I read the government’s response to the review of the Legal Services Board, published on 5 November 2026, with one question in mind: whether legal services regulation would be reopened, and whether AI would sit inside that work. The answer to both is yes. The Ministry of Justice accepted every recommendation Richard Lloyd made in his independent review, published in July. It also committed to a comprehensive review of the regulatory framework, which will consider the regulatory boundaries and the implications of developments such as AI and lawtech among other things.
What the government has agreed
Lloyd’s recommendation asked the ministry to look at what activity should sit within or outside the current regulatory perimeters, and to have a new framework ready by 2029 for the next Parliament. The government accepts the substance of that, though it says the scale and complexity of the work mean it cannot yet commit to the timetable. Sarah Sackman KC MP, the minister for courts and legal services, writes in her foreword that change is needed. The response puts consumer protection first among its principles.
Where AI sits in the rules today
Section 12 of the Legal Services Act 2007 reserves six activities, among them rights of audience, the conduct of litigation and probate activities. Giving legal advice is not one of them. A member of the public who takes advice from a general-purpose chatbot therefore deals with nobody the Act regulates, with no compulsory insurance behind the answer and no complaint to the Legal Ombudsman if it is wrong.
Dr Natalie Byrom made that point at length in Delegated by default?, a report for the Nuffield Family Justice Observatory published in the same week, which the Law Society Gazette reported on 5 November. She writes that litigants using these tools face risk for which there is currently no redress, and that the tools are prone to sycophancy, affirming users in their beliefs even where they are wrong. The terms of these tools disclaim their accuracy, she adds, so consumer law protections are unlikely to apply either.
What Byrom asks the review to do
Of her 26 recommendations, those aimed at the new review matter most to firms. She asks the ministry to set up a mandatory public register of unauthorised legal service providers now, without waiting for the review, with complaints handling and financial protection as conditions of registration. She then asks the review to consider regulating domestic AI advice tools through registration rather than by making legal advice a reserved activity, and to reshape the reserved activities around risk.
She also wants AI legal advice, from general-purpose tools as well, in the first annual assessment of sector risk that Lloyd recommended. The government has accepted that the Legal Services Board, the frontline regulators and the ministry should build a shared framework for market and consumer risk, with an agreed statement of risk tolerance, and Lloyd gave that work six to nine months. The response does not say whether AI will feature in it.
What I would do in your firm
Start with what your regulation gives a client that a chatbot does not. Your firm carries professional indemnity insurance, answers to its regulator and sits within the Legal Ombudsman’s jurisdiction, and a client who relies on a free AI tool gives all of that up. Say so in plain terms in your client care letter and on your website, since consumer protection is the principle the government has put first.
Then prepare for the client, or the opponent, whose view of the case a chatbot has already formed. If Byrom is right about sycophancy, that view will be held firmly, and your first meeting needs to test it. We set out how in clients using AI chatbots to check your advice and what an AI-assisted litigant in person changes.
Take part, too, when the review seeks the sector's views. The government says it will work closely with consumers, regulators and the legal sector, and the Law Society has said it will work with the government to ensure the profession’s voice is heard. From now on, keep a short note of each matter in which a client’s AI advice changed the work and what it cost to put right. Evidence from small firms on where AI helps clients and where it harms them is what a review of this kind needs.
The Ministry of Justice published the Government response to the Independent Public Bodies Review of the Legal Services Board on 5 November 2026, a ten-page document that is free to read.
If you want to work out which parts of your fee income a regulated firm wins on and which an AI tool already contests, talk it through with us.
