The reform of 2007 on regulation of the market of legal services in England and Wales as an institutional experiment

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The article presents a reform that provides a regulatory framework for the legal services market, implemented as the Legal Services Act of 2007 in England and Wales. The reform was intended to systematise the institutional system of that market, to increase its transparency, to increase the role of competition and to enhance the position taken by customers at the expense of the current legal self-regulatory bodies. The reform involved development of a multi-level management structure for institutions–organisations that supervise or represent lawyers handling various market segments. A new form of functioning was provided to lawyers in order to facilitate acquisition of capital and know-how. A new package of supervisory measures was initiated and applied to operations undertaken by lawyers and their companies. The aim of this case study is an attempt at evaluating the above-mentioned reform and drawing conclusions for model operation of the legal services market. In order to achieve such an aim, the institutional change is described based on the current data about the functioning of regulators, taken from their websites. The article also refers to literature related to regulation of legal professions and the English-Welsh context. The conclusions that have been drawn prove the advisability of its implementation. For the sake of economic and social evaluation of the outcomes of the applied solutions, the dynamics of the rates describing market operation (supply, prices, demand, consumer choice) has been analysed. It has been stated that since the implementation of the reform in 2008, the accessibility of legal assistance has been increased along with the quality of legal services and market competitiveness. However, the authors of the reform have been disappointed with the scarce interest in new forms of development provided to legal companies, innovation for licensed lawyers and further increase in prices of legal services. A demand barrier has been also encountered. Despite all those facts, the value of the legal services market in England and Wales has been increased and export of legal services and the number of licensed lawyers have also grown. Furthermore, the reform has already found its followers in other countries.

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