Law Firms Could Lose Control of the Legal Business
Deregulation is giving lawyers the jitters…
For weeks now, Scottish lawyers have been wrangling fiercely with proposals in their Legal Services (Scotland) Bill. (See Scottish Solicitors Scuppering Their Legal Big Bang and Scottish Big Four Leaving Scotland?).
Many small Scots firms oppose the external ownership of practices which the bill’s alternative business structure proposals could entail. So, last week at a special general meeting of the Law Society of Scotland, members voted against the introduction of ABSs altogether.
Which runs counter to the wishes of Scotland’s ‘Big Four’ firms – McGrigors, Dundas & Wilson, Maclay Murray & Spens and Shepherd & Wedderburn. Who, if the push comes to shove, may go in for some regulatory arbitrage and re-register under the Solicitors Regulation Authority south of the border – where the LSA is well on its way…
Deregulation in England and Wales might be unstoppable but that doesn’t mean all lawyers here are over the moon about it. Big opportunities are probably on the horizon but not necessarily for existing law firms. In fact many could become the losers in a zero sum game.
In a recent Legal Week debate, senior lawyers warned that firms will have to get used to competing against non-legal entrants to the market.
Legal Week: Osborne Clarke (OC) managing partner Simon Beswick told delegates: “Venture capitalists see more opportunities in setting up new businesses to compete with law firms, as opposed to direct investment into existing firms.”
And Russell Jones & Walker chief executive Neil Kinsella warned that “the biggest competition will come from the outside”.
So are they really ready for it or will deregulation be the legal profession’s Nick Clegg moment?
