KPMG, the global accounting and consulting powerhouse, is taking a bold step into the U.S. legal market by launching a new legal services business. This move leverages Arizona’s groundbreaking regulatory framework, which allows non-lawyers to co-own law firms, a program that has been a game-changer for the legal industry since its inception in 2020.
KPMG Law US, a subsidiary of KPMG US, has applied to the Arizona Supreme Court to operate under the state’s alternative business structure (ABS) model. This innovative framework permits non-lawyers to have an economic stake in law firms, enabling companies like KPMG to provide legal services while incorporating its extensive network and cutting-edge technology.
The Arizona Supreme Court is set to review KPMG’s application at a meeting on January 14, 2025. If the court’s committee approves the proposal, KPMG Law US will become the first of the Big Four accounting firms—KPMG, EY, Deloitte, and PwC—to formally practice law in the United States.
KPMG’s new legal arm in the U.S. will focus on providing outsourced legal services related to compliance, contract management, and other key areas of legal work. The company’s strategy is to combine its global technology infrastructure and expertise in regulatory compliance to offer affordable, efficient, and scalable legal solutions. These services will complement the traditional offerings of law firms, particularly in complex, process-heavy areas where technology and legal expertise intersect.
The move marks a significant shift in the legal landscape, particularly as traditional regulations limiting non-lawyer ownership of law firms have been relaxed in Arizona. Since 2020, Arizona has been at the forefront of legal industry innovation, becoming the first state to allow non-lawyers to have a financial stake in law firms with court approval.
KPMG’s entry into the U.S. legal market is the first by one of the world’s four largest professional services firms to provide direct legal services. While other global markets, such as the UK and Australia, have long allowed professional services firms to operate in the legal field, U.S. regulations have traditionally kept the legal sector more insulated. The new program in Arizona opens the door for further innovation and competition in the legal services space.
The company’s move could reshape the competitive landscape, especially in the growing market for legal consulting and managed services, where firms like KPMG, EY, Deloitte, and PwC already provide advisory services to legal teams. By offering a unique combination of legal services and business consulting, KPMG aims to differentiate itself in the crowded U.S. market.
The announcement has been met with optimism from proponents of legal reform, who argue that the relaxation of ownership restrictions could lead to more affordable legal services, foster innovation, and increase access to justice. Arizona has already approved over 100 alternative legal business structures, including companies like LegalZoom and Rocket Lawyer, as well as personal injury and mass tort law firms partly owned by non-lawyers.
Marquita Brazil, who oversees Arizona’s legal innovation program, welcomed KPMG’s proposal, stating that it would “further our mission of providing affordable and efficient legal services to Arizona residents.” The state has also seen pilot programs introduced in Utah, Washington, and Indiana, where similar eased rules have been tested in response to demand for more accessible legal solutions.
However, critics of these changes argue that allowing non-lawyers to own law firms could lead to ethical concerns and potential abuses, particularly if companies are not subject to the same stringent ethical standards as licensed attorneys. KPMG has addressed these concerns, assuring that its new legal business will adhere to the same high ethical standards that govern traditional law firms.
With its proposed expansion into the legal services market, KPMG is setting a bold precedent for the future of legal services in the U.S. By leveraging its extensive expertise in compliance and technology, KPMG Law US aims to drive innovation while maintaining a commitment to quality and ethical legal practice.
The decision on KPMG’s application will be a landmark moment in the evolution of U.S. legal services, potentially paving the way for similar initiatives from other professional services firms.
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