The Co-operative group, which includes the popular supermarket chain, as well as banking and funeral services, has become one of the first non-legal companies to be approved to sell legal services under new legislation which came into effect last October.
The Legal Services Act 2007 is set to revolutionise the provision of legal services in the UK. Under the terms of the Act, non-legal businesses can now sell legal services as part of what are known as ‘Alternative Business Structures’ (ABS).
In addition to allowing non-law firms to enter the legal services market for the first time, the law also allows existing law firms to seek investment from external sources including via floatation on the stock markets.
Johnathan Djanogly, the justice minister, yesterday visited the Co-op legal services HQ in Bristol.
“This is a huge milestone for UK legal services and the future of alternative business structures,” he said.
“ABS introduce more competition in the marketplace, delivering competitive pricing, higher standards of product and more choice for the consumer,” he added.
Although the law which introduced ABS was dubbed the ‘Tesco law’, Britain’s biggest supermarket chain has so far said that they will not be entering the legal services market.
Eddie Ryan is the Co-op’s managing director of legal services.
“We are committed to playing a leading role in this new era by offering straightforward value-for-money expert legal services, backed by an ethos of social responsibility and a level of protection that can be provided by a diverse, multibillion-pound organisation,” he said.
The other two ABS licenses granted yesterday by the Solicitors Regulation Authority (SRA), the body overseeing the introduction of ABS, went to Lawbridge Solicitors in Kent, and John Welch & Stammers in Oxfordshire.
The SRA received some 96 applications from businesses for ABS licences up until February this year. So far the applications have come from smaller high-street solicitors’ firms and also from personal injury specialists. However, it is thought that up to one third of the UK’s largest 100 law firms are considering taking external investment or offering shares.
Read more on the story (Financial Times)
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