Becoming SRA-authorised is a lengthy and involved process. But it is all too easy for a regulated firm to lose its precious authorisation through an administrative oversight that had hitherto been regarded as a relatively minor breach.
We have now seen multiple instances of the SRA taking the position that section 18(3) of the Legal Services Act 2007 means that, as a matter of statute (and therefore not something the SRA can waive or vary), failing to ensure that every partner renews their SRA registration on time can lead to loss of authorisation.
In particular, any SRA-authorised firm which is a recognised body (which includes most English law firms) which fails to renew the practising certificates or registered foreign lawyer (RFL) registrations held by all of its partners will automatically lose its SRA authorisation after 90 days of the failure persisting.
This occurrence is all too common, since byzantine rules, historic records issues and the somewhat unwieldy online mySRA self-service platform conspire to thwart even the best-intentioned efforts of those charged with ensuring the practising certificate renewal process runs smoothly.
It is quite easy, particularly for large and international firms, for individuals to be left off the bulk renewal process (if that system is operated at all), or for clerical errors to record someone as renewed when they are not. Such errors often do not come to light until some time after they arise – potentially not until the following renewal season, or later still.
Even where firms operate a bulk renewal process for practising certificates, partners in overseas offices may not have been opted in, or RFLs may have been treated differently, meaning a manual renewal of their registrations are required.
To deal with this additional compliance hurdle and avoid an inadvertent lapse of authorisation, firms are strongly advised to undertake a meticulous cross-check of their partnership against the SRA’s records and renewal statuses. Firms must ensure every partner who requires renewal has indeed been renewed.
This process should involve a responsible person reviewing partnership records to verify who should be authorised, taking account of promotions, lateral hires and retirements. This should then be cross-checked with SRA Records to identify any discrepancies or lapses in authorisation.
With the practising certificate renewal season concluding on 31 October each year, firms should diarise the following 29 January as the last possible moment to ensure everything is in order and ensure that all checks are complete well ahead of this, since time should be allowed to submit and have processed any missing renewals. RFL registrations, for example, might take up to 30 days or more to process, even after the individual has obtained a certificate of good standing from each and every bar association they are admitted to.
Thankfully the SRA has to date treated a loss of authorisation in this manner as a largely technical matter, but that approach may not continue and the SRA’s fixed fines for minor breaches – and its willingness to publicise those firms on which it imposes thosefines – suggests that the SRA may well harden its position.
Irrespective of the SRA’s approach, loss of authorisation can have serious consequences, including the inability to practise in certain areas of law, reputational damage should it become known, and potential repercussions for clients and professional indemnity insurance. It’s therefore essential that firms take immediate and thorough action to ensure full compliance.
Please get in touch if you require assistance with SRA authorisation matters or partner registrations and approvals.
Need more information about the above people and legal expertise? Talk to one of our lawyers: +44 (0)20 7628 2000
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