Copenhagen Economics has been asked by the Norwegian Ministry of Justice and Public Security to evaluate the impact on competition from two proposed changes to the lawyer regulation: 1) a liberalisation of the right to provide legal services, and 2) a tightening of the ownership regulation for law firms.
Our analysis shows that the competition in the Norwegian market for legal services is generally high, especially in the market for less complicated cases.
We find that a liberalisation of the right to provide legal services will not affect the competitive situation significantly. However, liberalisation can make it easier for legal tech firms to enter the market and moreover, the enforcement of the current regulation is difficult.
We also conclude that tightening the ownership regulation is not appropriate as it can restrict competition unnecessarily without addressing any major quality issues. Finally, we analyse a liberalisation of the ownership regulation that allows for external owners. Such a liberalisation can improve competition in the market but can also threaten the lawyers’ independence.