WHILE IT, accounting and logistics are probably the services most frequently associated with outsourcing, the phenomenon is also common in legal services. The Slovak Spectator spoke with David Soukeník, partner of Soukeník – Štrpka law firm, Stanislav Ďurica, managing associate at Ružička Csekes in association with members of CMS, Andrea Butašová and Přemysl Marek from Peterka & Partners law office in Bratislava, and Daniel Futej from Futej & Partners, about the current interest in legal process outsourcing in Slovakia and which legal services or processes are suitable for outsourcing.
The Slovak Spectator (TSS): How would you assess the interest in legal process outsourcing in Slovakia and how has this interest changed in the last two to three years?
David Soukeník (DS): The interest in legal process outsourcing has, based on our experiences, an upward tendency over the long term. This is especially because of savings of operating costs of the client and the higher expertise of legal services provided resulting from their securing by an external subject. The higher expertise is not linked with the lack of qualified employees, but because a very narrow specialisation of employees with the legal education unable to provide qualified legal knowledge on the whole spectrum of the legal order of the Slovak Republic. Thus, from this point of view, it is suitable to involve external subjects, which either directly specialise in the given field of law or guarantee by their capacity and professional experience an expert solution to a problem.
Stanislav Ďurica (SĎ): The interest in legal outsourcing persists, which I consider to be positive. But in terms of the volume of opportunities is this field, similarly as in the case of other services, the [economic] crisis has also affected this field. For the time being, there is a tendency toward strengthening in-house legal teams as compared with the past. This results either from the need to save on costs on the side of clients but also from the fact that in general the quality of provided services has increased significantly over the last decade. Moreover, for the time being, the client rightfully expects more than just strict managing of a case or a project. This often also requires a complex commercial view of a certain affair, which is a minimal inevitable added value, which we try to provide to our clients on a daily basis.
Along with the expansion of business activities of our clients outside Slovakia, there occurs, more often than in the past, situations where we are looking for a solution for our client in cooperation with colleagues from CMS Cameron McKenna in various countries of Europe. A fundamental equipment of each law office should be an excellent interconnection to foreign colleagues.
Andrea Butašová and Přemysl Marek (AB and PM): In regard to the interest of our clients in legal outsourcing, we have not registered any significant changes compared with the development from the previous two to three years. Based on the experiences of our branch offices in central and eastern Europe, we can say that demand for external legal services basically mimics the curve of the economic development in the country. This is because external legal services are always a cost item, which was cut during this period of time.
Daniel Futej (DF): Based on our experiences the interest of companies in legal outsourcing strictly depends on the financial abilities of the company. In recent years we are witnessing that companies are very careful in terms of their costs, and one of the fields in which they save is legal services. This actually means that many risks are primarily assessed internally and this happens also in cases when a company is not fully prepared for doing so in terms of expertise.
Companies outsource especially the assessment of complicated and legally complex matters where it is required to assess the legal risk and asses the cost-benefit relationship. Also, companies appreciate the possibility to secure legal support from law offices in assessing complicated financial relations and tax risks in cases of large transactions, for example, mergers and acquisitions. Apart from this, it may also be economically more convenient for a law office to secure a service for a client via another lawyer in some specific fields of law, for example those related to the environment or competition.
TSS: Which legal services or processes are suitable for outsourcing? Why?
DS: Probably the most frequently outsourced services are services related to recovering claims, because this is a specialised field for which mostly creditors do not have their own capacities for coverage, especially in the case of a judicial recovery of claims. With regards to the extent of possible outsourcing in the case of legal services, this is actually unlimited. Possible limits could be found in the case of acts requiring an immediate response, for example, in employment-related legal issues, but during the current time of developed communication technologies even this does not represent any obstacle for legal outsourcing.
Insufficient knowledge of the internal relations of the subject that is securing provision of legal services by an external subject is not an obstacle because legal process outsourcing is also increasingly conducted directly in the internal environment of the client.
SĎ: Litigation is especially suitable for outsourcing, but also certain compact projects at which the extent of the risk is higher or for which it is necessary to reach for specific expertise or to diversify the risk of an error. Analytical assignments are also very often outsourced in cases where the added value is that the given law office holds specific expertise because of its experience in similar cases for other clients. Another field is so-called second opinion, when a client wants to get a confirmation that his local management or the current legal representative has set the suitable strategy for the solution of a certain problem, either in litigation or in the transaction field. Last but not least, a situation when a client needs to check various sensitive affairs before their implementation or before the local management gets acquainted with them. It is less necessary to outsource common daily affairs from the field of operations of the client, as long as the client has enough capacities for this.
AB and PM: The answer depends on the needs and the size of the company. It generally pays for small firms that do not have internal lawyers to outsource legal services, but of course only up to wage and payroll costs which they would have spent on an internal lawyer. Large corporations with their own legal departments contract external offices to deal with a specific legal agenda from the viewpoint of the legal field. On the other hand, they internally process especially ordinary, corporate, employment-related or commercial agendas.
DF: In principle, any legal services, either preparation of deals or legal analyses, but also representation in court trials, may be outsourced. From a practical point of view simple legal services, for example, contracts on the supply of gas, electricity, security services and others, do not need to be outsourced as most of companies are able to secure them on their own and the closing of such contracts is not linked with significant economic risks. The most frequent legal services outsourced are bigger transactions like mergers and acquisitions, where there is also a bigger risk of possible damages. In employment-relation law, the matter of employment termination is often being outsourced as this is often a matter of legal disputes between the employer and the employee. Outsourcing is used also in less frequented fields of the law, for example criminal law, which is what some lawyers specialise in.
