Martin Partington: Spotlight on the Justice System

Keeping the English Legal System under review

Regulation of Claims Management Companies

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One of the documents published with papers relating to the March 2016 Budget statement was a report of an independent review of Claims Management Companies (CMCs). Unusually, CMCs are regulated by a dedicated Unit which operates within the Ministry of Justice, rather than by a body more independent of a government department.

The review offers three options for the way forward: 1, creating a wholly now external regulator; 2, leaving things within the Ministry of Justice, while building on the reform programme currently being developed by the Unit; or 3, transferring the function to the Financial Conduct Authority.

The review concluded that the first option would be unlikely to be approved by Government, as it would be too expensive and disruptive. The second option would be the least disruptive to the market; option 3 would permit a new, refreshed approach.

The Government has now announced that it will transfer this function to the FCA – but as this will require legislation to achieve, it is unlikely to take place before 2018.

Details of the review are at https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/508160/PU1918_claims_management_regulation_review_final.pdf

 

 

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Written by lwtmp

March 18, 2016 at 11:54 am

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