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SRA Innovate: A new approach to waivers

SRA Innovate: A new approach to waivers


Kirsty Peay explains the regulator's thinking behind its latest consultation on legal services innovation

The Solicitors Regulation Authority launched SRA Innovate in the spring of 2016 to help law firms to develop new ideas and support new types of organisations that are thinking of delivering legal services for the first time.

The objectives of the initiative are to:

'¢ Encourage new services and service delivery methods to benefit the public;

'¢ Formalise and expand existing initiatives in place that support innovation; and

'¢ Consider what else we could be doing to support innovation in legal services.

Following the launch, the current focus of the SRA Innovate is looking at how the waiver process can be streamlined with the consultation 'Enabling innovation: Consultation on a new approach to waivers and developing the SRA Innovation Space'. SRA Innovate wants to allow solicitors to find new ways of servicing their clients, so that they are not restricted by the rules.

The consultation on proposed changes aims to allow existing or new firms the opportunity for specific rules to be waived to allow them to run their business in a way that suits them best, while still applying appropriate safeguards. The objective of removing barriers that are restricting innovation while maintaining the protection of the users of legal services should support the industry as it develops. To ensure a competitive market and quality services, innovation is essential.

The current policies mean certain requirements in the SRA Handbook can be waived and the regulator is seeing an increase in the number of applications being approved. At present around 60 per cent of the 100-to 150 applications received each year are being granted.

The proposal is for a new set of criteria for granting waives which is simply set out and gives the SRA more flexibility to approve waivers where they feel justified. It also aims to make the waiver policy more transparent and easier for firms to make applications.

For an application for a waiver to be successful, the reporting body need to be satisfied the waiver is still compatible with the regulatory objectives in section 1 of the Legal Services Act 2007, which are:

'¢ Protecting and promoting the public interest;

'¢ Supporting the constitutional principle of the rule of law;

'¢ Improving access to justice;

'¢ Protecting and promoting the interests of consumers;

'¢ Promoting competition in the provision of legal services;

'¢ Encouraging an independent, strong, diverse, and effective legal profession;

'¢ Increase public understanding of the citizen's legal rights and duties; and

'¢ Promoting and maintaining adherence to the professional principles.

Waivers are unlikely to be granted for applications where the circumstances are similar to those of many others in the market as in those instances the overall policy in that area may be awaiting review. It is also unlikely that a waiver would be granted if there is a reasonable alternative option available. Waivers will not be granted if they undermine the public interest.

Waivers may be published to ensure fairness and transparency and also as it may benefit other firms who could use the innovation themselves.

A consultation is currently open until 8 March 2017 for feedback on the new approach to waivers and developing the SRA Innovation Space.

Kirsty Peay is an audit and assurance manager at Kreston Reeves @KrestonReeves