China’s Push in Artificial Intelligence Development Spills Over into Legal

Topics: Access to Justice, Artificial Intelligence, China, Data Analytics, Efficiency, Law Firms, Leadership, Legal Innovation, Thomson Reuters

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HANGZHOU, China — You need only take a ride on one of China’s high-speed trains or visit one of its vast new cities full of residential towers to understand that the country is pretty good at getting things done when it sets its collective mind to it.

Next up on China’s (digital) infrastructure agenda? A play to become the world’s leader in artificial intelligence technologies. In June 2017, the country announced a new Artificial Intelligence Industry Innovation Alliance, which calls for China to become a global innovation center in AI by 2030, with an estimated total output from AI industries of about $150 billion. The Chinese State Council calls for an “open and coordinated AI innovation system” to develop not only the technology, but also the products and the market. China’s total investments in AI enterprises reached $2.6 billion in 2016 by some estimates.

That announcement came as a backdrop for the Legal+Technology New Champions Annual Convention, a conference held late-July in Hangzhou, China, the home of e-commerce giant Alibaba. While this was not an AI conference per se, it is not difficult to connect the dots between the announcement of billions of dollars in state investment in AI and the excitement shown by Chinese leaders in the legal field — if China is to become a leader in the AI space, now would be a good time for the various actors in the legal space to start staking out claims on some of the action.

The event — now in its second year — was hosted by Shanghai-based BestOne Information & Technology Co., a legal services provider whose flagship offering is a consumer-facing platform for quick legal consultations delivered through an online and voice platform. (Since 2009, BestOne has delivered more than 21 million legal consultations.) The regional government in Hangzhou also provided support for the event.The 560 convention attendees included chief legal officers from China’s state-owned enterprises and new technology companies; leading professors on intellectual property rights, business transaction disputes and insurance law; lawyers and practitioners from large and small law firms; and judges and officials from various levels of government.

From the West, speakers included:

  •        Richard Susskind, author of the world-wide bestseller Tomorrow’s Lawyers [and the gentleman in the red tie speaking in the picture above];
  •        Brian Kuhn, co-founder and leader of IBM Watson Legal;
  •        myself (David Curle, Director of Market Intelligence at Thomson Reuters Legal); and
  •        joining via video link was Brian Liu, the founder and former CEO of LegalZoom, and Andrew Arruda, CEO of Ross Intelligence.

Chinese speakers included:

  •        He Fan, a judge on China’s highest court and a frequent writer about court reform;
  •        BestOne’s CEO Feng Zihau, who during the conference signed an agreement of cooperation with the local authorities in Hangzhou;
  •        Jingzhou Tao, China managing partner for US law firm Dechert;
  •        Hong Tianfeng, CEO of investment fund F&G Venture and former vice-chairman and COO at Huawei Technologies; and
  •        Xu Wu, professor at the Walter Cronkite School of Journalism & Mass Communication at Arizona State University. He played multiple roles at this event, serving as emcee for the opening session, working the PR, media and branding angles, and serving as cultural ambassador between the foreign visitors and the Chinese.

There was an intense interest in what China has to learn from the development of legal technology in Western markets such as the US and the UK. As with the current hype-cycle in the Western legal industry, however, there was a tendency for Chinese speakers and the audience to conflate AI with legal technology in general. Chinese legal tech enthusiasts showed the same tendency as their Western counterparts to view AI as some kind of magic pixie dust that can be sprinkled over the legal industry to transform it. The Western speakers did their best to try to temper the exuberance of the audience while sharing their own visions for a future legal services industry, in which AI will certainly play a significant role.

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Thomson Reuters’ David Curle (left) joins in a discussion at a recent legal tech event in China

There was no shortage of ambition on display — many Chinese lawyers look to technology to give them an edge in one of the world’s most cutthroat legal markets. Local colleagues in the legal tech space agree. “You see a lot more buzz around legal tech and a lot more openness to change in China than anywhere else in Asia except perhaps Singapore,” says Peter Davies, Legal Solutions Specialist for North Asia at Thomson Reuters and a former M&A lawyer. “Lawyers get characterized as professional pessimists, but the sector here expanded very fast and many managing partners have only ever known a bull market. To them, it’s a natural next step to incorporate technology to keep on growing at that same breakneck pace; and the relative youth of the sector means that the innate conservatism of many lawyers from the West has yet to become ingrained.”

What was really striking about this event was the combination of the diverse roles represented in the attendees, on the one hand, and their united focus and determination to learn as much as they can so to begin applying that knowledge to further China’s goals in this area, on the other. The group included — in contrast to most US and UK legal tech and innovation conferences — a healthy mix of law firm practitioners, heads of in-house legal departments, representatives of the judiciary, non-governmental organizations, and various government entities. It included a wide range of ages and — again in contrast to many similar events in the West — a balance of men and women. But for all that diversity, there was one unifying principle: All were on board to build out China’s role in the application of AI to legal problems and to thereby play their own part in wider national goals.

There was a familiar feel to this event. It felt a lot like the buzz and excitement of the 2014 ReInvent Law conference, which many now see as a watershed in the development and mainstreaming of a strong legal tech movement in the US. There was the same crowded event venue, the same high-energy audience from a mix of legal and technology backgrounds feverishly exchanging contact information, and the same sense that something big was about to change in the legal services industry.

Real transformation and disruption rarely comes as fast or as comprehensively as these industry events would sometimes lead a crowd of speakers and attendees to believe, but the Chinese have a pretty good track record when it comes to the overall transformation of their economy.

Time will tell if a Chinese legal tech transformation will become a component of that overall trend, but I wouldn’t bet against it.