Resistance to legal tech innovations in Malaysia — a threat to the rule of law?


legal tech image
Image from

Guest writer Pang Jo Fan—Head of Marketing & Communications at legaltech lawyer-discovery service CanLaw—presents his views on why Malaysia’s Bar Council should be encouraging the development and introduction of legaltech to ensure access to justice.

Of late, there has been a spike in legal technology startups in the Malaysian market providing innovative tech solutions to assist both the public and lawyers in their day-to-day legal needs. Other than the more veteran players such as eLawyer and OfficeParrots who have been tirelessly serving Malaysian law firms with their human resource needs, there are also recent players such as Lesys Tenancy (tenancy agreements), BurgieLaw (legal directory), Dragon Law (document drafting), EasyLaw (calculators for lawyers), Locum Legalis (MOB app) and, of course, CanLaw (lawyer-discovery).

Much has been said about the Bar Council’s denial of Dragon Law’s entry to the Malaysian market and the infamous lawsuit against Answers-In-Law. The Malaysian Lawyer also provided an insightful update on the said matters based on the report by the Legal Profession Committee dated 1 December 2016 contained in the 2016/17 Annual Report of the Malaysian Bar. As it stands, it appears that the legal industry remains rather cautious of any form of tech innovations that are being introduced into the profession, mostly due to the general misconception that technological innovations pose a threat to the livelihoods of law practitioners in the country.

It is important for legal practitioners to note that while technology startups are often unfortunately associated with the “uber-isation” or “disruption” of traditional industries, only a fraction of them actually do. For the purposes of this article, tech innovations are often categorised into two different market forces: disruptors and enablers. Disruptors are technologies that challenge the way a certain industry functions in a very fundamental way. Enablers, on the other hand, are technologies that seeks to enhance and empower existing industries without reducing its fundamental relevance. Meanwhile, there are some technologies which exhibit a good fusion of both. Nevertheless, it would be too simplistic to argue that disruptions are bad and should therefore be avoided at all costs. Case in point, while Whatsapp “disrupted” the telecommunications industry, it enabled more efficient and effective real-time communication at no cost at all, directly benefiting individuals and businesses.

Internationally, we have seen a wide range of legal technology startups enabling legal practice in many ways. Clio and CoreMatter are great examples of how tech innovations have assisted 21st century legal practitioners in effectively managing the tedious administrative aspects of their practice so that they can focus on practising law. There is also a startup in the US, ROSS, that recently introduced Big Data and Artificial Intelligence (AI) technology into legal research, helping reduce lawyers’ research length from days to just seconds! While document drafting technologies such as LawCanvas are more disruptive in nature, it has been widely credited to have successfully removed a significant barrier between the public and access to justice, while allowing legal practitioners to spend their billable hours working on more high value cases and to develop the law.

Digital Malaysia needs digital access to justice

In his book “The Rule of Law”, the late Lord Tom Bingham submitted that there are 8 main principles which forms the ingredients of the Rule of Law, the first one being that “the law must be accessible and so far as possible intelligible, clear and predictable”. Other than for members of society to know their limits under criminal law and their rights under civil law, he also stated that access to justice is important for a country’s economic growth.

For many scholars and practitioners, the beauty of the law which rules us really lies in its ability to adapt to the constant societal changes to further the administration of justice. In 1959, Lord Denning authored a book called “The Way of An Iconoclast”, where he described defenders of the rule of law as:

“One who is not content to accept cherished beliefs simply because they have been long accepted. If he finds that they are not suited to the times or that they work injustice, he will see whether there is not some competing principle which can be applied in the case in hand. He will search the old cases, and the writers old and new, until he finds it. Only in this way can the law be saved from stagnation and decay.”

Essentially, he propounded that the original genius of the common law of England lies within its capacity to adapt its rules to meet different social conditions.

According to a report by the Malaysian Digital Association in August 2016, Malaysia has a 68.5% internet penetration, 67.7 % social media penetration and a shocking 144.8% mobile penetration. We spend on average 5.1 hours a day on the internet, of which 2.8 hours are spent on social media. These trends continue to grow at a rapid pace on a yearly basis.

What the trend above shows is that majority of Malaysians has joined the rest of the developed world in working and living within the digital space, a space the Malaysian legal profession has yet to fully penetrate. Recent research by Asia Law Portal showed that 40% of people start off their search for legal help on Google. Many of the individuals and small business owners we spoke to also said that in their search for legal help online they often have no choice but end up resorting to legal resources which are foreign in nature.

The social conditions has shifted in how the society and economy functions, the old ways of practice may no longer be “suited to the times”. As such, it is submitted that there is a dire need for the adoption of legal technology in Malaysia to bridge this “intelligible, clear and predictable” gap in access to justice. Something must be done to “save the law from stagnation and decay”.

As the late HRH Sultan Azlan Shah said in his very visionary speech 20 years ago in 1997:

“In order to guarantee a stake in the legal system of the future, lawyers must adapt, and take responsibility for changing their working practices.”

Regulators leading the change

Being adaptable to changing societal norms is by no means rendering regulation irrelevant. In fact, proper regulation is absolutely necessary for an innovative industry to thrive and succeed without posing as a national risk. Regulators should be at the forefront steering the wheel and setting the agenda for technological innovations in an industry. This way, an industry will be able to enjoy all the benefits of innovations.

We don’t even have to look overseas for great examples of such regulators. In April 2016, the Securities Commission (SC) launched their regulatory framework to facilitate peer-to-peer financing. In October 2016, Bank Negara Malaysia (BNM) followed suit by launching their Financial Technology Regulatory Sandbox Framework to “enable the experimentation of fintech solution in a live environment, subject to appropriate safeguards and regulatory requirements”. It is said that these frameworks are not meant to stifle the creative process at play, but rather to facilitate an orderly process while protecting the interests of various stakeholder and maintaining public confidence.

Regulators of many other legal jurisdictions have also identified this gap in access to justice and has since stepped in to drive legal tech innovations. The Singapore Law Academy recently released their Legal Technology Vision to help small firms adopt baseline technologies, setting up collaborative virtual platforms and initiate link-ups with other sectors to help create fresh legal technologies.

Collaboration is key in the digital age

I sincerely hope that the Malaysian Bar Council will be able to acknowledge this real gap in access to justice in digital Malaysia and begin a discourse with relevant stakeholders. I’m sure that the various legal tech players in Malaysia and lawyers alike will be more than willing to collaborate with the Bar in setting up similar regulatory frameworks and to experiment with Malaysia’s very own brand of legal technology within a controlled environment.

The Malaysian Bar we know always steps in at time of grave injustices to uphold the cause of justice without fear or favour and to advocate for positive social change.

This is one of such times.

Pang Jo Fan is the Head of Marketing & Communications at CanLaw. He is also a Loyarburokker and the former President of KPUM.

4 thoughts on “Resistance to legal tech innovations in Malaysia — a threat to the rule of law?

  1. Mortica 28 April, 2017 / 2:53 pm

    Excellent article!

Leave a Reply

Your email address will not be published. Required fields are marked *