Editor's blog | No lighted match in the SRA's petrol station
The SRA may have its reasons, but the low number of ABSs is beginning to cast doubt on its position in the new market
However many good reasons SRA chief executive Anthony Townsend has put forward to explain the low number of ABSs, the impression remains that his organisation has been either unnecessarily slow or overly cautious.
Townsend’s main concern is that hurrying up the authorisation process would be like throwing a lighted match in a petrol station.
The result: only 30 or so ABSs have been authorised since the SRA became a licensing authority in January.
Townsend’s main justification is that ABS licensing isn’t “a simple authorisation process” and that the more important question is to ensure that the regulator can supervise the new entities effectively. This may be a valid argument, but having provided very public support for ABSs and after the extensive preparation it went through, the SRA should have reached cruising speed by now.
Although this wouldn’t justify an uprising at this stage, it is certainly disappointing, and if the SRA cannot design a faster, more efficient licensing procedure, stakeholders will be justified in questioning the regulator’s position in the new market.
Because so far, the market hasn’t really changed. Even the large corporate entities that have been authorised were known to the SRA, with no application yet from a genuine MDP – a point Townsend himself made.
Even the Council for Licensed Conveyancers has received fewer applications than it anticipated. And according to CLC chair Anna Bradley, none from an estate agency group.
This, however, was before the CLC authorised Connells Group’s subsidiary Conveyancing Direct Property Lawyers as an ABS last week.
Property specialists will know about Connells. The general public is more likely to know about its local estate agents brands, such as Barnard Marcus.
Connells doesn’t have any immediate plans to leverage its ABS status. The only specific point its directors make is that it would future-proof the business if a referral fee ban was re-introduced.
But Connells’ authorisation is part of a bigger picture. At least two of the CLC-licensed ABSs are big online businesses, who have invested heavily into technological solutions and will be keen to deploy their services into other markets such as will writing. And four are already licensed for probate activities.
It’s more a slow burn than a lighted match, but it suggests that innovation is coming to the market, just not from law firms at the moment.