Legal Process Outsourcing Surges in the Philippines

By Kathleen Yu

Legal Process Outsourcing (LPO) is one of the fastest growing sectors in the Philippine BPO industry. This is mainly due to the financial difficulties currently experienced by many US, Australia, Canadian and British law firms, as a consequence of shrinking legal budgets. According to research conducted by knowledge process outsourcing firm Evalueserve, the global LPO industry employed over 5,200 professionals in the first quarter of 2010 with India and the Philippines leading the pack with an estimated annual profit of USD 300 million. Legal Offshoring services are expected to employ over 19,000 professionals and post an annual revenue of USD 960 million by December of 2015. Some LPO firms in India have even predicted an annual growth of as much as 200%, citing recession-related litigation in the U.S. However, their expectations have not yet been realized. This is because U.S. lawyers themselves are now looking at alternative options to address the legal recession, and cut down on job losses.

The global Legal Process Outsourcing (LPO) Industry grew by as much as 40-60% in the last year alone. Although some areas collapsed from the recession, litigation, document review, and corporate compliance services brought both business and profits to the Philippines. More and more foreign and local law firms are now turning to the legal process outsourcing industry to cut down on their company’s overheads and reduce company expenditures. According to Evalueserve, these overhead expenses are usually related to marketing, general administration, information technology (IT), accounting, clerical, legal and knowledge management, and account for about 17% of a firm’s total expenditures. Companies that avail of legal process outsourcing (LPO) services reduce these costs by approximately 7%.

Amanda Carpo of Manila consulting firm Kittelson & Carpo Consulting says that “The biggest advantage of legal process outsourcing is that it is cost-effective and extremely efficient. A U.S. attorney typically charges anywhere from $150-600/hour for legal services and there is a good part of the work that can be outsourced to¬† legal process outsourcing firms for a fraction of this cost which provides value to the client. Apart from that, legal process outsourcing (LPO) firms sometimes have a faster turnaround time processing legal documentation, because they specialize in this. Private law firms and the legal departments of businesses simply lack the time, infrastructure, and technology to efficiently manage this procedure.”

Some legal process outsourcing services offered by law firms in the Philippines include legal coding, legal transcription, legal scoping, legal research, legal writing and drafting, legal documentation review, legal analysis, court reporting, due diligence, billing, litigation support, data entry, and many more.

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