Part 1 The regulatory objectives

1 The regulatory objectives

(1) In this Act a reference to “the regulatory objectives” is a reference to the objectives of—

(a) protecting and promoting the public interest;

(b) supporting the constitutional principle of the rule of law;

(c) improving access to justice;

(d) protecting and promoting the interests of consumers;

(e) promoting competition in the provision of services within subsection (2);

(f) encouraging an independent, strong, diverse and effective legal profession;

(g) increasing public understanding of the citizen’s legal rights and duties;

(h) promoting and maintaining adherence to the professional principles.

(2) The services within this subsection are services such as are provided by authorised persons (including services which do not involve the carrying on of activities which are reserved legal activities).

(3) The “professional principles” are—

(a) that authorised persons should act with independence and integrity,

(b) that authorised persons should maintain proper standards of work,

(c) that authorised persons should act in the best interests of their clients,

(d) that persons who exercise before any court a right of audience, or conduct litigation in relation to proceedings in any court, by virtue of being authorised persons should comply with their duty to the court to act with independence in the interests of justice, and

(e) that the affairs of clients should be kept confidential.

(4) In this section “authorised persons” means authorised persons in relation to activities which are reserved legal activities.

Part 2 The Legal Services Board

Constitution

2 The Legal Services Board

(1) There is to be a body corporate called the Legal Services Board (“the Board”).

(2) Schedule 1 is about the Board.

General functions

3 The Board’s duty to promote the regulatory objectives etc

(1) In discharging its functions the Board must comply with the requirements of this section.

(2) The Board must, so far as is reasonably practicable, act in a way—

(a) which is compatible with the regulatory objectives, and

(b) which the Board considers most appropriate for the purpose of meeting those objectives.

(3) The Board must have regard to—

(a) the principles under which regulatory activities should be transparent, accountable, proportionate, consistent and targeted only at cases in which action is needed, and

(b) any other principle appearing to it to represent the best regulatory practice.

4 Standards of regulation, education and training

The Board must assist in the maintenance and development of standards in relation to—

(a) the regulation by approved regulators of persons authorised by them to carry on activities which are reserved legal activities, and

(b) the education and training of persons so authorised.

5 Corporate governance

In managing its affairs, the Board must have regard to such generally accepted principles of good corporate governance as it is reasonable to regard as applicable to it.

6 Annual report

(1) The Board must prepare a report (“the annual report”) for each financial year.

(2) The annual report must deal with—

(a) the discharge of the Board’s functions,

(b) the extent to which, in the Board’s opinion, the Board has met the regulatory objectives, and

(c) such other matters as the Lord Chancellor may from time to time direct.

(3) As soon as reasonably practicable after the end of each financial year, the Board must give the Lord Chancellor a copy of the annual report prepared for that year.

(4) The Lord Chancellor must lay a copy of the annual report before Parliament.

(5) In this section “financial year” means—

(a) the period beginning with the day on which the Board is established and ending with the next following 31 March, and

(b) each successive period of 12 months.

7 Supplementary powers

The Board may do anything calculated to facilitate, or incidental or conducive to, the carrying out of any of its functions.

Consumer Panel

8 The Consumer Panel

(1) The Board must establish and maintain a panel of persons (to be known as “the Consumer Panel”) to represent the interests of consumers.

(2) The Consumer Panel is to consist of such consumers, or persons representing the interests of consumers, as the Board may appoint with the approval of the Lord Chancellor.

(3) The Board must appoint one of the members of the Consumer Panel to be the chairman of the Panel.

(4) The Board must secure that the membership of the Consumer Panel is such as to give a fair degree of representation to both—

(a) those who are using (or are or may be contemplating using), in connection with businesses carried on by them, services provided by persons who are authorised persons in relation to activities which are reserved legal activities, and

(b) those who are using (or are or may be contemplating using) such services otherwise than in connection with businesses carried on by them.

(5) The Consumer Panel must not include any person who is—

(a) a member of the Board or of its staff;

(b) a member of the Office for Legal Complaints (see Part 6), an ombudsman appointed by it or a member of its staff appointed under paragraph 13 of Schedule 15;

(c) a member of the governing body, or of the staff, of an approved regulator;

(d) an authorised person in relation to an activity which is a reserved legal activity;

(e) a person authorised, by a person designated under section 5(1) of the Compensation Act 2006 (c. 29), to provide services which are regulated claims management services (within the meaning of that Act);

(f) an advocate in Scotland;

(g) a solicitor in Scotland;

(h) a member of the Bar of Northern Ireland; or

(i) a solicitor of the Court of Judicature of Northern Ireland.

(6) The chairman and other members of the Consumer Panel are to be—

(a) appointed for a fixed period, and on other terms and conditions, determined by the Board, and

(b) paid by the Board in accordance with provision made by or under the terms of appointment.

(7) But a person may be removed from office in accordance with those terms and conditions only with the approval of the Lord Chancellor.

(8) A person who ceases to be chairman or another member of the Consumer Panel may be re-appointed.

9 Committees and the procedure of the Consumer Panel

(1) The Consumer Panel may make such arrangements as it thinks fit for committees established by the Panel to give advice to the Panel about matters relating to the carrying out of the Panel’s functions.

(2) The Consumer Panel may make such other arrangements for regulating its own procedure, and for regulating the procedure of the committees established by it, as it thinks fit.

(3) Those arrangements may include arrangements as to quorums and as to the making of decisions by a majority.

(4) The committees established by the Consumer Panel may include committees the membership of which includes persons who are not members of the Panel.

(5) The membership of every committee established by the Consumer Panel must contain at least one person who is a member of the Panel.

(6) Where a person who is not a member of the Consumer Panel is a member of a committee established by it, the Board may pay to that person such remuneration and expenses as the Board may determine.

10 Representations by the Consumer Panel

(1) The Board must consider any representations made to it by the Consumer Panel.

(2) If the Board disagrees with a view expressed, or proposal made, in the representations, it must give the Consumer Panel a notice to that effect stating its reasons for disagreeing.

(3) The Consumer Panel may publish such information as it thinks fit about any representations made by it to the Board.

(4) Where the Consumer Panel publishes information about any representations made by it, the Board must publish any notice it gives under subsection (2) in respect of those representations.

11 Advice and research functions of the Consumer Panel

(1) The Consumer Panel may, at the request of the Board—

(a) carry out research for the Board;

(b) give advice to the Board.

(2) The Board must consider any advice given and the results of any research carried out under this section.

(3) The Consumer Panel may publish such information as it thinks fit about advice it gives, and about the results of research carried out by it, under this section.

Part 3 Reserved legal activities

Reserved legal activities

12 Meaning of “reserved legal activity” and “legal activity”

(1) In this Act “reserved legal activity” means—

(a) the exercise of a right of audience;

(b) the conduct of litigation;

(c) reserved instrument activities;

(d) probate activities;

(e) notarial activities;

(f) the administration of oaths.

(2) Schedule 2 makes provision about what constitutes each of those activities.

(3) In this Act “legal activity” means—

(a) an activity which is a reserved legal activity within the meaning of this Act as originally enacted, and

(b) any other activity which consists of one or both of the following—

(i) the provision of legal advice or assistance in connection with the application of the law or with any form of resolution of legal disputes;

(ii) the provision of representation in connection with any matter concerning the application of the law or any form of resolution of legal disputes.

(4) But “legal activity” does not include any activity of a judicial or quasi-judicial nature (including acting as a mediator).

(5) For the purposes of subsection (3) “legal dispute” includes a dispute as to any matter of fact the resolution of which is relevant to determining the nature of any person’s legal rights or liabilities.

(6) Section 24 makes provision for adding legal activities to the reserved legal activities.

Carrying on the activities

13 Entitlement to carry on a reserved legal activity

(1) The question whether a person is entitled to carry on an activity which is a reserved legal activity is to be determined solely in accordance with the provisions of this Act.

(2) A person is entitled to carry on an activity (“the relevant activity”) which is a reserved legal activity where—

(a) the person is an authorised person in relation to the relevant activity, or

(b) the person is an exempt person in relation to that activity.

(3) Subsection (2) is subject to section 23 (transitional protection for non-commercial bodies).

(4) Nothing in this sectio