SOLICITORS in the North-East will need to brace themselves for new challenges as large businesses look to move into the legal services field, the Law Society President Kevin Martin warned today.

A historic shake up of the legal services market is underway with the new Legal Services Bill, which will allow new forms of legal practice and external investors to be involved in law firms.

Mr Martin spoke at the opening of the Law Society's new office in Newcastle which will serve the 2,600 solicitors in the our region.

He said: "Just last week, the AA said they would like to offer legal services as soon as the market opens up.

"They may want to buy a law firm or set up an in-house legal team, but the legal landscape is changing and solicitors in the region need to be aware of this.

"The Law Society will be vigilant to ensure equal standards of regulation for these new entities and a level playing field which is fair to all practitioners."

On his visit to the region, Mr Martin said he had spoken to solicitors working on the legal aid sector who had concerns about the collapse of some areas of service.

"A growing number of people are unable to find a legal aid solicitor to help them improve their lives and the system is currently being run on the goodwill of solicitors and others due to inadequate funding", he said.

At the opening ceremony, Margaret Fay of the regional development agency One NorthEast said it was a real coup for the region to have attracted the Law Society to the area.

The new regional office will be working with local law societies based at Hartlepool, Sunderland, Tees Valley and Newcastle to feedback views of local solicitors to government.

It will also help local firms develop their business and individual solicitors with their career development.