Global telecommunications giant BT sent tremors through the market when it announced that it was to jump into the legal profession with an application to become an alternative business structure under the provisions of the recently implement Legal Services Act.

Heavyweight players

That corporate bid for a slice of the law firm market suggests that a wave of heavyweight players may soon follow sooner than expected, as speculation mounts in the UK over the announcement of the first approved ABS. No date has been given for when the first Solicitors Regulation Authority-regulated ABS will be announced, but SRA Chief Executive Antony Townsend publicly suggested that it will be in a matter of weeks rather than months.

The UK telecoms giant has applied to launch a structure called BT Claims, a wholly-owned subsidiary of the group. It applied to the SRA for an ABS licence last week and if approved BT will become a major player in the legal sector.

The SRA confirmed that the number of stage 1 applications from organisations wishing to be regulated as ABSs currently stands at 121 – a significant number considering that as recently as a year ago legal profession pundits had predicted interest in ABS accreditation would be minimal at best.

Motor claims

BT Claims already boasts a complete motor claims management service for more than 35,000 vehicles in BT’s UK fleet. According to the UK weekly, the Law Society Gazette, it handles around 4,000 at-fault accident damage and personal injury claims annually with an average liability value exceeding £5 million, and around 3,000 non-fault loss recovery claims with an annual recovered value of over £2.5m.

It is understood that talks have already begun with potential clients with large vehicle fleets. A BT spokesman told the Gazette: ‘The initial focus will be on handling motor claims and litigation, which may be transferable to other sectors. It is about getting claims settled quickly and for the right price rather than stringing things out.’