The Law Society, already fighting to recapture full control of education standards for lawyers from the Solicitors Regulation Authority (SRA), is facing a claim at the Competition Appeals Tribunal (CAT) over ‘an abuse of its dominant position’ that is allegedly ‘restricting competition’ of financial crime training in the UK.
The claim has been brought by Socrates Training, which sells anti-money laundering, anti-bribery and financial crime training, and is set to be fast-tracked to be heard within six months. The training provider alleges that a new requirement by the Law Society forcing law firms to buy anti-money laundering (AML) and mortgage fraud training from it in order to maintain their Conveyancing Quality Scheme Accreditation (CQS) is ‘anticompetitive’.
Socrates Training, argues that this requirement by the Law Society is blocking access to the lucrative market for anti-money laundering training sold to conveyancing firms that have a statutory duty to provide their staff with this training. Socrates Training, which is based in Primrose Hill, London, claims the Law Society’s ‘insistence that firms must buy their AML, mortgage fraud or other financial crime training from itself rather than from the claimant or any other provider, is an abuse of its dominant position, restricting competition…and causing loss to the claimant’.
Socrates Training is seeking several remedies, including damages, interest and costs for the claim. It is also pursuing a declaration that the Law Society has abused its dominant position, an injunction restraining the Law Society from continuing to do so. It also wants a declaration that the clause tying its own training to CQS accreditation is illegal and unenforceable.
Socrates Training registered the claim just over a week ago and has applied to use the fast track system ensuring a case will be heard within just six months. If successful, the case will become one of just a handful of cases to be fast tracked through the CAT since it was handed a range of new powers on 1 October 2015 to reduce cost and encourage more claims against anticompetitive behaviour.
The Law Society, whose slice of some £121m in practising certificate fees used to regulate and represent the profession is under threat with the UK government proposing to make the SRA entirely independent from the Chancery Lane body, is facing increasing pressure to raise more cash through commercial avenues amid calls to make membership voluntary.
The Law Society’s complaints-handling powers and responsibilities over training and education passed to the SRA in 2007, leaving championing the public interest and professional representation its two remaining functions. However, the body is fighting to recapture the training and education as the two bodies look to split following a difficult marriage.
Socrates Training is being advised by Stephen Tupper, who left Greenberg Traurig Maher last summer to launch competition law boutique Tuppers. He previously headed Watson Farley & Williams’ competition and regulatory group and Hammonds’ European law team.
A Law Society spokesperson said: ‘The Law Society’s Conveyancing Quality Scheme provides a quality standard for solicitors delivering residential conveyancing. A claim has been made by Socrates Training Limited in relation to training as part of the CQS programme. The Law Society believes this claim to be wholly without merit.’
Read more about the Law Society’s work in the feature: ‘Taxation without representation’