth in their business
  • two-thirds of all CLC lawyers and three-quarters of those regulated for three years or less agree that the CLC supports innovation and growth in the legal business it regulates
  • three-quarters believe that being regulated by the CLC is either ‘extremely’ or ‘mostly’ beneficial to their business
  • nine out of ten managers said that CLC staff are helpful and nine out of ten lawyers said that they are satisfied with the information and support that is provided by the CLC

In terms of performance in administration and regulation overwhelming majorities consider that the CLC performs ‘well’ in:

  • issuing licences - 82% (up from 67% in 2014)
  • regulation of Licensed Conveyancers - 78% (up from 69%)
  • setting standards for professional practice - 75% overall and 84% of managers (up from 63% overall)
  • setting standards for education and training - 74% (up from 63%)
  • providing practical guidance to the regulated community - 65% (up from 41%)

Stakeholders in other parts of the legal sector, the media and government described the CLC as ‘trusted, approachable, forward looking, helpful, open, proactive and professional’. Most stakeholders feel the CLC compares favourably to other organisations in the legal community, with several citing a closer relationship and more personal touch.

Both the regulated community and stakeholders now look to the CLC to continue to do more to raise its profile in the sector and ensure that its positions on developments in the sector and in regulation are more widely understood.

This very positive report on the CLC’s performance comes immediately after a solid endorsement from oversight regulator the Legal Services Board in its report on the CLC’s regulatory standards.

Chief Executive of the CLC Sheila Kumar said: ‘The results of this survey are a testament to the entire team at the CLC, both members of Council and the staff. The staff group is largely new since the beginning of 2015 and over the past three years we have also made major investments in infrastructure and IT.

‘It is very gratifying that the lawyers we regulate appreciate the efforts that we are making to continue to improve the service that we provide. It is especially important to us that those we regulate agree that the CLC regime supports innovation and growth alongside protecting the consumer. I am very pleased that we are now consulting on 20% reductions to regulatory fees for CLC firms, which I hope will support further growth.

‘We are also pleased to have received such positive comments from the lending community as we are working hard with them to ensure that there is continued good understanding of the profession that we regulate.’

View the recording of our lunchtime webinar that took place on Tuesday, 21st June to find out more: Register Now

The full report, prepared by independent researchers IFF, is available here.

Our comment on the LSB’s recent report on the CLC’s regulatory standards is available here