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A report released by the CMA last week has called on the legal services sector to invigorate competition and improve access for individuals and small businesses by improving transparency around pricing. According to the provisional report, only one in five legal services consumers compares providers before making a selection, with the majority relying on recommendations from friends and family rather than market information. Furthermore, just 17 per cent of providers publish pricing information on their websites, while online comparison platforms for legal services are still underdeveloped.
No formal investigation
Despite lingering obstacles to competition, the CMA has confirmed that it will not launch a formal investigation into competition in the sector, finding ‘no clear evidence’ that the current regulatory structure of the legal industry impedes competition: ‘Our focus will now be on how we can drive competition by improving the information that providers make available to consumers both before they buy – in order to help them shop around – and during the process so that they aren’t hit with unexpected costs,’ said Rachel Merelie, the watchdog’s senior director for the legal services market study.
Law Society comment
The Law Society has welcomed the CMA’s decision not to pursue a formal investigation into the sector, but has pushed back against the suggestion that transparency is lacking among legal services providers. ‘We believe that the market for legal services is already competitive and solicitors offer exceptional services to their clients as a consequence of rigorous training and years of expertise,’ said Law Society chief executive Catherine Dixon, citing a study co-commissioned with the Legal Services Board which measured consumer satisfaction rates with solicitor services at around 80 per cent. The same study suggests that solicitors are already more likely to provide information about pricing and expected duration of work to prospective clients than other kinds of advisers.
Sources: Law Society Gazette; Legal Futures
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