Northamptonshire Law Society Magazine Winter/Spring 2021

Northamptonshire Law Society Bulletin www.northamptonshirelawsociety.co.uk Winter/Spring 2021

Northamptonshire Law Society Published by: Unit 27a, Price St. Business Centre, Price St., Birkenhead, Wirral, Merseyside, CH41 4JQ Tel: 0151 651 2776 simon@eastparkcommunications.co.uk www.eastparkcommunications.co.uk

Contents

Winter/Spring 2021

5 The President Writes 6 Council Member Report; Anti-Money Laundering AML - Linda Lee 9 Returning to work and employee mental health

Managing Editor - Carolyn Coles

12 Articles by Euan Temple:

Advertising - Simon Castell

Data Protection “Adequacy” or not?

Design - East Park Studio

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Brexit – are you prepared? Parallel Trade: key points

Accounts - Tony Kay

15

Online harms: UK government confirms new Online Safety Bill

Key Account Manager - Denise Castell

Media No. 1111 Published March 2021

16 COVID-19 vaccination – what every employer needs to know

Legal Notice

20 BRI - Fit, Feasible and Fair?

© East Park Communications Ltd. None of the editorial or photographs may be reproduced without prior written permission from the publishers. East Park Communications Ltd would like to point out that all editorial comment and articles are the responsibility of the originators and may or may not reflect the opinions of East Park Communications Ltd. Correct at time of going to press.

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EAST PARK COMMUNICATIONS Ltd.

Bulletin

22 Bell vs Tavistock: Does informed consent stand in the way of autonomy?

25 Landmark Planning: A Clearer View of Future Plan 29 And Finally… - Carolyn Coles 30 Top 10 compliance mistakes and how to avoid them

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Acting for Seller and Buyer –

The Classic Conveyancing Conflict Lorraine Richardson provides a reminder of conflicts of interest in conveyancing, focusing on one of the key areas where risk can arise: acting for both the buyer and seller in a transaction.

Conveyancing solicitors have got more to worry about than conflicts, haven’t they? It might seem that way, but avoiding conflicts of interest is an ongoing professional duty. Also, I would suggest that the current upheaval makes conflicts more likely, and thus more of a risk for conveyancing firms.

Solicitors should think carefully about whether their firm should act for seller and buyer in the same transaction. This article is written from the perspective of conflicts in conveyancing for solicitors. Licensed conveyancers are governed by a different conduct and conflicts regime.

Anyone considering conflicts of interest should remember that an actual conflict of interest is not the requirement. The purpose of the Code of Conduct is to avoid conflicts arising in the first place. This is why solicitors must always be looking out for a “significant risk” of a conflict. A significant risk is sufficient for the solicitor to decline to act. It may be a cliché, but prevention is better than cure: avoiding a conflict in the first place is far better than trying to clear up the mess if a conflict arises.

The reason that identifying a potential conflict and avoiding it is so important is because if a conflict between clients arises during the transaction and the solicitor concludes that they are unable to continue acting, they should inform the clients accordingly, and cease to act. The solicitor should also advise the affected clients to seek legal advice elsewhere and will no doubt lose the costs on the file.

When considering whether it is appropriate to act for the seller and buyer in the same transaction, some solicitors will apply the following criteria: • the clients are established clients of the firm • separate fee-earners act for the seller and buyer; and • each fee-earner is based in a different office These may look familiar. These criteria are, in fact, the exceptions to the prohibition for acting for seller and buyer which applied in the 2007 Solicitors’ Code of Conduct. They have not been applicable since 2011. While they might be helpful indicators when considering the overall risk of conflict, they are not in themselves exceptions which allow the firm to act.

I suggest the starting point is that the firms do not act for the seller and buyer in the same transaction. The fee-earners involved should try to justify to themselves why they should act, and note their detailed considerations on the file. If the firm decides it can act in this situation, it should then obtain the informed consent in writing from all affected clients, to allow the firm to act.

But acting for the seller and the buyer in the same conveyancing transaction should be an exceptional event.

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It is necessary to ensure that it is in each client’s best interests for the firm to act. If a firm concludes that it should act for seller and buyer in the same transaction because it does not want to lose both sets of legal fees, this is a classic example of the firm putting its own interests above those of the clients.

It is fair to say that solicitors’ firms have vastly differing approaches to matters of conflicts of interest: some firms take conflicts of interest very seriously and have a clearly defined process to follow, while others give this little or no thought.

Whatever the attitude of the firm to conflicts, I suggest that all staff in a conveyancing team, of whatever experience, should be encouraged to trust their instincts in relation to conflicts and report any concerns to a more senior member of their team.

‘Knowing what you don’t know’ is a powerful risk management tool when it comes to conflicts.

Lorraine Richardson is an experienced property solicitor, author and speaker, and Managing Director of property law training provider, Adapt Law Ltd (www. adaptlaw.co.uk)

Northamptonshire Law Society Officers & Council Members 2020 Sharine Burgess

Deputy President Jabeer Miah

Immediate-Past President Oliver Spicer

Honorary Secretary Ika Castka

Honorary Treasurer Afua Akom

Constituency Member & Past President Linda Lee

Council Members: David Browne Laura Carter Michael Orton Jones Karen Shakespeare Euan Temple - Past President Edward St John Smyth- Past President Afua Akom Aimee Johns Amy Leech Lynsey Ward

Co-opted Members:

Sarah Franklin Maurice Muchinda

Society Manager Carolyn Coles

Northamptonshire Law Society The Gatehouse, Stable Lane Pitsford Northampton NN6 9NG Tel: 01604 881154 Email: Sec.nls@outlook.com All Council members should in the first instance be contacted through the Society Manager.

Writes...

Northamptonshire Law Society

President

The President

Welcome to the first edition of the Bulletin this year.

Most of us will be glad to put the last year behind us. It was the most challenging year in my lifetime and one that we will never forget. However, despite the challenge it was also a time of great opportunity. A year in which our legal community was able to adapt and innovate, to implement new ways of working and to continue to deliver legal services at the very highest standard. I witnessed first-hand what can be achieved when we all pull together. There is still some way to go before the restrictions are lifted but I see this year as an opportunity to build on the hard work last year and, despite the crisis, I believe that we will emerge stronger and better for it.

There has been a lot of activity over the few months. A big thank you to Linda Lee for delivering the hugely entertaining, and at times quite scary, webinar “Regulation, the new code and how to avoid being struck off!”.

This was a joint event with Leicestershire Law Society and was very well attended. We are planning future joint events and, as always, if you have any suggestions for future events or training please let me know NLS held The Great Legal Quiz on 10 December. The event raised £425 with all proceeds going to the Midland Legal Support Trust who support charitable and other agencies providing free advice, casework and r epresentation to those in need in our community. A huge thank you to our eminent quizmasters Linda Lee and Michael Orton-Jones who did a fantastic job and to Carolyn Coles for organising the quiz so brilliantly. A big well done to the winners Sarah Franklin Solicitors and thank you to all the firms who participated. I feel a rematch this year is warranted!

Unfortunately, the Council took the decision to cancel the NLS Annual Awards Dinner last year. All nominations will be carried over to this year and we will be inviting nominations for this year in due course. The awards showcase the immense talent in our legal community and recognise excellence and outstanding achievement in the following categories:

• Solicitor of the Year

• Young Lawyer of the Year

• Community person of the Year

• Firm of the Year

A date is yet to be set, for obvious reasons, but we do hope to hold the event later in the year at a time when it is safe for us to all get together.

More information to follow.

And finally, could I say a massive thank you to Carolyn Coles our Society Manager for all her work over the last year in keeping our Society running so efficiently, providing information to our members and organising events and training despite the pandemic. On behalf of the Council, thank you Carolyn we are all grateful for your contribution.

Happy reading!

Sharine Burgess

- President Northamptonshire Law Society

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5

Anti-Money Laundering AML

Council Member - Report -

By Linda Lee Richard Feynman, the great theoretical physicist said, “If I could explain it to the average person, it wouldn’t have been worth the Nobel Prize.” My first reading of the Legal Sector Affinity Group Anti-Money Laundering Guidance for the Legal Sector 2021 (AMLG) published on 2 February 2021 by the Office for Professional Body Anti-Money Laundering Supervision (OPBAS), made me want to start looking up Feynman’s development of quantum electrodynamics for light relief.

At over 200 pages , the guidance (now submitted for Treasury approval) undoubtedly increases the burden placed on practitioners following the Money Laundering and Terrorist Financing (Amendment) Regulations 2019. The guidance requires careful study and thought by all firms.

All solicitors and firms will need to consider how the AMLG applies to them and make any necessary changes to their current processes and procedures.

The areas to be considered include more detailed guidance/requirements in relation to policy controls and procedures including firm wide risk assessment and individual matter risk assessments, analysis of source of funds and separately source of wealth, training requirements, and understanding how AML technology operates to ensure it is used more effectively.

The AMLG is a response to the Money Laundering and Terrorist Financing (Amendment) Regulations 2019 which came into force on 10 January 2020.

Firms should be reminded that the Regulations expanded the definition of tax advice to include providing material aid, or assistance or advice on tax affairs of other persons including where provided through a third party. The Solicitors Regulation Authority (SRA) has provided guidance which is a good starting point for firms to consider if they are caught by these provisions and if they need to register with the SRA although the deadline for registration ended in January 2021 it would seem sensible to register late than not at all.

The SRA guidance makes it clear that there are circumstances where those practising for example, family, probate, employment, and personal injury will be engaged in transactions documentation and advice that comes within scope of these provisions. Despite the guidance, individual cases and some sets of circumstances will undoubtedly

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throw up difficult situations and the way forward may be unclear. This is especially the case where issues of client privilege may arise or protection for information acquired in the ordinary conduct of litigation by legal professionals . For example, if a family or employment lawyer acquires information about a scheme that bears the hallmarks of tax evasion is this privileged for the purpose of the money laundering regulations? Chapter 13 of the AMLG is particularly helpful. Litigation privilege would include any step taken in litigation, from the issue of proceedings and the securing of injunctive relief or a freezing order up to its final disposal by judgment.

Each incident must be considered carefully and the circumstances of how and when the solicitor acquired the information or belief will be crucial. If the situation arises it may be prudent for the solicitor to obtain Counsel’s opinion.

The SRA also published ‘Sectoral Risk Assessment - Anti-money laundering and terrorist financing’ on 28 January 2021.

The SRA draws on the National Risk Assessment 2020 (NRA) published in December 2020. This highlights latest trends and a fresh upturn of crime following Covid 19. It confirms that the conveyancing sector is still high risk. There is increased emphasis and resource focused on the threat posed by the corporate and trust sector. The SRA notes that the creation and operation of corporate structures, can be used to invest and transfer funds to disguise their origin and lend layers of legitimacy to their operations. There are planned reforms to Companies House and Limited Partnership structures to further mitigate against some of the identified risks and advance beneficial ownership transparency.

The SRA produce a risk assessment of law firms, to help firms to better understand the scale and types of risks they are exposed to. The SRA requires firms to consider the overall sectoral risk assessment as a part of each firm’s firm-wide risk assessment and reference here by firms to the NRA can be helpful.

The SRA investigate firms if they receive information about a firm, but they also carry out a, ‘proactive supervision programme’. When the SRA visits, they will ask to see firms’ written risk assessments and policies, procedures and controls. A firm’s risk assessment is to assist in the setting of appropriate policy and should not be disclosed to

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clients, or third parties, because it could be useful to those who are seeking to launder money. Having a risk assessment that reflects the reality of the matters handled by a firm is regarded by the SRA as an indication that suitable attention and thought has been given to the policies adopted by the firm. Firms should avoid any suggestion where templates and proformas have been copied that firms have not given thought and attention to the relevant issues.

The guidance sets out the risks a firm may face from the Covid 19 pandemic, the use of financial technology (such as fund transfer systems and crowdfunding platforms), the legal status of Cannabis and the wider economic pressures.

SRA investigations have revealed that the most common weaknesses are inadequate checking of the source of funds, lack of independent audits, poor screening of staff and inadequate matter risk assessments. The SRA also observed that whilst larger firms have greater resources, the use of compliance teams to handle risk assessment may mean that fee-earners working on a case are less alert to signs that should trigger investigation as a matter progresses. The SRA noted that smaller firms can be less aware of the risks around Politically Exposed Persons. It was also concerned that there was too much reliance on external help with compliance by all types of firms. It expressed concern that policies may be drafted by external experts with little knowledge of the firm or there was little understanding of the technical support a firm used, thus risks were not properly understood or dealt with.

The SRA also listed the highest areas of risk for firms. It will not be a surprise that conveyancing (given that property is an asset preferred by criminals) or the use of a client account to legitimise the source of money or tax advice were considered high risk areas. However, creating or managing trusts and corporate structures and family law may not receive consideration as a potentially a high-risk area. The guidance also sets out information relating to transaction, client and delivery channel risks.

There will be increasing focus on AML and firms should take all the necessary steps to ensure they are complying, although in the current climate, this will be an unwelcome and costly exercise for all.

Transparency and comparison websites

The SRA responded by introducing the Transparency Rules in 2018. Price information had to be displayed in respect of conveyancing, probate, motoring offences, employment tribunals (claims for unfair or wrongful dismissal), immigration (excluding asylum), debt recovery (up to £100k) and licensing applications for business premises. Plans to extend into other areas such as family law were postponed.

The SRA considered compliance with these Rules a priority and assiduously inspected firms’ websites. It has now taken regulatory action where there has been non-compliance, fining and rebuking firms and even putting restrictions on firm’s authorisation.

After initially observing poor levels of compliance it concluded that the majority of firms are now complying.

This view contrasted with that of other

However, the CMA desire for the usage of comparison web sites has not materialised. The SRA has encouraged the development of comparison websites, providing free data to any company interested in setting up such a scheme.

Some years ago, the SRA promoted an entrepreneur at its annual conference.

He was keen to develop his comparison website and could not understand why firms would not want to participate. Since then, various comparison websites have been set up but there appears to have been little engagement from the profession and no evidence of impact on the market.

Pressure has been exerted on the SRA, by the Legal services Board, the Legal Services Board Consumer Panel and the CMA itself which reviewed the effectiveness of its 2016 report and concluded that although there had been progress, further work was required to reinforce initiatives to develop DCTs. In February 2021, the SRA took a step further with its announcement that comparison websites and quality indicators would be a new ‘hot topic’.

It set out its plans to work with CILEx Regulation and the Council for Licensed Conveyancers. It will run two pilot schemes, one on conveyancing and the other on employment law. The pilot schemes will last for at least six months and the SRA are seeking firms to work with comparison websites to trial

approaches. Amongst it aims are to increase law firm engagement with customer reviews and comparison websites and increase the number of consumers accessing online information, beginning with using and leaving online reviews.

In readiness, the SRA has provided advice on engaging with online reviews.

In the guidance, it sets out the business case for firms engaging with online reviews. It encourages solicitors to be ‘authentic’ and to engage positively with bad reviews, setting outs suggested responses and reminding solicitors of their regulatory duties not to breach client confidentiality in any such response.

Given the difficulties many firms are facing in the current climate, it is to be hoped that the regulators, temper their ambitions with a level of realism as to how much regulatory change the profession can cope with and indeed afford. It is hard not to question the CMA belief that consumer experience will be improved by its tactics to promote through proxies such as testimonials or price indicators -indeed the evidence so far is that the opposite has been the case with prices having risen over recent years and the number of firms carrying out conveyancing has reduced rather than increased!

Linda Lee Council Member Linda Lee has been Council Member for Leicestershire, Northamptonshire and Rutland since 2003. She is a past President of the Law Society of England and Wales and is the Chair elect of the Professional Indemnity Insurance Committee and a member of the Policy and Regulatory Affairs Committee, Regulatory Processes Committee and Access to Justice Committee. She is current Chair of the Solicitors Assistance Scheme. Linda is an experienced litigation solicitor and is a Consultant at RadcliffesleBrasseur where she specialises in solicitors’ disciplinary, compliance and regulatory work. She can be contacted by email at: lindakhlee@aol.com

i https://www.sra.org.uk/globalassets/documents/solicitors/firm-based-authorisation/lsag-aml-guidance.pdf? version=4903b4 ii https://www.legislation.gov.uk/uksi/2019/1511/made/data.pdf iii https://www.sra.org.uk/solicitors/resources/money-laundering/money-laundering/tax-adviser-guidance iv see the deadline reminder at https://www.sra.org.uk/sra/news/press/tax-advice-money-laundering. l v Bowman v Fels [2005] EWCA Civ 226 see exemption from disclosure under s330(6) of Proceeds of Crime Act 2002. Where information came Failure to disclose: regulated sector (1)A person commits an offence if each of the following three conditions is satisfied.

(2)The first condition is that he— (a)knows or suspects, or (b)has reasonable grounds for knowing or suspecting, that another person is engaged in money laundering.

(3)The second condition is that the information or other matter— (a)on which his knowledge or suspicion is based, or (b)which gives reasonable grounds for such knowledge or suspicion, came to him in the course of a business in the regulated sector.

(4)The third condition is that he does not make the required disclosure as soon as is practicable after the information or other matter comes to him.

(5)The required disclosure is a disclosure of the information or other matter— (a)to a nominated officer or a person authorised for the purposes of this Part by the Director General of the National Criminal Intelligence Service; (b)in the form and manner (if any) prescribed for the purposes of this subsection by order under section 339.

(6)But a person does not commit an offence under this section if— (a)he has a reasonable excuse for not disclosing the information or other matter; (b)he is a professional legal adviser and the information or other matter came to him in privileged circumstances; (c)subsection (7) applies to him. vi https://www.sra.org.uk/sra/how-we-work/reports/aml-risk-assessment vii Legal services market study Final report December 2016 viii SRA Report May 2019 ix https://www.sra.org.uk/sra/news/press/2020-press-release-archive/transparency-research-2020 x https://www.legalfutures.co.uk/latest-news/sra-transparency-rules-compliance-improving xi https://www.gov.uk/cma-cases/review-of-the-legal-services-market-study-in-england-and-wales xii https://www.sra.org.uk/home/hot-topics/comparison-websites xiii https://www.sra.org.uk/solicitors/guidance/engaging-online-reviews

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Northamptonshire Law Society

In 2016, the Competition and Markets Authority (CMA) published its report into Legal Services. . It was made clear that there was a desire for there to be a new way in which ‘consumers’ found solicitors.

It was noted with some dissatisfaction that the majority of clients had found their solicitor as a result of personal recommendation. The CMA ambition was to make consumers better informed about price and their choice of service provider (and by driving competition lower prices).

The CMA recommendation was for all firms to publish information on price, service, redress and regulatory status and for the regulator to promote the provision of information on quality.

It wanted this information to be available not just to consumers but also to digital comparison tools (DCTs) and other intermediaries. It made it clear that in its opinion the legal services market needed comparison websites.

commentators, such as DG Legal which conducted its own review of websites and reported that the level of non-compliance in the web-sites it surveyed was at around 90%, although it agreed with the SRA that the majority of firms were now publishing some information. The SRA has stepped up its enforcement work and has extended this to working with consumer groups to encourage them to report non-compliance to the SRA.

Returning to work

and employee mental health

By Amy Leech early on to understand any concerns.

The employee viewpoint

What the above demonstrates is that there isn’t a one size fits all type of employee or mental health state relating to returning to work, for example, after a period of furlough leave. Employers need to be alive to this in order to manage and look after its workforces’ mental health as a whole.

For many employees, the thought of returning to the workplace probably comes with mixed emotions.

Some employees may be happy to return to work as it indicates job security and helps mitigate against any financial strains that come with furlough pay.

As a result of returning to work, those employees worried about finances and whether their job is safe may feel better and more in control of their livelihoods.

Employees may welcome a change of scene and the social aspect of the workplace, especially from a wellbeing point of view.

However, for most, the end of lockdown and furlough leave will not be a choice.

Some employees may feel they are being asked to return to the workplace too soon. Some may feel it is too late.

Others may have a whole host of anxiety-based feelings and frustration.

Employees who have to travel on public transport or have caring responsibilities at home may feel unsafe and will look to their employer for support.

It is likely that many employees will want to strike a balance between coming back to work and managing their personal lives more. Furlough leave gave many individuals the chance to reflect on their working life and to rediscover their personal life and passions outside of work. It allowed employees to gain some headspace from their normal busy working life and for some, this may have been the mental health recuperation they needed. These employees may be worried about returning to work and how it will impact their mental health if their schedules become busy and hard to manage again. Employers need to be alive to this and start having conversations with returning employees

Working parents are also likely be concerned about the precarious childcare position they find themselves in. Said employees are likely to be concerned about the impact of school/nursery bubbles collapsing and how this will impact on their ability to work.

The employer viewpoint

When calling employees back to work, employers will have legitimate business reasons for them to be there. Many employers were negatively impacted by the pandemic and will want to get their businesses moving again as quickly as possible.

Senior people within businesses will have been affected by the pandemic – and them sharing their experiences can be a very effective way of connecting with the wider workforce, especially when discussing mental health issues.

Some employers will have had employees working constantly throughout the pandemic, with others furloughed.

These employers are likely to be keen to integrate all employees again to ensure there is no separation or divide between the two populations. It should be recognised that both have played vital but different roles in helping the business react and survive the pandemic.

The flexibility that has been shown by the employer and employees alike is likely to lead to an increase in flexible working requests. The employer may want to open the dialogue in this respect to demonstrate that it is supportive of flexibility and the benefits it can bring from a mental health perspective.

What can employers do?

Employers should approach any return to work from furlough leave the same way

Amy is an Associate at Shoosmiths LLP specialising in employment law.

Amy is passionate about promoting mental health and wellbeing in the workplace and undertakes the role of a Mental Health and Wellbeing Champion at Shoosmiths.

they would approach a normal return to work (for example, after maternity leave or a long term sickness absence).

Communication will be key and employers should ensure they are talking to employees as early as possible ahead of their return. Employers should explain what measures are in place in the workplace to ensure it is safe and also listen to any concerns their returning employees might have. Things will have inevitably changed, and this should be communicated. The pandemic has forced people to be resilient, but it does not change the fact that people generally do not like change and that uncertainty can increase anxiety levels. In a workplace, it is imperative that employees are aware of the new rules and understand what is expected of them.

Most employers have a range of resources already in place to look after employee wellbeing. Examples include employee assistance programs, mental health champions and/or first aiders within the workplace. Employers should locate the details of these resources and share them with employees returning to work and ensure that they are easily accessible. In the event that no such resources exist then employers will need to ensure that management are aware of their obligations to support their teams and/ or consider introducing new initiatives to support their workforce’s mental health.

Any concerns or worries about the return to work should be addressed at the outset to prevent them from spiralling out of control or going unnoticed and consequently unaddressed by the employer down the line. Employers need to be reflecting on their workplace culture and their openness. The more welcoming a culture, the more likely employees will want to return to the workplace and will feel safe and comfortable to do so.

Having an engaged workforce where people feel safe and supported will greatly improve productivity.

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Northamptonshire Law Society

With the second lockdown now over and the tier system fully in play, some employers are finding themselves able to open and trade again. This has allowed some employers to bring their workforce back into the workplace – some of which may have been off work on furlough leave since the pandemic began in March 2020. There are other employees that have been in and out of work and face very uncertain futures.

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Articles by Euan Temple

Northamptonshire Law Society

Data Protection “Adequacy” or not?

With Brexit on the horizon, potential changes to data transfer laws raise the spectre of disruption to Personal Data transfers from the European Economic Area (EEA) to the UK. From 1 January 2021, the UK will be considered a third country outside the EEA for the purposes of the General Data Protection Regulation (EU) 2016/679 (GDPR).

Ahead of this deadline, businesses should start thinking pragmatically about Personal Data transfers from the EEA to the UK to ensure a frictionless transition in case a European Commission ‘Adequacy Decision’ is delayed, or worse, not granted at all.

So what is ‘Adequacy’?

European Commission ‘Adequacy Decisions’ constitute findings by the Commission that the legal frameworks and data protection regimes of countries, territories, sectors or international organisations outside the EEA are ‘ essentially equivalent’ to those established by the GDPR and provide ‘adequate’ protection for individuals’ Personal Data.

The UK is currently undergoing an Adequacy Assessment.

If an Adequacy Decision is granted in respect of the UK prior to 1 January 2021, Personal Data will be able to continue to pass freely between the UK and the EEA. If not, EU-based organisations will be required to implement additional appropriate safeguards in order to transfer Personal Data from the EEA to the UK. By failing to act, companies could face enforcement action of various kinds (including, in the case of very serious breaches, maximum penalties of the greater of €20 million or 4% of annual global turnover).

Adequacy Decisions take time. The fastest assessment carried out to date, for Argentina, took 18 months. Whilst the Political Declaration - which sets out the framework for the future relationship between the EU and the UK - implies that such a decision may be reached for the UK before 31 December 2020, this appears increasingly unlikely.

The reality is that it could be upwards

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of two years before the UK assessment is complete and a Decision regarding Adequacy is made.

The 20 million Euro question: how likely is an ‘Adequacy Decision’ for the UK? On the face of it, the ‘spirit’ of the GDPR is encompassed in the Data Protection Act 2018 (DPA18) and the UK GDPR. However, there are some important challenges.

A key obstacle is UK law enforcement’s reliance on mass surveillance under the Investigatory Powers Act 2016.

This was most recently highlighted when the European Court of Justice (ECJ) ruled in October 2020 (in joint cases C-511/18, La Quadrature du Net and Others, C-512/18, French Data Network and Others, and C-520/18, Ordre des barreaux francophones et germanophone and Others) that mass surveillance by national security agencies is unlawful.

The US also encountered this when the Court of Justice of the European Union (CJEU) invalidated the EU-US Privacy Shield adequacy decision on this basis earlier in 2020 for almost exactly the same reason.

Therefore, even if an Adequacy Decision is granted, legal challenges by data privacy activists may well be made, with subsequent invalidation a possibility.

On the other hand, some comfort can be taken from the fact that Japan has similar (if not more pervasive) surveillance laws in place, and was awarded Adequacy in January 2019.

The ‘immigration control’ exemption in the DPA 2018 may also cause concern.

This exemption allows the UK government to use personal data without a data subject’s consent, for the purpose of ‘effective immigration control’.

However, in 2019, UK citizens’ rights groups lost a challenge against the exemption in the High Court of England and Wales on the basis that the DPA 2018 was appropriate and the safeguards were sufficient to remedy any errors.

Nonetheless, this was a decision made under the jurisdiction of England and Wales, and not European law. The EU may well take a different approach.

If no adequacy, then what?

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Assuming that no Adequacy Decision is granted in respect of the UK before the end of the transition period, ‘business as usual’ transfers of Personal Data between the EEA and the UK require swift attention.

It is the responsibility of businesses making or planning to make such transfers to consider implementing appropriate safeguards. Some examples are set out below: Standard Contractual Clauses (SCCs).

SCCs are currently the most commonly used and cost-effective safeguard to ensure adequate protection for Personal Data transferred outside the EEA. The SCCs are standard sets of contractual terms which are entered into by importers and exporters of personal data. They are approved by the European Commission and ensure that any transfers comply with the GDPR’s requirements regarding international Personal Data transfers.

However, SCCs are currently the subject of review and debate and the European Commission has recently published new draft sets of SCCs which are open for public consultation.

The proposed new SCCs adopt a flexible, modular approach and significantly improve on the current SCCs. The new SCCs should make international personal data transfers much easier (at least after the initial administrative hurdle is cleared).

In addition, in the Schrems II case in July 2020 (C-311/18), the CJEU ruled that SCCs (and other transfer tools) could continue to be used to transfer Personal Data outside the EEA if ‘additional safeguards … that supplement the [SCCs]’ in order ‘to compensate for the lack of data protection in a third country’ are implemented, if required.

Such supplementary measures will be required if, following an assessment of the laws and practices of the third country of destination of the transferred Personal Data, anything is revealed that might impinge upon the effectiveness of the appropriate safeguards of the transfer tools relied upon.

The European Data Protection Board

However, the Guidance also notes that contractual and organisational measures alone are unlikely to be sufficient to demonstrate essential equivalence, and, in some cases, only technical measures (e.g. encryption) will be appropriate.

The Guidance also notes that there are also certain circumstances (such as transfers of non-encrypted Personal Data to cloud providers in certain third countries) where even technical supplementary measures are unlikely to be sufficient to provide adequate protection for Personal Data transferred from the EU. Binding Corporate Rules (BCRs).

For multinational companies, BCRs are a tailor-made alternative to the impracticalities of implementing numerous SCCs between different group companies. Through legitimising ex-EEA as well as intra-group transfers, they offer an effective way for data-reliant organisations to perform hundreds of Personal Data transfers on a daily basis.

There are 33 companies whose BCRs the ICO already authorised before 25 May 2018. All of these BCRs are automatically eligible for UK BCRs. In order to make the transition to UK BCRs,

EFT564 18.12.20

the company simply needs to create a stand-alone version of their EEA BCRs, revise them in accordance with the ICO’s Transition Table and publish their resulting UK BCRs by 1 January 2021.

The UK BCRs must then be provided to the ICO on or before the due date of the next annual update.

After 1 January 2021, the ICO will contact each of these 33 companies to confirm the status of their UK BCRs. If the EEA BCRs are not transitioned into UK BCRs, the ICO may revoke the UK BCR authorisation.

Explicit consent and other derogations.

In the absence of an Adequacy Decision or appropriate contractual and legal safeguards, a transfer of Personal Data from the EEA to the UK may still be possible if one of the derogations set out in Article 49 of the GDPR can be relied upon.

The most commonly relied upon derogations include the obtaining of explicit consent from data subjects, the fact that the transfer is necessary for the performance of a contract between the data subject and the controller, and circumstances where the transfer is necessary for reasons of important public interest.

However, whilst more straightforward, firms should consider the EDPB’s position on the GDPR’s derogations, which highlights the fact that the derogations may only be relied upon in limited circumstances.

Confused? Don’t worry—you are not alone!

We are monitoring developments and market practice to enable us to provide advice on how best to achieve personal data transfers to the UK in various circumstances.

What does this uncertainty mean for businesses?

On the basis that an ‘Adequacy Decision’ by the European Commission may not be forthcoming, businesses should act now to consider how best to ensure that personal data can continue to flow from the EEA to the UK from 1 January 2021.

At best, the UK will receive an Adequacy Decision. At worst, inaction threatens significant disruption to the free flow of Personal Data from Europe to the UK. If Brexit reaches an inadequate conclusion, don’t let your business suffer the same fate!

Conclusion As we reach the end of an unprecedented year, the UK is still not in a clear position with regards to Brexit and its new relationship with the EU. Businesses must therefore continue to be mindful of this shifting landscape and stay up to date with the evolution of Data Protection rules. In particular, businesses should ensure that the transfer of any Personal Data from the EEA into the UK has appropriate safeguards. If that is by way of Standard Contractual Clauses, it’s important they are fully aware of the anticipated Guidance that is due to emerge, which may call for amendments to existing contracts.

Brexit – are you prepared? Parallel Trade: key points

Parallel Trade is the cross-border sale of goods within the EU by traders outside of the manufacturer’s distribution system without the consent of the manufacturer or Intellectual Property (IP) holder.

The commercial rationale underlying parallel trade is the ability to buy goods in one EU Member State at a relatively low price and subsequently to resell them in another Member State where the price is higher. In the case of pharmaceuticals, this is incentivised by the considerable variations in drug prices between EU/EEA Member States.

The Exhaustion of Intellectual Property Rights constitutes one of the limits of intellectual property (IP) rights. After a given product has been sold under the

authorisation of the IP owner, the reselling, rental, lending and other third party commercial uses of IP-protected goods in domestic and international markets is governed by this important principle.

What is the EU Commission’s positon on Parallel Trade?

The EU Commission’s position is that parallel imports increase price competition as the import of goods from a country with lower prices forces sellers in the country of destination to reduce prices. This is the fundamental principle underpinning the single market.

This in turn helps consumers.

It is on this basis that the Commission has consistently found pharmaceutical

companies to have infringed competition law by preventing parallel trade.

Has the Court of Justice of the EU (“CJEU”) taken a different position to the EU Commission on parallel trade?

The CJEU has sometimes taken a more nuanced approach to the Commission, seeking to balance the competing interests of the pharmaceutical sector and national health systems. However, its guiding principle has been the same as the Commission: maintaining the single market, including in relation to the pharmaceutical sector.

This applies not only under the competition rules, but also to legal considerations such as the enforcement

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(EDPB) has recently released Draft Guidance (again, currently subject to public consultation) which explains what appropriate supplementary measures might include. The Guidance notes that technical, contractual and/or organisational measures can be adopted to meet the standards required, and often a combination of such measures will be appropriate.

of national intellectual property rights, where the application of the principle of Community Exhaustion of Rights underpins the free movement of goods across national borders, after they have been placed on the market.

Northamptonshire Law Society

Are restrictions of resales permissible under competition law?

Explicit bans on exports in distribution agreements are likely to infringe the prohibition on anti-competitive agreements (Article 101(1) TFEU). In Sandoz v Commission (1990) the CJEU considered that the sending of invoices by a supplier bearing the words “export prohibited” breached EU competition rules. It was an Export Ban. Are stock management programmes viewed more favourably?

Stock management programmes (“SMPs”) ensure that the correct quantity of product is available to meet the needs of individual markets and can reduce excess stock holding on a national level.

The competition implications of SMPs were assessed in the General Court’s judgment in Bayer (Adalat) (2000), which was subsequently upheld by the CJEU. This case concerned the parallel export of Bayer’s ‘Adalat’ product by French and Spanish wholesalers to the UK. Bayer implemented an SMP under which French and Spanish wholesalers would be supplied only with a quantity of Adalat calculated on the basis of orders made in the preceding year.

The EU Commission found that Bayer had entered into an agreement with the wholesalers to prevent exports to the UK, thereby infringing Article 101 TFEU. However, the General Court held that there was no agreement on which Article 101 could ‘bite’, on the basis that there was no genuine ‘concurrence of wills’ between the parties because, rather than agreeing with Bayer, the distributors had objected to Bayer’s policy of reducing the quantity of drugs available for parallel trade. An SMP may have an impact on parallel trade, but it must be imposed, unilaterally, by the manufacturer, without seeking (or receiving) agreement from national distributors.

How is dual pricing treated under competition law?

Typically dual pricing schemes involve the supply of products for sale in a particular Member State at a given price, suitable to pricing and conditions in that country, but impose a supplement if the products are to be sold elsewhere in the EU/EEA. Dual pricing strategies have been the

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subject of a long-running CJEU case concerning GlaxoSmithKline’s (“GSK”) Spanish distribution model. GSK originally notified its dual pricing model to the Commission for approval (a procedure that is no longer available).

The Commission’s initial Decision was that the agreement amounted to an Export Ban and so restricted competition by object.

This assessment was overturned by the General Court, but was reinstated by the CJEU in GSK v Commission (Spain, 2009). However, the CJEU agreed with the General Court that the Commission had not properly considered whether the agreement could have benefited from an individual exemption under Article 101(3) TFEU, on the basis of benefits to research and development, even though the CJEU had found the agreement was a restriction by object.

When can a Dominant company refuse to supply parallel traders?

In Lelos v GSK (Greece, 2008), the CJEU held that it might be permissible for Dominant companies to refuse to meet orders in certain circumstances. The Court suggested that manufacturers may refuse orders from wholesalers that are ‘out of the ordinary’, threaten its own legitimate commercial interest and are essentially destined for parallel export.

What are the practical implications for Dominant companies engaged in parallel trade?

On the basis of Lelos v GSK it seems likely that Dominant pharmaceutical manufacturers can refuse orders from distributors that appear disproportionate to previous business dealings between them or to the projected requirements for the relevant national market.

But great care is needed in ensuring that all the requirements are met before supply is refused.

Is there as an overall position in relation to competition law and parallel trade?

Pharmaceutical companies adopt a variety of mechanisms to mitigate the effects of parallel trade. Insofar as these are in conflict with the single market objective of the EU/EEA, competition law has tended to take a strict approach and some of these approaches have been found to be unlawful.

Other strategies may work effectively if appropriately implemented and have tended to receive a more sympathetic hearing from the EU Court than the EU Commission.

What impact is Brexit likely to have on Parallel Trade to and from the UK?

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It remains to be seen what impact Brexit will have on parallel trade into the UK. If the UK remains inside the single market, pharmaceutical companies will almost certainly be unable to limit parallel trade.

However, if the UK ultimately withdraws from the single market, this may provide greater scope for limiting parallel trade between the UK and EU/EEA countries.

The UK left the EU at the beginning of 2020 and the transition period during which the UK is treated as if it was still a member of the EU is coming to an end on 31 December 2020, 11pm (UK time).

As of 1 January 2021, some of the parallel trade rules (i.e. the rules on importing and exporting IP protected goods) will change: • there will not be any change to parallel import rules for goods entering the UK from the EEA/EU. IP rights used in respect of goods legitimately put onto the market of the EEA/EU by the IP right holder or with the IP right holder’s consent will be considered exhausted in the UK. These goods can enter the UK. An IP right cannot be used to stop the import of these goods into the UK or their resale in the UK; • there will likely be a change to rules for goods exported from the UK into the EEA/EU. IP rights used in respect of goods legitimately put onto the market in the UK (including Northern Ireland) by the IP right holder or with the IP right holder’s consent may not be considered exhausted in the EEA/EU. The lack of ‘Exhaustion’ of IP rights means that there is a chance that these IP rights can be used to stop the distribution or resale of these goods in the EEA/EU. The IP right holder’s consent may be required to export such goods from the UK to the EEA/EU; • Check: * Are you an IP right holder?

Do you permit Parallel Exports from the UK into the EEA/EU? * Are you exporting goods for which a third party owns the IP rights? Do you need the IP right holder’s permission to export goods from the UK into the EEA/EU? The UK Government has already announced that it will review the

Exhaustion of Rights rules in the New Year and so these may change in due course.

UK-EU TRADE AND COOPERATION AGREEMENT, two website access references to draw down if so desired.

UK version: https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/948093/TCA_SUMMARY_PDF.pdf from EU dated 24 December 2020: https://ec.europa.eu/info/sites/info/files/eu-uk_trade_and_cooperation_agreement-a_new_relationship_with_big_changes-brochure.pdf

Online harms: UK government confirms new Online Safety Bill

Companies will be categorised into two tiers according to the size of their online presence and the level of risk posed on the platform. The long-awaited Online Safety Bill could also see online platforms being blocked in the UK if they do not abide by a duty of care to their users, particularly children and vulnerable people.

The legislation, which the Government will bring forward in 2021, means Ofcom can fine firms up to £18m or 10% of global turnover, whichever is higher.

Category 1 companies will likely include large household-name social media companies. As well as the duty to address relevant illegal content and content which is harmful to children, Category 1 companies will also be under a duty to take action against content which, while strictly legal, may be harmful. This will not a requirement of Category 2 companies.

The legislation will define content as harmful where: ‘it gives rise to a reasonably foreseeable risk of a significant adverse physical or psychological impact on individuals’ Category 1 companies will also be under a legal requirement to publish transparency reports on the measures they have taken to tackle online harms.

Companies will be able to fulfil their duty of care by complying with statutory codes of practice published by Ofcom. This will involve the implementation of systems and processes to improve users’ safety, such as specific user tools, content moderation, recommendation procedures, and reporting and redress mechanisms.

The UK Government is promising to publish interim Codes of Practice on terrorism and child sexual exploitation and abuse which, whilst voluntary, will help companies to understand the changes they need to make before the publication of the statutory Codes of Practice.

Larger web companies such as Facebook, TikTok, Instagram and Twitter that fail to remove harmful content such as child sexual abuse, terrorist material and suicide content could face huge

fines - or even have their sites blocked in the UK. They could also be punished if they fail to prove they are doing all they can to tackle dangerous disinformation /fake news about coronavirus vaccines.

Under the new rules, the most popular social media sites will be expected to set and enforce clear terms and conditions which explicitly state how they will handle content which is legal but could cause significant physical or psychological harm to adults.

access to key services. For serious failures of the duty of care, Ofcom has the power to entirely block a company’s services from being available in the UK. Earlier proposals also included the possibility of imposing criminal penalties on senior executives for failure to comply with the duty of care generally. While the government has chosen not to pursue such broad sanctions, it has decided to include a power for the government to impose criminal offences at a later date in secondary legislation where senior managers ‘fail to respond fully, accurately, and in a timely manner, to information requests from the online harms regulator’.

The power will expire after two years, and the government has said it will only exercise it if, on review of the new regime in the first year, it was apparent that industry hadn’t complied with their new information sharing requirements.

One measure announced to address concerns regarding freedom of expression is that companies will need to implement effective complaint mechanisms to enable users to object if they feel that their content has been unfairly removed. These new online laws will (probably) not cover articles or Under the new Online Safety bill, www.northamptonshirelawsociety.co.uk 15 comment sections on news websites. businesses will have a new ‘duty of care’ The new rules are designed to protect to protect children from cyberbullying, visitors to sites which allow users to post grooming and pornography. their own content or interact with others. The Government is also However there are also concerns the considering whether to make the legislation does not go far enough to promotion of self-harm illegal. protect legitimate news on the internet, and social media news feeds could be There is widespread concern that when censored by tech giants. news is accessed via social media or search, internet giants will try to protect themselves from draconian penalties by setting their algorithms to censor content which is controversial but legitimate, such as criticism of Government handling of the Covid crisis.

Critics also say that commercial organisations should not have the power to decide what news the public can read in social media news feeds, if it comes from legitimate news organisations.What are the sanctions for non-compliance?

Ofcom, the media and communications regulator, will be responsible for enforcing the rules and will have the power to impose fines for non-compliance, of up to 10% of a company’s annual turnover or £18 million (whichever is higher).

The regulator may also take enforcement action to require providers to withdraw

Conclusion The 10% figure for fines will clearly be the headline from this latest development, as this dwarfs even the most serious GDPR fines. Nevertheless, the full response is largely a confirmation of earlier proposals. Despite some delays, we now have some more certainty as to timings, with the introduction of a Bill promised in 2021.

There will still be much to be debated when the Bill is published. There are very serious questions of free speech and technical implementation to be addressed in relation to the Government’s intention to police lawful content, an avenue that the European Commission is avoiding in its plans for the Digital Services Act, further details of which were published on the same day.

This will put a post-Brexit UK out of kilter with the EU and give rise to billions of moderation headaches.

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EFT570 21.12.20

COVID-19 vaccination –

what every employer needs to know Northamptonshire Law Society

By Stuart Lawrenson

Will the Coronavirus vaccine solve the many challenges faced by employers or does it just inject further issues for employers to deal with?

To be vaccinated or not to be vaccinated?

That is the question …. being discussed in homes and in workplaces up and down the country. With the start of the roll out of the COVID-19 vaccine the idea that some sense of normality could return to the workplace in the near future became a more attainable vision.

Employers hardest hit by the pandemic, such as those in the health and care sector, had to digest the news of a vaccine and prepare for roll out in a matter of days. The Department of Health and Social Care asked care home providers to begin booking appointments for staff in to be vaccinated . However, early reports in the press indicated that even in the care sector there was a large percentage of employees who were reluctant to agree to be vaccinated.

There are numerous employment law issues facing employers who are eagerly awaiting the vaccination of their employees.

1. Can you require your employees to be vaccinated?

Employers who forcibly vaccinate their workforce could be committing criminal offences therefore mandatory vaccination programmes are not appropriate. However, what if the employer considered the vaccination of its workforce to be a reasonable management instruction? In some sectors where COVID-19 presents an increased risk of outbreaks, morbidity and mortality it is conceivable that employers may be able to argue that asking employees to take the vaccine is a reasonable management request; therefore, giving rise to disciplinary action on refusal.

However, such an instruction carries a risk to reputation and could jeopardize relationships with the workforce. It is doubtful that an employer would want to be labelled as one of the first to dismiss an employee on the grounds of a refusal

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to be vaccinated. Any such behaviour could lead to a breakdown in the employer/employee relationship and could ultimately lead to claims of a breach of trust and confidence/ constructive dismissal.

2. Could an employer’s mandatory vaccination programme risk discrimination claims?

Whilst much of the early debate has centred around individual choice, it must not be forgotten that requiring employees to be vaccinated could give rise to potential discrimination claims.

Employees may have medical conditions that prevent them being vaccinated and others, such as pregnant employees/ anyone trying to conceive and anyone with significant allergies are also advised against having the vaccine.

For others, a refusal might be based on the employee’s own religion and/or beliefs. All such matters would be considered to determine whether a refusal was ultimately reasonable from both an unfair dismissal and a discrimination perspective.

3. It’s not just employees an employer needs to be worried about It is not of course just employees who can spread coronavirus. If an employer allows contractors, visitors and other third parties on site this is likely to weaken an employer’s argument that all employees have to be vaccinated. As part of the communication strategy outlined below, employers should seek to understand the reasoning behind any refusal to be vaccinated and explore alternatives where possible.

4. How best to encourage a high percentage of employees to agree to being vaccinated?

It is expected that most employers will not look to impose a mandatory vaccination requirement on their employees, particularly as the government has made it clear there are no plans for the vaccinations to be mandatory.

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As an alternative to imposing a mandatory vaccination programme, employers are advised to adopt a clear communication strategy so that employees are well informed of the impact of COVID 19 on the business and are given all necessary information to make their decision. Where employers are under time pressure to confirm the number of vaccinations required, fast track discussions should be had with all employees. Such discussions should aim to secure a high percentage of consent whilst the opportunity to obtain vaccinations is still open to their business. This is particularly relevant at this early stage of the vaccination rollout, as it may be that employers only receive one opportunity to access the vaccination.

5. Can those workers who will not, or are unable to, be vaccinated be prevented from attending the workplace?

Understandably, employers will be concerned about the risk of COVID-19 returning to the workplace and continuing to spread amongst those who have not received the vaccination.

Careful consideration will need to be given as to whether it is appropriate to stop those who have not been vaccinated from entering the workplace.

Where taking the vaccine is seen to be a reasonable management instruction, it is possible that restricting access would be considered a reasonable precaution.

6. Can an employer make an offer of employment conditional upon an employee proving that they have been vaccinated?

Potentially yes. Whist the risks of discrimination claims (as referred to above) will remain, an employer will not face the possibility of claims of unfair dismissal from prospective mployees.

7. Vaccinations and GDPR considerations In order to contain and control COVID 19 within the workplace, many employers will be keen to record who has and has not received the vaccination. From a GDPR and privacy perspective, this creates its own challenges as the mere fact that someone has or has not received a vaccine will constitute special category data concerning health.

Employers will therefore need to ensure that any records are kept in accordance with GDPR and privacy laws. Employee Privacy Policies should be reviewed and updated accordingly.

Whilst it is hoped there is now light at the end of the tunnel, it will be some time before everyone will be vaccinated.

Employers should ensure that they maintain all of the practices which have become commonplace this year, such as social distancing, the use of PPE and hand sanitiser. Employers will need to continue to implement these practices for the foreseeable future, particularly where 100% take-up of the vaccine has not been achieved or where new starters have yet to receive the vaccine or employers do not require contractors or visitors to be vaccinated.

9. Need to review risk assessments Any risk assessments carried out in response to COVID 19 may require updating to refer to the prospect of being vaccinated to protect against the risks of the virus. As part of this internal review of risk assessments, employers should consider alternative measures to r eceiving the vaccine. This will be of particular importance to those who are unable to receive the vaccine including those who are pregnant, trying to conceive or prone to allergic reactions.

10. The ongoing need to be flexible Everyone has needed to be flexible since the start of the pandemic. As the country transitions optimistically to this new chapter, vaccine development will no doubt advance and availability will fluctuate. There are still many unanswered questions and employers will need to be flexible and ensure that they are fully aware of new developments.

Stuart Lawrenson is a partner at Shoosmiths specialising in commercial and employment law who provides “across the board” advice on contentious and non-contentious employment matters. He has an interest in the retail sector. He regularly advises on unfair dismissal, sex, race, age and disability discrimination claims; collective redundancy consultations, National Minimum Wage investigations and TUPE. Stuart is also a training specialist and regularly drafts and delivers bespoke client training. Recent advice has also focused on the effects of the pandemic including the Coronavirus Job Retention Scheme, employee mental health and homeworking.

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Northamptonshire Law Society

New starters may not have received a vaccine unless they fall into a group able to receive early vaccinations. Employers will also need to be aware that setting such a condition will almost inevitably lead to delays in the recruitment process.

8. The importance of maintaining current practices

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Northamptonshire Law Society

Fit, Feasible and Fair?

A company voluntary arrangement (“CVA”) is a rescue process which is used when a viable business is in need of a restructure but is unable to afford the associated costs and/or it is experiencing cashflow problems or creditor pressure and is in need of some breathing space.

A CVA is typically based on affordable monthly contributions from profits over a period usually between 3 and 5 years.

The monthly contributions are paid to the Supervisor of the CVA, a licensed insolvency practitioner (“IP”), which is held on trust for the benefit of creditors.

The trust funds are distributed to creditors during or at the end of the CVA. Compared to other insolvency processes, there is very little legislation for CVAs. The proposed terms of a CVA are set out in a bespoke proposal and if approved by the required requisite of creditors, the terms are legally binding on all creditors.

In order for creditors to consider a CVA proposal, they would be provided with an estimated comparison statement which

compares the dividend outcome in a CVA to an alternative insolvency process i.e. a liquidation or administration. It is key to ensure that, when proposing a CVA, all creditors in a particular category e.g. unsecured, are treated fairly.

However, post Covid-19, it would appear that CVAs are evolving.

Recently, we have seen a number of CVA proposals where creditors within the same category have been split in order to receive different dividends.

For example, a CVA we advised on recently had proposed to split out landlords from trade creditors and then trade creditors were split into essential and non-essential categories. The timing and amount of the dividend for each category was different even though they are all unsecured creditors.

In addition, some CVAs we have advised on do not have an end date, the duration of the CVA is unknown. Due to not being able to produce business forecasts as a result of lockdown, the proposal

By Lauren Auburn

simply states that the CVA will be fully implemented when the proposed dividend has been paid. In an extreme situation, that could be ten years or more.

Since the start of the pandemic, the insolvency profession has very much been focusing on rescue and this is clearly evident when reading current CVA proposals. However, when advising on a CVA, the IP needs to be satisfied that what is being proposed is fit, feasible and fair to all creditors. In some of the cases we have seen, we are not sure that the terms are fair to all creditors but what is being proposed is necessary to ensure survival of the business in very difficult circumstances.

It may be only a matter of time before we see new case law being introduced as a result of the current CVAs being proposed.

If you would like further information on CVAs or you have any general insolvency queries, please do not hesitate to contact any of the BRI management team on: 01604 754352.

Bell vs Tavistock: Does

informed consent stand in the way of autonomy?

Northamptonshire Law Society

By Dr. Neil Sullivan

In a landmark court case, judges ruled that children under 16 years of age could no longer be prescribed puberty blockers unless this has been authorised by the court. The reason: under 16s are not likely to be competent enough to “understand and weigh the long-term risks and consequences of the administration of puberty blockers”1. The judgement did not stop there, though. It also ruled that where persons over 16 years of age are involved, “clinicians may well regard these as cases where the authorisation of the court should be sought prior to commencing the clinical treatment”.

The legal challenge was brought against the Tavistock and Portman NHS Trust in London. One of the claimants was Keira Bell, who was prescribed puberty blockers at 16 by the Trust’s GIDS (Gender Identity Development Service) clinic, but later regretted transitioning2.

The High Court ruling was not quite the outcome people expected and, naturally, led to a polarised reaction. While some welcomed it as “a victory for common sense”, others were concerned it would curb young trans people’s rights3.

The issue of informed consent was a fundamental part of the judges’ final decision. However, it also begs the question: Could informed consent stand in the way of young individuals’ autonomy over matters regarding their health?

In medicine, informed consent has been a cornerstone for a long time. It rests on the principle that patients need to understand the possible consequences of their decision, prior to agreeing to or refusing certain treatment. It is “permission granted in the knowledge of possible circumstances” 4 rather than a simple “permission for something to happen or agreement to do something” 5.

In DNA testing, too, we must have “appropriate and qualifying” consent for each sample to be tested. Consent is required from each adult party that is to be tested. If the test involves a child under 16, then consent must also be obtained from a person with Parental Responsibility for that child. This is where it gets interesting: if the mother were

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under 16, she could give consent for her child to be tested. However, someone with Parental Responsibility for the mother would have to consent on her behalf for her own sample to be collected...which is a fascinating paradox we shall go back to in another article!

Although in the Bell vs Tavistock case treatment with puberty blockers would not be undertaken solely on parental consent, it was argued that “if the child’s consent was rendered invalid, the treatment would continue to be lawful if the parents had consented.”

Bell -v- Tavistock judgment (judiciary.uk) Puberty blockers: Under-16s ‘unlikely to be able to give informed consent’ - BBC News 3 Puberty blockers ruling: curbing trans rights or a victory for common sense? | Society | The Guardian 4 Informed Consent | Definition of Informed Consent

by Oxford Dictionary on Lexico.com also meaning of Informed Consent 5 Consent | Definition of Consent by Oxford Dictionary on Lexico.com also meaning of Consent 1 2

Case law offers a mixed bag of conclusions on that matter. In Gillick vs West Norfolk and Wisbech Health Authority [1986], the House of Lords reached a majority that a doctor could lawfully give contraceptive advice and treatment to a girl under 16, without the consent of her parents6. But this could only be done if she demonstrates sufficient maturity and intelligence to understand the nature of the treatment.

In Re W (a Minor) (Medical Treatment: Court’s Jurisdiction) [1993] Fam.64, the court ordered that a girl under 16, who was suffering from anorexia nervosa, be transferred to hospital specialising in eating disorders7. This was against the girl’s wishes. Although she was considered to have sufficient intelligence and understanding to make informed decisions, it was ruled that she should still receive treatment. The court emphasised that due to the nature of anorexia nervosa the patient does not wish to be cured but fulfilling such wishes could lead to severe consequences or even death.

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Unlike contraceptive treatment and anorexia - or even DNA testing - not enough is yet known about the long-term effects of puberty blockers. This arguably makes achieving informed consent almost impossible both for parents and children, as the information given to either party would not be exhaustive. Therefore, it is not only the patient’s age that impacts on their ability to make an informed decision - it is the quality of the information, too.

Clinicians must not be blamed for this, however, since they can only provide what is currently available from research and the literature. Every scientist would agree there is always more to explore on any topic, but when the knowledge gaps about a treatment are so significant, access to it should be regulated with the utmost strictness.

Of course, age cannot be entirely ignored either. Adolescents’ ability to assess the long-term consequences of certain treatments may come under scrutiny.

A child’s experience of gender dysphoria must not be invalidated, but when the remedy could have irreversible effects on a person’s fertility and sexuality – experiences someone under 16 may not have been through yet – deciding whether such medication should be prescribed must not be rash or emotional.

With that being said, young people’s ability to make decisions regarding their own health must not be taken away from them. However, institutions also have a responsibility to safeguard children’s wellbeing and step in, if and when absolutely necessary. It is a delicate balance to strike and an individual approach would be required in each case.

But when the consequences are likely to be very serious and much remains unclear about the long-term side effects of a treatment, the informed in “informed consent” can become elusive and further scrutiny is required to protect vulnerable children.

UK, Gillick v. West Norfolk and Wisbech Area Health Auhtority (hrcr.org) Re W (A Minor) (Medical Treatment) - PubMed (nih.gov)

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Gender dysphoria is a “sense of unease that a person may have because of a mismatch between their biological sex and their gender identity” . It could be so intense that it leads to feelings od depression and anxiety. According to the NHS, other signs of gender dysphoria include low self-esteem, becoming withdrawn or socially isolated and taking unnecessary risks11.

Transgender describes a diverse group of people whose internal sense of gender is different to the one they were assigned at birth. To attain transgender status in the law, an individual must be diagnosed with gender dysphoria by a professional and then apply for a gender recognition certificate under the Gender Recognition Act, 200412.

What are puberty blockers? - BBC News Gender dysphoria - Treatment - NHS (www.nhs.uk) Gender dysphoria - NHS (www.nhs.uk) 11 Gender dysphoria - Signs - NHS (www.nhs.uk) 12 Gender Recognition Act 2004 (legislation.gov.uk) 8 9

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About the author: Dr. Neil Sullivan is General Manager of Complement Genomics Ltd (trading as dadcheck®gold).

The latter is a company accredited by the Ministry of Justice as a body that may carry out parentage tests as directed by the civil courts in England and Wales under section 20 of the Family Law Reform Act 1969.

Please see: www.dadcheckgold.com.

Tel: 0191 543 6334, e-mail: sales@dadcheckgold.com

www.northamptonshirelawsociety.co.uk

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Northamptonshire Law Society

Puberty blockers, also known as hormone blockers, are used to delay puberty. They supress the release of sex hormones, including testosterone and oestrogen, and stop the body from developing breasts, periods, facial hair or deeper voice8. The medication is prescribed to young people experiencing gender dysphoria, as well as to treat premature puberty in children. It is described as physically reversible, if stopped, but it is not known what the psychological effects may be. It is also unclear if puberty blockers affect the development of the teenage brain or children’s bones9.

Landmark Planning: A Clearer View of Future Plan

By Allie Parsons, Customer Success Consultant, Landmark Information (Legal)

Of course, a preference or indifference to planning proposals in its various forms is very much a personal view.

Property lawyers and conveyancers may air on the side of caution following guidance, preferring to simply understand the proposed purchase property and to rely on the seller’s information.

Homebuyers, however, have a right to understand any impact, positive or negative, that a nearby development may have before they commit to a purchase.

It is important to be aware of any potential changes within the surrounding area that would affect the use, enjoyment or even value of a property from planning and building regulation decisions. But how do you make the extent of a development application clearly understood?

As part of Landmark’s ever-evolving data and technology provision, we have recently merged our Plansearch reports into a newly enhanced Landmark Planning.

Uniquely, the report displays data on the majority of the UK’s large planning applications, such as a new housing estate, as polygons (boundaries).

This means both conveyancer and client will benefit from a visually clearer, more realistic view and understanding of the extent or potential impact of larger planning applications, rather than relying on a list, single mapped point or buffer to work it out.

Northamptonshire Law Society

Here at Landmark Information, we have provided planning application insights and information for residential property conveyancing through for many years.

I recall the now legendry Bird & Bird transaction case, in which the conclusion found that ‘Changes to the surrounding environment, brought about through development are an important factor in protecting a client’s investment pre-acquisition’.

The report not only delivers details of planning applications from extensions to large developments but also provides information on what future uses of land are being proposed for the surrounding area, alongside the Local Authority policies and constraints. It also includes key neighbourhood information such as:

• Housing

• Demographics

• Schools

• Local amenities

• Rights of way

To help both property conveyancer and client, all the data within the report is supported by easy-to-understand guidance and next steps.

Determining what is important to the home buyer with regards to planning can be difficult and can lead to large amounts of time being spent on reviewing data which is not of interest or concern to the home buyer. Large volumes of data can also lead to the homebuyer missing important information about their purchase.

Landmark’s gold standard all in one enviro-report RiskView Residential removes this pain for the legal conveyancer and home buyer by presenting planning applications, including the large sites as polygons and constraints through its advanced, simple to use, dynamic online viewer.

The viewer includes a date filter which allows the homebuyer reduce the amount of data presented and helps to provide focus on what really matters to them. In some cases, reducing hundreds of applications down to just three or four.

The Riskview viewer includes (where possible) a clickable weblink for each recent planning application. The homebuyer can then look further into the application via the authority planning portal. Together, RiskView’s unique time-saving features help the property professional add value to their home-buying client whilst reducing time spent dealing with planning related enquiries.

The Government is still committed to 300,000 new homes per year even these unprecedented times. The Prime Minister’s ‘Build, Build, Build’ speech in July last year was followed by a series of new laws that came into effect on 1 September 2020. The aim is to deliver new homes and revitalise town centres across England alongside a permanent extension to the existing permitted development rights.

In the current climate, who can guess the impact of these laws? To what extent will they change the places we live, or want to live?

Whatever the future holds, surely the best outcome for conveyancers and homebuyers is a more transparent transaction, which provides the insights needed for informed decisions.

Selecting the Landmark Planning report or Riskview Residential demonstrates good due diligence in taking all practicable steps to reasonably identify information that the client would want to know.

www.landmark.co.uk

www.northamptonshirelawsociety.co.uk

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www.northamptonshirelawsociety.co.uk

And Finally…

Our training courses went online, as did our Council meetings, we all became experts in Zoom, Microsoft Teams, and Google classrooms! In a bid to deliver a level of normality, we even managed to host the annual quiz in support of The Midland Legal support trust.

As we move into the New year, I would like to thank all of you that have taken the time and engaged and supported the Society over the last year – in these unsettled times, it is a time when we all need to come together and reach out to those who are struggling be it on a personal or professional level.

I am in conversation with several speakers to continue to deliver the members a variety of training options in 2021, keep a look out on the website, and in your in box for details. If there is a specific topic that you wish me to source, please do let me know; you can reach me at; sec.nls@outlook.com.

We are hopeful that we can hold our NLS awards dinner at some point in the year and look forward to having a face-to-face event where cannot only discard our current “lounge wear” uniform, but dust off the sequins to celebrate all that is good and great within the local Law fraternity.

Northamptonshire Law Society

Where do I begin in my summary of 2020? A year that saw unbelievable changes to all our working lives, our spare bedrooms and dining rooms becoming our offices and classrooms, our domestic lives with our children being home schooled, and the free flow of our every - day existence that we all took for granted halted almost overnight.

By Carolyn Coles

Finally, a special note of thanks to the Council and Borneo Martell Turner Coulston for supporting me in my ongoing volunteering role at NGH. Wishing you and all of yours a Happy healthy 2021.

Carolyn Coles - Society Manager Email: sec.NLS@outlook.com Office Number: 01604 881154 My mobile: 07543 662572

www.northamptonshirelawsociety.co.uk

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Top 10 compliance mistakes and how to avoid them

Northamptonshire Law Society

By Julian Bryan, Managing Director, Quill Compliance should be neither an afterthought nor a burden – it should be a natural consequence of running your law firm and managing your accounts well.

The SRA will tell you that anti-money laundering and mishandling client money are the two most common mistakes law firms make.

So how do you avoid the SRA’s intervention?

Here are 10 compliance mistakes law firms most often fall foul of: 1. Not paying attention to the latest SRA Accounts Rules: The SRA regularly updates its rules, and it’s up to you to be aware of these changes and understand how it impacts your accounts function. The best thing to do is follow the SRA news and adopt a compliance-centric approach to your business in order to avoid serious SRA Accounts Rules breaches.

2. Incorrectly operating a client account: Ensure your client account includes the required level of information and that you don’t provide banking facilities to clients or third parties. It’s essential that your staff are aware of the relevant money laundering regulations and what constitutes provision of banking facilities.

On the same point, don’t suffer lack of understanding about how to operate without a separate client account, should you choose this route. SRA’s Rule 2.2 is all-or-nothing.

It gives you the choice of exemption from having a client account (across the whole practice, not on a client-by-client basis).

Whilst this may sound like an easier option (and cheaper as you don’t need accountants’ reports), it could create more work by asking clients to pay third parties directly and subsequently making sure these payments have been made.

Alternatively, another option permitted by the SRA is Third Party Managed Accounts which can provide client onboarding checks, card processing and outsourced client account services within one solution. You must decide what makes the most sense for your business.

3. Not maintaining a clear breach register: You and your employees must be suitably trained to spot suspected breaches, and you must document how discovered breaches will be rectified and keep a register of this information.

4. Not having a payment of interest policy: Your policy of interest should clearly state how money held in your client account will be handled, including when it becomes due and the rates you’ll use.

6. Not defining ‘promptly’: This word is dotted throughout the revised SRA Accounts Rules. What ‘promptly’ means to one person is different to another. Choose suitable timeframes for your firm and clarify in your office policies.

7. Not setting realistic service level agreements (SLAs): There’s no point in setting impossible-to-meet timescales.

For example, if you’re a rural practice with no easy access to a local bank or building society, don’t set tight timings regarding paying in cheques. Instead, be honest and upfront about what’s feasible for your unique circumstances and incorporate that into your contracts and policies.

8. Not supporting your COFA: Your accounting system should allow you to produce a tri-balance comparison of your client bank, cashbook and client ledger balances. By checking and signing a report of this nature, your COFA can meet his / her SRA obligations and you’ll have the visibility you need to make sure compliance measures are being met.

9. Purchasing the wrong legal accounts software: Ask for recommendations from trusted peers of what works best for them.

Be sure to probe any potential software provider about how they handle system enhancements to address ever-changing rules. Your supplier should be rolling out new and enhanced functionalities which allow you to streamline compliance procedures and ensure you’re constantly protected.

10. Not collaborating and communicating effectively: Compliance is not a one-person task.

It’s the duty of everyone in your organisation from your cashiers and compliance officers to senior leaders and solicitors. Seek input from all stakeholders when reviewing compliance-related policy documents and roll out updated documentation with appropriate training company-wide.

Keep your accountant informed always so audits can be done quickly and efficiently.

Summary: Hopefully our tips will help you fulfil your regulatory compliance responsibilities with ease. This excerpt is taken from our ’15-Step Guide to Starting Your Own Law Firm’. To download our guide in its entirety, and learn how to keep client money safe and avoid money laundering scams, please visit www.quill.co.uk/ Legalpracticemanagementforstartups.

5. Not thoroughly checking your residual and suspense balances: Analyse which of these monies you currently hold, determine if you should be holding them, return to the proper recipients where possible, and log what you’ve done if these people can’t be located.

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www.northamptonshirelawsociety.co.uk

Julian Bryan is the Managing Director of Quill, which helps law firms streamline, and run their practice better and compliantly by providing simple and easy-to-use legal accounting and case management software, as well as outsourced legal cashiering services. Julian is an advocate for quality software standards and served as the Chair of the Legal Software Suppliers Association from 2016 to 2019. He can be reached at j.bryan@quill.co.uk.

www.northamptonshirelawsociety.co.uk

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