Corporate legal spending has reached new highs. What can law firms do to tempt in-house counsel to send more of it their way? Vandana Chatlani reports
Banking on an upswing in work thanks to liberalized investment policies, renewed optimism and a momentum that has long been lacking, India’s lawyers are rediscovering their bullishness. This buoyant mood is not pinned purely on hope, but grounded firmly in numbers. A total of 1,800 listed Indian companies spent roughly ₹219 billion (US$3.5 billion) on legal services between 1 April 2013 and 31 March 2014 according to research by the Economic Times Intelligence Group. This represents a 17.5% increase from the previous year. Pharmaceuticals, IT, oil and gas, capital goods and finance were the sectors with the biggest legal budgets and Reliance Industries, Ranbaxy Laboratories, Tata Consultancy Services, Larsen & Toubro and Infosys were the top five spenders.
The rise in legal spending has been attributed to the need to ensure compliance with a plethora of new rules and regulations. Transactional and litigious activity also plays a major role as does the enforcement of anti-bribery legislation globally.
The demand for legal assistance is promising, but clients increasingly expect fee flexibility and innovative costing to relieve the pressures on their purse strings. At the same time, greater exposure to international standards of legal service due to cross-border activity has created savvy in-house teams that expect their external counsel to deliver value through sharp skills, efficiency and business acumen.
The above information was supplied by participating law firms with their consent for it to be published in India Business Law Journal. Law firms that declined to have their rates published are not included. The figures quoted are the average hourly billing rates for each category of lawyer. Actual rates may vary depending on the nature and complexity of work. Law firms may sometimes bill on a project basis rather than an hourly rate.These figures are indicative of hourly rate billing only. The average rates for each law firm have been calculated as the mean average of the billing rates provided for each category of lawyer. India Business Law Journal has not verified the accuracy of the billing rates supplied by participating firms.