Legal services regulation should be taken from the hands of the professional bodies, according to the report of the independent review of regulation published today.

In her report, Esther Roberton, who chaired the review supported by a panel of experts, proposes a "transformational approach" which she believes goes further than other jurisdictions round the world, though many of them are "moving in that direction".

It would mean both the Law Society of Scotland and Faculty of Advocates losing their powers to regulate the solicitor and advocate branches of the profession respectively, in favour of a single new regulator independent both of the professions and of Government. The new body would regulate individuals including solicitors, solicitor advocates, advocates and commercial attorneys, have the powers to regulate entities and be empowered to seek approval as a regulator in other jurisdictions. It would be responsible for the whole system of regulation including entry, standards, monitoring, complaints and redress, covering individuals, entities and activities, and should be accountable to the Scottish Parliament and subject to the supervision of Audit Scotland.

In its complaints handling role it would take over the functions of the Scottish Legal Complaints Commission. The report envisages the regulator developing "appropriate, flexible and fair sanctions, rules for proportionate compensation and a simple process for appeals".

The 64 page report, which makes 40 recommendations to Scottish ministers on reforming the way in which legal services are regulated and complaints handled, finds that the current statutory framework has led to a complex system which is not accessible to either professionals or the consumer.

Ms Roberton concludes that her proposals would "streamline the current landscape" and provide a "much clearer line of sight" from failure to meet standards through to redress procedures. They would require the new independent regulator to put in place a system of licensing of all legal professionals who practise, whether or not they provide services directly to the public, and to hold a register for those legal professionals.

The independent regulator would also have responsibility for setting standards, working in partnership with professional bodies, and in doing so should "drive a preventative/quality improvement focus, including simplification and better overall cohesiveness of the rules, making them more consumer friendly, comparable and proportionate".

In the preface to her report Ms Roberton states: "The recommendations contained in the report are mine and I accept full responsibility for them. All of the panel members agree with some of them but, as might be expected, some do not agree with all of them. In fact, a minority of members expressed significant disagreement with the primary recommendation and I wholly respect that view."

Ms Roberton, who investigated international and domestic best practice to inform her conclusions, commented on launching her report: "Jurisdictions across the world are grappling with regulation across all professions. This review has therefore been timely, as I have been able to draw on how thinking on regulation has been developing in recent years both domestically and internationally.

"None have so far taken the transformational approach that I propose but many of them are moving in that direction. The modern framework I propose would put Scotland at the forefront of better regulation."

Responding, the Law Society of Scotland argued that the proposal of a new single regulatory body had been made without any consultation with the legal profession and risked weakening public protection and increasing costs for those who paid for legal services.

Alison Atack, President of the Society, commented: "We strongly oppose the primary recommendation of a new single regulatory body because of the unnecessary risk it places on protecting consumers and higher costs. The Law Society has almost 70 years’ experience of successfully setting and enforcing standards in the solicitor profession. I find it surprising that, following such a long review, Ms Roberton would conclude without any consultation with the profession, that a new regulatory body be set up and that the Law Society be removed from the regulatory process.

"However, I am pleased to see that some of our suggestions to improve the regulation of legal services have been recommended by Ms Roberton in her report. The ideas that we put forward are carefully thought out. Our suggestions include the protection of the term ‘lawyer’, entity regulation and ensuring all legal services are regulated. It is these changes that the Scottish Government should be focusing its attention on and we look forward to engaging with them."

In an initial reaction Gordon Jackson QC, Dean of the Faculty of Advocates, said: "We have received the report by Esther Roberton and will carefully consider her recommendations with our members. We look forward to further contributing to what is an important discussion about the provision of legal services in Scotland."

The Scottish Legal Complaints Commission welcomed the report, which it said had adopted the "vast majority" of its own proposals for reform. Chief executive Neil Stevenson commented: "Two and half years ago the SLCC published a vision for reform based on the ‘better regulation agenda’ and the internationally recognised consumer principles. At the time we were a lone voice saying the current regulatory and complaints system was broken and that an entirely new approach was required both in the public interest and to support a vibrant and sustainable legal services sector.

"We recognise that the independent review has adopted the vast majority of our proposals into the final recommendations and found the evidence of best practice in other jurisdictions and sectors that we presented to be compelling. A single and simplified regulatory scheme, established as an independent body, is a logical starting point for future discussions. For too long the barrier to change has been a failure to tackle the issue of whether five separate statutory bodies are really needed to regulate lawyers in Scotland."

Minister for Community Safety Ash Denham responded: "I'd like to thank Esther Roberton and all the members of the independent review for their work to consider what changes may be needed to the regulation of legal services to protect consumer interests and promote a flourishing legal sector.

"Working with the sector and other stakeholders, I will consider the 40 recommendations in the report in detail and set out the Government's next steps in due course."

Click here to access the report.