37.This section provides for—
	two categories of regulator (category 1 and category 2) for the regulation of legal services providers (the requirements imposed on category 1 regulators are more onerous and reflect that they are responsible for legal services providers that typically provide a broad range of legal services directly to the public),
	the regulation of licensed providers to continue under the 2010 Act,
	each of the three existing regulators of legal services to be assigned to a category (and power for them to be reassigned to a different regulatory category in certain circumstances), and
	a power to be conferred on the Scottish Ministers to change the category to which a regulator is assigned and to specify the category to which a new regulator is assigned.
38.The three existing regulators of legal services in Scotland are assigned as follows—
	the Law Society is assigned to category 1,
	the Faculty is assigned to category 2,
	the Association of Construction Attorneys is assigned to category 2.
39.Any new regulator that has an application for accreditation approved under Chapter 3 of Part 1 of the Act will be assigned to either category 1 or category 2. The Scottish Ministers must, as soon as reasonably practicable, make the regulations necessary to assign it to a category (as they are required to do under section 28). In the meantime, the new regulator is deemed a category 2 regulator.
40.Subsection (6) sets out the factors that the Scottish Ministers must consider when assigning a regulator to a category. These relate to the type and range of legal services that are to be regulated, whether the services are to be provided directly to the public and how many legal services providers the regulator is likely to regulate. The Act does not specify particular types of legal services, or a number of providers, that will lead to a particular regulator being categorised as a category 1 regulator. However, the bigger the regulator, the more services provided directly to members of the public and the more significant the legal services, the more likely it is that a body will be categorised as a category 1 regulator.
41.The Scottish Ministers can only make regulations, which are subject to the affirmative procedure, under subsection (5)(a) at the request of the Lord President. Before making the request, the Lord President must consult the bodies listed in subsection (9). When making a request to the Scottish Ministers, the Lord President must include a document setting out the reasons for the request and copies of any written representations received in relation to the consultation. After making the request, the Lord President must publish those documents.
Background Part 1 – Regulatory Framework Regulatory categories Section 7 – Regulatory categories