No more tax breaks to firms that outsource: Obama

"To encourage ... Businesses to stay within our borders, it is time to finally slash the tax breaks for companies that ship our jobs overseas, and give those tax breaks to companies that create jobs right here in the United States of America.

"Now, the House has passed a jobs bill that includes some of these steps. As the first order of business this year, I urge the Senate to do the same, and I know they will. They will. People are out of work. They're hurting. They need our help. And I want a jobs bill on my desk without delay," he told in the customary State of Union address.

India has been one of the biggest beneficiaries of outsourcing and could be the worst hit by this move to end tax breaks. The turn of this century saw American companies move jobs abroad that helped them save costs, with no dent on services as countries like India boast of an English-educated workforce -- be it IT engineers or for jobs that had to be done over phone. This trend gave India the name "back-office of the world" and birth to the term 'Bangalored' that means outsourced.

"But the truth is, these steps won't make up for the seven million jobs that we've lost over the last two years.

Legal Process Outsourcing - a Look Inside for 2010 and Beyond

LPO is the hot new trend in the legal field that allows law firms and corporations to obtain operational support and services from outside providers rather than internally. This process has demonstrated huge growth in the past few years within the United States and the UK, and offers a unique path for companies to get the services that they need, including document review, legal research, patent services, and drafting of pleadings and legal briefs.

Countries like India and the Philippines have proven to be very successful in this area, offering their services to anyone who needs them. The main purpose of legal process outsourcing is to cut costs dramatically and have the same quality of work done for less money. So far, it has been a successful endeavor.

What is the future like for LPO? As of July 2009, some of the largest firms in the world are using LPO services to handle their legal needs, but will it hold up? The services offered are very effective and affordable, but what will happen in the years to come? Specifically speaking, the trends for 2010 and beyond in the legal process outsourcing industry are of a key interest. Attorneys and law firms within the U.S. and other major markets often charge $150 -$350 an hour for services like the ones offered by outsourcing entities, which can do the same work at a fraction of the cost. As such, it is estimated that LPO will continue the massive growth, even through the current recession.

The work done by outsourcing services in the legal field is mostly work that is time-consuming and chore-like for the U.S. and UK based firms that seek out these overseas services. Legal process outsourcing providers have the advantage of providing a broad spectrum of services and being exposed to new theories, the best practices, and the latest laws and defenses available because of the work that they do. Some of the services offered by LPO companies include:

1. Case management, which includes the collection and review of documents, along with providing answers to client questions
2. Legal research, which is time-consuming and laborious for U.S. firms to handle on their own
3. Medical records reviews
4. Billing management
5. Patent services
6. Contract management
7. Expert witness services, including those who serve as witnesses and consultants in various matters and who can provide reports and expert testimony in Federal and State court trials and legal proceedings

Many other tasks that are time consuming and expensive to have done at home are also assigned to these LPO services on a firm-by-firm basis. There is very little limit to what these companies can and will do for law firms and corporations, if only they inquire about what services can be given.

Legal process outsourcing is not without its flaws and critics. One of the biggest points of concern for many is the potential confidentiality breaches that can take place. People who are performing these services overseas may or may not be bound to the same ethical standards and code that U.S. and UK based lawyers are subject to, which can cause conflicts of interest. The American Bar Association recently offered its own ethics opinions that laid down a framework that would allow for ethical LPO services across the country and around the world.

While confidentiality is a major concern, it�s going to be a matter of choosing the lesser of two evils in many cases. This might be taking valuable work away from the country�s own lawyers and legal advisors, and it could potentially cause a conflict of interest within the ethics and confidentiality area. However, LPO provides many legal entities a way to get services they desperately need at rates they can afford - sometimes as low as 15% of what they may pay if they were to handle the tasks "in house".

The work is cheap, which is why many firms choose this method for their legal needs. The steadily decreasing rates of LPO services in India are a large area of concern, because the quality and value of the services might be in jeopardy if the rates become too low. When the world revolves around getting what is paid for, how can anyone expect quality services when they�re paying next to nothing? Many people claim that they know quality when they see it, but many others feel that talents should reach farther than legal skills and provide U.S. specific and client/service/project specific training.

This service gained its popularity because it was affordable. When clients can get rates of $20 to $50 per hour for various legal services, rather than paying five times that with U.S.-based services, what is there to lose? Over the next few years, the LPO industry is projected to grow exponentially, allowing people to find everything they need outside their own country at a much reduced cost factor.

The legal process outsourcing industry has driven a revenue growth of 495% in 2009 alone. In response to increasing legal demands such as foreclosures and bankruptcies, the industry has been a popular choice for many in recent times. Forrester Research, which is an independent market research and technology company, forecasts that the LPO industry will create more than 79,000 jobs by 2015, all around the world. A small number of U.S. Census Bureaus also estimated that more than $184 billion in revenue generated by the legal services industry in the U.S. would generate more growth and job creation for legal process outsourcing services and providers.

Another independent market research firm, ValueNotes, estimates that LPO revenues will grow from a projected $640 million in 2010 to more than $4 billion by 2015, which is a big jump in revenues for this fairly new industry. Similar to many of the other outsourcing methodologies practiced by U.S. companies for decades, the LPO industry simply works by taking the �chore work� that legal firms and services have and sending it to providers that can do it for a much more affordable rate, and still provide the same high quality service and confidentiality that is needed in handling legal paperwork and proceedings.

It seems, due to the current research and projected forecasts, that the estimated trends for legal process outsourcing are quite good. The industry has grown nearly 500% in revenues in 2009 alone, and is projected to be an industry worth well over $4 billion by the year 2015. In an economy where the US is in recession, things need to be affordable. Many law firms are looking to hand these various services off to someone who can do them properly, but for much less than professional services offered in the U.S. or the UK.

It is a race to see which firms can perform tasks faster, smarter, and better than others. Law firms are essentially handing off the tedious, chore-like work to services that can perform the work properly and affordably, while maintaining their own abilities to focus on their clients and other more important aspects of their legal firm or corporation. Considering all the new services being developed and the increased popularity of this type of service acquisition, it appears that legal process outsourcing has a very promising outlook for the next five years at least.

What Is a Magna Carta?

Author: Anirudha

Most of the time when I write my legal articles, I try to give you some tips and practical hints to make your life a little easier when it comes to living with the law. This month, however, I want to take a moment to reflect on a document that made “the law” what it is today. Most of my friends know, I’m a bit of a history buff, especially when it comes to legal history. I promise I’ll write something more practical next month!


I was watching CNN recently when I saw a feature about one of the revisions of the Magna Carta going up for auction in New York. It turns out that this document was privately owned by billionaire H. Ross Perot. The document sold for a whopping 21.3 million dollars. A lot of money, but what price can one put on freedom?


As many of you may have learned in school, the Magna Carta was the single most important influence on the development of the constitutional rule of law we enjoy today. Essentially, the Magna Carta limited the right of the English monarch and gave certain protections to the king’s subjects. Most notable of these rights was the writ of habeas corpus, or the right to appeal an unlawful imprisonment. This was an astounding development in 13th century Europe! The Latin “Magna Carta” literally translates to “Great Paper.” Given its significance on the development of legal rule in western civilization, this name is no understatement.


There were several versions of this great document. The original Magna Carta came about as a result of a dispute between King John, Pope Innocent III and the English barons as to the rights of the monarch. While the power of the English king had been steadily increasing since the Norman conquest of 1066, a series of missteps by King John early in the 13th century led to discontent among the barons, anger from Rome, and a shortage in the treasury. On June 10, 1215, the barons marched on London. Londoners, in a show of support for the rebellious barons, opened the city gates and allowed them to enter without resistance. Fearing the loss of his crown (or even his life), King John agreed to grant certain rights and powers to his barons in exchange for their renewed vows of fealty. This written agreement was the first iteration of the Magna Carta. The document was revised and reissued several times over the next 80 years or so until its final issue in 1297. This is the document which was recently sold at auction.


So the next time you marvel at our constitutional government, our representative democracy, our bills of rights and the rule of law which we enjoy in this country, take a moment to reflect on the document that started it all. Given the influence of this document on our history, 21.3 million seems like a bargain.

India- The Most Favorable LPO Destination

The growth of Legal Process Outsourcing (LPO) industry in Asian and African countries has given the global legal services sector a reason to celebrate. The LPO industry has become extremely popular throughout the international market, creating waves all across the globe. Various multinational corporations and law firms, especially in the USA and UK have gained substantial benefits from the presence of professional LPO companies in India. The presence of LPO companies has helped in simplifying complex legal processes and enabled domestic legal firms to work more efficiently and effectively, as a major part of the complex legal documentation

work is carried out by the LPO companies overseas.

The biggest global market today, for outsourcing legal work is undoubtedly in India. The country with its huge, talented and skilled labor pool has been a major source delivering consistent work quality. Implementation of various identifiable and measurable quality-control initiatives by Indian LPO companies have also helped them in delivering top quality work-product thereby attracting various multinational corporations and law firms to outsource complex legal documentation to the Indian market

India offers a comparatively cheaper labor rate for a highly skilled workforce, which is competent enough to handle the most complex global legal operations. Employees working in the legal sector in India earn up to 30 to 70 percent lower wages, compared to their USA counterparts. This allows domestic firms to reap significant cost savings that are further reinforced by the cost of infrastructure in India, which is remarkably low.

The legal system prevailing in India is similar to the legal systems of UK and USA, which helps facilitate better understanding of client requirements, as well as timely delivery of work. Also, the availability of English speaking attorneys in India ensures clear communication between the parties minimizing the chances of errors created due to language barrier.

The geographical time difference of India with USA and UK helps in round-the-clock delivery of urgent projects or assignments. This considerably reduces the time involved in the legal process thereby allowing domestic law firms to function more efficiently. Various Indian LPO companies work round-the-clock on pressing legal projects, meeting tight deadlines and delivering high quality work.

The legal information outsourced by domestic law firms and multinational corporations require a high level of privacy and confidentiality. Indian LPO companies are extremely particular about the security of such data and ensure zero leakage of information by implementing stringent security measures.

Apart from all this, it is predicted that skilled labor force in India would increase at a rate of about 15 million a year. This would ensure a huge pool of qualified employees for law firms in the USA, Europe, and several other parts of the world, where there is an ever increasing demand for labor.

The future of LPO is looking better than ever. It is worthwhile to note that besides India, other countries such as Australia, China, Philippines, South Africa and South Korea are also gaining momentum in the LPO sector. The journey has only just begun for this sector, and the coming years promise more legal service providers emerging from diverse global locations. India’s huge pool of skilled professionals, rapidly improving technology and infrastructure, high quality work and geographical time difference helps India retain her popularity as a widely-favored LPO destination.