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ICAEW has consistently lobbied for a review of the laws of privilege.

Most recently, ICAEW has been granted leave to intervene when the Prudential case reaches the Supreme Court during 2012.  Michael Izza has commented on the reasons for our intervention in his blog available.

The desire for reform will become more pressing post October 2011, when the first multidisciplinary practices involving lawyers and other professionals can form. ICAEW is concerned how the current laws of privilege will operate in a multi-disciplinary practice of the future and the anomalies are highlighted in this article.

In October 2010, ICAEW wrote to the Law Commission requesting that privilege be added to the 11th Programme of Law Reform however the request was not accepted. A copy of our letter is available here.

The Tax Faculty continues to highlight the issues and in their response to Budget 2010 stated as follows;

Legal professional privilege

  • 41 We said in our 2009 PBR representation that the Government should announce a consultative body to review legal professional privilege (LPP) as it affects tax advice so as to end discrimination and establish a level playing field for all taxpayers and their advisers. We also said that this body should represent the views of all those who provide tax advice, with particular emphasis on those who are not qualified lawyers, and should report back by the PBR 2010.
  • 42 We understand that the Prudential case is going to appeal, but the current position on LPP in relation to tax advice is far from satisfactory and from press reports it is now clearly a matter of concern of HMRC. This is a matter of public concern and needs to be addressed as we believe that the current position is not sustainable.

Policy recommendation

  • The Government should announce a consultative body to review LPP as it affects tax advice and make recommendations for extending LPP to all appropriately qualified tax

It is abundantly clear that the current legal position cannot be sustained post the introduction of multi-disciplinary practices under the Legal Services Act 2007. The only questions are  how and when reform will happen.