SRA Transparency Rules and Law Firm Clients
When legal regulators use the word “consumers”, the general meaning is actually “clients of law firms”. We are all consumers of law in one way or another, buying a property, divorcing, involved in a dispute, immigration, employment law and probate are just some examples.
Who is this blog for?
Regulated law firm owners, sole practitioners, compliance officers, marketing departments, practice managers and ideally any person who has control over consumer transparency.
What law firms must do to adhere to the SRA Transparency Rules?
All regulated firms and authorised bodies*, regardless of area of practice, must display the SRA’s digital badge. It’s simple to enable your firm’s digital badge. A firm should;
- Register their website address (the SRA badge logo will only work with websites linked to a regulated firm's mySRA).
- The firm’s authorised signatory or organisation contact can log into mySRA then:
- click on My Organisations
- click on your Organisation's name > Office Details > select Edit on the relevant office > update your website and click save.
*authorised body = a body that has been authorised by the SRA to practise as a licensed body or a recognised body; or a sole practitioner's practice that has been authorised by the SRA as a recognised sole practice. READ HERE FOR FULL EXPLANATION
The SRA’s transparency rules require all regulated law firms to publish price and service information relating to certain common services on their websites or make it available offline if they do not have a website.
Client Costs and VAT & Disbursements
Under the SRA Transparency Rules 1.4 and 1.5 clearly state the following:
1.4 a description of, and the cost of, any likely disbursements, and where the actual cost of a disbursement is not known, the average cost or range of costs;
1.5 whether any fees or disbursements attract VAT and if so the amount of VAT they attract;
Cost information published under this rule must be clear and accessible and in a prominent place on your website.
The ILFM offers law firms specialist knowledge of legal accounting. We have two training courses that are specific to VAT & Billing and VAT & Disbursements (3 hours and 1 hour respectively, online and live). As the professional body supporting law firms with finance, compliance and practice management, we highly recommend employees in these departments are given the opportunity to attend ILFM training CPD sessions.
SRA Fixed Penalties and Transparency Rules
The SRA is clear about compliance by confirming it is NOT an option. The transparency rules are there to benefit the public, helping people compare law firms' services and make informed choices.
Paul Philip, Chief Executive of the SRA, said:
“We brought in fixed penalties so we could deal with non-complex breaches of our rules more swiftly. That saves everyone time, cost and stress.
'We are here to promote the public interest and it's essential firms comply with our transparency rules. They help people compare law firms' services and make informed choices. Those firms that are publishing the correct information rightly expect that we will take action against those who don't.
'Similarly, collecting diversity data helps everyone. A diverse, inclusive legal sector that represents the communities it serves is a strong legal sector. Firms' diversity data not only helps us understand the progress the sector is making but enables firms to benchmark themselves against others. Providing that data is not difficult to do, but it is a regulatory requirement.”
As at time of writing in February 2024, the SRA have published firm names that have been issued with fixed penalties as part of its new financial penalty regime. Naming and shaming deterrent!
There have been a good few firms fined £750 each for non-compliance of the transparency rules. When the SRA take any disciplinary action, including fining a firm, they publish decisions on the Solicitors Register. This is easily accessed by the public and competitors.
For example, the list of firms breaching transparency rules and have been fined are:
- Evans Harvey Limited – 389105
- Johnsons Solicitors Limited – 569070
- Jury O'Shea LLP – 541952
- Adams Hetherington – 073946
- Waugh & Musgrave – 057403
- Fadiga & Co Limited – 562462
- Abbey Solicitors Limited - 567317
That said, before firms are fined, they are always sent notices by the SRA which offers time and opportunity to rectify a rule breach. Most notices result in firms following the rules, which is great news.
Have you checked that the information your firm displays is compliant with the Transparency Rules? If not, please speak to your colleagues, partners, compliance officers and those looking after your website that can help your firm stay compliant. To read the Transparency Rules in full please click HERE.
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