10 September 2008


More does not mean better: less highly regulated European legal systems are less costly but offer the same quality

- Further liberalisation reduces cost of access to the law -

(Munich) More advanced liberalisation of national legal services markets makes access to the law cheaper for citizens. This is the outcome of a study conducted by SEO Economisch Onderzoek, an economic research institute in Amsterdam. The study is central to the 20th RIAD congress held in Munich on 11 and 12 September, organised by the international umbrella organisation of legal protection insurance companies.  The congress participants will address the question of whether more highly regulated legal systems better safeguard the interests of consumers in fair access to the law and high-quality legal advice than less regulated countries. The clear conclusion of the study is that more regulation does not mean better service but rather drives up the cost of access to the law.  

"From an economic viewpoint, a great deal can be gained from further deregulation of national legal services markets", says Dr Barbara Baarsma, Deputy Director of the SEO in Amsterdam and author of the study. The study, Regulation of the Legal Profession and Access to Law, examines the legal services markets in 12 European countries (Belgium, Germany, England/Wales, Finland, France, Italy, the Netherlands, Austria, Spain, Switzerland, the Czech Republic and Hungary). The results show that in spite of considerable differences in the degree of regulation, access to the law is sufficiently guaranteed in all countries. Stricter regulation of the legal services market and the legal professions therefore does not mean improved access to the law. On the contrary, regulation hampers competition and innovation, usually leading to an increase in costs for society and for individuals seeking legal advice.  

According to Baarsma, national governments and lawyer associations must demonstrate the costs and benefits generated for the population by the relevant degree of regulation and if necessary further liberalise their legal services market. For instance, further liberalisation of the legal profession in many countries could allow qualified jurists to supplement the services provided by lawyers. To quote Baarsma: "According to our research, there is no proof that lawyers in strictly regulated countries supply better services than legal experts who are not lawyers. It is certainly true that lawyers cost more than non-lawyers".

Liberalisation should move ahead, in particular in legal professions

Finland is a particularly successful example of a more liberal legal services market. According to a 2004 survey conducted by the Council of Europe's Commission for the Efficiency of Justice (CEPEJ), the Finnish legal system, with annual expenditure of about € 47 per inhabitant, ranks among the least costly in Europe – only England and Wales spend even less (€ 23). Germany however, with nearly € 97, is among the most expensive. Moreover, in Finland rather than the state it is self-regulation of legal protection insurers that requires their insured to seek legal advice only from legally-trained advisors. This ensures quality, saves money and enhances access to the law as the (cost) threshold for people seeking legal advice is lower.

"Depending on the country, engaging an external lawyer costs four to six times as much as having the same case dealt with by the legal protection insurance company’s own jurists", explains Antje Fedderke, Secretary General of RIAD. Nevertheless, in Germany, Italy and France, legal protection insurance companies are not allowed to offer legal advice and/or may represent their insured in court to a limited extent or not at all. Barbara Baarsma emphasises that "the findings of the study show that especially the liberalisation of legal professions by admitting qualified jurists to the monopoly could have a significant impact on prices in the legal professions". In most cases, more freedom of choice for the consumer means lower costs.  

She points out that "the differences in regulation of the legal services market in Europe are in fact surprising as we must assume that all countries have the same interest in their citizens having access to the law and they are not better protected in regulated countries than in the others."

The executive summary of the study is available for downloading at 



RIAD, the association of legal protection insurers and service providers, is committed to promote via its global members easy, affordable and high-quality access to justice and the law. RIAD has 57 members in 18 countries. RIAD members are specialised in insurance and/or services to enforce and defend individual rights. They offer their clients the resources that are necessary for access to high-quality and easily accessible legal advice and services. They also protect their clients effectively against financial risks associated with engaging legal experts and gaining access to the law.

SEO Economic Research conducts independent and applied economic research for public and private clients. SEO Economic Research is affiliated to the University of Amsterdam which offers the organisation invaluable insights into the latest scientific methods.  As a non-profit organisation, SEO constantly invests in the intellectual capital of its staff and encourages them to actively plan their careers, publish academic papers and participate in academic networks and international conferences.

More information:
Antje Fedderke
International Association of Legal Expenses Insurance
Avenue Michel-Ange 7, B-1000 Brussels
Tel   +32 (0)2 732 36 28