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We are pleased to sponsor a ground-breaking piece of research into the value of English law and its contribution to the global economy.
The fascinating study – the first of its kind – reveals how English law underpins trillions of dollars of business activity annually, both at home and abroad.
This includes more than €660 trillion of OTC derivatives trading in 2018, $11.6 trillion of global metals trading in 2020, £250 billion of global M&A in 2019, plus insurance contracts worth £80 billion each year.
The report also identifies the benefits of doing business using English law – namely lower transaction costs thanks to being able to increase the predictability of outcomes – as well as opportunities for it to be used in new areas of the economy such as sustainable finance, fintech and cryptoassets. The report concludes that greater coordination is required, including by government, to ensure growth of the user base of English law in the face of growing global competitive pressure.
Conducted by economic and finance consultancy Oxera, the study was commissioned to mark the official launch of LegalUK – a body set up to promote and increase the use of English law.
England was one of the few places that was able to adapt its court system to the COVID pandemic by way of remote hearings. Whilst other jurisdictions came to a grounded halt, England embraced technology and reacted positively. Looking forward, there should be a growing emphasis on the importance of England as a leading centre for dispute resolution.
Established by the Lord Chief Justice, LegalUK brings together representatives from across the industry including solicitors, barristers, arbitrators and other key stakeholders, and is chaired by the former Court of Appeal judge and Vice-President of the Civil Division, Dame Elizabeth Gloster.
She said: “The role of the law in supporting the creation of economic value and as a source of influence has not been fully appreciated."
“We now understand the true value of English law to UK PLC and need to explore the best forms of investment and coordination of efforts to nurture and safeguard it as an asset.”
Guy Beringer CBE, a director of LegalUK and former chair of UK Export Finance (UKEF), added: “This is the first time anyone has looked at the economic value and contribution of English Law as distinct from legal services."
“It is extraordinary to see laid out in economic terms the extent to which English law is an underappreciated asset and platform that provides huge economic value not only to the UK, but also the global economy."
“The fact that English law continuously evolves to reflect the issues businesses face is key to its success.”
The research points to a “free-rider problem” with English law – where parties are able to benefit from it without having to do anything in return.
Professor Richard Susskind, a leading expert on the future of legal services and a director of LegalUK, concluded that this was a “critical” opportunity for the UK to develop legal technology to overcome this and fulfil its potential as an international business platform.
Kennedys has already secured its position at the vanguard of new legal technology thanks to Kennedys IQ, a separate business set up with the aim of using data-driven insight to develop smart technology and help clients use lawyers less.
The English legal system is something that we as a firm, and as individuals, are rightly proud of. It is the reason we joined the profession and the principles that underpin it are something we strive to uphold every day.
Richard West also added: “It is, however, enlightening to see, in real terms, the valuable contribution it makes to the global economy, and we are delighted to support anything which leads to a greater understanding and appreciation of that.”
The report will be used for discussion between the legal services ecosystem and the government and can be read in full here.
United Kingdom