The introduction of information technology in the legal industry has been going on for a long time, but only a few years ago a new field had a definition – Legal Tech.
LegalTech (short for legal technology) is an IT service for professional legal activities, as well as the provision of legal services to consumers using information technology.
It is believed that LegalTech originated in the United States, and the first LegalTech company is usually called LexisNexis, created back in 1977. However, the industry began to actively develop in the 2000s, when the first online legal consultations and services for automated document creation appeared. And now lawyers are talking about the insufficient efficiency of the business models of the oldest law firms that have not adapted to the development of the latest technologies, as well as the importance of using innovative LegalTech solutions for the development of the legal services market.
LawTech is a variety of online applications and services that allow you to replace traditional ways of obtaining legal services with new ones and (or) make it easier for users to access legal information.Their main difference from LegalTech is that these technological solutions are not intended for lawyers, but for end-users of legal services who, without directly contacting a professional lawyer, receive the necessary legal advice or other legal services (primarily for citizens and small businesses).
Despite the above-mentioned difference between the types of technologies under consideration, in practice it is often not so obvious, and not in all cases, technological solutions related to the legal sphere can be clearly distinguished into those related to LegalTech and LawTech. Often, the same services and applications are intended to solve the problems of both professional lawyers and end users of legal services: for example, both lawyers and their clients can use the services of legal reference systems or a calculator for calculating state fees for court cases.
Digitalization of the conservative legal industry is accelerating: from 2017 to 2020, the costs of legal services for information technology increased by one and a half times, instead of 2.6% of the internal budget, they began to spend 3.9%. Gartner predicts that by 2025, these costs will increase by another three times, and the share of technology in the budgets of legal services will reach 12%.
The automation of legal processes is carried out by both specialized software companies and IT specialists who solve the customer's problem on a specific request. Automation goals: reducing the cost of a lawyer's services, customer risks, prompt execution of client requests. Technologies also help to make the work of lawyers more convenient and transparent, and make it easier for the client to communicate with the authorities.
Obviously, for the legal business, automation has more advantages than disadvantages.
One of the latest trends in Legal Tech is the use of intelligent assistants, thanks to which you can analyze large amounts of data and documents, collect information automatically, receive notifications and respond to situations in time. At the same time, the harm associated with the human factor is minimal.
Such assistants appear in different areas, significantly speeding up the work and making it more convenient. Automation of projects will help to collect and not lose the information necessary in accordance with the technological processes. There are also a number of CRM systems designed for legal operations. Some companies adapt the SAP, 1C system to the legal features. The idea behind this activity is to tailor processes to patterns and common standards. In addition, there is a fundamentally different approach – the creation of their own systems.
Thanks to the automation of simple services (for example, obtaining an information certificate, creating a document according to a template, etc.), it is possible to exclude a lawyer from the chain of communication with a client by describing all the possible movements of the algorithm in this process.
Then, provided that all the necessary information is obtained from reliable sources (commercial or open), the automation process takes place. The lawyer and the IT system monitor the relevance of the process, while the legal assistance itself becomes better, and the process of its provision is accelerated.
The market for legal services thus becomes more competitive. For example, receiving compensation from the airline, contesting fines, checking the employment of a trademark. And the more new opportunities there are, the more interesting and useful services will appear. If this is accompanied by the development of digital legislation, open APIs and databases will become widespread, the level of services will become very high.
A promising direction in the development of LegalTech is the creation of robotic consultants capable of answering simple questions. So, the robot can understand the question, clarify the information and then give an answer. This, in fact, is possible in any area of law, the only limitation is the number of options. The battle between lawyers and robots is already underway, and in standardized tasks like the NDA, robots are showing faster results with fewer errors.
Another area of development of the industry is software that helps analyze documents for errors in the application of legislation, which could automatically track changes in it, as well as indicate potential problems and risks at the stage of document formation.
The use of chatbots, solutions that allow converting paper documents into electronic form and analyzing the data received, as well as blockchain, which in the future will be able to replace, in particular, the traditional notary system, represent a great potential today.
For the LegalTech sphere, the correct operation of the electronic digital signature system at the state level is very important. For a document to become legally binding, it must be signed. Paper documents are signed by hand, and electronic digital signatures are used – unique digital information in the form of a combination of characters. From this information, you can find out exactly who and when signed the document. The industry also needs a digital state that will work transparently, adopt reasonable and timely laws.
