Page last updated at 23:39 GMT, Friday, 30 April 2010 00:39 UK

Lawyers seek reform 'compromise'

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The bill seeks to increase competition in legal services

Lawyers could be able to protect themselves from low-priced competitors such as supermarkets under plans backed by the Law Society of Scotland.

A bill seeking to reform legal services is currently making its way through the Scottish Parliament.

The law society wants reform to limit control of those offering legal services to "regulated" professionals.

This could allow accountants or even teachers to control legal firms but it would exclude estate agents.

The Legal Services (Scotland) Bill would allow supermarkets and other commercial organisations to provide legal services to the public.

The bill would bring Scots law into line with new legislation in England and Wales, which was sparked by consumer group Which? after it argued existing rules were stifling competition and choice.

A bitter dispute broke out within the membership of the Law Society of Scotland over how to handle the Scottish government's pressure for reform.

The society originally backed the plans to de-regulate and allow non-lawyers to control legal firms, known as Alternative Business Structures (ABS).

But there has been a revolt, much of it from small-scale firms that fear their existence would be threatened by deregulation.

Differences of opinion

After a referendum of members, a special general meeting failed to find any compromise.

On Friday, the society's council decided to adopt a compromise position that would require at least 51% control of any legal firm by people who belong to a profession with a regulatory body that could stop them practising.

This would exclude estate agents, the group most likely to exploit the opportunity to compete with established legal firms.

Ian Smart, president of the Law Society of Scotland, said: "We have listened to the profession and there are strong differences of opinion about the way forward, with large and small firms on both sides of the debate.

"There does, however, seem to be an acceptance that ABSs are inevitable, as reflected in the parliamentary vote, and that a compromise must be found.

"With that in mind, the society's council - which includes solicitors from every sector of the profession - has adopted what it believes to be fair and reasonable compromise position, which would prevent outright external ownership, for instance by supermarkets, but allow firms to compete in a changing marketplace".

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