The Bar Council has submitted a joint response with the Criminal Bar Association to the Legal Services Board’s discussion document on the regulatory treatment of referral fees, referral arrangements and fee sharing, calling for referral fees to be scrapped.

The Bar Council’s response says:

• Referral fees represent an unwarranted and unjustifiable threat to the public interest in the efficient and effective provision of legal services to consumers. They should be prohibited.
• Attempts to provide a regulated system of referral fees have failed. Individuals will be represented on the basis of the financial interests of those party to the payment, the details of referral fees will remain unexposed, costs will almost certainly increase, any such increase will be passed on to the public, and the field of providers of legal services may well be reduced. All of this is likely to occur without any increase in the quality of representation.
• The effect of the Unified Contract Standard Terms 2007 and the 2007 Funding Order make it clear that both the payment and the receipt of any referral fee, and the practice of becoming “Instructed Advocate” in order to exploit the fund-holding position, are prohibited.
• There can be no halfway house compromise in relation to advocacy, where the right of the consumer to the optimal choice of representative in court cannot be allowed to be prejudiced by referral fees.

Chairman of the Bar, Nicholas Green QC, said:

“It is plainly not in the public interest to maintain a system of referral fees and in fact they represent a serious barrier to the provision of most appropriate advocacy. The failure of recent attempts to regulate referral fees leaves no fair alternative but to scrap them altogether.”