No one can escape the influence of the digital age, but what will the new technologies mean to providers of legal services? Richard Li reports

The power of the computer, internet connection and data storage has never been so revolutionary, ubiquitous, exciting – and intimidating. The integration of those three capacities means that, in a highly connected world, a vast number of data can be easily collected, processed and analyzed by an artificial brain that doesn’t need rest, and the online knowledge-sharing or computer-generated results can be easily accessible through the internet to relevant users instantly.

Zhang Danian, the chief representative of Baker McKenzie’s Shanghai office, says that digitization is affecting most business sectors, and the legal industry is not immune to this. “Successful firms are proactive, and they adapt, rather than retrench and practise old models,” he says.

Bai Gang, a senior partner at Wanhuida Peksung in Beijing, believes that the traditional legal sector is facing impact and revolution brought about by internet-based big data and artificial intelligence (AI) technologies that result in the learning of expertise at substantially lower costs, and consequently, the decline in the absolute leading advantages of some professionals. He adds that professionals providing legal services that require little expertise risk being replaced by AI technologies.

Bai-Gang,-Senior-Partner,-Wanhuida-Peksung

“The combination of big data and AI technologies can be a game changer for the legal sector by facilitating an industry upgrading,” says Bai. “While some firms and professionals benefit from fast growth due to ready access to expertise, others that provide low-end services or repetitive labour are very likely to be eliminated. That is how the impact on the traditional legal sector works.”

Bai suggests that, against such a backdrop, law firms should strengthen not only construction of their knowledge management platforms but also sharing of best-in-class expertise and practices to enable more efficient access to necessary knowledge by their employees. “On the other hand, accessibility to knowledge is bridging the gaps between firms in term of legal service capabilities,” he says. “In such a context, law firms should attach greater importance to training of professionals, because their core competencies will depend on high-calibre talent and their sophisticated capabilities.”

Zhou Bo, a senior partner at Wintell & Co in Shanghai, agrees that big data and informatization pose an immense challenge to traditional legal services. He envisages an era of electronic data processing when automatic generation of a verdict is enabled simply through entry of evidence, especially for cases to which summary proceedings are applied. He points out that such a verdict can serve as an important reference for judges because its generation is based on the retrieval of all precedents.

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Bespoke needs create difficulty

Hu YiguangSenior partnerLifang & Partners
Hu Yiguang
Senior partner
Lifang & Partners

Hu Yiguang, a senior partner at Lifang & Partners in Beijing, believes that an overwhelming trend for law firms will be to informatize their operations, although the progression varies depending on factors that include the firm’s development stage, awareness, and capabilities of its management, and to what degree the firm believes that informatization is important.

Many firms prefer purchasing management systems or other IT products from external service providers. However, Hu does not think that the IT technologies available in the market fit into the needs of law firms. He argues that an IT management system suitable for a business enterprise may not be a smart choice for law firms due to their idiosyncratic needs relating to management, not to mention variations in the management approaches adopted by different law firms.

“However, law firms only account for a small portion of total market demand due to the fact that there are a limited number of firms and still, for some, IT management system is not a must. As a result, no big players are willing to develop bespoke IT products for the legal sector,” he says.

Automation tools developed by PRC firms

Some PRC firms are actively involved in the independent development of automation tools. For example, Jianfabang (www.jianfabang.com), an SaaS platform enabling online DIY legal document preparation services, targets startups and enterprises in the early growth stage, and was launched in June 2015 with support from Han Kun Law Offices.

“Jianfabang is committed to providing users with inexpensive and quality online legal documentation services,” says Li Chaoying, a partner at Han Kun Law Offices in Beijing. “It also provides online tools such as a finance calculator, equity allotment calculator, Jianfa AI and an option management tool to help tackle challenges faced by entrepreneurs.”

Zhu Xiaohui, the director of Tian Yuan Law Firm, reveals that the firm is discussing a co-operation plan with an institution that specializes in AI technologies. Tian Yuan wants to work with the institution to develop a robot assistant that will be used on public platforms (e.g., its website or WeChat account) to answer simple, frequently asked questions.

Tian Yuan’s plan also includes using AI technologies to assist in lawyers’ work. The plan will be initially implemented for litigation services. As an ultimate version of the plan, once details of a case are entered into a computer, it will be able to outline considerations for the case and go further to provide case studies and key concerns based on these considerations. “In addition to helping lawyers in case analysis and judgment, AI technologies will facilitate internal training effectively,” says Zhu.

JunHe’s R&D efforts in AI technologies were initiated at the end of 2016. “Developing AI technologies is difficult for law firms, given their lack of technical capabilities, although they have professional legal knowledge and skills,” says Hua Xiaojun, a partner at JunHe in Beijing. “JunHe has taken a participating interest in a small business with the aim of taking part in the development of an AI product designed to facilitate due diligence conducted by lawyers. The program is at a very early stage, though.”