Non-lawyer employees can now have a stake in their law firms
Singapore
FOR the first time in Singapore's history, non-lawyer employees of law firms can now become partners, directors or shareholders in, and share in the profits of the firms they work for, with amendments to the Legal Profession Act taking effect on Wednesday.
Law firms have traditionally been owned only by lawyers.
This change comes in the wake of recommendations by a committee that reviewed the legal services regulatory framework here with the aim of modernising it. The Legal Profession Act has since been amended, and the changes were passed by Parliament a year ago.
On Wednesday, the Ministry of Law said non-lawyer employees in law firms can submit applications to a newly established regulatory body, the Legal Services Regulatory Authority (LSRA), to be registered as regulated non-practitioners.
Law practices will thus have the flexibility to attract and retain such non-lawyer talents, including individuals with strong management or finance experience, it said.
The LSRA, set up on another of the committee's recommendations, will be tasked with streamlining licensing matters related to law practices in Singapore.
It takes over certain regulatory functions that were previously carried out separately by the Legal Profession Secretariat of the Attorney-General's Chambers (AGC), and also the Law Society of Singapore.
The AGC used to oversee the licensing of foreign law practices, foreign law practice collaborations with Singapore law practices and the registration of foreign-qualified lawyers; the Law Society previously took care of approvals applicable to Singapore law practices.
Under the new integrated licensing framework, business criteria (such as the names of law practices, foreign ownership and profit sharing) will be applied consistently across the board, said the ministry.
It added that the LSRA's e-services portal will bring all application transactions online and do away with manual processes.
Back-end data interfaces between the LSRA, the Supreme Court and the Law Society will provide a more seamless and convenient experience for users of the portal, the ministry said.
It added that, through the LSRA website, the public can run a search of law practices and collaborations registered with the regulatory authority, as well as of lawyers practising in Singapore by name, firm or practice area.
On the changes, Law Society of Singapore president Thio Shen Yi said law firms will now enjoy more flexibility in the way they can structure themselves.
"We are no longer limited or constrained by traditional partnership structures. Non-lawyer employees can now own a minority share in a law firm. Of course, this is subject to safeguards such as AGC and Law Society consent, but it does open up potential opportunities for lawyers to collaborate with other professionals in an integrated way, and deliver a more integrated or holistic service."
Sunil Sudheesan, acting president of the Association of Criminal Lawyers of Singapore, welcomed the move to streamline licensing matters involving law firms here, adding that it does away with the back-and-forth communications between the different parties.
He also expressed hope that lawyers will be consulted should there be changes envisaged in the licensing regime.
