Legal Services Bill [HL]

moved Amendment No. 142A: 142A:Clause 166 , page 85, line 40, at end insert— ““( ) In apportioning or imposing a levy the Board shall have regard, inter alia, to— (a) the extent to which any resulting increase in the regulatory fees of a regulator will be reasonable and proportionate in comparison to the fees already levied on relevant regulated persons; (b) the extent to which the levy might discourage entry to or retention in the regulated sector; (c) the extent to which the number of persons regulated by a regulator might be reduced in consequence of the amount of the levy; (d) the extent to which the regulator might be disadvantaged and another regulator might derive an advantage, in particular through the movement between regulators of regulated persons as a consequence of any differences in the levy imposed; (e) the likely ability of the regulator to raise the levy from regulated persons; (f) the impact of the levy on the regulator’s viability.”” The noble Lord said: This amendment overlaps to some extent with the ideas behind those tabled in the previous grouping. This time, we are hoping to find an appropriate solution for apportioning the costs fairly between the various approved regulators. One of the ideas behind this amendment is that the distribution of costs should be done proportionately according to the extent that the regulator causes any burden on the board, not merely a proportionate fee purely in terms of numbers of members. The amendment is therefore particularly in the interests of those smaller bodies which traditionally have extremely low regulatory rates. It will come as no surprise to the Minister that the inspiration for our tabling the amendment came from the patent and trademark attorneys. The amendment introduces a number of considerations to the imposition of a levy that are important to the unique environment of the patent and trademark profession. As these attorneys can easily trade without carrying out reserved activities and without being registered or regulated, the charge of a significant fee to raise funds for a levy could simply drive them out of the regime. If some opt simply to practise outside the regulated sector, that will only increase the burden on the remainder. A system that discourages submission to regulation cannot be in either the public or the consumer interest, or indeed support the Government’s intentions. A further consideration is that many patent attorneys are dual qualified as trademark attorneys, but would resign from ITMA rather than pay two regulatory fees, making the ITMA levy even harder to raise. Similarly, many patent attorneys are also qualified as European patent attorneys and could therefore easily opt to practise solely in that capacity and thus, again, outside the board’s regulatory reach. In addition, many practitioners operate in industrial departments that will not bear the cost of practising fees. The smaller the pool of regulated persons, the greater the burden of the fixed, irreducible costs of regulation on the remainder. As the levy itself is imposed on the regulator, not the regulated persons, the viability of the regulator may fall into question if the collection of fees proves impossible. I beg to move.