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THE LEGAL VIEW: THE LAW SOCIETY


THE ECONOMIC IMPORTANCE OF LEGAL SERVICES


THE LEGAL SERVICES SECTOR MAKES A SIGNIFICANT DIRECT CONTRIBUTION TO THE GLOBAL ECONOMY, SAYS NANKUNDA KATANGAZA, FORMER HEAD OF INTERNATIONAL POLICY


T


he importance of high-quality legal advice has long been recognised as being central to all financial and business transactions. Financial service centres thrive if they have


the right legal framework to support commercial transactions and resolve commercial disputes. Firms in England and Wales are globally recognised as leaders in providing advice on developing financial centres across the world with a physical presence in every continent and a thriving domestic market. Tose involved in providing legal advice and


representation have long held the role of trusted advisor. Te high professional and ethical standards adhered to by English and Welsh solicitors, together with client protection requirements and rigorous education and training, all contribute to this perception. Te legal services sector makes


a significant direct contribution to the global economy. Te UK’s legal services provider account for 7% of the global legal services market and is the largest in Europe. Fourteen UK firms in the Global 100 account for 16% of Global 100 gross turnover - more than all other jurisdictions combined, with the exception of the USA. UK legal services turned over £27.22 billion in 2011 and contributed £20.47 billion to the UK’s gross value added. We are the largest net contributor of any professional services sector. Internationally, the UK exported £4 billion worth of services last year, and contributed to a net positive trade balance of £2.85 billion. Legal services are economic powerhouses in and of themselves but they are also magnets for other business looking to locate in a city and a country where there is the right level of legal support. Indeed, the economic contribution of legal


services should be seen in the broadest context. Beyond facilitating the administration of justice and the rule of law - a dynamic legal services market is the foundation of a multiplier and enabler for economic growth and stability. It


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makes a catalytic contribution to the economy by boosting business confidence through an impartial and efficient legal system able to settle disputes quickly, and also by ensuring a proportionate and effective regulatory regime that is essential for investment and a healthy business. Te greatest impact on improved business and


investment environments around the world has been attributed to government reforms that have reduced complexity and cost, according to the World Bank’s 2013 ‘Ease of Doing Business’ report. In a recent survey of potential investors, 84% considered the stability, transparency and efficiency of the legal system to be of paramount importance. Te advice UK law firms provide to companies


and organisations run on the implementation of, and adherence to, regulations (corporate governance and employment rules) help to reduce administrative costs and combat unnecessary – and often unwelcome – bureaucracy. Te safe and secure protection of intellectual


THE ECONOMIC CONTRIBUTION OF LEGAL SERVICES SHOULD BE SEEN IN THE BROADEST CONTEXT.’


assets is an important tool in the armoury of a government hoping to attract companies and organisations considering where to locate their research and development functions, or for giving entrepreneurs the confidence to innovate. More international and commercial disputes take


place in London under English law than in any other city in the world, and 90% of commercial disputes handled by London law firms now involve an international party1


. Parties to contracts, or those


seeking litigation, mediation or arbitration know that they can place their trust in a legal system that is clear, and built upon well-founded principles such as the ability to require exact performance and the absence of any general duty of good faith. As the independent professional body for


solicitors, the Law Society works domestically and globally to represent and support our members, promoting the highest professional standards and the rule of law. Our members’ expertise and skills are an important part of the UK’s professional services sector and, as such, to businesses looking to the UK for support in growing their markets at home and beyond.


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1 ‘Te Rolls Building, London’s Trump Card’, Te Gazette, Neil Hodge 09th February 2012


For more information go to www.lawsociety.org.uk EXPERTVIEW SPRING 2015 53


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