British legal eagles fly to India for support

Firms are taking a hard-headed look at costs and outsourcing some legal services to India

Some of Britain's biggest law firms arecutting costs for the duration of the downturn by sending tasks including conveyancing, accident claims and due diligence investigations to young lawyers in India.

Thousands of Indian lawyers and recent law graduates are being employed by British firms for a fraction of the cost of having the work done in this country.

Leading the charge for the cheapersupport services is Clifford Chance, the world's largest law firm, which has set up its own bespoke offshore centre in Delhi.

Eversheds, another leading UK law firm, has confirmed it is making use of Indian-based legal resource centres. Now it has emerged that dozens more legal businesses have expressed an interest in following suit by outsourcing hundreds of millions of pounds worth of high-volume work.

CPA Global, a legal process outsourcing company, said more than 30 law firms and company legal departments are in talks to use its legal support base in India, which employees 450 graduates and lawyers. Two law firms have already signed deals but are sensitive about going public.

CPA is one of the biggest providers of these services in India and counts Microsoft among its clients. It says the downward pressure on legal costs in the economic downturn has forced the once-conservative legal profession to consider radical means for delivering legal services to clients who want fees to be fixed, rather billed at an hourly rate.

Indian firms have responded by offering US and UK law firms litigation support and compliance work at around 100 different legal outsourcing centres.

Andrew Loach, vice president of business development at CPA, said: "Legal process outsourcing has been on the agenda for some time for corporations and law firms looking to reduce costs, but the economic downturn has significantly accelerated this trend. We have seen enquiries increase dramatically. At the beginning of the year, we were talking to five prospects. Now we're in discussions with over 30 – more than 20 of these being law firms and another 10 being corporate legal departments."

He added: "Law firms recognise they have no control over external factors such asmarket conditions, so they are starting to focus on things they do have control over, and one of the most important is their internal cost base. Many managing partners of law firms have recognised that top-line organic growth will be difficult to achieve during 2008-2009, and that profits may suffer during this period. They have become much more receptive to assessing alternative and innovative ways of reducing their cost base to reflect current trading conditions."

Law firms are attracted to India because of its large pool of English-speaking graduates – around 80,000 graduate each year – and its common law system based on English law. The often negative image of call-centres is increasingly being replaced by more accurate perceptions of the quality of legal work available from professionals in India.

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