In-house legal teams will be vulnerable to replacement by services run by outsourcing businesses, such as Capita and Serco, once the Solicitors Regulation Authority (SRA) is able to license alternative business structures (ABSs).

That was the warning from Bevan Brittan partner Iain Miller to The Law Society’s 2011 In-house counsel forum this week. Miller noted that SRA-licensed ABSs would ‘blur the distinction between in-house and private practice’. He predicted the emergence of legal services providers whose business and charging models ‘look a lot more like outsourcing organisations’ which would be in a position to ‘gather together in-house work’.

He also argued that in-house teams could themselves drive change. He used the hypothetical example of BT and Centrica setting up a joint legal team to handle both companies’ property law or intellectual property needs. Such an entity could also sell services externally.

The SRA’s director of standards, Richard Collins, told the forum that ‘ABSs are not just about the high street’. He predicted that the flexibility ABSs created would mean new models could meet the ‘drive for value’ within public and private sector organisations. The legal services market has seen rapid change, he noted, wherever regulations have allowed new entrants.