Dara Murphy (Cork North Central, Fine Gael) | Oireachtas source

I thank Deputies for their amendments. Amendments Nos. 49aand 49b, tabled by Deputy Murphy, would in effect enable all barristers and solicitors to immediately hold clients' moneys and allow the Minister to regulate for this. However, key safeguards have been put in place in case such an event arises, and, therefore, we cannot support the amendments. We consider that the serious safeguards should remain a crucial part of the public consultation process on the holding of clients' moneys to be conducted under section 99.

The transition to the new legal service models will involve a staged approach to ensure they can be delivered in a prudential manner that will protect the interests of legal practitioners and the consumers of their services.

I will take Deputies through the Minister's initial amendment in this group, amendment No. 61a. This tightens up the definition of "contentious matter". It is now proposed to provide that a "contentious matter" means a matter that arises in and that relates to the subject matter of proceedings before any court, tribunal or any other body or person, rather than a matter that has arisen in proceedings, as originally set out. These changes are being made as a matter of interpretation under Part 8 on the advices of the Office of the Parliamentary Counsel. I therefore propose them for agreement under amendment No. 61a.

The proposed amendments to part 8 provide for the introduction of alternative business structures, such as multidisciplinary practices and legal partnerships. The introduction of these alternative business structures remains central to the achievement of the structural reforms to which the Government is committed. The Bill, having been a reform under the EU-IMF-ECB troika programme, is now a structural reform commitment covered by the relevant country-specific recommendation agreed under the EU semester process.

The strategy proposed today in respect of the introduction of legal partnerships and multidisciplinary practices has three main elements. First, we are distinguishing the provisions relating to legal partnerships and multidisciplinary practices to more clearly delineate the modalities of their introduction and regulation. Under this revised approach, legal partnerships will precede multidisciplinary practices in their introduction and both models will be subject to periodic review.

Second, I am introducing a series of new amendments to strengthen the regulatory powers of the new authority and to apply additional prudential conditions on participation in multidisciplinary practices and in legal partnerships. At the same time, I am being careful not to unduly restrict the type of legitimate businesses that may participate in these new legal services models. I wish to alert Deputies that we will address these particular regulatory enhancements relating to the new legal business models a later within the separate group of amendments to which they have been assigned. Whether we get to that this morning or not, we will see.

Third, over three years after publication of the Bill and in recognition of the fact that multidisciplinary practices are still being rolled out in other jurisdictions, such as England and Wales, I am meeting the recognised need to conduct independent and professional research on the likely effects their introduction may have on competition and on the Irish legal services market itself. This research will be allowed for by proposed amendment.

Under amendment No. 65a, Deputy Catherine Murphy proposes to change the current provision of section 85 of the Bill, which prohibits a professional code from preventing direct access to a barrister in regard to non-contentious matters by opening up such access to contentious matters as well. The policy approach being taken under section 99 of the Bill is that the authority will, within a year of its establishment, carry out a public consultation on the retention or removal of restrictions on a barrister receiving instructions in a contentious matter directly from a person who is not a solicitor. It will also examine the reforms, whether administrative, legislative or to the existing professional codes, that are required to be made in the event that the restrictions are retained, or, as the case may be, removed. This approach will enable us to carefully examine the issues involved and ensure that the necessary administrative, legislative and prudential structures are put in place, if access to barristers by members to the public is to be extended to contentious matters. It would be a risk-laden approach to proceed with such an opening up of direct access to barristers without first considering the viability of this option and then putting the necessary prudential safeguards in place to protect the moneys and interests of any clients concerned.

Government amendment No. 77aproposes a replacement for section 98 that will now deal exclusively with the public consultation process in regard to legal partnerships - that is, the new legal business model of barrister-barrister and barrister-solicitor partnerships. Separately, a new section 99 will provide for the consultation process in regard to multidisciplinary practices. It will now be provided under amendment No. 77a that the legal services regulatory authority will, immediately following its establishment, and periodically thereafter, carry out consultations in regard to the regulation, monitoring and operation of legal partnerships. The authority will carry out its initial consultation and report to the Minister within six months of its establishment and the Minister will lay the report before the Houses within 30 days of its receipt. Deputies will also wish to note that it is our intention to introduce, in the Seanad, an amendment to section 1 of the Bill, which deals with commencement issues. It is intended that the Seanad amendment will provide that legal partnerships will come into operation within six months of the completion of the initial six-month consultation process and report. Some other consequential or technical amendments may arise to dovetail with these changes at that time.

It is our considered view that the introduction of legal partnerships, augmented by today's amendment, will provide early, viable and duly regulated alternatives in the way solicitors and-or barristers can work together in responding to the needs of a modern legal services market. Both are regulated professions and have established status and rights of appearance before the courts and both are eligible to apply for judicial appointment. There is already an established, recognised and regulated system for switching between the professions of barrister and solicitor, and this is something which now takes place on quite a regular basis. Indeed, there is now a growing number of practitioners who have worked under the two professions. The two legal professions already work closely with each other in the conduct of legal business and litigation. They have common legal expertise and competence in areas such as arbitration and mediation. Some barristers already share premises and facilities, as solicitors do, and legal partnerships will enable both professions to avail of the economies that can be achieved to the benefit of both lawyers and the consumers of their services, be they private citizens or enterprises.

Both of the legal professions will be regulated by the new legal services regulatory authority and by the new conduct and disciplinary regime under which they will both be answerable. They will both be answerable ultimately to the legal practitioners disciplinary tribunal. Without going outside the two existing legal professions, which already have established, regulated and, in some cases, overlapping functions, there is a very substantial platform upon which, supported by the public consultation process as now set out under amendment number 77a, we can modernise the legal services market through the early introduction of legal partnerships.

Amendment No. 78aprovides that a new section 99 will set out the consultation process for multidisciplinary practices or, as they may be called, MDPs. I am now proposing that the authority will, within six months of its establishment, prepare an initial report. This will provide us with an opportunity to learn from the experiences of other countries which have introduced these new business models. It should be remembered that these are complex entities, combining different professions and standards in order to offer the consumer choice and better value. It is also important to ensure we have the right structures in place to protect consumers and their moneys. The initial report, therefore, will include research on the operation of multidisciplinary practices in other jurisdictions, including the legislative and regulatory measures which underpin them. The report will also focus on their likely impact on legal costs, the provision of legal services to consumers and the access of persons to legal practitioners. Again, it will be laid before the Houses within 30 days of receipt.

I am providing that, following the initial exploratory report to the Minister, the authority will conduct, within a further six months, a public consultation on the establishment and impact of multidisciplinary practices alongside other factors such as their regulation, monitoring and operation. It will then make a final report to the Minister with recommendations based on the research and the results of the public consultation process, which will also be laid by the Minister before the Houses within 30 days of receipt. The commencement of the provisions governing the introduction of MDPs will then become a matter for the Minister.

In summary, I am front-loading the MDP process with a six-month research module, which will give depth to the public consultation process that will follow it. I want us to take stock of MDPs, their implications and their benefits for our own legal services market and the lessons we can learn from elsewhere. Rather than having an automatic commencement date for the introduction of multidisciplinary practices, we are now proposing that the Minister, following receipt and consideration of the final report under the procedure I have set out, will have the discretion to proceed with their appropriately regulated introduction.

Amendment No. 80a, which inserts a new section 100, provides that the authority will carry out periodic reviews of the operation of Part 8 with respect to legal partnerships and multidisciplinary practices. As part of the review process, it will be open to the authority to make recommendations to the Minister for the amendment of any provision of Part 8 that it considers necessary. The initial review for multidisciplinary practices will be started not later than two years after their commencement and completed within one year, which is a total period of three years. The initial review relating to legal partnerships will start within four years of their commencement and be completed within one year, which is a total period of five years. Thereafter, the reviews for the two new business models will be conducted at five-year intervals.

The timely advancement of legal partnerships between the two established, regulated and highly developed legal professions and an informed research-driven approach to the introduction of multidisciplinary partnerships will provide the basis for a well managed delivery of structural reform in these key areas, while allowing legal practitioners to continue to practice under the more traditional legal practice models where they so wish. Therefore, I commend the Government amendments I have proposed to the Deputies for their agreement.

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