The rise of artificial intelligence (AI) and its application across various industries has inevitably raised questions about its impact on the legal profession. How will AI affect law practice? Will it reduce law firms’ revenues? Will it limit career advancement for lawyers? How will it impact opportunities for legal interns and associates, and how will they gain necessary skills? These are pertinent questions that need to be addressed as we move towards an increasingly AI-integrated world.
Addressing Concerns About AI in Law
Major changes often bring fear and uncertainty about their effects on entire industries. Concerns arise about potential job losses and reduced service costs. A significant 67% of lawyers believe AI will drastically change the legal profession in the next five years. Such apprehensions are not unfounded; historical technological advancements have often disrupted industries, leading to job losses and economic shifts.
However, AI in the legal profession should be seen as an opportunity rather than a threat. AI can handle time-consuming tasks, allowing lawyers to focus on more complex and human-centric aspects of their work. This shift can lead to more efficient and effective legal practices, ultimately benefiting both lawyers and their clients.
Enhancing Efficiency and Creating New Roles
AI can quickly conduct large-scale data analysis, handle legal administrative duties, and analyze and summarize documents. This frees lawyers from non-billable work, allowing them to focus on billable tasks and client interaction. The rise of AI will also create new legal jobs, as firms will need specialists in AI training, consultation, and compliance.
Adapting to Change
AI will change the legal landscape, but it won’t replace highly trained lawyers. Instead, in my opinion lawyers using AI will outpace those who don’t. Generative AI tools will boost productivity by reducing time spent on routine tasks. While AI presents confidentiality and accuracy challenges, it also offers transformative potential.
The key to thriving in this new landscape is adaptability. Lawyers must be willing to learn and integrate AI into their practice. This includes understanding how AI works, what it can and cannot do, and how to use it ethically and effectively. Continuing education and professional development will be crucial as AI technology evolves.
Exploration, Research, and Document Generation
Generative AI excels at reading and interpreting large volumes of documents. Lawyers can use this saved time to understand clients’ problems better. AI can find relevant laws and rulings, review evidence, and generate documents, contracts, and letters.
In litigation, for instance, AI can be used to analyze past cases and identify patterns that might be relevant to a current case. This can provide lawyers with valuable insights and help them build stronger arguments. Similarly, in transactional law, AI can review contracts and identify potential issues or areas for negotiation, improving the efficiency and accuracy of contract review processes.
Risk Assessment and Due Diligence
AI’s predictive analytics help lawyers make data-driven decisions, such as evaluating litigation success chances. However, AI requires accurate, unbiased data, and lawyers must be transparent with clients about AI-assisted decisions.
There are ethical and business concerns associated with AI. Lawyers will need to be transparent with clients about what decisions they’re making with the help of AI. Additionally, predictive analytics requires vast amounts of data, and ensuring the data is accurate and free from bias is crucial. Firms will need to develop protocols for data management and ensure compliance with privacy laws and regulations.
The Changing Role of Lawyers
AI will change, but not replace, the role of lawyers. Lawyers will spend more time on client interaction and understanding legal issues in a human-to-human way. This shift allows more time for education and skill development. Lawyers must become familiar with AI-related regulatory and compliance issues and understand the importance of transparency.
The role of a lawyer is inherently human, involving empathy, ethical judgment, and complex decision-making. AI can assist with many tasks, but it cannot replace the nuanced understanding and interpersonal skills that lawyers bring to their work. As AI takes over routine tasks, lawyers will have more time to focus on building relationships with clients, understanding their needs, and providing tailored legal advice.
AI-Powered Legal Tools
AI-powered legal tools perform tasks traditionally done by lawyers, such as document automation, review, legal research, contract analysis, and case pattern recognition. These tools enhance efficiency, reduce costs, and minimize human errors. By leveraging natural language processing (NLP), machine learning, and data analytics, AI can process vast amounts of information quickly and with minimal error.
For example, document automation tools can generate standard legal documents such as wills, contracts, and NDAs, saving time and reducing the risk of errors. Legal research tools can sift through thousands of case laws, statutes, and regulations to find relevant information, making research faster and more comprehensive.
Potential Risks of AI in Legal Practice
AI in legal practice poses risks, including data security, ethical concerns, and overreliance on technology. AI should be viewed as an assistant that enhances, rather than replaces, human expertise. Firms must develop robust data security measures to protect sensitive information and ensure ethical guidelines are followed in AI’s use.
There are also concerns about the potential for AI to perpetuate biases present in the data it is trained on. Lawyers must be vigilant in ensuring that the AI tools they use are trained on diverse and unbiased data sets and that the outputs are regularly reviewed for fairness and accuracy.
Integrating AI into Legal Practice
Law firms should embrace AI strategically, focusing on augmentation rather than replacement. AI can handle tedious tasks, allowing lawyers to focus on strategy and client advocacy. Firms must invest in training programs and develop ethical guidelines to ensure responsible AI use, including maintaining client confidentiality and accuracy in AI-generated information.
Successful lawyers of the future will balance efficiency and growth while navigating the challenges of transformative technology, ensuring their careers are future-proofed. This includes staying informed about technological advancements, participating in continuing education, and being open to new ways of working. By doing so, they can harness the power of AI to enhance their practice and provide better service to their clients.
In conclusion, AI has the potential to significantly transform the legal profession. While it brings challenges, it also offers numerous opportunities for innovation and improvement. By embracing AI and integrating it thoughtfully into their practices, lawyers can enhance their efficiency, improve access to justice, and ensure their relevance in an increasingly digital world.
Ivica Jevtic
With the recent amendments to the Companies Law, legislators introduced the institute of convertible loans—an eagerly anticipated option for investors and startup companies in North Macedonia.
In 2022, through amendments to the Companies Law, lawmakers provided investors (third parties) with the ability to convert provided loans into shares. This conversion process involves increasing the company’s share capital by issuing new shares or, in other words, transforming the given loan into shares.
In this article, we will outline the procedure for augmenting the share capital by issuing new shares using convertible loans in a limited liability company.
The procedure for increasing the company’s share capital is governed by the Companies Law and is executed through the Trade Registry maintained by the Central Registry of North Macedonia.
A loan provided by a third party (investor) intending to convert it into shares must be paid in cash. The conversion of the loan into shares must be completed no later than the end of the third year from the signing of the loan agreement.
To implement this process, the Investor and the Company are required to undertake the following steps:
Tosic & Jevtic, attorneys and counselors-at-law, boast extensive experience and expertise in handling various procedures before the Trade Registry. Throughout our professional journey, we have successfully navigated numerous intricate procedures for trade company modifications, including the intricate process of augmenting company share capitals through the conversion of loans into shares.
Our esteemed Law Firm comprises seasoned lawyers ready to guide and support you throughout this process. With our wealth of experience, we assure efficient and effective assistance for our clients.
Prior to the recent amendments to the Companies Law, the conversion of loans into shares was limited to existing shareholders of the Company exclusively.
However, with the latest amendments to the law, this option has been extended to third parties investing in a company, providing them with the opportunity to convert their loans into shares of the Company.
This development presents a favorable option, particularly for startup companies in North Macedonia, as it allows them to attract investors by offering the conversion of loans as a form of security for the investment.
Ivana Jevtic Nikolova
