You’d think that once the Legal Services Board rubber-stamps a rule, the argument is over. But not this one.

On 31 July 2026, the LSB approved the SRA’s changes separating the COLP and COFA roles from anyone who can “unilaterally” call the shots in a firm. Six weeks on, a newly formed lobby group has walked out of a meeting with the SRA no better informed than when they went in, a former SRA head of legal has accused the regulator of muddying its own rules, and the phrase “adding to confusion” is doing the rounds. If you’re a COLP, COFA, or owner-manager wondering whether you’ve missed something, you haven’t. Quite a lot of people are confused, and some of them wrote the rules in the first place.

A quick recap, because there’s been a lot to keep up with

The change amends Rule 8 of the SRA’s Authorisation of Firms Rules. Where a firm has more than one manager or owner, an individual with the power to unilaterally determine or direct significant management decisions can’t also be the COLP or COFA if the firm:

• had an annual turnover above £600,000 in its last accounting period, or
• held more than £2 million in client money at any point in that period

Sole owner-manager firms get a partial carve-out: the sole owner-manager can still be the COLP, just not the COFA. The thresholds have moved since the original consultation (the client money figure in particular has roughly quadrupled), which the SRA points to as evidence it listened. The changes are being phased in from 2027, and the SRA says the reform is meant to close the gap that let recent high-profile firm collapses happen with the same person marking their own homework on both the practice and the money.

As we wrote back in June, the SRA changed the rules, and smaller firms were always going to feel it most. What’s changed since then is the tone. This has stopped being a “watch this space” story and become a live fight.

Where the argument has landed

The new SME & Boutique Law Firm Alliance, fronted by Circe Law’s Jade Gani, has been the most visible voice pushing back. Their central point is a fair one: this reform was consulted on as part of a broader “protecting client money” package, not as a standalone question about restructuring the governance of roughly 1,660 firms. Plenty of firms, the Alliance argues, never appreciated that a consultation response buried in a wider exercise could end with their owner-manager barred from being their own COFA.

A £600,000 turnover doesn’t automatically make a firm large, complex, or high-risk to run.

That’s the crux of the objection. A busy two-partner conveyancing practice or a boutique family firm can clear £600k without looking anything like the kind of organisation the reform seems to have been designed for.

Then there’s Stephen Nelson, formerly the SRA’s own head of legal, who’s taken issue with the drafting itself. His complaint is that the SRA’s explanatory blog uses “unilaterally” in at least four different senses without ever pinning down what it actually means in practice. Does a COLP who has final say on client onboarding policy count as “unilaterally directing” a management decision? Is shared responsibility automatically present in any firm with more than one owner? Nobody at the SRA has given a straight answer yet, and firms are being asked to plan their governance structures around a word that seems to mean whatever the reader needs it to mean.

The SRA’s response so far has been to point out that the changes were properly consulted on: 62 responses, spanning individuals, firms, and representative bodies. That’s true, but it doesn’t really answer the Alliance’s point, which was never about whether a consultation existed. It was about whether the firms most affected knew to look for it.

What this means if you’re the COLP, the COFA, or both

If your firm is anywhere near either threshold, the sensible move now is not to wait for the fog to clear; it’s to start modelling what your governance would need to look like under the new Rule 8, using the clearest reading available rather than the most convenient one. For multi-owner firms, that may mean genuinely collective decision-making on the issues that matter, properly documented. For sole owner-managers, the COFA question in particular needs an honest answer sooner rather than later, because “we’ll sort it when the phase-in gets closer” has a way of becoming “we’ll sort it in a panic.”

We’ve written before about what the SRA’s own compliance officer thematic review found about how COLPs and COFAs are actually operating day to day, and this reform lands directly on top of those existing pressures. If you’d like a second pair of eyes on where your firm sits against the thresholds, or what your options look like if you do, our COLP and COFA support work is built for precisely this kind of question.

We’ll keep tracking this one as it develops, not least because we suspect the SRA will need to say something clearer than “unilaterally” means whatever we tell you it means before this argument settles down.

Enderley Consulting can help with:

• Compliance audits and gap analysis
• COLP/COFA support retainers
• Annual declaration preparation
• Staff training via the Enderley InfoHub