A study by the Law Society points out that, although global investment in LegalTech continues to increase, it is not yet a mature sector. The same report places Madrid as an emerging focus in the sector, thanks to the work of entities such as the IE Law School, the Garrigues law firm and the Institute for Legal Innovation.
The technology sector applied to the world of Law, or LegalTech, is experiencing moments of intense activity, to which our country is no stranger. Throughout this year there have been numerous events organized, of which we have been reporting in these pages, and the first ones have also reached the market Monographs who have analysed this phenomenon in depth.
Very recently, the British Law Society, an organization that encompasses lawyers from England and Wales, has carried out a study on the situation of LegalTech in the world, in which it highlights the position of Madrid as a new emerging focus in this sector, thanks, among others, to the contribution of three to the sector: IE Law School, the Garrigues law firm and the Institute of Legal Innovation.
The study, entitled “Lawtech: a comparative analysis of Legal Technology in the UK and in other jurisdictions”, aimed, according to its promoters, to carry out a comparative analysis of public, private and third sector accelerators of innovation and adoption of legal technology in the United Kingdom and in other jurisdictions. To this end, the study has been based on the data available up to August 2019.
What is Lawtech?
It should be noted that for the Law Society, the term LawTech describes “technologies that are intended to support, complement or replace traditional methods of providing legal services, or that improve the way the justice system works”.
As you can see, the concept includes what is known in our country as LegalTech. Some experts, such as Moisés Barrio have indicated that while this refers to tools to help the work of lawyers, LawTech refers mainly to the tools that replace these professionals. For the purposes of this article, we will use both terms interchangeably.
In this sense, it includes a wide range of tools and processes, such as document automation; advanced chatbots; practice management tools; predictive artificial intelligence; smart legal contracts and knowledge management and research systems
According to the Law Society, this sector is made up of both law firms that provide legal services through technology, and the providers that develop and supply technological solutions to these firms.
A growing sector
1. The global legal technology market is growing rapidly globally, already reaching a valuation of around $15.9 billion.
2. The adoption of new technologies could increase productivity growth in the legal sector from 1.3% per year to 2.7% per year.
3. However, Lawtech is still a less mature sector than other fields of digital disruption, in particular financial technology or Fintech, in which financing and regulatory alignment are more advanced.
4. The already established areas of the sector are that of collaborative tools (Collaboration Tools); document management (Document Management); the management of industrial property (IP management) and billing (e-billing). In the UK, in particular, the most established products in the UK are aimed at eDiscovery and legal search and research (Legal Research)
5. The sector’s growth areas are legal analytics (Legal Analytics); the management of legal projects (Legal Project Management); Governance and Compliance (Compliance) and contract management (Contract Management).
Other findings of the study, more focused on the United Kingdom, indicate that this country is at the forefront of the most advanced in legal technology worldwide (in close competition with Singapore, Hong Kong and the Netherlands); London is becoming a benchmark centre for the sector (especially in areas such as artificial intelligence, cybersecurity and FinTech), so it is likely that investment in UK Lawtech will increase, although it will need continued investment to stay ahead, due to the strong competition that is developing in other countries.
By continents, North America has the largest number of start-ups in this sector, followed by Europe and Asia and, at a great distance, South America.
10 emerging cities in the development of LegalTech (includes Madrid)
The report highlights 10 cities in the world as new emerging places for the development of Legal/LawTech: Toronto, San Francisco and Atlanta, in North America; Belfast, London and Madrid in Europe; Tel Aviv in the Middle East and Kuala Lumpur, Hong Kong and Singapore, in Asia.
Madrid’s position, which stands out in the face of the decrease in the creation of start-ups registered in Barcelona that is also included in the report, is based on the activity of institutions such as the IE Law School, that it teaches a course on lawtech and start-ups, in partnership with other international universities; The Institute of Legal Innovation, very focused on LawTech and the firm Garrigues, which stands out for its Innovation Think Tank, in which its members can develop new ideas.
First published by Wolters Kluwer
Carlos B Fernández
