Chancery Lane raises concerns over 'Tesco law'

The Law Society has warned it is ready to challenge the Legal Services Board's (LSB's) attempts to regulate Alternative Business Structures (ABS), it has emerged.

The Law Society has raised concerns at the overarching legal regulator's plans to implement and regulate ABS, with Chancery Lane concerned about the LSB's 2011 deadline to have the model fully operational.

The Law Society is also opposed to any move that would force it to cover costs if the LSB opted to directly license applying ABS should front-line regulators not be ready by 2011. The LSB is supposed to be funded by approved regulators.

ABS - often dubbed Tesco law - is the most radical element of the Legal Services Act, allowing qualifying companies to invest in law firms and offer legal services directly.

The Law Society's director of Government relations, Russell Wallman, told Legal Week: "If the LSB seeks to license and directly regulate ABS other than when the approved regulators are unable or unwilling to do so, then it is likely that we will take action against them. We are strongly against the LSB directly regulating ABS, and so is Parliament. We will do all that we can to meet the LSB time-tabled expectations, but we can not guarantee it."

The robust stance came after LSB chair David Edmonds (pictured) this month launched the formal consultation on the implementation of ABS at a Legal Week event.

Edmonds told delegates: "The LSB's objective is about helping the existing approved regulators get where they need to get... but the LSB does need to be ready so that new entry is not delayed."

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