Hansard

Amendments 51 to 72 bring the provisions relating to a category 1 regulator’s exercise of its regulatory functions by an independent regulatory committee established and maintained by the regulator, in line with the equivalent provisions in the Solicitors (Scotland) Act 1980, which apply to the Law Society’s committees. The amendments reflect engagement with the Law Society. Taken together, the effect of amendments 51, 52 and 53 is to require rather than allow the regulatory committee to determine its composition, governance arrangements and priorities in accordance with the bill. Amendment 54 ensures that a regulatory committee can continue to delegate its functions. Amendment 64 allows sub-committees to delegate any of their functions to an individual, such as a member of staff. Delegation to a sub-committee, or onwards to an individual, is subject to some exceptions relating to the regulatory committee’s function of making regulatory rules and decisions around complaints. Amendment 56 introduces a requirement on a regulatory committee to maintain and publish a document setting out its composition, governance arrangements, regulatory functions and procedures and any arrangements for the delegation of functions. Amendments 57 and 58 limit the consultation requirement on the regulatory committee to consult the governing body of the regulator to only those cases where the committee is making a “material” change to its governance arrangements, rather than a less significant change to either its structure or governance arrangements. Amendments 60 to 63 make changes to the rules and requirements relating to the composition, membership and procedure of regulatory committees, with amendment 59 making a minor technical change to clarify the meaning of section 53(3). Amendment 65 removes the requirement to include in the annual report a summary of decisions to pay out professional indemnity insurance, to reflect concerns raised by the Law Society that it is the insurance provider and not necessarily the regulator that has access to that information. Amendments 66, 67 and 69 increase the range of material that must be included in a category 1 regulator’s annual report to include information about the number of complaints and regulatory waivers. Amendment 68 is consequential on the transfer of the powers from the Scottish ministers to the Lord President under section 20, to take specified measures in relation to a category 1 regulator. Following engagement with legal stakeholders, amendment 70 removes the requirement on a category 1 regulator or its regulatory committee to consult the Lord President when preparing an annual report. Instead, amendment 71 will require the regulator to send a copy of the report to the Lord President as well as publishing it. Amendment 73 is clarificatory and makes minor changes to the interpretation provision in section 13(7), setting out how conduct and regulatory complaints are to be construed, and clarifying that a regulator’s “reporting year” means a 12-month period that coincides with the regulator’s financial year. Section 14 of the bill requires a category 1 regulator to establish and maintain a compensation fund. It also gives the Scottish ministers the power, by regulations, to make further provision in connection with the fund or the fund rules. Reflecting engagement with legal stakeholders, amendment 74 will restrict the exercise of that ministerial power to cases where the Lord President, a category 1 regulator or the consumer panel has requested them to use it. The amendment specifies the information that must be included with such a request and sets out who must be consulted before such a request is made and when the Lord President’s agreement must be secured, as well as what information must be given to the Lord President when seeking their agreement. Amendment 75 makes regulations that are made under the ministerial power subject to the affirmative procedure. It aligns with schedule 1, paragraph 6, which inserts section 43A, in respect of the Law Society of Scotland’s guarantee fund, into the Solicitors (Scotland) Act 1980. That is a delegated power that is subject to the affirmative procedure. 10:00 Section 16 requires a category 2 regulator to prepare and publish online an annual report on the exercise of its regulatory functions. The section also specifies the information that the report must include. Amendments 76 and 77 require additional information to be included in the report. Amendment 78 makes a consequential change to section 16(2)(g) to reflect that amendment 112 changes section 20 of the bill to allow the Lord President rather than Scottish ministers to take specified measures in relation to the performance of a category 1 or category 2 regulator. Under section 16, the annual report must include details of the steps that are taken by the regulator to comply with any such specified measures. Amendment 79 exempts the Faculty of Advocates as a regulator from the requirement to include a statement in the report that indicates whether it considers that it has been assigned to the correct category in line with the adjustments to section 8. Amendment 80 requires a category 2 regulator to consult the consumer panel when it is preparing an annual report in order to ensure that consumer interests are considered. Amendment 81, which was included following engagement with stakeholders, makes it a requirement for a category 2 regulator to send a copy of its annual report to the Lord President in addition to publishing it. Amendment 82 clarifies that a “conduct complaint” is to be construed in accordance with part 1 of the Legal Profession and Legal Aid (Scotland) Act 2007 in respect of a category 2 regulator annual report. Amendment 83 changes the definition of a “reporting year” to mean, in relation to a category 2 regulator, a 12-month period that coincides with the regulator’s financial year. The other amendments in the group expand on the information that a regulator must hold about members in its register, as required under section 17 of the bill. They also widen the definition of “professional liability” in the bill to bring it more in line with the definition in the Solicitors (Scotland) Act 1980. Amendments 84 to 88 and amendment 90 expand the information that is required to be held by regulators on the mandatory register about its members. In order to provide further transparency about the outcome of disciplinary action, that includes information about the business address, any sanction resulting from disciplinary action, suspension and what is required after a period of suspension has been lifted. Those amendments were included following engagement with stakeholders. Amendment 89 allows the regulator to decide what additional information the register may contain, as it considers appropriate. Amendments 91 and 92 widen the definition of “professional liability” as set out in section 18(7) on professional indemnity insurance to include former legal services providers and cover other services, in addition to legal services, which form part of the professional practice of the solicitors or qualifying individuals within the legal business that provides the legal services. The definition draws on some elements of the definition in the 1980 act. I move amendment 51 and ask members to support the other amendments in the group. Amendment 51 agreed to. Amendments 53, 52 and 54 to 58 moved—Siobhian Brown—and agreed to. Section 9, as amended, agreed to. Section 10—Regulatory committee: composition and membership Amendments 59 to 62 moved—Siobhian Brown—and agreed to. Section 10, as amended, agreed to. Section 11—Regulatory committee: lay and legal members Amendment 63 moved—Siobhian Brown—and agreed to. Section 11, as amended, agreed to. Section 12—Regulatory committee: convener, sub-committees and minutes Amendment 64 moved—Siobhian Brown—and agreed to. Section 12, as amended, agreed to. Section 13—Annual reports of category 1 regulators Amendments 65 and 66 moved—Siobhian Brown—and agreed to.