Chamber and committees

I will begin by speaking to my own amendment 1 before moving to those lodged by Paul O’Kane.

The Law Society of Scotland has asked for clarification of registered foreign lawyers being included among the “qualifying individuals” as defined in section 39 of the bill.

At stage 2, I agreed to correct and strengthen the explanatory notes to make it clear that registered foreign lawyers are included as “qualifying individuals” as they exist at present and to make it clear that part 2 of the bill, on the regulation of legal businesses, does not change the basis on which existing individual rights to practise are still required by the existing underlying legislation. That will be done in the explanatory notes to the act if the Parliament agrees to pass the bill today.

I confirm that I have engaged extensively with the Law Society of Scotland. I wrote to it last night, outlining the position and confirming that I am happy to adopt its suggested wording in the explanatory notes. In particular, registered foreign lawyers will still be required to work with other solicitors in Scotland in order to practise where that is already provided for in the existing legislation. The new regime in part 2 of the bill will not change that.

My amendment 1 will define “legal business” in section 18 by reference to the definition of that term in section 39(2) in order to make the definition consistent in the bill. That will provide additional clarification in the bill’s provision on professional indemnity insurance. The effect will be similar to that of Paul O’Kane’s amendment 119, but my amendment 1 means that amendment 119 is unnecessary, as defining “legal business” by reference to the definition of that term in section 39(2) also draws in the definition of “qualifying individual” as set out in section 39(8).

Although I recognise the intention behind Paul O’Kane’s wider amendments in the group—amendments 117 to 122 and 138, which have been developed by the Law Society—we consider that they would have unintended consequences. In particular, they would in some ways rule out use of the structures in part 2 of the bill, which will otherwise cater for those types of lawyers and allow them to be brought in as qualifying individuals if they are made licensed providers or if the other rules that govern them are changed.

On that basis, Mr O’Kane’s amendments are unnecessary, and they would be problematic in some respects as they would specifically refer to “registered European lawyers” and “registered foreign lawyers”, rather than their being included under “qualifying individuals” in the bill. The amendments would provide less future proofing to implement the legal structures in the bill.

Amendments 124 and 125 would delete section 44(1)(e), which sets out that practice rules are to include rules about

“the making and handling of any complaint about an authorised legal business”.

I consider that, given the provisions that will allow the Scottish Legal Complaints Commission to make minimum standards for complaints handling in consultation with the profession and the Lord President, it is important that section 44(1)(e) remains as a mechanism to apply those standards.

After careful consideration of amendments 123 and 126, I am content to support them.

I therefore ask Mr O’Kane not to press amendment 117 and not to move his other amendments in the group, with the exception of amendments 123 and 126. If amendment 117 is pressed—

I thank all members and stakeholders for their constructive engagement in respect of the bill. I understand that Paul O’Kane has lodged his amendments in this group on behalf of the Law Society of Scotland.

I consider that amendment 116 is not necessary, as the bill already provides that the establishment and management of a compensation fund is a regulatory function of the Law Society as a category 1 regulator. That is because section 7 of the bill, which provides that “regulatory functions” include “complying with the requirements” under the bill, is to be read with section 14, which places a requirement on the Law Society to “establish and maintain” a compensation fund. It is clear from section 14 that a category 1 regulator “must establish and maintain” a compensation fund. That requirement is then caught by the definition of “regulatory functions” in section 7.

Amendments 129 and 139 to 141 would make provision to restrict conduct complaints that are brought against solicitors in relation to them discharging regulatory functions. The Law Society raised that matter with the Scottish Government following stage 2. Although I appreciate and understand the concerns that were raised, I consider that amendment 531, which was agreed to at stage 2, will give all relevant professional organisations the flexibility to discontinue a conduct complaint that has been remitted to it if the relevant professional organisation considers that it is in the public interest to do so. It provides a route to address the concerns that are raised.

As Mr O’Kane alluded to at the start of his speech, there are competing views, and, as we know, there is a history with this bill of trying to find a balance for both sides. Given the SLCC briefing that has been sent to members, I will continue to engage with the Law Society to monitor the operation of the new provisions. I consider that the matter would benefit from further consultation and consideration. I therefore ask Mr O’Kane not to press or move his amendments in the group. If he does so, I urge members to oppose his amendments.

After careful consideration of amendments 127, 128 and 136, in Paul O’Kane’s name, I am content to support them. I ask members to support Mr O’Kane’s amendments in the group. I will not move amendment 91.

No, we do not share your view and have to agree to disagree. A lot of concessions have been made to the legal profession throughout the bill process. We also have to look after consumer bodies, which is why we will oppose amendment 135.

Maggie Chapman will be aware that amendment 14 was raised at stage 2. We have engaged with the SLCC on the approach to the wording in order to find a compromise and progress with a flexible approach that allows the SLCC to investigate a complaint more quickly while retaining the requirement to reject complaints that are without any merit. That is why we lodged amendment 14.

Amendment 5 agreed to.

Section 57—Commission decision making and delegation

Amendment 129 not moved.

Section 58—Commission review committee

Amendments 6 to 8 moved—[Siobhian Brown]—and agreed to.

Section 60—Disclosure of information by practitioners etc to the Commission and relevant professional organisations

Amendments 9 and 10 moved—[Siobhian Brown]—and agreed to.

Amendment 11 moved—[Paul O’Kane]—and agreed to.

Section 61—Power of Commission to request practitioner’s details in connection with complaints

Amendments 12 and 13 moved—[Siobhian Brown]—and agreed to.

Section 65—Unregulated providers of legal services: voluntary register, annual contributions and complaints contributions

I appreciate that Mr O’Kane’s amendment 135 is a Law Society amendment, but, as we have all known throughout the passage of the bill, there has to be a balance for consumers and the legal profession. My view is that amendment 135 would weaken the SLCC’s authority to set complaints handling standards. Consumer bodies support the strengthening of independent oversight by the SLCC.

Amendments 10, 61, 98 to 100, 102, 114 and 115 are minor and technical amendments that correct or update cross references.

Amendments 3, 17 to 21, 24 to 26 and 103 to 106 correct errors and tidy up the bill.

In relation to amendment 4, section 37 of the bill applies the new provisions that relate to regulators that are accredited under the bill to regulators that are approved under section 26 of the Law Reform (Miscellaneous Provisions) (Scotland) Act 1990—for example, allowing a review and updating of the regulatory scheme at the direction of the Lord President. To date, the only regulator that is approved under section 26 of the 1990 act is the Association of Commercial Attorneys.

Section 32A, which was inserted at stage 2, allows for a review and updating of the regulatory scheme to take place at the regulator’s own initiative as well as at the direction of the Lord President. Section 35A, which was inserted at stage 2, introduced a role for the Lord President in securing replacement regulatory arrangements for authorised providers, where their accredited regulator has ceased to operate.

Amendment 4 amends section 37 of the bill to apply the provisions of the proposed new sections that sections 32A and 35A would insert into the Solicitors Scotland Act 1980 to the Association of Commercial Attorneys.

Section 76 of the bill expands on the information that must be included in the SLCC’s annual report and also requires the SLCC to consult the Lord President, the consumer panel and each regulator.

Amendment 27 responds to concerns that were raised by the SLCC and makes it clear that the requirement to consult is triggered at an early stage in the process, before the report is prepared.

Regarding amendment 63, section 47(1) of the Solicitors (Scotland) Act 1980, as amended at stage 2, provides that an authorised legal business must not, without written permission from the Law Society of Scotland, employ a solicitor who has been struck off the roll or suspended from practice.

The sanction for acting in contravention of that requirement is set out in section 47(4) of the 1980 act. As amended by the bill, the provision sets out that any authorised legal business acting in contravention of the requirement will have its authorisation to provide legal services automatically withdrawn for a period determined by the Scottish Solicitors discipline tribunal, or by the court, in the case of appeals against the refusal to be granted permission by the Law Society.

Amendment 63 instead provides for a more flexible approach to imposing sanctions, allowing the tribunal, or the court, in the case of an appeal, to impose conditions or restrictions on the authorisation of an authorised legal business to provide legal services.

Amendment 101 ensures that there is a right of appeal against decisions to restore a solicitor’s practising certificate, subject to conditions in cases in which the solicitor has complied with requirements relating to the refunding of excessive fees charged to a client.

Amendments 108, 109 and 112 move a provision that was inserted into section 16 of the 1980 act at stage 2 to its correct place in section 34 of that act.

Amendments 110 and 111 insert titles into sections of the 1980 act. That was noted by the Law Society of Scotland and the Scottish solicitors discipline tribunal.

I ask members to support the amendments in my name.

I move amendment 3.

Where a solicitor or authorised legal business is unable to continue to operate, the safeguarding provisions that the bill inserts into the Solicitors (Scotland) Act 1980 enable the Law Society to take on any client account of that former solicitor or authorised legal business. That includes the ability to make a direction requiring the former authorised legal business to take any specified action.

My amendment 34 will allow for an authorised legal business to appeal such a direction to the court. Although the process is a protective one that can be put in place urgently, it is important that such matters can be tested by the court, and the court’s decision is final. I am aware that the Law Society has raised concerns about delay, but we think that that can be catered for by the courts in urgent circumstances. Following stage 2, the Lord President also raised the issue of whether there should be an appeal.

The safeguarding provisions in proposed new section 46A of the Solicitors (Scotland) Act 1980 will apply in relation to an authorised legal business that is comprised of a “sole solicitor”. Amendment 45 provides a definition of that term. Together, amendments 37 and 38 make it clear that the safeguarding provisions will also apply where the sole solicitor has, for any reason, ceased to practice. At present, similar but not identical requirements to satisfy the Law Society apply in those circumstances under section 46 of the 1980 act.

Amendment 42 follows amendments at stage 2 to set out duties that an authorised legal business must comply with within 21 days of its sole solicitor ceasing to practise. Although the requirements are different, they are not onerous. Vesting in the Law Society, as is provided for in the bill, will not, as the Law Society has said, apply unless the solicitor is disqualified, as in the provision at present. The main point is to give the Law Society the ability to make a direction. The amendment will also enable a solicitor or authorised legal business to whom a direction is given to appeal against it to the Court of Session, as I mentioned previously.

Amendments 31 to 33, 35, 36, 39, 40 to 44, 47, 46, 48 to 58, 60, 62 and 64 are minor technical amendments to update the drafting style and to correct minor errors such as cross-references.

I ask members to support my amendments in the group.

I move amendment 31.

Amendments 59 and 113 respond to concerns raised by the Faculty of Advocates. The amendments put beyond doubt that it is competent for the civil remedy of interdict to be sought with a view to preventing the carrying out of an act that is subject to criminal law penalties under the Solicitors (Scotland) Act 1980 and the Legal Services (Scotland) Act 2010.

For example, an interdict could be sought to prevent a person from pretending to be a lawyer, a regulated legal services provider or a member of the Faculty of Advocates. The Government recognises that interdict could be an effective remedy in preventing the continuance of that kind of deceptive behaviour as a matter of urgency, and could be a useful tool for a regulator.

I ask members to support the amendments.

I move amendment 59.

No, thank you.

Amendment 92 agreed to.

Amendments 94 to 115 moved—[Siobhian Brown]—and agreed to.

I thank Paul O’Kane for his question and for reminding me to get to that point, because I might have missed it.

There are consequences to amendment 42 not being agreed to. There will be no right of appeal to the Court of Session for sole solicitors or a sole solicitor business against a direction given by the Law Society of Scotland under proposed section 46A(4)(b) of the Solicitors (Scotland) Act 1980, which would have been inserted by section 86B(3). Contrast that with the right of appeal for a legal business regarding a direction under new section 46A(4) of the 1980 act.

Obviously, this has just happened, so I will have to take time to reflect. I will get back to members on the specific point in relation to amendment 42.

I ask members to support the motion in my name and to agree to the Regulation of Legal Services (Scotland) Bill.