IPReg Overarching Principles & Code of Conduct

Question 1

What are the Overarching Principles?

Answer 1

These Principles set out the ethical behaviours that IPReg expects all regulated persons to uphold.
This includes not only in their professional life but also their private life where it is relevant to their practice as a regulated person.

Should any of these Principles come into conflict with one another, those which safeguard the wider public interest (such as upholding the rule of law and upholding public confidence) will take precedence.

You must:
1. act in a way that upholds the constitutional principle of the rule of law and the proper
administration of justice.
2. act in a way that upholds public confidence in the regulated profession.
3. act with independence.
4. be honest.
5. act with integrity.
6. act in a way that encourages equality, diversity and inclusion in and by the profession.
7. act in the best interests of each client.
8. maintain proper standards of work.

Question 2

About Rule 1 of Law and Justice (Overarching Principles):

Answer 2

“Act in a way that upholds the constitutional principle of the rule of law and the proper administration of justice.”

• “Supporting the constitutional principle of the rule of law” LSA s.1(1)(a)
• “persons who exercise before any court a right of audience, or conduct litigation in relation to proceedings in any court,…should comply with their duty to the court to act with independence in the interests of justice” LSA s.1(3)(d)
• General idea: barristers, solicitors, and attorneys are “officers of the court” with duties transcending to those clients or colleagues

Question 3

About Principle #2 - ‘Act in a way that upholds public confidence’ (Overarching Principles):

Answer 3

“act in a way that upholds public confidence in the regulated profession”
* Not LSA – Comes from National Health Service Reform and Health Care Professions Act 2002, s25(2B)(b)
* inherited from professional bodies:
* “The service ideal demands the continual reaffirmation of an image of moral rectitude. … the ideal of moral rectitude is asserted specifically in firm action taken by professional bodies against clearly defined wrongs likely to scandalise the professional image…”
* “It is possible to think of many forms of conduct which would undermine public confidence in the legal profession. Manifest incompetence is one example.”
* Sexual misconduct (e.g. abuse of authority) in workplace is another.
* See IPReg Admission Requirements 1.1.4, 1.2.4 “character & suitability”

LSA - Legal Services Act 2007

Question 4

About Principle #3 - ‘Act with independence’ (Overarching Principles):

Answer 4

Potentially acting independent of boss/client

• LSA s.1(3)(a); also s.1(1)(f) (profession in general)
• LSA s.1(3)(d) (for litigation)
• You’re meant to be the expert advisor, using your own judgment, not blindly following instructions from your boss or the client.
• Your opinion is more valuable to the client if it is really what you think, not a rubber-stamp – sometimes you have to say what’s best even if it isn’t what they want to hear.
• WHY? It wastes everyone’s time and money if people do stupid or counterproductive things in actions before the Court or the IPO.

Question 5

About Principle #4 - ‘Be honest’ (Overarching Principles):

Answer 5

• Not within the LSA – but a form of “integrity”, which is.
• Applies to private life, if there would be an impact on business life.
• Objective test: what the public would think is dishonest, not what you think, Lord Hoffman, Barlow Clowes v Eurotrust [2005] UKPC 37
• “Lapses … may … take different forms and be of varying degrees. The most serious involves proven dishonesty, whether or not leading to criminal proceedings or penalties. In such cases the Tribunal has almost invariably, no matter how strong the mitigation advanced by the solicitor, ordered that he be struck off the role of solicitors.” Thomas Bingham MR, Bolton v Law Society [1994] 1 WLR

Question 6

About Principle #5 - ‘Act with integrity’ (Overarching Principles):

Answer 6

• LSA s.1(3)(a)
• See rule 1 (and all others)
• “integrity” is a useful shorthand to express the higher standards which society expects from professional persons and which the professions expect from their own members…That involves more than mere honesty, Jackson LJ, Wingate and Evans v SRA, SRA v Malins [2018] EWCA Civ 366.

Question 7

About Principle #6 - ‘Encourage equality, diversity, and inclusion’ (Overarching Principles):

Answer 7

“act in a way that encourages equality, diversity and inclusion in and by the profession.”
* “encouraging [a] … diverse … legal profession” LSA s.1(1)(f)
* See Rule 3.8
* See IPReg Statement on Counter-Inclusive Misconduct (intentionally or unintentionally has the effect of narrowing or denying opportunities to people because of their background or characteristics) https://ipreg.org.uk/sites/default/files/Tackling-counter-inclusive-misconduct-statement-FINAL.pdf

Question 8

About Principle #7 - ‘Act in the best interest of each client’ (Overarching Principles):

Answer 8

• LSA s.1(3)(c)
• See Rules 1, 4, 5

Question 9

About Principle #8 - ‘Maintain proper standards of work’ (Overarching Principles):

Answer 9

• LSA s.1(3)(b)
• See Rule 2
• See IPReg Gidance on continuous professional development CPD (requires “reflective practice”) https://ipreg.org.uk/sites/default/files/Continuing%20competence%2 0guidance.pdf
• Upcoming IPReg seminar on CPD

Question 10

What’s the IPreg Code of Conduct?

What are the main rules?

Answer 10

The provisions set out in this Code of Conduct are the standards of professionalism that IPReg expects of all regulated persons. This will include where working on a pro bono basis. These provisions should be applied to the context in which you are working as not all will apply in all circumstances.

This Code of Conduct applies to registered patent attorneys and registered trade mark attorneys, IPReg registered and licensed bodies, authorised role holders such as a body’s HoLP, HoFA, managers and owners and – where the context applies - employees.

Rules:
1. Client care
2. Competence
3. Managing your practise
4. Client Money
5. Complaints handling
6. Requirements for licensed bodies

Question 11

Rule 1: Client care

Answer 11

• (a) Existing, former, and prospective clients
• (b) (includes anyone for whom the regulated person is the address for service)
• (c) In foreign originating work, the principal remains the client, even if instructions come from an intermediary foreign patent or trademark attorney

1.1 - Cost Information - Clients must receive the best available information on work and costs at the time of engagement and as work progresses.

1.2 - Benefit information - Clients must receive an explanation of any financial benefits (commissions, foreign exchange uplifts, discounts, or rebates) resulting from their instructions.

1.3 - Publicity and advertising - * Publicity related to your work must be accurate, fair, and not misleading.

1.4 - Kickbacks and fee-sharing - Information on any referral arrangements, including referral fees and fee-sharing, must be provided to the client.

1.5 - Confict wuth Client’s interest - You must not undertake work where your duty to act in the client’s best interest conflicts, or may conflict, with your own interest in that work.

1.6 - Conflict between client interests - * Do not act for multiple clients on the same or related work if their interests conflict or may conflict.

1.7 - Conflict between duty and confidentialty - Do not act for a client where your duty to act in their best interests conflicts with your duty to keep another client’s affairs confidential, unless:
o There is no risk of disclosure, or
o The other client gives informed consent.
o Principles: 5, 7 (integrity, duty to client)
o Note: Former guidance suggests confidentiality safeguards (Chinese Walls) may cure the conflict.

1.8 - Confidentiality - * You must keep your client’s affairs confidential, unless permitted by law or with client consent.

1.9 - Lien - * You can exercise a lien over client papers/materials only if:
o The lien is available under law, or
o It is an express term agreed upon by the client.
o Principle: 7 (duty to client)
o Note: It is unclear whether a common law lien exists for attorneys, so it generally depends on express terms. Often used to extract payment, but it may conflict with other rules.

Question 12

What’s a lien?

Answer 12

A lien is a legal right or claim that one party has over the property of another as a form of security for a debt or obligation.

In simpler terms, it gives a person (such as a lawyer or creditor) the right to keep or hold onto someone else’s property until a debt is paid or an obligation is fulfilled.

Question 13

Rule 2: Competence

Answer 13

2.1 You only undertake work that is within your expertise and competence.
2.2 You maintain your continuing competence in accordance with IPReg’s requirements and guidance.
2.3 Those with management responsibility ensure that appropriate training and supervision arrangements are in place for those working at all levels

Question 14

Rule 3: Managing your practise

Answer 14

Accountability, cooperation and provision of information

3.1 You are accountable for your work and the work delivered by those you supervise. You are also accountable for the selection of sub-contractors.

3.2 Effective governance arrangements are in place so that you and those you contract with can comply with IPReg’s regulatory arrangements.

3.3 You cooperate with IPReg, other regulatory, supervisory and enforcement bodies and the Legal Ombudsman.

3.4 Any information which suggests a breach of any of IPReg’s or another approved regulator’s regulatory arrangements is reported promptly to IPReg or another approved regulator, as appropriate.

3.5 You do not inhibit anyone from providing information to IPReg or any of the types of body set out at 3.3 above or subject anyone to detrimental treatment who provides or proposes to provide information in this way.

3.6 IPReg’s requests for information, documentation and payment of fees are complied with within prescribed timeframes.

3.7 IPReg has up-to-date details for you and the practice and is promptly notified of any material changes to this information or circumstances, including matters which may impact upon your suitability and entitlement to remain a regulated person.

3.8 Workforce diversity data is monitored, reported and published, as prescribed. Risk management

3.9 Material risks to the practice are identified, monitored and managed.

3.10 Where you provide services to the public, professional indemnity insurance (PII) is in place that is commensurate with the risks presented by your business and which meets IPReg’s current Minimum Terms and Conditions (MTCs).

3.11 When you cease to operate, you take out run off cover unless there is a successor practice.

3.12 Once it becomes clear that a practice will cease to operate, those with management responsibilities effect the orderly wind-down of the business and promptly notify IPReg in accordance with 3.7 above.

Question 15

Rule 4: Client money

Answer 15

4.1 Client money is kept safe in the following ways:
4.1.1 it is always identifiable and is kept separate from money belonging to the firm; and
4.1.2 it is returned promptly to the client as soon as it can be;
4.1.3 it is held in a bank account in the UK.

4.2 Clients are aware of where their money is being held – including where this is held on trust – the reasons for this and the regulatory protections afforded to them.

4.3 You may use the services of a third party managed account provider, in respect of money othat would otherwise be held by you as client money provided that you comply with guidance issued by IPReg.

4.4 IPReg is notified if you hold client money.

4.5 IPReg is notified when client money above the prescribed amount cannot be returned to the client. Any residual balances below the amount prescribed which relate to that client must be donated by you to a charity of your choice.

Question 16

Rule 5: Complaints handling

Answer 16

• Most complaints sorted out by the firm, few go to IPReg or LeO – suits all
• “Complaint” – former Guidance: “oral or written expression of dissatisfaction which alleges that the complainant has suffered (or may suffer) financial loss, distress, inconvenience or other detriment.” includes:
• Failure to follow instructions
• Failure to advise or poor/wrong advice
• Failure to keep informed / failure to reply
• Failure to comply with agreed action / remedy
• Delay / failure to progress
• Failure to keep papers safe
• Cost information deficient / costs excessive
• Failure to release file or papers
• Misconduct

5.1 Clients are informed, in writing, at the time of engagement about:
5.1.1 their right to complain about your work and associated fees;
5.1.2 how a complaint can be made and to whom; and
5.1.3 any right they have to make a complaint to the Legal Ombudsman and when they
can make any such complaint.

5.2 If a client has made a complaint about your work or fees, this should be resolved to
the client’s satisfaction within eight weeks.

5.3 If a complaint cannot be resolved and your complaints procedure has been exhausted, you must:
5.3.1 explain to the client why you cannot settle the complaint; and
5.3.2 inform the client of any right they have to complain to the Legal Ombudsman, the
time frame for doing so and provide full contact details to do so.
5.4 Complaints are dealt with promptly, fairly, and free of charge.

[NOTE: LeO and IPReg expect client to exhaust the firms complaint route first. LeO gives you 6 months from then, but must also be one year from cause]

Question 17

Rule 6: Licensed Bodies

Answer 17

• Specific rule for bodies not 100% owned by attorneys, e.g., mixed practices, limited companies and external investors.
• “must be read in conjunction with the standards of professionalism that IPReg and the public expect of all regulated persons set out at 1 to 5 above”
• Glossary: has the meaning set out at section 71(2) of the LSA and is a body which has been entered onto the patent attorney register and/or the trade mark attorney register in accordance with the requirements set out at [2] of Chapter 3 of the Core Regulatory Framework
• LSA s71(2): “licensed body” means a body which holds a licence in force under this Part
  1. At all times, there is an individual designated as HoLP and an individual designated as HoFA, whose designation IPReg has approved.
  2. Compliance officers comply with their legislative and regulatory obligations and duties as prescribed and as set out in Schedule 11 to the LSA.
  3. Effective governance arrangements are in place to ensure that your compliance officers are able to discharge their duties.
  4. Licensed bodies have a practising address in England or Wales.
  5. No one is employed who is disqualified under section 99 of the LSA from being an employee or a manager of a licensed body.
  6. Non-authorised owners are approved in accordance with IPReg’s requirements relating to authorisation [see 6.3 of Chapter 3] and any accompanying guidance and in accordance with Schedule 13 to the LSA.

Question 18

Define ‘client money’:

Answer 18

“money heId or received by you or your firm in connection with work undertaken for a client, excluding any advance payments for costs received where the terms have been agreed”