Lawyers, Markets and Regulation

Lawyers, Markets and Regulation

Frank H. Stephen

Frank H. Stephen’s evaluation of public policy on the legal profession in UK and European jurisdictions explores how regulation and self-regulation have been liberalized over the past 30 years. The book surveys where the most recent and radical liberalization involving the ownership of law firms by non-lawyers is likely to lead, and appraises the economic literature on the costs and benefits of regulating markets for professional services. It challenges socio-legal views on professional legislation and highlights the limitations of regulatory competition, as well as the importance of dominant business models. The author reviews the empirical work underpinning these theories and policies. He also evaluates the effectiveness of regulatory competition as a response to regulatory capture.

Chapter 5: Liberalization of legal markets in UK and EU jurisdictions

Frank H. Stephen

Subjects: economics and finance, industrial economics, institutional economics, law and economics, law - academic, law and economics, regulation and governance

Extract

In Part I of this book it has been argued that, while there are clear reasons why markets for legal services should be subject to some degree of regulation, there are also reasons to be cautious about self-regulatory bodies regulating lawyer behaviour in the interests of the profession and its members. This chapter examines how policy in many European jurisdictions has moved in the direction of liberalization. UK jurisdictions, to some extent, have led the way in this but other EU jurisdictions have also moved in this direction, particularly following the Treaty of Lisbon and the extension of freedom of movement to the professions. The chapter begins by discussing the liberalization that has taken place in UK jurisdictions and then turns to a selection of other EU jurisdictions. The next chapter will examine evidence on the effects of liberalization, particularly in the UK. In this chapter the broad direction of regulatory reform in a number of European jurisdictions is discussed.Whilst the evolution of regulatory regimes for the professions in Europe has been in the same direction as competition policy, these have been sometimes in parallel rather than in unison. Both competition policy and policy on professional regulation have had different starting points in different jurisdictions and until relatively recently have moved at a different pace.

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