The Primary Authority Scheme

Despite the Government’s commitment to ‘cutting red tape’ the regulatory burden on businesses continues to be perceived by many as being a major obstacle to success.

The Issues For Businesses

The major concerns for businesses when dealing with the myriad of regulatory obligations include:

  • Lack of consistency within regulatory advice and enforcement action
  • Little co-ordination between regulatory bodies
  • Failure by local regulators to understand the business well enough to regulate it effectively
  • Difficulties simply understanding the applicable regulatory requirements and keeping up to date with, what often appear to be, a constant changing of the goalposts.

A One-Stop Shop for Regulatory Assurance?

There are, however, real attempts being made by local regulators to view regulation from the business end of the telescope. The general aim as identified by the Local Better Regulation Office is ‘to reduce unnecessary red tape for law abiding businesses to allow greater focus on targeting the rogue traders and persistent offenders who harm vulnerable people and damage our communities’.

The Primary Authority Scheme which launched in April 2009 was established on the simple premise that businesses should be able to rely on the advice it gets from local authorities. Prior to the scheme being introduced businesses that sought, obtained and relied on advice provided in good faith by a local authority, remarkably received no legal protection if challenged by another local authority.

Although at its outset, the schemes critics were concerned that the cost to a business partaking in the scheme would outweigh its worth, over 2 years later more than 1000 partnerships have been established with over 400 businesses covering nearly 1.2 million employees.

Essentially what the Primary Authority Scheme does is enable a business which operates across council boundaries to form a partnership with a single local authority in relation to regulatory compliance covering mainly environmental health and trading standards legislation.

The scheme is limited to businesses which operate across council boundaries, but this is not limited to geographical premises. It also covers manufacturing businesses whose products are sold regionally and nationally and businesses which operate on the internet and/or via mail order.

Once the partnership is registered the business can seek and receive robust and reliable advice on all manner of regulations from the primary authority which crucially must then be respected by all local regulators. National inspection plans can also be drawn up by the primary authority to improve the effectiveness of inspections of businesses and avoid costly duplication.

If a regulatory compliance issue should arise with the business, any potential enforcing authority must liaise with the primary authority where possible to ensure a consistent and informed approach to the business is adopted. In cases where enforcement action is proposed against a business involved in the scheme, a formal notification process exists to ensure that in most cases the primary authority is informed of and has an input in deciding whether enforcement action is appropriate.

It should be noted however that investigative actions such as test purchases, inspection and seizure of goods, records and documents and interviewing suspects under caution do not constitute enforcement action and therefore fall outside the requirement for an enforcing authority to notify the primary authority. However early dialogue between the two authorities is still actively encouraged.

As the number of partnerships continues to increase, the Local Better Regulation Office is now looking at ways in which the principles of the Primary Authority Scheme can be applied to other smaller businesses. Businesses which do not qualify for the Primary Authority Scheme should certainly consider contacting their local authority to identify whether any related schemes are in operation or being planned which could assist them.

Whilst the Primary Authority Scheme is certainly not the answer to every regulatory issue a business may encounter, it has many advantages for a business wanting advice which promotes certainty, consistency and sensible risk management. In today’s economic climate such benefits are not just desirable but essential.

If you would like more information on this topic or an initial discussion with no obligation please call Sarah Wallace on 0207 421 3883 or 07808 899657.