We met with Philipp Nagel, in-house lawyer at Raiffeisen Bank International AG being responsible, among other things, for projects in the field of Legal Tech, to exchange views on current trends in Legal Tech and financing transactions, and to find out about the advantages that process optimisation tools, such as Schoenherr's together: your transaction manager, can offer to the end user, e.g. a bank or a borrower.
Q: Philipp, you are in-house lawyer at Raiffeisen Bank International. How did you arrive at Legal Tech as a lawyer?
It was primarily the question of process optimisation that brought us at RBI to Legal Tech. Personally, I have already provided legal support for some of the bank's digitisation issues in the past and have thus gained solid insight into how the market is currently developing in this area. The automated analysis of data, behaviour and structures has, in my view, great potential in the area of artificial intelligence and we are now looking to implement this within our group.
Currently, I am responsible for the digitisation process of our legal department, implementing, among others, legal tech solutions. The central question for me is always to what extent the numerous solutions can create specific added value for us as a bank even outside the legal department.
Q: The term "Legal Tech" is often used, but it is not always clear what is meant by it. What do you mean by "Legal Tech"?
For me, this term covers two important subject areas: Legal Tech in the broad sense, and Legal Tech in the narrow sense of the word. On the one hand it means process optimisation and process automation and on the other hand it covers solutions based on artificial intelligence. With the latter we are looking to find Legal Tech applications that can support the review of documents or contracts, which would allow a chunk of this work to be managed faster and more efficiently. We also see the regulatory field as a further area of application. We would welcome machine learning programmes, which, for example, could analyse and screen the (new) relevant laws for us as a bank. The technologies here are certainly still in an advanced early stage of their development, but in the future, they will significantly influence and change the legal (advisory) area, and we, as an innovative legal department and bank, want to actively participate and implement these developments.
In terms of process optimisation, I find the areas of automated document creation, knowledge management or optimisation of transactions interesting.
Q: As a key player in the region, what are you or RBI currently doing in the area of Legal Tech?
We are currently focused on three topics related to Legal Tech in the narrow sense: AI supported document analysis, AI supported legal analysis and the resulting process optimisation.
Q: What potential do you see for Legal Tech specifically in the area of finance transactions? In your opinion, which areas of a transaction could particularly benefit from innovation in the future?
I also see a similar situation in the area of finance transactions. In the long run, I can imagine an automated document creation for standardised loan agreements, as well as a preliminary analysis of certain topics, since very often the same topics arise, and these could probably be easily processed by artificial intelligence through preliminary analysis.
In process optimisation, of course, the topic of satisfaction of conditions precedents, "the CP process" in general, is an area with a lot of potential. Although this process comes after loan documentation, it sometimes requires a significant amount of time for more complex transactions. At this point, the deal has already been negotiated for all parties, which can often lead to annoyance if delays occur. Therefore, Legal Tech-based solutions will certainly play a major role in this area. Furthermore, there is also great potential in the area of loan syndication for process optimisation or the use of artificial intelligence, especially when it comes to the identification of critical contract clauses in the sense of deal breakers. Participation in a loan syndicate is always time-critical and often loan documentation can no longer be renegotiated. Therefore, a Legal Tech solution would be particularly suitable to quickly and efficiently identify potential deal breakers.
From our point of view, the current focus is certainly attorney / client interaction in the course of a transaction, in particular in the context of process acceleration and optimisation, whereby the Schoenherr together: your transaction manager, is for me a good example for overall transaction process optimisation.
Q: We share a similar view. Especially with complex financing transactions in several countries, the high number of conditions precedents often proves to be very time-consuming and a real pain point for the parties involved. The purpose of the transaction manager was to address precisely these pain points in terms of process optimisation and to redefine the CP process for all parties involved. Did we succeed?
I believe that the transaction manager is a solution that can generate significant added value, both in terms of coordination between banks and lawyers but also subsequently following closing in terms of the banks' customer relationships. Above all, the notification functions can bring great added value to our customers, the borrowers, because it enables them, with the help of automation, to easily organise ongoing tasks under a loan and to ensure credit compliance.
Q: As a last question, what do you expect from us, the professional services industry, in terms of future use of Legal Tech? How can we, as law firms, deliver added value here? And what would be on your wish list for the future as one of our clients?
From my point of view, Legal Tech is already crucial for the services industry and especially for lawyers.
In addition to legal expertise, I also consider the ability to understand the client and excellence in transaction management to be essential for a good lawyer. Optimised processes are an enormous help in managing complex transactions better and faster. In this respect, the right use or development of appropriate tools and applications by the respective service provider is key.
Thank you very much for the interview.
Schoenherr's together: your transaction manager, was introduced in spring 2019 as part of our established client collaboration platform Schoenherr together, for better support and coordination of transaction processes.
For further information see www.schoenherr.eu/your-transaction-manager.