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In-house teams to spend less on law firms, counsel, suggests survey

Are legal department budgets better invested in-house than paid to outside lawyers?
Are legal department budgets better invested in-house than paid to outside lawyers?

Law firms may lose company referral business if the predictions of general counsel (GC) surveyed by event management company IDEX Legal and information firm Thomson Reuters come true.

The two companies surveyed over 65 Indian general counsel (GC) and other senior counsel in March 2016.

74 per cent of the participating GC declared that they planned to decrease the use of external counsel over the coming 12 months.

Around 83 per cent stated that they intend to increase the size of their legal team over the next 12 months.

This finding isn’t a new trend – in 2015’s version of the survey, 56 per cent of the GCs had reported that their legal team had expanded in the last 24 months.

Law firm fee currently eats up more than one-third of the in house legal budget of the GCs companies.

Law firm allocations

Survey participants said that on an average 34 per cent of the total spend of their departments consisted of fees of engaging external counsel.

The largest share, 47 per cent of the budget, was spent on the in-house legal teams themselves, with the remaining budget going to “non law firm vendors” (see graphic below).

Around 47% of budgets go in-house, 34% to law firms
Around 47% of budgets go in-house, 34% to law firms
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