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Legal Services Bill [HL]

moved Amendment No. 106B: 106B: Clause 53 , page 30, line 2, at end insert— ““(2A) An external regulatory body may make an application to an approved regulator under this section if it considers that the arrangements of the approved regulator— (a) frustrate the exercise of the external regulatory body’s regulatory requirements, or (b) conflict with the external regulatory body’s regulatory requirements, or (c) give rise to unnecessary duplication of regulatory requirements for the subjects of the external regulatory body. (2B) For the purposes of subsection (2A)(c) below, ““subjects”” means any individuals or entities subject to the regulatory powers and jurisdiction of the external regulator. (2C) Where an application is made to an approved regulator under this section, the approved regulator must— (a) determine whether such regulatory conflict exists with the external regulatory body’s requirements and, where it so determines, take such steps as are reasonably practicable to address the regulatory conflict outlined by the external regulatory body, or, (b) in the absence of satisfactory resolution and where provisions for the resolution of external regulatory conflict provide, make an application to the Board under subsection (4).”” The noble Lord said: The previous amendment was inspired by the trade mark and patent attorneys; this amendment has been brought to my attention by the Institute of Chartered Accountants. The motivation for the amendment comes from the interests of regulators who operate outside the legal services area. The issue is, as I understand it, that there is no mechanism for dialogue between approved regulators and external regulators such as, for example, the Financial Services Authority or the Institute of Chartered Accountants. This is already an important point in a situation, for example, where an accountant is employed by a law firm. Following this legislation it will become doubly so because of the creation of the new alternative business structure regime, where there will inevitably be more interaction between the various professions. The problem, as I understand it, is that the Bill as currently drafted allows an affected person—in other words, a licensed individual or a firm—to make an application to the board in the case of regulatory conflict. There is a similar capability between the various approved regulators on the same ground. But the Bill does not allow any mechanism whatever for an external regulatory body as defined in the Bill to address the problem of conflicting regulation. We believe there should be the means for such a dialogue to take place. That is the background to the amendments. Amendment No. 106B would allow an external regulatory body to approach other approved regulators, while the amendments to Clause 67 address the same issue with respect to the Legal Services Board. The Bill as it stands puts licensed bodies at a disadvantage when they happen also to come under the jurisdiction of a regulator not covered under the Bill, as will be the case for many of the new alternative business structures. This could have the consequence of increased cost and potentially reduced competition for consumers—the noble Lord, Lord Whitty, please note—which we know well by now the Government are eager to avoid. In short, what makes the amendments desirable is that it is less costly and more appropriate if conflicts can be resolved between the regulators themselves. I beg to move.