2. Summary of aims and expected outcomes of strategy, proposal, programme or policy
2.1 The Bill makes provision in relation to the regulation of legal services. It has five Parts.
- Part 1 introduces the objectives of legal services regulation and the professional principles which apply to those who provide and those who regulate legal services provision in Scotland. Part 1 also introduces a two-category regulatory framework which imposes requirements on all legal services regulators and provides for Ministers to review regulatory performance in certain circumstances.
- Part 2 creates a requirement for legal businesses to be authorised by a category 1 regulator to provide legal services and for category 1 regulators to produce a regulatory scheme for the authorisation and regulation of legal businesses.
- Part 3 makes provision for how complaints in connection with legal services are to be investigated and determined.
- Part 4 makes miscellaneous provision including changes to ownership restrictions to alternative business structures, removing practising restrictions on third sector organisations and the creation of offences around the use of professional legal titles.
- Part 5 makes general provision.
2.2 The overarching policy objective of this Bill is to provide a modern, forward-looking regulatory framework for Scotland that will best promote competition, innovation, and the public and consumer interest in an efficient and effective legal sector. The Bill will implement a number of key recommendations from the 'Independent Review of Legal Services Regulation in Scotland' by Esther Roberton (the Roberton report).
Firstly, the Bill will implement a modern, forward-looking model for legal services regulation which will build on the existing regulatory framework. This will provide for a proportionate approach that seeks to balance and deliver the key priorities of all stakeholders. The existing regulators will retain their regulatory functions with a greater statutory requirement to incorporate independence, transparency and accountability within their regulatory approaches.
2.3 Secondly, the Bill will reform legal services regulation in key areas:
- Introducing greater protections to consumers through regulation of legal businesses, to run in parallel with the current regime of regulating individual legal professionals.
- Bringing in controls over the use of the title 'lawyer', protecting the use of a professional title for the use of qualified or regulated individuals.
- Reducing restrictions in respect of alternative business structures to encourage competition and innovation in the legal sector and place Scottish firms on an equal footing with counterparts within the UK and other jurisdictions.
- Changing the way complaints about legal services are handled which will benefit both consumers and legal practitioners alike.
2.4 These measures are intended to modernise the existing regulatory framework and provide a proportionate approach which supports growth and competitive provision in the legal services sector while improving the consumer journey and consumer choice for legal service users, by placing consumer interests at the heart of regulation. In addition, the Bill will incorporate appropriate safeguards that deliver a balance between the independence of the legal profession with their duty to work in the public interest.
How consumers access legal services
2.5 The Roberton report set out that Scotland is home to a well-educated, well respected legal profession with a high degree of public trust, of which we can be very proud. However, there is significant potential for "market failure" in the provision of legal services whereby consumers either receive or perceive that they have received a poor service. Consumers are less likely to make a well-informed purchasing decision when consuming legal services versus a typical purchasing decision, because:
- Consumers tend to use legal services infrequently and have limited ability to learn about legal products and service providers.
- Legal services, as well as the law itself, are extremely complex.
- Legal services are often sought during traumatic or stressful circumstances.
- It is often the case that the same providers are responsible for diagnosing problems and offering and executing solutions.
2.6 Legal services contribute to the social value of Scotland. There is significant diversity in the types of legal services people access, often in times of distress or vulnerability. Legal services support individual's wellbeing, promote their continued contribution to society and help to prevent the escalation of problems. Legal services also support a range of commercial matters affecting many different types of organisations, from small businesses to multi-national corporations.
Ensuring that Scotland is able to maximise the benefits that a strong and independent legal sector represents is a priority for the Scottish Government. It is widely agreed that there are some elements of the current regulatory regime that could be significantly improved. Current restrictions which may inhibit competition and the complex complaints system are key areas in this regard.
How the Bill will improve the consumer experience
2.7 There are a number of provisions in the Bill designed to make it easier for members of the public to access legal services. These improvements may be of particular benefit to those who may not easily be able to access legal services, including those who experience inequality due to socioeconomic disadvantage.
- Changes to the ownership requirements for licensed legal services providers (a type of legal business, sometimes referred to as alternative business structures) may make it easier for legal services providers to set up in areas which have traditionally suffered from a lack of legal services provision.
- An ability for regulators to grant regulatory waivers, opening the door for legal services providers to trial new and innovative uses of technology which may benefit specific user groups.
- Improving the legal complaints system to simplify the way a legal services consumer can seek redress.
- Improving the transparency of legal services regulation, including a register of all practising legal services providers which is accessible to the public for free.
- Removing restrictions on how charities and other third sector bodies can provide legal services to their clients who may include vulnerable groups.
- Protecting the public by preventing those who have been struck off or are unqualified from using the title of 'lawyer' to provide legal services.
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