Part 1Regulatory framework

Chapter 2regulators

Requirements of category 1 regulators

12Annual reports of category 1 regulators

(1)

A category 1 regulator or, where section 8(2) applies, its regulatory committee, must prepare a report on the exercise of its regulatory functions as soon as practicable after the end of each reporting year.

(2)

The report must include—

(a)

information demonstrating how the category 1 regulator or, where section 8(2) applies, its regulatory committee, is complying with the regulatory objectives,

(b)

information as to how the regulator or, where section 8(2) applies, its regulatory committee, is carrying out its regulatory functions,

(c)

a statement on the strategic priorities of the regulator or, where section 8(2) applies, its regulatory committee, for the next reporting year in relation to its regulatory functions,

(d)

a copy of the regulator’s or, where section 8(2) applies, its regulatory committee, annual accounts (in so far as they are relevant to the carrying out of regulatory functions),

(e)

a summary of decisions to pay out from the compensation fund, including details on—

(i)

how decisions on claims are made,

(ii)

the criteria for making decisions,

(iii)

the average length of time it has taken to make a payment following the making of a claim,

(iv)

the proportion of claims that have been paid out, whether in part or in full, compared to the number of claims made,

(f)

information, in relation to legal services providers that the regulator regulates, about—

(i)

the number of conduct complaints remitted (or treated as having been remitted) to it under the 2007 Act, and the number of those complaints that are determined, discontinued or reinstated by it or, where section 8(2) applies, its regulatory committee,

(ii)

the number of regulatory complaints remitted (or treated as having been remitted) to it under the 2007 Act, and the number of those complaints that are determined, discontinued or reinstated by it or, where section 8(2) applies, its regulatory committee,

(g)

information on any measures taken or financial penalties imposed by the regulator on legal services providers that it regulates as a result of complaints remitted (or treated as having been remitted) to it under the 2007 Act (including information as to compliance with the measures and the actions taken to enforce them),

(h)

information about directions (if any) given under section 20, including—

(i)

the number of directions given in pursuance of each of the purposes in section 20(3),

(ii)

a summary of which types of rules are being disapplied or modified (and how frequently they are being disapplied or modified),

(iii)

any trends in the kinds of directions that were applied for, rejected or granted,

(iv)

the changes in such trends (if any) from the previous report,

(i)

where the Commission has given a direction in relation to the handling of complaints, details of how the regulator or, where section 8(2) applies, its regulatory committee, has complied with it,

(j)

where the Commission has given a direction in relation to the compensation fund, details of how the regulator or, where section 8(2) applies, its regulatory committee, has complied with it,

(k)

details of steps taken by the regulator or, where section 8(2) applies, its regulatory committee, to ensure compliance with any measures taken under section 19 by the Lord President,

(l)

except in the case where the regulator is the Law Society, a statement indicating whether the regulator or, where section 8(2) applies, its regulatory committee, considers the category which it has been assigned is appropriate for the purposes of section 7 (having regard to section 7(6)).

(3)

Where section 8(2) applies—

(a)

the category 1 regulator must make available to its regulatory committee such information as the committee may require to prepare an annual report under this section,

(b)

the report must include such information as the committee considers relevant about—

(i)

the committee’s internal governance arrangements, and

(ii)

the relationship between the committee and the regulator’s governing body, and

(c)

the regulatory committee must involve the governing body of the regulator in the preparation of the report.

(4)

When preparing an annual report, a category 1 regulator, or where section 8(2) applies, its regulatory committee must consult the independent advisory panel of the Commission.

(5)

A category 1 regulator, or where section 8(2) applies, its regulatory committee, must—

(a)

publish its annual report by such electronic means as the regulator (or regulatory committee) considers appropriate, and

(b)

send a copy of its annual report to the Lord President,

as soon as practicable after the end of the reporting year to which the annual report relates.

(6)

In this section—

“conduct complaint” is to be construed in accordance with Part 1 of the 2007 Act,

“regulatory complaint” is to be construed in accordance with Part 1 of the 2007 Act,

“reporting year” means, in relation to a category 1 regulator, a 12 month period that coincides with the regulator’s financial year.