UK Law Society Defies OFT

by Robin Pilgrim, LawAndTax-News.com, London

20 October 2003

Despite the Office of Fair Trading's (OFT) threat to take legal action against the UK's Law Society if it failed to approve reforms designed to liberalise the rules on the provision of legal services, the Society revealed last week that proposals to allow solicitors to pay referral fees had been rejected.

The OFT revealed recently that it was investigating a complaint "from a major estate agency chain" which argued that the Law Society's ban on solicitors paying referral fees to non-solicitors was a breach of UK competition law.

Although the referral fee proposals, which constituted a key part of the so-called 'Tesco Law' reforms, were defeated during a Law Society vote, the council did vote in favour of ending restrictions on fee sharing between solicitors and non-solicitors, a move which will likely be welcomed by supporters of the reform process.

However, some believe that the failure to secure approval for the referral fee proposals, which the Law Society leadership has been trying to push for two years now, could herald the end of the industry body in its current form.

According to the Legal Week news service, speaking after the vote, former president of the Law Society, David McIntosh warned that:

"I have no doubt that Government will say that we cannot sort [ourselves] out."

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