The Law Society of England and Wales abused its dominant market position when it required conveyancing firms to buy training from it to maintain an accreditation, the UK’s Competition Appeals Tribunal (CAT) said.
The CAT
ruled in favour of online training company Socrates Training, which claimed that from April 2015, the Law Society practised anti-competitive behaviour when it required firms to secure anti-money laundering (AML), mortgage fraud, and subsequently financial crime training only from the Law Society to maintain Conveyancing Quality Scheme (CQS) accreditation.
The Law Society, which should have allowed third-party trainers to offer some modules required for the CQS, owes Socrates damages and has been ordered to stop any anticompetitive conduct related to the requirement.
The Law Society
said that it is reviewing the training elements of the CQS, which has been running since 2010. It also said that only one of the modules that concerned the tribunal – the financial crime module – has been withdrawn.
"We are grateful to the tribunal for their guidance on changes to CQS that they make in their ruling and we will be looking at their comments as a matter of priority in the coming days," said Robert Bourns, Law Society president.
“For the vast bulk of the time CQS training has been available, it has been compliant with competition rules. I am certain that in setting CQS up, the Law Society acted in good faith and in the public interest. The purpose of CQS – and its effect – was to ensure greater consumer choice in terms of practitioners available to undertake this important work. We note the decision and have and will take steps to avoid similar issues in the future,” he added.
Bourns said that buying a house is the biggest investment most people make, and they – as well as lenders – need to feel confidence in the process.
“That was always our motivation - CQS has never been about profit,” he said.
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