Lammy: Turbocharging legal innovation
Legal services will be the first sector to join the government’s new AI Growth Labs – providing a regulatory sandbox for AI systems – justice secretary David Lammy announced yesterday.
The Ministry of Justice (MoJ) said applications would open later this summer for legal services providers, legal tech firms and “conveyancing companies”, before being rolled out to other sectors later this year.
The government described the AI Growth Labs as “a new advisory sandbox designed to accelerate the development and deployment of AI products and services by helping innovators navigate existing regulatory frameworks with greater confidence”.
The legal sector lab will bring together the Legal Services Board (LSB), Solicitors Regulation Authority (SRA) – which had lobbied to lead the initiative – Council for Licensed Conveyancers (CLC) and the Information Commissioner’s Office (ICO).
“Together, they will work with innovators to surface and address cross-regulatory challenges, identify any unintended barriers in regulators’ rules, and build a clearer picture of what good regulatory oversight of AI looks like in practice.”
Legal services was chosen as the first sector, “reflecting strong demand from the industry and clear evidence that smarter regulation can deliver breakthrough lawtech solutions”, said the MoJ.
The MoJ offered three “illustrative” use cases for the lab. First was Garfield.AI, the first AI-only law firm authorised by the SRA.
“AI growth lab provides a structured environment for legal services firms and lawtech companies to explore how innovative models, such as this example, can be compliant with regulatory rules, and overcome any concerns or assumptions that rules may be more rigid or restrictive than they are in fact,” it explained.
“The lab aims to give innovators greater confidence to develop AI-enabled services that are both compliant and capable of significant benefits to both consumers and business, improving their access to justice.”
The second example was a conveyancing firm that has developed a concept for an AI tool to analyse sales packs and identify issues that require closer examination.
“The firm wishes to use the sandbox to test the tool and find ways to demonstrate to the end user: why it has decided to highlight the issues that it has; and whether and how to provide assurance that other common issues not identified in a particular case do not arise in the data provided…
“Such an approach would provide assurance to other firms that might potentially use the tool without requiring a technical understanding of the AI approach.”
The final case study was a large law firm working with a lawtech company to develop an in-house AI tool to support its work in areas such as conveyancing and family law.
“The tool is intended to improve efficiency and consistency by drawing on information and data from the firm’s existing and historical client files, including correspondence, matter records (i.e. anything entered into official court records) and transaction data.
“As development progresses, the firm identifies a number of questions relating to its proposed approach, such as what steps they would need to take should they seek to use client data to train or fine-tune its AI systems.”
Through the lab, it would be able to bring these questions to the SRA, CLC and ICO “in a co-ordinated way rather than engaging with each organisation separately”.
Mr Lammy said: “The legal sector is a cornerstone of the UK economy, contributing over £40bn a year – yet too often it’s been held back by analogue systems simply not fit for the digital age.
“That’s why we’re deploying these new AI Labs to turbocharging legal innovation, helping us drive growth, boost efficiency and deliver smarter justice, as well as positioning the UK to lead internationally in this vital market.”
The LSB said: “The lab gives AI companies the opportunity to test products and services in the real-world under supervised conditions before bringing them to market, with regulators providing practical guidance on how existing rules apply.
“This ‘advisory sandbox’ offers legal services providers and innovators greater confidence to innovate quickly, without needing changes to any legal or regulatory requirements. Participation does not constitute regulatory approval, endorsement or authorisation.
“Following testing, the LSB and the regulators it oversees will consider what regulatory changes, if any, may be needed to further support innovation and growth, while ensuring consumers remain protected.”
Sarah Rapson, chief executive of the SRA, said: “AI is already transforming legal services, from enabling small businesses to recover debts, to helping consumers navigate complex legal processes. These tools are improving access to justice in a practical and meaningful way.
“The lab will accelerate this progress, supporting the growth of legal services that benefit the public, and that maintain the high professional standards that underpin trust in the legal profession.”
Milton James, chair of the CLC’s technology and innovation working group, added that the lab “has the potential to accelerate innovation and drive growth across the UK legal sector”.
LawtechUK, which is funded by the MoJ, launched its pilot version of a regulatory sandbox with five legal tech firms in December 2020.