Principles and risk-based regulation - Reserved legal activities

Learning Outcomes

After studying this article, you will be able to identify and explain the six reserved legal activities under the Legal Services Act 2007, understand the SRA Principles and their application to reserved activities, and describe the concept of risk-based regulation as it applies to legal services. You will also be able to apply these concepts to SQE1-style scenarios and recognise the consequences of unauthorised practice.

SQE1 Syllabus

For SQE1, you are required to understand the regulation of legal services, the scope of reserved legal activities, and the ethical and practical implications of the SRA Principles and risk-based regulation. Focus your revision on:

  • the definition and scope of reserved legal activities under the Legal Services Act 2007
  • the authorisation and exemption requirements for carrying out reserved legal activities
  • the SRA Principles and their application to reserved activities
  • the meaning and purpose of risk-based regulation in legal services
  • the consequences of unauthorised practice and the importance of ethical compliance

Test Your Knowledge

Attempt these questions before reading this article. If you find some difficult or cannot remember the answers, remember to look more closely at that area during your revision.

  1. Which activities are classified as reserved legal activities under the Legal Services Act 2007?
  2. What is the effect of carrying out a reserved legal activity without authorisation?
  3. Name three of the SRA Principles and explain how they apply to reserved activities.
  4. What is meant by risk-based regulation in the context of legal services?

Introduction

Reserved legal activities are specific types of legal work that, by law, can only be performed by authorised or exempt persons. These activities are central to the regulation of legal services in England and Wales and are designed to protect the public, uphold the rule of law, and maintain professional standards. The Solicitors Regulation Authority (SRA) Principles set out the core ethical duties that solicitors must follow, especially when engaging in reserved activities. Risk-based regulation is the approach used by regulators to focus their resources on the areas of greatest risk to the public and the profession.

Reserved Legal Activities: Definition and Scope

The Legal Services Act 2007 defines six reserved legal activities. Only authorised persons (or those exempt) may carry out these activities for the public or a section of the public. Carrying out a reserved activity without authorisation is a criminal offence and may also amount to misconduct.

Key Term: reserved legal activity
A legal activity that only authorised or exempt persons may carry out, as defined in the Legal Services Act 2007.

The six reserved legal activities are:

  1. Exercise of a right of audience – appearing before and addressing a court, including calling and examining witnesses.
  2. Conduct of litigation – issuing proceedings, commencing, prosecuting or defending cases, and performing formal steps in litigation.
  3. Reserved instrument activities – preparing or lodging certain legal documents relating to the transfer or registration of land or property.
  4. Probate activities – preparing papers to obtain a grant of probate or letters of administration, or to oppose such a grant.
  5. Notarial activities – authenticating and certifying documents for use abroad, as carried out by notaries.
  6. Administration of oaths – administering oaths and statutory declarations.

Key Term: authorised person
An individual or entity authorised by an approved regulator to carry out one or more reserved legal activities.

Key Term: exempt person
A person permitted by law to carry out a reserved legal activity without formal authorisation, such as a litigant in person or someone granted a right of audience by a court in a specific case.

Worked Example 1.1

A paralegal working for a law firm drafts and submits a claim form to the County Court on behalf of a client, without supervision from an authorised solicitor. Is this permitted?

Answer: No. Issuing proceedings is a reserved legal activity (conduct of litigation). Only an authorised person or an exempt person may do this. The paralegal is neither, so this is unauthorised practice and may be a criminal offence.

Authorisation and Exemptions

To carry out reserved legal activities, a person or entity must be authorised by an approved regulator (such as the SRA for solicitors, the Bar Standards Board for barristers, or other regulators for specific professions). Some exemptions exist, for example for litigants in person, McKenzie Friends (with court permission), or employees acting under supervision.

Key Term: approved regulator
A body designated under the Legal Services Act 2007 to authorise and regulate persons carrying out reserved legal activities.

Key Term: unauthorised practice
Carrying out a reserved legal activity without authorisation or exemption, which is a criminal offence and may result in regulatory action.

Worked Example 1.2

A will-writing company offers to prepare and submit probate applications for clients, but none of its staff are authorised persons. Is this allowed?

Answer: No. Preparing papers to obtain a grant of probate is a reserved legal activity. Only authorised or exempt persons may do this. The company is acting unlawfully.

The SRA Principles

The SRA Principles are mandatory ethical standards that apply to all solicitors and SRA-regulated firms. They underpin all aspects of legal practice, especially reserved activities.

Key Term: SRA Principles
The core ethical duties set by the SRA, requiring solicitors to act with integrity, independence, honesty, and in the best interests of clients and the public.

The seven SRA Principles are:

  1. Act in a way that upholds the constitutional principle of the rule of law and the proper administration of justice.
  2. Act in a way that upholds public trust and confidence in the solicitors’ profession and in legal services provided by authorised persons.
  3. Act with independence.
  4. Act with honesty.
  5. Act with integrity.
  6. Act in a way that encourages equality, diversity and inclusion.
  7. Act in the best interests of each client.

These Principles apply to all legal work, but are especially important when carrying out reserved activities, which often involve the courts, client money, or significant public interest.

Worked Example 1.3

A solicitor is instructed to represent a client in court. The client asks the solicitor to mislead the court about a key fact. What should the solicitor do?

Answer: The solicitor must refuse. The SRA Principles require solicitors to act with honesty and integrity and to uphold the rule of law and the proper administration of justice. Misleading the court would breach these duties and is misconduct.

Risk-Based Regulation

Risk-based regulation is the approach used by the SRA and other regulators to focus their resources on the areas of greatest risk to the public and the profession. This means that the SRA:

  • identifies and assesses risks to its regulatory objectives (such as protecting the public, upholding the rule of law, and maintaining public trust)
  • prioritises supervision and enforcement action where the risk of harm is highest (for example, in relation to client money, vulnerable clients, or unauthorised practice)
  • expects firms to have systems in place to identify, monitor, and manage risks to their business and clients

Key Term: risk-based regulation
A regulatory approach that targets supervision and enforcement on the areas of greatest risk to the public, clients, and the legal system.

Worked Example 1.4

A small law firm regularly handles large sums of client money in conveyancing transactions. What is the SRA likely to expect from the firm under risk-based regulation?

Answer: The SRA will expect the firm to have robust systems for safeguarding client money, regular account reconciliations, and effective supervision. The SRA may monitor the firm more closely due to the higher risk of harm if things go wrong.

Consequences of Unauthorised Practice

Carrying out a reserved legal activity without authorisation or exemption is a criminal offence under the Legal Services Act 2007. It may also amount to professional misconduct if done by a regulated person. The courts may refuse to recognise steps taken by unauthorised persons (for example, issuing proceedings), and the SRA or other regulators may take disciplinary action.

Exam Warning

Carrying out reserved legal activities without authorisation is a criminal offence and may result in prosecution, fines, or imprisonment. It can also lead to disciplinary action, including striking off or suspension for regulated persons.

Key Point Checklist

This article has covered the following key knowledge points:

  • Reserved legal activities are defined by the Legal Services Act 2007 and can only be carried out by authorised or exempt persons.
  • The six reserved legal activities are: exercise of a right of audience, conduct of litigation, reserved instrument activities, probate activities, notarial activities, and administration of oaths.
  • Carrying out a reserved legal activity without authorisation is a criminal offence and may also amount to misconduct.
  • The SRA Principles set out the core ethical duties for solicitors and apply to all legal work, especially reserved activities.
  • Risk-based regulation means the SRA targets its resources on the areas of greatest risk to the public and the profession.
  • Firms and individuals must have systems to identify, monitor, and manage risks in their legal practice.

Key Terms and Concepts

  • reserved legal activity
  • authorised person
  • exempt person
  • approved regulator
  • unauthorised practice
  • SRA Principles
  • risk-based regulation
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Pleased to share that I have successfully passed the SQE1 exam on 1st attempt. With SQE2 exempted, I’m now one step closer to getting enrolled as a Solicitor of England and Wales! Would like to thank my seniors, colleagues, mentors and friends for all the support during this grueling journey. This is one of the most difficult bar exams in the world to undertake, especially alongside a full time job! So happy to help out any aspirant who may be reading this message! I had prepared from the University of Law SQE Manuals and the AI powered MCQ bank from PastPaperHero.

Saptarshi Chatterjee

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Senior Associate at Trilegal