Thomson Reuters reports a global trend – clients are cutting their budgets on legal consultants, which affects the income and employment of lawyers. Clients do not wish to pay for expensive, low skill and routine work, instead they want flexible and high quality service for a lower price.
In 3-5 years, the BigLaw business model lawyers are used to may give way to various NewLaw forms: field work, Internet platforms, hybrid law firms, innovations, products and services instead of just services, etc. This model is more efficient and sustainable. Under these conditions, the geographic strategy for the development of Ukrainian companies will also change: automated processes and centralized training of freelance consultants may replace traditional regional offices.
Dividing law firms into national and regional ones is historically linked to the access to the legal profession and issue of licenses to practice the law in certain territories (as in Germany or the United States). In Ukraine, however, there are no such requirements for lawyers, which is why a law firm being regional or national usually depends on their clients, location and offices, as well as their business model.
So who will find these criteria useful, and how? First of all, our colleagues from the market of outsourced legal services, e.g. international law firms and their offices in Ukraine.
According to a survey by Olga Usenko, chief editor of the Ukrainian Law Firms, last year only 9.2% of the clients of regional law firms were other law firms, as opposed to 23.3 - 26.9% among the clients of major national players and boutique law firms.
What criteria are important today when hiring freelance lawyers to perform law services in regions:
- Reputation and trust: recommendations of colleagues, clients and former employees, successful track record, membership in alumni clubs.
- Professionalism: this includes international standards of customer service, knowledge of foreign languages, practical experience in relevant cases (both in that field of law and relevant branches of industry), and promptness in responding to clients’ requests.
- Price: project budget and financial benefits are no less important for outsourcing.
This market is still evolving, which is why international and national players outsource only legal procedures, such as on-site registration or simple lawsuits, but leave project strategies and basic communications for themselves.
After weighing all these criteria, we can conclude that there are no regional legal markets in Ukraine yet. The task of developing them can be assumed by the Ukrainian Bar Association, by promoting international standards of lawyers’ work in regions through their local offices. Competition based on transparent rules and universal standards will help clients understand the market better and increase the efficiency of law firms' projects.
Such was the conclusion that top managers of national companies and Ukraine offices of international law firms arrived at during the XIV Annual Legal Forum "Development of the Legal Services Market in Ukraine - 2018" organized by the Ukrainian Bar Association on 23 February 2018, where I had the honor to act as moderator.
