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To help your firm avoid inadvertent breaches of the Probate Regulations, we have highlighted some of the common breaches we see. These issues can lead to potential regulatory action and interruption of probate services so it’s important that you take note to ensure your firm avoids these common pitfalls.

Keeping us informed

It is the role of your Head of Legal Practice (HoLP) or Probate Contact Partner to ensure that all individuals and entities related to the accredited probate firm [1] comply with the regulations. The onus is on these individuals to ensure that your firm’s record is up to date and submit any notifications appropriately, including any required application forms.

Eligibility issues often arise as a result of structural changes in a firm or group. Continuing obligations for a probate accredited firm are detailed under Regulation 2.7. You must inform ICAEW of any changes to your firm within 10 business days.

The annual return is not a mechanism to tell us about changes to your firm structure.

How to notify ICAEW of changes

You can use the standing data change and probate application forms to report most changes. Any notifications outside the remit of these forms can be reported by contacting regulatory.support@icaew.com.

[1] The term ‘accredited probate firm’ includes both ICAEW authorised and licensed probate firms.

Common eligibility issues

Authorised individuals

Remember, all probate accredited firms must have one Authorised Individual (AI) that is a principal of the firm and (when considering changes of address) one office within England and Wales. Regulation 4.1 explains who can be an AI. In summary this person:

  • Must hold an appropriate probate and estate administration qualification.
  • Must be an employee or principal of the firm.
  • Cannot be a subcontractor.
  • Their application must be approved by ICAEW before commencement of probate work.

Probate affiliate status

It is important to consider whether principals require probate affiliate status. Especially when you have additions and / or cessations in principals, or when the regulatory status of your firm changes (for example when affiliate status for other regulated areas is removed).

Regulation 8 covers affiliates. Principals of the firm who are not:

  • an ICAEW member;
  • a member of The Institute of Chartered Accountants Scotland (ICAS), Institute of Chartered Accountants Ireland (ICAI), Solicitors Regulation Authority (SRA) or another approved regulator for probate;
  • an accredited probate firm;
  • a registered auditor;
  • a DPB-licensed firm; or
  • a regulatory affiliate under audit, DPB, Insolvency, LPS or holds general affiliate status;

must apply for probate affiliate status. All probate affiliate applications must be approved BEFORE being appointed as a principal of the firm. In the case of a change of circumstance where the individual is already a principal, the application must be approved before the change is enacted. Remember, under continuing obligations (regulation 2.7k), you must inform ICAEW within 10 business days of any changes affecting your firms eligibility.

Changes to firm legal entity (incorporations, dissolutions, mergers etc)

When a firm changes legal entity (eg, incorporations, sole trader to partnerships etc), all regulatory areas must be reapplied for under the new entity. In the case of a licensed firm, HoLP, Head of Finance and Administration (HoFA) and Non-authorised owner (NAO) application forms must also be submitted as part of the application. AI’s are able to be transferred over to the new entity. As part of the application the firm is required to submit a new letterhead for the firm and also full Professional Indemnity Insurance (PII) documentation that complies with regulations 2.10 and 2.11 as well as ICAEW’s PII Regulations.

Specific issues at authorised firms

Regulation 2.2 states that all principals and interest holders within an authorised firm must be approved as an AI before appointment.

Under regulation 2.7e, an authorised firm must at all times have a probate contact partner.

Specific issues at licensed firms

Licensed firms must appoint a HoFA and a HoLP (who must also be an AI). The applications must be approved by ICAEW prior to appointment (Regulation 2.4f).

If there is a change in HoFA or HoLP an application must be made for their replacement (Regulation 2.7j).

Non-authorised owners (NAO's)

You must consider Regulations 6 and 2.7l regarding NAO’s, when considering changes of shares (voting and non-voting), voting rights or management board within the licensed probate firm and any parent firms (including group scenarios). This is important when a person [2] changes, acquires or ceases to hold interest in the firm.

Regulation 6.2 sets out the different kinds of material interest that require ICAEW’s approval, but in summary, this applies to:

  • Individuals and firms with at least 10% of shares (voting and non-voting), voting rights or substantial voting rights on the management or decision-making board.
  • Individuals and firms with at least 10% of shares (voting and non-voting), voting rights or substantial voting rights on the management or decision-making board in a parent firm to the probate licensed firm.

When reporting any changes in ownership, you must provide the full ownership and control of the probate accredited firm, including any parent firms if they are affected, including total number of shares (voting and non-voting) and nominal share value to confirm accurate records.

Remember that you must inform ICAEW of any changes in material interest within 10 business days, and approval must be obtained from ICAEW before acquisition of material interest.

If you are unsure how any proposed changes to the ownership and control of the probate accredited firm may affect its eligibility, please contact our regulatory support team and they will be able to advise you further.

T: +44 (0)1908 546 302

E: regulatory.support@icaew.com

[2] A 'person' under the Legal Services Act 2007 includes a body of persons (corporate or unincorporate).

Diversity monitoring

It is a requirement of Regulation 2.7s that all probate accredited firms, regardless of size or structure complexity, must monitor the diversity of its principals and employees, and publish the findings of the monitoring in the manner and format prescribed by ICAEW.

Diversity monitoring is carried out biennially and we will write to the HoLP and the Probate Contact Partner detailing the process when it is time to carry out a survey at your firm.

Annual review and transparency

All probate firms must carry out a probate monitoring review of its activities periodically - an annual review is strongly encouraged (Regulation 2.7p).

All probate firms must be transparent in the provision of price and service information (Regulations 2.7t to 2.7w).

Dispensations

When considering changes that may make the firm unavoidably ineligible (for example, death or sudden departure of a relevant person [3]), you must contact ICAEW within 10 business days. An application for a dispensation (see Regulations 2.19, 2.20 and 2.21) must be made for consideration. A dispensation can be granted for up to 90 days from the date the firm became ineligible to allow the firm time to rectify the ineligibility.

This time frame has no scope to be extended.

[3] A 'relevant person' is defined as an AI, HoFA, HoLP or any other principal or employee of an accredited probate firm.

Further information

Probate Regulations

Firms accredited for probate by ICAEW are required to comply with these regulations.

Read the regulations