Meeting of the Parliament 20 May 2025
I will deal with the more minor amendments in the group first, before dealing with the important issue of registered foreign lawyers.
Amendment 123 will make changes to section 42 to allow category 1 regulators to make rules about the effect of an authorisation of a legal business that is a partnership or another unincorporated body where the membership of the legal business changes or another legal business succeeds to the whole, or substantially the whole, of its business. It deals with an ambiguity in Scots law regarding traditional partnerships to ensure that, where there are changes to membership, there is a swift transfer of authorisation of interests of the business. I am grateful to the minister for her indication that the Government is willing to support amendment 123, which will be important in delivering justice and support to those who require it when there is such a change, as I have outlined.
Amendment 126 will remove section 44(2)(a)(ii), which currently requires practice rules of authorised legal businesses to have regard to “regulatory objectives”. Overarching regulatory objectives are applicable to regulators, and it is regulators who must adhere to them. Instead, legal providers must adhere to professional principles, which are already covered elsewhere in the bill, so the subparagraph is an incorrect reference that has to be removed from the bill. I am grateful to the minister, again, for indicating that she is minded to support amendment 126, which seeks to clarify and clear up the bill as drafted—and, subsequently, if it is agreed to, the legislation.
Amendments 124 and 125 would remove from section 44 a paragraph and a subparagraph that require practice rules to include the process for the making and handling of complaints. Given that complaints processes are currently set out in statute, there has been concern among stakeholders that the current provisions in section 44 might not be appropriate or, indeed, legally competent. However, the minister’s written explanation to me about the necessity of the powers that are provided to the SLCC to direct minimum standards has been very helpful for my understanding of the purpose of the subsections. If the minister will provide detail of that on the record in her contribution, I would be most grateful and, subsequently, minded not to move those two amendments.
I turn to my remaining amendments in the group, which are amendments 117 to 122 and 138, regarding qualifying individuals and the status of registered foreign lawyers. The issue is critical to the functioning of the legal services market in Scotland; it was debated extensively at stage 2 and we heard evidence on it at stage 1.
If we do not get definitions of the status of registered foreign lawyers correct, in order to provide legal certainty that they are permitted to part-own authorised legal businesses as part of multinational practices, that could have a particularly concerning impact on the legal services market in Scotland. The ownership structures of some of our largest and best-known law firms could be threatened by the implementation and interpretation of the statute.
It is difficult to overstate the level of concern that that has caused within the legal profession, because it is a significant issue that many lawyers feel has been left in the balance for the past two years. We are talking about the ability of some of the United Kingdom’s largest law firms to operate here in Scotland, which concerns thousands of jobs and tens of thousands of clients.