Article 2 Maximum penalty

(1)

For the purposes of section 37(3) of the Legal Services Act 2007 (financial penalties), the maximum amount of any financial penalty which the Legal Services Board may impose on an approved regulator is an amount equal to 5 per cent. of all income which the regulator derived from its regulatory functions in respect of its most recent accounting period.

(2)

The reference to the approved regulator’s most recent accounting period is to the most recent accounting period—

(a)

which ended before the imposition of the financial penalty; and

(b)

for which the regulator has audited accounts which have been drawn up in accordance with generally accepted accounting practice.

(3)

The amount of the income referred to in paragraph (1) is to be determined by reference to the audited accounts referred to in paragraph (2)(b).