Adjacent businesses, regulatory barriers and virtual nomads

Session Chair

Paul D Paton, Chapman University Fowler School of Law, California

Panellists

Hanim Hamzah, King & Wood Mallesons, Beijing (now KPMG, Singapore)

Dominique Hogan-Doran, 5 Wentworth, Sydney, New South Wales; Senior Counsel, Australian Bar

Stephen Revell, Making Change Happen, London

Panupan Udomsuvannakul, Mori Hamada & Matsumoto, Bangkok

Valéria Wessel Souza Rangel de Paula, Simões Pires Advogados, São Paulo

Reporter

Saranya Mishra, Khaitan & Co, Mumbai

Session overview

This session focused on the evolving landscape of the legal profession as influenced by adjacent businesses and virtual nomad lawyers. With the boundaries of what constitutes ‘legal services’ becoming increasingly blurred, the discussion centred around the regulatory challenges and potential solutions across various jurisdictions.

The lead IBA committee for the session was the Alternative and New Law Business Structures Committee, and it was supported by the Law Firm Management Committee and the Regulation of Lawyers Committee.

Key discussions

Changing times

The panel addressed how the rise of technology and non-traditional legal service providers is redefining what constitutes the practice of the law, as well as the evolving concept of the digital nomad. The implications of these changes for both regulation and competition within the legal market were discussed.

The panel had a rich geographical representation, providing the audience with valuable insights from every continent. The jurisdictions represented by the panel included Australia, Brazil, Canada, Indonesia, Japan, Singapore, Thailand, the UK and the US.

The discussion was focused on two aspects: adjacent businesses and virtual nomads.

Adjacent businesses

The panel discussed a wide range of aspects, from whether a law degree is required to establish a legal practice, ie, professional barriers to entry in regard to the career trajectory in terms of a glass ceiling for a non-lawyer in a law firm, conversely to whether a non-lawyer can be partner in a law firm.

The discussion covered the classification of jurisdictions into three buckets: open market, closed market and somewhere in between. While Thailand emerged as a free and open market, markets like Japan and Brazil were decisively closed with a regulatory monopoly, while Australia was found to be progressing away from a conservative outlook.

Hanim Hamzah discussed the perception of the ‘Big 4’ as consultants and non-lawyers, and the emergence of KPMG Law and its expansion using case studies in Denmark and Singapore.

Valéria Wessel Souza Rangel de Paula shared how the Big 4 cannot practice law in Brazil, and the Brazilian regulatory mandate that only lawyers can partake in law firm ownership and/or partnership.

An interesting aspect that was also discussed by the panellists was non-lawyer third-party ownership in a law firm, and the showstopping case study in the discussion concerned Halmer, which concerns the case of Daniel Halmer, a Berlin lawyer and tech entrepreneur, who sold 51 per cent of his law firm to a non-lawyer investor.

On a related note, during the Q&A session when the floor was open for comments and questions from the audience, it was pointed out that Israel has no limitation on non-lawyers being shareholders. Another contributor also shared how in their experience as an antitrust lawyer, there is immense need for non-lawyers like economic advisors, etc, and they shared their perspective on the glass ceiling for non-lawyers in a law firm.

Virtual nomad lawyers

The panel highlighted the increasing number of lawyers who operate remotely, underscoring the need for a flexible regulatory framework that accommodates this new type of workforce.

Paul D Paton, in a jovial manner, sought comments on the practice of the law, while looking at pristine beach views. He acknowledged Stephen Revell as a virtual nomad, way before the Covid-19 pandemic instigated the rise in remote working.

A hypothetical case of an English lawyer practising English law in a non-UK territory was also discussed, and Revell spoke about the Indian context and restrictions on foreign law firms setting up a foreign law practice in India.

Dominique Hogan-Doran emphasised the gig economy, which has existed for multiple years now. The discussion progressed with each speaker sharing insights on the specific regulatory environments in their jurisdictions.

The interplay between a licence to practice and the ability to practice the profession when on vacation was also discussed. Panupan Udomsuvannakul shared that while in Thailand anyone is free to practice the law in the sense that anyone can give legal advice, but an immigrant would technically require a permit in order to work for profit when in the jurisdiction.

Conclusion

The panel session, moderated to perfection by Paton, offered an in-depth analysis of the current legal landscape, particularly as it relates to the rapid evolution of business models and the increasing prevalence of virtual legal practices.

As non-lawyers participate in the provision of legal advisory services and technology reshapes how legal services are delivered through virtual consultations, automated document generation and online dispute resolution, the relevant regulators that govern these practices must engage in a dialogue with industry stakeholders and proactively adapt to keep up with the changes. As pointed by Hamzah, all these efforts boil down to the importance of providing access to justice.