In the address by the President of the Law Society of England & Wales to Said Business School, Oxford, which you have made available to your readers, he mentions the situation of the legal profession in Australia.

The Australian legal framework does indeed have interesting features. The organisation of legal practices is governed by the Legal Profession Act 2006 and uses words and expressions defined in the Corporations Act 2001.

The Legal Profession Act contains detailed provisions designed to safeguard lawyers' independence. These include an offence of "causing or inducing" the contravention of obligations under that Act or "as an Australian legal practitioner", and an outright prohibition on the conduct by an "incorporated legal practice" or by a "related body corporate" (equivalent to member of the same group of companies) of a "managed investment scheme", an expression that covers a range of financial services that in the UK would be "regulated activities" under the Financial Services and Markets Act 2000 (see Legal Profession Act at ss 149 and 102, and Corporations Act at ss 50 and 9).

At first sight the adoption of a similar approach in Scotland, preferably extended to "parent undertakings" and "subsidiary undertakings" (UK Companies Act, s 1162), might seem to be a way of addressing (even if not to the satisfaction of Advocate General Kokott) some of the concerns about ABS "licensed legal services providers". But the Australian regime does not appear to make any distinction between an incorporated legal practice which is the top company in a group and one which is lower down.

So one consequence of whosale adoption of the Australian approach would appear to be that the activities of members of a group of companies containing an incorporated legal practice would be subject to considerable restrictions that would apply even in cases where the licensed legal services provider was the ultimate parent.

James McLean
Partner, Burness LLP