Who should declare
Applicants
When you apply to own a legal practice you will be required to answer two forms, one about your prior conduct as an individual and one about the conduct of the business, fitness to own.
Information about Prior Conduct can be found here.
Approved Managers of existing Authorised Entities
If you already own an Authorised Entity or if you have been authorised by CILEx Regulation as an Approved Manager you must make a Fitness to Own declaration on all CILEx and CILEx Regulation application forms, including the annual returns, or at the time the Fitness to Own conduct occurred, whichever is sooner.
When to declare
You must declare fitness to own on all CILEx and CILEx Regulation application forms, including the annual returns, or at the time the conduct occurred, whichever is sooner.
New Approved Managers
You must make a fitness to own declaration on your application form to become an Approved Manager and/or as the owner of the entity you are applying to be authorised. This is in addition to the prior conduct you would declare as an individual applying to become a CILEx Member, a CILEx Practitioner or an Approved Manager.
Existing Approved Managers
If you are an Approved Manager, which means you have already gained authorisation from CILEx Regulation, then you must declare fitness to own each year. In regard to your individual responsibility to declare prior conduct you can find out more information on our Prior Conduct pages.
Declarations can be made by emailing CILEx Regulation: info@cilexregulation.org.uk
What to declare
Guidance is available to download here or you can browse on the left-hand side of the page.
Every Applicant or Relevant Person that is not an individual, must declare in writing to CILEx Regulation if it or any related business (i.e. parent and/or subsidiary) has:
- Been the subject of a resolution for voluntary winding-up passed without a declaration of solvency under the Insolvency Act 1986, s. 89
- Ever entered administration within the meaning of paragraph 1(2)(b) of Schedule B1 to that Act
- Had an administrative receiver within the meaning of section 251 of the Act appointed
- Been the subject of a meeting of its creditors under section 95 of that Act
- An order for the winding up of the entity applying to be authorised, or any related business (i.e. parent and/or subsidiary)
- Had a civil judgement made against it
- Been the subject of any investigation or proceedings conducted by any regulatory or professional body
How to declare
Declarations can be made by completing the form on the left-hand side of the page and emailing it to info@cilexregulation.org.uk or posting it to CILEx Regulation.
What happens after I make the declaration?
Prior conduct and fitness to own declarations are considered and determined in accordance with the Enforcement Rules which you can download here or you can browse on the left-hand side of the page.
Guidance on the Enforcement Rules can be found in the Enforcement Handbook and the annexes to it. Annex 2 includes guidance on sanctions that may be imposed and factors that are taken into account when making decisions.
Decisions can be made by CILEx Regulation or by the Professional Conduct Panel depending on the nature of the conduct declared and the type of application being made.
New applicants and existing Approved Managers
If you are a new applicant and have declared prior conduct CILEx Regulation can approve your application – this is referred to as a Delegated Decision in the Enforcement Rules.
If the conduct that you have declared does not fall within a Delegated Decision the conduct will be referred to the Professional Conduct Panel, the Professional Conduct Panel can:
- approve your application
- refuse your application
- decide to take no action and direct CILEx Regulation how to deal with declaration
- impose conditions on you in respect of future conduct and (if you are an individual) your employment
- require you to give an undertaking regarding your future conduct
- reprimand (existing Approved Managers only), warn as to future conduct
- refer the matter to the Disciplinary Tribunal as it was an allegation of misconduct (existing Approved Managers only)
Before making decisions the Professional Conduct Panel may seek further information from you or request your attendance.
FAQs
What do I need to declare in regard to my business or related businesses (parent and/or subsidiary)?
You will need to declare the following:
> If any resolutions for voluntary winding-up have ever passed without a declaration of solvency under section 89 of the Insolvency Act 1986.
> If your business or related businesses has ever entered administration within the meaning of paragraph 1(2)(b) of Schedule B1 to that Act.
> If an administrative receiver within the meaning of section 251 of the Act has ever been appointed.
> If your business or related businesses has ever been the subject of a meeting of its creditors under section 95 of that Act.
> If an order for the winding up of your business has ever been made.
> If your business has ever been the subject of a civil judgement.
> If your business has ever been the subject of any investigation or proceedings conducted by any regulatory or professional body.
> If your business has been involved in any other matter which may be relevant to a decision by CILEx Regulation to authorise or approve it.
Do I need to declare everything?
You must ensure that you answer fully all the questions within your Fitness to Own declaration. If you are in any doubt on what to declare please contact CILEx Regulation for guidance: info@cilexregulation.org.uk
You must declare Fitness to Own matters on:
> CILEx Regulation annual return forms
> all other forms and documents you return to CILEx Regulation; and
> at the time the conduct occurred, whichever is sooner.
If a Fitness to Own matter arises at a time you are not completing a form for submission to CILEx Regulation you must write to us to declare the matter as soon as it occurs.
What happens when I declare a Fitness to Own matter?
Your Fitness to Own declaration will be reviewed by CILEx Regulation’s Investigation team. We will gather information relating to the Fitness to Own matter from you (and relevant third parties where necessary) and decide what, if any, action to take in relation to it.
The decision will relate to whether to accept your application for regulation or, where you are already regulated by CILEx Regulation, what action to take in relation to your continued regulation.
How long will it take for my Fitness to Own matter to be considered?
This will depend on the type of conduct you have declared and how promptly you provide the information we request from you. All Fitness to Own declarations must be put to our Professional Conduct Panel (PCP). The PCP will decide what action, if any, to take based on the information you have provided. A decision will usually be made on the day of the meeting unless further information is required by the PCP. If you do not provide the information promptly, this will delay the determination of your matter.
What information will I need to submit to CILEx Regulation relating to my Fitness to Own declaration?
We will write to you requesting the following types of evidence some may only apply if you are applying to become an Approved Manager and/or a Compliance Manager:
> Disclosure Barring Service [SS1] report
> Companies House documents
> Copy of a Court Order
> Details relating to any winding up or insolvency arrangements, including resolutions
> A receiver’s or creditor’s report
> Details of the circumstances that led to the Fitness to Own matter
> Letters relating to a debt that is owed and/or evidence that it has been repaid in full
> Details relating to any regulatory investigations
> Any mitigation that you wish to bring to the attention of the decision-making Panel
> Information relating to your conduct since the matter occurred
This list is not exhaustive and there may be circumstance where you are unable to get this information. If this is the case you must contact CILEx Regulation to explore other routes through which you can obtain the information.
Can I submit character evidence?
Yes, you may submit character evidence. Where your character evidence is in the form of references they must be signed and dated, with clear details of the status of the person providing the reference. We will require original signed copies. The reference should be from someone who is aware of the matter you have declared and must be no more than six months old.
When do Professional Conduct Panel meetings take place?
There are approximately eight to nine meetings each year. They are roughly six weeks apart. If you are unable to provide the required information to us at least three weeks before the meeting, your prior conduct matter will have to be delayed until the next meeting of the Panel. This is because under the Enforcement Rules papers must be sent to the PCP two weeks before the meeting.
Who sits on the Professional Conduct Panel?
The Professional Conduct Panel (PCP) is made up of three individuals. Two are lay members who are non-lawyers. One is a Fellow of CILEx and is called the professional member. All members are independent of CILEx Regulation who takes no part in the decision-making process at these meetings. CILEx Regulation only attends to provide any further information the Panel may request.
The PCP is supported by an independent clerk who takes minutes of the meeting and assists with procedural matters. The Clerk takes no part in decision-making.
Will I need to attend a meeting?
In some cases you may be asked to attend a meeting by the Professional Conduct Panel to answer questions it might have. You will be given notice of whether this has been ordered.
Where are the meetings held?
The meetings are held at the CILEx Regulation office which is College House, Kempston Manor, Kempston, Bedford MK42 7AB. The clerk will take you through to the meeting.
Will I need to bring anything with me to the meeting?
If you have been ordered to attend you must bring a form of identification with you and a copy of any original documents that you have used in support of your entity authorisation application form, unless the originals are already with CILEx Regulation. You may wish to prepare in advance any submissions or mitigation about your Fitness to Own matter ready to provide to the Professional Conduct Panel.
What happens at the conclusion of the meeting?
You will receive a copy of the signed order providing reasons for the decision about your Fitness to Own declaration. This will be sent within 21 days of the meeting.
If my application is refused can I make another application to become an Authorised Entity?
You may reapply unless the Professional Conduct Panel has stated you cannot. You should consider the reasons why your application was refused and wherever you can make attempts to address those issues before reapplying. There will be a fee for each application made.
Can I appeal a decision?
Yes, you may appeal a decision of the Professional Conduct Panel. You will have 42 days within which to appeal. If you are unclear about Fitness to Own declarations then please email us: info@cilexregulation.org.uk
