China’s Growing Legal Tech Industry

4 min read.

China’s legal tech industry is an underrated sector that has experienced a significant growth in the current Digital Age. As a result, its culture is one that readily embraces various forms of technology in the workplace. With the Chinese legal community being generally forward-thinking and open towards innovation, we can expect to see many developments and breakthroughs in the legal tech industry in the future.

At a glance: China’s Legal Tech landscape with examples

A Brief History on China’s Legal Tech Landscape

As a growing  market that is only about 30 years old, the Chinese legal industry often experiences a shortage of legal professionals. Artificial Lawyer, an online publication focused on AI news in the legal profession, states that for every 4,500 citizens in China, there is only one lawyer, a ratio far from that of countries like the United States, which has one lawyer for every 300 citizens. This disparity has encouraged companies like Qihan, Wusong and Legal Miner to develop technologies that are aimed at increasing the accessibility and affordability of legal services for citizens across the board.

As a result, legal tech has contributed significantly to the industry, with courts relying more on technology to help determine the outcome of cases, given the overwhelming 19 million cases each year and only 120,000 available judges, according to the Financial Institutions Legal Snapshot. In 2017, internet courts were also introduced in Hangzhou, Beijing and Guangzhou to facilitate online dispute resolution and reduce the strain on physical courts. A report by Legal Daily estimated the internet court in Hangzhou alone to have heard over 26,000 cases since it was launched.

Apart from compensating for the shortage in manpower, legal tech can also help boost productivity in legal procedures. If robots were able to sift through piles of paperwork on behalf of lawyers and tend to the more mundane, repetitive and time-consuming tasks, then lawyers themselves will be able to focus on the more sophisticated aspects of their jobs and take on more cases. Realizing the importance of the legal sector, the Chinese government increasingly endorsed legal tech companies with generous funding in recent years. This support has contributed to the development and integration of technology into judicial processes.

Examples of Chinese Legal Tech

Internet Courts:

Internet Courts have increasingly digitized judicial proceedings in various ways. For example, platforms like Qingdun (擎盾), Thunisoft (华宇元典) and Gongdao (共道) feature databases with information and court documents from previous proceedings, enabling a smooth delivery and procurement of the relevant information during and prior to trials. Chinese courts have also developed an office automation system that facilitates trial management and connects different courts nationwide using big data to deliver analyses of court trials across the country in real-time, according to China Justice. Speech recognition technologies such as that provided by iFlytek (科大讯飞) are also frequently used to record court proceedings, though manual correction is still performed on the recordings in most cases to minimize errors.

Additionally, Chinese courts have also successfully integrated online trial services into pre-existing platforms such as Weisu (微诉), a WeChat-based mini program. This mini program allows users to attend trials via video call, submit court files and give testimonies over the phone, which can then be transcribed by WeChat’s voice-to-text technology. According to Artificial Lawyer, Weisu was first used in the Beijing Intellectual Property Court in 2017 and is now used frequently in intellectual property trials.

Electronic Contracts:

In light of China’s upgraded E-Signature Law passed in 2005, electronic contracts have become a crucial area of development for Chinese legal tech. A contract database like Fatianshi (法天使) has made sifting through legal documents much easier, whereas contract review and generation technologies have simplified administrative processes in contracts handling, especially for medium to large firms. These technologies have enabled legal firms to improve their productivity at a higher level of convenience.

Meanwhile, improvements in smart technology have led to advances in cryptography and a more robust system in safeguarding e-documents from being tampered with. With technologies such as Hetong Robot (合通机器人) and E-qianbao (易签宝) enabling the possibility of signing contracts electronically, legal e-documents could potentially replace signing contracts with paper and pen altogether. That said, the widespread application of such technologies are still in discussion, with companies still working on improving the security of their services and products before making a full transition to e-contracts.

Offline-To-Online (O2O) Legal Platforms:

O2O platforms offering legal services have also been a prominent area of development in Chinese legal tech. Often utilizing AI technology, these platforms enable clients who are seeking legal advice to be matched with a suitable lawyer more efficiently. These O2O platforms generally streamline and simplify the process of matching lawyers with potential clients, based on the areas of expertise of lawyers and the needs of clients.

What’s Next for the Chinese Legal Tech Industry?

The pros and cons of legal tech have been hotly debated in recent years. Proponents argue that legal tech would relieve the burden of human lawyers and deliver high quality service to clients, whereas detractors have expressed concerns that legal tech might threaten human job roles ranging from judges to legal clerks. Given current developments in internet courts and workflow automation, positions focused on administrative duties and data-based reasoning seem to be most at  risk. No matter which side will take precedence in the future, companies likely have ample time to figure out how to balance human roles with legal tech, in preparation for a more digitized future. 

Moreover, Forbes has reported the adoption of AI technologies to perform time-consuming in the legal sector to be more cost-efficient than relying on human roles, which further suggests the possibility of a widespread adoption of legal tech in the future. For individuals in the industry, the need to remain tech-savvy and gain mastery of legal technologies becomes all the more prominent, in order for them to remain competitive in the industry.

Generally, the outlook regarding the future of the legal tech sector in China is an optimistic one, though Chinese professionals in the sector often find the laudatory tone taken on by the Western media to be slightly exaggerated. The fact remains that developments are still rather nascent, and that the industry has far from adopted a widespread use of legal tech. While a breakthrough in AI, deep learning and other such smart technologies has not yet occurred in the legal industry, it could very much be a possibility in the near future.