Lawyers set for competition shake-up

15 March 2011

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This article first appeared in Business Day

The legal profession has welcomed a recent ruling by the Competition Commission which described the rules of law societies as “old-fashioned” and in “need of revision” to bring them in line with international norms.

The Law Society of SA filed an application with the commission to exempt its rules from the Competition Act on the grounds that they were aimed at maintaining professional standards. The rules it sought to exempt included those determining fee tariffs, advertising, organisational forms, multidisciplinary practices and reserved work.

The commission's ruling comes a month after the high court in Pretoria ruled against the Law Society of the Northern Provinces and in favour of commercial law firm Eversheds, allowing it to use the international name “Eversheds”.

The court suggested that the society reconsider its rules to bring them in line with the rest of the world. The Law Society of SA’s rules of professional conduct, which date back to 1979, are expected to be replaced this year by a uniform set of rules which will come into effect when the Legal Practices Bill becomes law.

Oupa Bodibe, a manager at the Competition Commission, said yesterday the commission and the society had entered into discussions after the commission raised concerns about the rules being “too wide”.

The law society said it was “disappointed” and would consider what to do after the commission had provided its full reasons for rejecting its application.

But law firms welcomed the decision. Chris Ewing, chairman of Cliffe Dekker Hofmeyr, said the law society needed to change its “old-fashioned” rules and bring SA’s legal practice in line with international norms.

Michael Hart, chairman of Deneys Reitz, said: “The legal profession is not happy with closed shops and the current method of regulation, which is outdated.”

Des Williams, chairman of Werksmans, said: “It is the right approach. The rules need to be modernised and competition needs to be promoted.”

Norton Rose South Africa (incorporated as Deneys Reitz Inc) joined Norton Rose Group on 1 June 2011.