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'We don't want a single legal regulator,' says Chris Perrin

Law Society proposals on regulation ‘not an option’  

4 December 2013

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By Manju Manglani, Editor (@ManjuManglani)

Chris Perrin, general counsel at Clifford Chance, has attacked the idea of a single regulator for UK law firms.

Speaking at Managing Partner’s 10th annual Risk Management for Law Firms conference yesterday, he said: “The Solicitors Regulation Authority has struggled to provide different types of regulation for different firms and one super regulator could find it even more difficult. If it was created I would be less happy than I am now.”

Perrin argued that the needs of City firms were very different from those of high street firms and that a one-size-fits-all approach to regulation, as suggested by the Legal Services Board, was not appropriate.

Looking at how the SRA could change its approach to regulating large law firms, Perrin said “there needs to be a more two-way process in future”.

He went on: “The SRA needs to build on City experience. We need two Nick Eastwells working full time, talking about regulatory risks with firms and providing papers with best practice guidelines on managing those risks.

“A single back office would be beneficial and result in lower costs, but would lead to an untailored approach. It would not be very beneficial to the profession and it would inevitably increase the in-house cost to law firms of dealing with regulation.”

Highlighting the risks facing larger law firms – particularly confidentiality, client demands and claims exposure – Perrin noted that a rising challenge is the practice of law firms agreeing to indemnify clients in order to join their panels.

“The SRA needs to say that you can negotiate this if you want, but is it responsible to indemnify clients? We can’t tell other firms not to do it but the regulator can warn firms about the risks involved.”

Perrin also described the Law Society’s proposals on regulation as “not an option”.

He said: “It doesn’t look appropriate or possible. The Law Society proposals go further than is acceptable”.

Patricia Greer, head of corporate affairs at the Law Society, agreed that regulators should take a more tailored approach to working with firms of different sizes.

“City firm issues are very different from those facing high street firms,” she said. “This is not sufficiently recognised. We need to rebalance this and have a regulatory regime that meets the needs of the profession and which the profession can help to shape.”

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