In Practice: Of OFR and ABSs

There are, of course, only two stories this week: the implementation yesterday of outcomes-focused regulation ('OFR') and the (final) arrival of the alternative business structure ('ABS').

As to the former, you may find the new SRA Handbook on their site here, and a useful 'at a glance' guide here, including a table comparing the old and new approaches. I will not attempt to explain the new regulatory requirements - I am sure many others far more learned than I will rise to this task. If, however, you are worried about the new rules, the new jargon and the sheer volume of it all (the Handbook runs to 658 pages) then I suggest you take the advice of David Pickup in the Gazette on Monday: Don't panic! David offers useful guidance, and a touch of common sense: "I find phrases like Outcomes-focused regulation and indicative behaviours to be gobbledegook." So it's not just me, then...

Before I move on I must mention this article in the Gazette yesterday, which brings the whole business of OFR into perspective. The article points out that back in 2007 the Financial Services Authority switched to an ‘outcome-focused’ compliance regime, which was supposed to "sustain the current, rigorous regulatory environment, but with better and more effective outcomes". The writer goes on:
"And we know what happened subsequently, because we are still living with the dire consequences.

There remains cause for bemusement that the legal sector was keen to ape an organisation that so abysmally failed to anticipate the banking crisis."

Turning to ABSs, New Law Journal happily pronounces that "Tesco law is here!" The excitement of the occasion is clear, with Justice secretary Ken Clarke recently likening the moment to the financial sector “Big Bang” of 1986, and Justice minister Jonathan Djanogly telling us that: “This is a landmark day for the UK legal industry." The story does, however, add a touch of reality by pointing out that law firms will not be able to form ABSs until at least the new year, as the SRAs application to license ABS has been delayed, and is now expected at the end of 2011. Further, the Council for Licensed Conveyancers is the only regulatory authority currently in a position to authorise an ABS licence. So not so much big bang as small fizzle...

I shall finish this week by turning away from the two big stories, and returning to a subject I have raised in previous weeks: the dreaded mySRA, and a post by Michael at Law Actually, who says of the debacle over activating accounts:
"...mySRA is a horrible name and is worrying close to the killer hospital bug MRSA. Given the atrocity of MySRA that solicitors up and down the country have had to suffer through, I think the name is scarily apt."
Couldn't have put it better.