SRA Handbook

SRA Overseas Rules 2013

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Version 10 of the Handbook was published on 01/07/2014. For more information, please click 'History' Above

SRA Overseas Rules 2013

Rules dated 30 August 2013 made by the Solicitors Regulation Authority Board under sections 31, 79 and 80 of the Solicitors Act 1974, sections 9 and 9A of the Administration of Justice Act 1985 and section 83 of the Legal Services Act 2007, with the approval of the Legal Services Board under paragraph 19 of Schedule 4 to the Legal Services Act 2007 regulating the conduct of solicitors and their employees, registered European lawyers and their employees, registered foreign lawyers, recognised bodies and their managers and employees and licensed bodies and their managers and employees.

Part 1: The Overseas Principles

Rule 1: Overseas Principles

1.1

You

(a)

as a regulated individual practising overseas must ensure that you; or

(b)

as a responsible authorised body must ensure that your overseas practice, and individual managers, and members and owners of your overseas practice (who are, for the purposes of these rules, 'those for whom you are responsible');

comply with the Overseas Principles stated below.

1.2

Each of the Overseas Principles stated below, is supplemented by a note to assist individuals and bodies to determine how best to comply with each Principle. These notes do not form part of the Principles and are for guidance only.

1.3

Overseas Principle 1: You must uphold the rule of the law and the proper administration of justice in England and Wales.

Guidance note

(i)

Your obligations to clients, the court and third parties in England and Wales with whom you are dealing on behalf of your clients are unaffected by the location outside England and Wales from which you practise or by the location of your overseas practice.

1.4

Overseas Principle 2: You must act with integrity.

Guidance note

(i)

Personal integrity is central to your role as the client's trusted adviser and should characterise all of your professional dealings with clients, the court, other lawyers and the public, wherever they are being conducted. You should use your judgment when considering how best to maintain your integrity at all times and avoid any behaviour outside England and Wales which undermines your character and suitability to be an authorised person. A responsible authorised body should ensure that its overseas practices observe comparable standards.

1.5

Overseas Principle 3: You must not allow your independence or the independence of your overseas practice to be compromised.

Guidance note

(i)

"Independence" means your own independence and that of your firm and your overseas practice, and not merely your ability to give independent advice to a client. You should avoid giving control of your overseas practice to a third party beyond any local legal or regulatory ownership requirements.

1.6

Overseas Principle 4: You must act in the best interests of each client.

Guidance note

(i)

You should act in good faith and do your best for each of the clients for whom you are (or your overseas practice is) acting. In particular, you should follow the local legal or regulatory requirements of the jurisdiction in which you or your overseas practice are practising in relation to confidentiality and conflicts of interest. If no such requirements exist, you should be guided by what you consider to be the best interests of each client in the circumstances.

1.7

Overseas Principle 5: You must provide a proper standard of service to your clients/the clients of your overseas practice.

Guidance note

(i)

You should provide a proper standard of client care and work. This includes exercising competence, skill and diligence and taking into account the individual needs and circumstances of each client as well as the particular requirements and circumstances of the jurisdiction in which you are working. If your client meets the definition of a complainant under Section 128(3) of the Legal Services Act 2007 or the Legal Services Act 2007 (Legal Complaints) (Parties) Order 2010, you should inform the client who is regulating the legal services you or your overseas practice is providing to the client, what client protections are in place and whether they have the benefit of professional indemnity insurance or other indemnity.

1.8

Overseas Principle 6: You must not do anything which will or will be likely to bring into disrepute the overseas practice, yourself as a regulated individual or responsible authorised body or, by association, the legal profession in and of England and Wales.

Guidance note

(i)

This includes any behaviour which occurs within or outside your professional practice which undermines your own reputation, that of the practice within which you are a manager or solicitor employee, or the wider reputation of the legal profession in and of England and Wales.

1.9

Overseas Principle 7: You must comply with your legal and regulatory obligations in England and Wales, and deal with your regulators and ombudsmen in England and Wales in an open, timely and co-operative manner and assist and not impede any authorised person or authorised body practising in England and Wales in complying with their legal and regulatory obligations and dealings with their regulators and ombudsmen.

Guidance note

(i)

As a responsible authorised body, you should ensure that you, and those for whom you are responsible, comply with all of the reporting and notification requirements that apply to you and respond promptly and substantively to communications. You should ensure that you (and those for whom you are responsible) do not cause, contribute or facilitate a failure to comply with the SRA's regulatory arrangements by any authorised person or authorised body practising in England and Wales. Regulated individuals practising overseas should assist their responsible authorised body to comply with its regulatory obligations to the SRA.

1.10

Overseas Principle 8: You must run your business/the business of your overseas practice or carry out your/their role in the business effectively and in accordance with proper governance and sound financial and risk management principles.

Guidance note

(i)

As a responsible authorised body you are required to ensure that your relations with your overseas practice accord with sound governance, financial and risk management principles. You should ensure that those for whom you are responsible under these rules assist you in meeting your obligations to the SRA in relation to managing any risks that your overseas practice might pose to your operations.

1.11

Overseas Principle 9: You must run your business/the business of your overseas practice or carry out your/their role in the business in a way that encourages equality of opportunity and respect for diversity.

Guidance note

(i)

Every jurisdiction has its own legal, regulatory and cultural framework for equality and diversity. The SRA does not expect, or require, regulated individuals or bodies practising overseas to approach these issues as they would in England and Wales. It does, however, expect that SRA regulated individuals and bodies will do what they reasonably can to encourage equality of opportunity and respect for diversity, within the legal, regulatory and cultural context in which they are practising overseas.

1.12

Overseas Principle 10: You must protect client money and assets.

Guidance note

(i)

You and those for whom you are responsible should comply with local regulatory requirements in relation to client money, documents and assets and, in any event, you should ensure that they are protected appropriately.

Part 2: Application

Rule 2: Application

2.1

With regard to the Overseas Principles set out in Rule 1:

(a)

they apply in full to you if you are a regulated individual practising overseas, or a responsible authorised body in relation to each of its overseas practices;

(b)

you will be committing a breach if you permit another person to do anything on your behalf which, if done by you, would constitute a breach of these rules;

(c)

you should ensure that you and those for whom you are responsible under these rules comply with all legal and regulatory obligations applicable in the jurisdiction outside England and Wales in which you or they are practising. You, and those for whom you are responsible under these rules, should not cause, contribute to or facilitate a failure to comply with those legal or regulatory obligations by any other person or body subject to them;

(d)

where there is a conflict between compliance with the Overseas Principles set out in Rule 1 and/or the Reporting Requirements set out in Rule 3 on the one hand, and any requirements placed upon you or those for whom you are responsible under these rules by local law or regulation on the other hand, the latter shall prevail, with the exception of Overseas Principle 6, which must be observed at all times;

(e)

nothing in these rules removes or modifies the requirements under the Legal Services Act 2007, for authorisation to be obtained for the delivery of reserved legal activities;

(f)

if you are a solicitor and your practice predominantly comprises the provision of legal services in England and Wales then, regardless of where you are established, the SRA will apply the full SRA Handbook to your practice;

(g)

if you are a regulated individual practising overseas, or a responsible authorised body, you must ensure that you, or those for whom you are responsible under these rules, comply with any requirements under:

(i)

the SRA Property Selling Rules 2011;

(ii)

the SRA Insolvency Practice Rules;

(iii)

the SRA European Cross-border Practice Rules;

(iv)

the SRA Financial Services (Scope) Rules;

(v)

the SRA Financial Services (Conduct of Business) Rules 2001; and

(vi)

the SRA Quality Assurance Scheme for Advocates (Crime) Regulations [2013];

which apply to you or your overseas practice.

Part 3: Reporting requirements

Rule 3: Reporting requirements

3.1

The SRA does not expect or require the same level of detailed monitoring, reporting and notification from those practising overseas as it would expect of authorised persons and authorised bodies in England and Wales. The level of reporting the SRA expects is proportionate to the level of regulatory risk posed by an overseas practice.

3.2

You, as a regulated individual practising overseas or as a responsible authorised body, must monitor any material or systemic breaches of the Overseas Principles that apply to you or to those for whom you are responsible and report them to the SRA when they occur, or as soon as reasonably practicable thereafter. In relation to an overseas practice, a material or systemic breach will relate either to the character and suitability of an individual, the financial vulnerability of an overseas practice outside of established business planning, or a pattern of behaviour within an overseas practice that infringes Overseas Principle 6. Notifications by the compliance officer of a responsible authorised body, or by another person on behalf of an overseas practice will satisfy these requirements without separate notifications from each individual or body who has knowledge of the breach. For example, you will be required to:

(a)

notify the SRA, if you, or any of the partners, members, managers, solicitor employees or other professionally qualified employees in your overseas practice, are convicted by any court of a criminal offence or become subject to disciplinary action by another regulator;

(b)

notify the SRA immediately if you believe that your firm or your overseas practice is in serious financial difficulty;

(c)

provide the SRA with documents held by you or your overseas practice, to which it is entitled, and any necessary permissions to access information as soon as possible following a notice from the SRA to do so.

(d)

provide the SRA, if you are a responsible authorised body, with an annual return which:

(i)

identifies the contact details of the office(s) from which you are, or your overseas practice is, practising, and

(ii)

confirms that you have fulfilled your reporting and notification obligations.

Part 4: Commencement

Rule 4: Commencement

4.1

These Rules shall come into force as follows:

(a)

Rule 1, 2 and 4 of these rules shall come into force on 1 October 2013, for:

(i)

regulated individuals falling within the definition of practising overseas, and

(ii)

persons falling within paragraph (i)(a) and (e) of the definition of overseas practice,

(b)

Otherwise, these rules shall come into force on 1 October 2014.