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Law firms may have just weeks to reorganise their business plans once a decision is made on enforcing the ban on referral fees in personal injury work, a leading practitioner has warned while branding the situation “unbelievable”.

A new business that brings together a law firm with seven other service providers needed to manage a motor accident from collision to settlement has applied for alternative business structure status, Legal Futures can report.

It will be for law firms to work out if they are complying with the ban on referral fees in personal injury cases, with the law drafted in such a way to make some collective marketing schemes “vulnerable to being in breach”, the Solicitors Regulation Authority has warned.

The Legal Services Board has warned regulators not to go further than the legislative requirements for the impending ban on referral fees in personal injury, calling for “a liberal approach” that does not prevent alternative business structures effectively circumventing it.

There is broad support for an outcomes-focused approach to implementing the ban on referral fees in personal injury cases, according to early indications from the Solicitors Regulation Authority’s consultation on the issue.