Navigating Jurisdictional Boundaries: Traditional Lawyers vs. Legal Tech Firms in the German Legal Services Market

Abstract

The recent rise of legal tech firms has led to significant changes in the German legal services market, challenging the quasi-monopoly of traditional lawyers. Our paper explores this evolving relationship between legal tech firms and traditional lawyers in Germany, focusing on how these groups compete, cooperate, and forge distinct professional identities. Drawing on Andrew Abbott’s theory of professions, we examine whether there is a jurisdictional conflict between them, i. e., whether they compete for the same work-related tasks. By conducting semi-structured interviews with individuals working in the field and a document analysis of relevant public statements and legal texts, we find that there is at least some degree of jurisdictional conflict, albeit limited to a specific segment of the legal services market, particularly tenancy law. In addition, legal tech firms have developed work practices that differ significantly from those of traditional lawyers, emphasizing automated workflows and largely eschewing in-person consultations. These novel practices have also led to the emergence of a new identity for legal tech entrepreneurs, one that emphasizes entrepreneurship and consumer advocacy. Despite the differences and conflicts, there currently appears to be a cooperative division between traditional lawyers and legal tech companies, suggesting functional interdependence in certain market segments.