AI adoption in Europe’s legal function and the impact of the EU AI Act
Across Europe, artificial intelligence is moving rapidly from a theoretical discussion to a practical reality for in-house legal teams. From generative AI and automation to AI-powered legal tech platforms, organisations are reassessing how AI fits into the modern legal function and what this means for legal work, governance and talent.
The use of AI across in-house legal teams is being shaped by regulatory change, evolving client expectations and growing pressure to streamline legal workflows. At the same time, General Counsel must balance innovation with risk, particularly around data protection, cybersecurity and professional judgement.
For many legal professionals, the question is no longer whether AI adoption is necessary, but how far it should be embedded within legal departments and which use cases are appropriate.
What does the EU AI Act mean for in-house legal teams in Europe?
The EU AI Act, introduced by the European Commission, establishes a risk-based framework governing AI systems across multiple jurisdictions. It places obligations on organisations depending on how AI models are developed, procured and deployed, with scrutiny on transparency, accountability and decision-making.
For in-house legal teams, this creates a dual responsibility. Legal departments must advise the business on compliance with the EU AI Act while also overseeing their own use of AI tools within legal services. This includes assessing how generative AI, AI-enabled document review and AI-driven legal research are used in practice.
Many organisations are taking a cautious approach, limiting AI adoption to lower-risk use cases while governance frameworks, approval processes and internal playbooks are developed. This is particularly relevant where AI systems process legal data subject to GDPR requirements.
Should businesses build AI tools in-house or outsource to third-party providers?
A central strategic question for legal teams is whether AI tools should be built internally or sourced from external providers.
Building AI systems in-house can offer greater control over legal data, workflows and compliance with GDPR, particularly in regulated sectors such as financial services. However, it requires investment, specialist expertise and long-term commitment.
Outsourcing to AI providers or legal tech platforms can accelerate implementation and reduce development risk, but introduces challenges around procurement, data protection and reliance on third-party AI models. Tools such as ChatGPT or established platforms like LexisNexis may support legal tasks, but they still require careful governance and oversight.
As a result, many legal departments are adopting hybrid approaches, combining external AI platforms for routine tasks with internally controlled systems for sensitive legal work.
How are General Counsel using AI today and where are the limits?
In practice, most General Counsel are deploying AI in targeted, pragmatic ways. Common use cases include document review, legal research, contract analysis and the automation of routine tasks.
These AI-powered tools can streamline workflows and improve efficiency, but legal professionals remain cautious about extending AI into complex areas such as decision-making, intellectual property strategy or high-risk advisory work.
The prevailing view across the legal sector is that AI should support, rather than replace, human judgement. AI-driven systems assist legal teams, but accountability remains firmly with the General Counsel and the wider legal function.
Why are CEOs and CFOs cautious about funding legal AI initiatives?
Despite growing interest in new AI initiatives, investment decisions remain closely scrutinised. CEOs and CFOs often require clear benchmarks around value, risk reduction and long-term impact before approving spend on legal tech.
Unlike other business functions, legal departments may struggle to quantify the return on AI adoption beyond efficiency gains. This has made funding more difficult, particularly where AI platforms compete with revenue-generating technology projects.
As a result, General Counsel increasingly frame AI adoption in terms of governance, risk management and compliance, rather than automation alone.
How does AI adoption differ between regulated and non-regulated companies?
AI adoption varies significantly across the legal sector.
In highly regulated organisations, AI systems are often tightly governed or limited to specific legal workflows. In less regulated environments, legal teams may experiment more freely with AI-enabled legal services.
This divergence has prompted broader discussion around AI governance frameworks and whether AI should be embedded incrementally within legal departments or deployed across enterprise-wide legal and compliance functions.
How will AI change legal training and early-career development in Europe?
The rise of generative AI and automation is reshaping how legal professionals develop their skills. Tasks that once formed the foundation of early-career training, such as legal research and document review, are increasingly supported by AI tools.
This creates a challenge for the legal sector. While AI can streamline legal work, it risks removing opportunities for junior lawyers to build experience through learning by doing.
Across Europe, legal teams are rethinking how training, supervision and exposure to AI-enabled systems can coexist. The future legal professional will need to understand AI governance and legal tech, while still developing the judgement, ethics and commercial awareness that only human experience can provide.
Can legal teams balance AI efficiency with human judgement and experience?
AI will continue to transform legal services, but its success depends on thoughtful implementation.
The most effective legal teams are those that treat AI adoption as part of a broader strategy, not a standalone solution. By combining AI-powered tools with strong governance, clear workflows and human oversight, organisations can build legal functions that are resilient, compliant and future-ready.
For General Counsel, the challenge is not choosing between technology and people, but designing a legal function where both work together.
Frequently asked questions
These FAQs explore common questions about AI in Europe’s legal function and the impact of the EU AI Act.
Across Europe, in-house legal teams are adopting AI in targeted and practical ways. The most common AI use cases include document review, legal research, contract analysis, NDA drafting and workflow automation for routine legal tasks.
Generative AI and AI-powered tools are also increasingly used to support internal knowledge management, streamline legal workflows and improve efficiency within legal departments. However, most General Counsel limit AI adoption to areas where human oversight remains clear and accountability is retained.
The EU AI Act, introduced by the European Commission, regulates the development and use of AI systems across EU jurisdictions using a risk-based approach. For legal teams, this means assessing how AI tools are procured, governed and deployed within the legal function.
In-house legal teams must consider transparency, data protection, AI governance and human oversight when using AI-powered systems. This is particularly important where AI models support legal decision-making or process legal data that may fall under GDPR requirements.
Law firms and in-house legal teams often use similar AI tools, but the way they are governed and deployed can differ significantly. In-house legal departments typically prioritise data protection, cybersecurity and integration with internal workflows, while law firms may focus on scalability and client-facing efficiency.
The AI use of law firms is also focused on automating routine tasks, contract and document review, accelerate legal research, client onboarding and controlling billable hours.
As a result, AI adoption strategies are often shaped by organisational structure, regulatory exposure and the nature of legal services being delivered.
Many General Counsel permit limited use of generative AI tools such as ChatGPT, particularly for low-risk tasks like drafting summaries, research support or internal brainstorming. However, unrestricted use of generative AI within legal departments is rare.
Concerns around legal data, confidentiality, accuracy and AI governance mean that most organisations apply clear policies, training and controls when allowing access to new AI tools.
AI is changing how legal professionals develop experience, particularly at junior levels. As AI tools increasingly support legal research, document review and routine legal work, organisations must rethink how early-career professionals build foundational skills.
Many legal teams are combining AI-enabled workflows with structured supervision, training and mentoring to ensure that legal judgement, ethics and decision-making continue to develop alongside technical capability.
Before adopting new AI tools, legal teams should assess regulatory risk, data protection obligations, procurement processes and alignment with existing legal workflows. Consideration should also be given to how AI systems will be governed, monitored and reviewed over time.
For General Counsel, successful AI adoption depends on balancing efficiency with accountability, ensuring that AI supports legal professionals rather than replacing human judgement.
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