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About the Innovation Sandbox

Our Mandate

The Innovation Sandbox is operated by the Law Society’s Innovating Regulation Group (IRG). The IRG’s mandate is to explore how the Law Society can allow for greater flexibility in its current regulatory framework and minimize regulatory barriers to both encourage and foster innovation in the delivery of legal services in Alberta. The IRG includes senior counsel and policy, risk, technology and compliance professionals from within the Law Society. This group is responsible for vetting and approving the applications, as well as ongoing monitoring of Sandbox participants.

What the Sandbox is for

With the Innovation Sandbox, the Law Society is creating a space where current regulations on legal service delivery can be relaxed to encourage innovation. The Sandbox environment supports potential providers in testing new ideas and models for the delivery of legal services in a controlled environment, with the IRG providing both guidance and oversight.

Legal service delivery, in this context, is defined as the means, tools and processes by which legal work product is transmitted to a client. It contemplates legal, technological, process/project management and business issues and expertise. Applications that contemplate the provision of legal advice (the analysis of the facts and the provision of a recommendation to a client with regard to a specific course of action, based on applicable law) by non-lawyers will not be approved.

Outside of the Innovation Sandbox, only lawyers who are active and practising members of the Law Society can provide legal services in Alberta; law firms cannot be owned by non-lawyers.

Eligibility Criteria

The eligibility criteria for Sandbox participants has been approved by the Benchers and is available here. The eligibility criteria include the following:

  • In Scope – The proposed delivery model must advance a goal of the Law Society’s Strategic Plan.
  • Benefit to the Public – The proposed delivery model must offer a reasonable prospect of identifiable and clear benefits to the public, such as improved efficiencies, lower cost, or greater access.
  • Access is Necessary – The Innovation Sandbox is designed for legal service delivery models that are outside of the Rules of the Law Society of Alberta or the Code of Conduct.
  • Genuine Innovation – Proposed delivery models should be innovative in Alberta, address gaps or offer a significantly different way of delivering legal services.
  • Client Safeguards – The proposed delivery model must identify any reasonably foreseeable risks that may be posed to the public during a pilot, and safeguards that will be put in place to mitigate these risks and protect clients.
  • Business Operating Permits – Any business permits required by the local or the provincial government must be obtained by the applicant prior to operating the delivery model in Alberta.
  • Readiness – The applicant must indicate when they will be ready to implement the proposed delivery model in a live environment. Readiness will be established by having a well-developed business plan, that sets out clear objectives, measures for success, safeguards for the public along with the necessary tools and resources in place.
  • Exit Strategy – Applicants are required to have a clear exit strategy either for a pre-determined end date, or earlier if the Law Society determines that a delivery model must cease operations during the pilot.

If an application does not meet the eligibility criteria, the application will be denied in a written decision which will clearly articulate how the application did not meet the eligibility criteria. The applicant can modify their application to address any deficiencies and resubmit their application.

How to apply

Applications are accepted via online form. Details on the application process, including what makes for a successful application, can be found in the Innovation Sandbox User Guide.

Frequently Asked Questions

What is an Innovation Sandbox?

An Innovation Sandbox is a “safe space” in which legal service providers are encouraged to develop innovative models for the delivery of legal services that cannot be offered due to existing regulatory requirements.

An Innovation Sandbox allows the Law Society to support providers in testing new ideas and models for the delivery of legal services in a controlled environment.

The core principle of an Innovation Sandbox is that innovation in the delivery of legal services can occur when there is support and encouragement. The Innovation Sandbox is a means for the Law Society to provide guidance and oversight to providers to develop innovative models for delivering legal services that may be of value to the public.

Are paralegals allowed to run an Innovation Sandbox model without a lawyer?

The Innovation Sandbox is focused on innovative legal service delivery models, which is distinct from models that deliver legal advice. While the Innovation Sandbox is open to both lawyers and non-lawyers, the Sandbox will not permit any business model that seeks to deliver legal advice from non-lawyers. Under no circumstances will a Sandbox application that proposes a business model that seeks to deliver legal advice from non-lawyers be approved. The Sandbox will accept applications for non-lawyer ownership of organizations providing legal services and organizations that include non-lawyer partners. As with all the applications, our mandate of acting the public interest will provide the lens through which we view these proposals.

Why is an Innovation Sandbox necessary?

The Legal Profession Act and the Rules of the Law Society prescribe that only lawyers may provide legal services and regulate what lawyers and, to a certain extent, law firms can do. Anyone who is not regulated by the Law Society is currently prohibited from providing legal services to the public. Lawyers are required to conduct their practices and deliver legal services in strict compliance with the Rules and the Code of Conduct.

The requirement to deliver legal services only in compliance with the Law Society’s regulatory framework does not necessarily foster innovation in the delivery of legal services. Anyone who wants to provide delivery models for legal services that are innovative but outside of the Rules of the Law Society of Alberta or the Code of Conduct cannot do so without encountering regulatory intervention.

In the structured, safe environment of an Innovation Sandbox, the Law Society can relax its regulatory requirements (the requirements in the Rules or the Code) which can foster innovation in the delivery of legal services. Lawyers, firms and other providers can explore, develop and implement new and innovative concepts, services and business models without the threat of enforcement if the innovation breaches the current requirements.

Who can participate in the Innovation Sandbox?

Proposals for innovative legal services delivery models can come from lawyers and law firms in Alberta as well as organizations that do not presently offer legal services. The intent of the Innovation Sandbox is to assist those who are interested in developing innovative delivery models for legal services that can potentially benefit members of the public – whether in the form of efficiency, accessibility or affordability, or all three, or more.

The sandbox is intended to be exploratory and innovative. For this reason, eligibility at the initial application stage will be open to the widest possible range of providers. Any legal function could be involved and any entity could apply – lawyers, non-lawyers, not-for-profits and for-profit corporations.

When can I apply for the Innovation Sandbox?

The Innovation Sandbox is now active and accepting applications. Information on the program and the online application form can be found on the Law Society website.

What are the eligibility requirements for the Innovation Sandbox?

The Law Society will evaluate applications based on the approved eligibility criteria. If an application meets the eligibility criteria, it will be accepted into the Innovation Sandbox. Eligibility criteria may include the following:

  • In Scope – The proposed delivery model must advance a goal of the Law Society’s Strategic Plan.
  • Benefit to the Public – The proposed delivery model must offer a reasonable prospect of identifiable and clear benefits to the public, such as improved efficiencies, lower cost, or greater access.
  • Access is Necessary – The Innovation Sandbox is designed for legal service delivery models that are outside of the Rules of the Law Society of Alberta or the Code of Conduct.
  • Genuine Innovation – Proposed delivery models should be innovative in Alberta, address gaps or offer a significantly different way of delivering legal services.
  • Client Safeguards – The proposed delivery model must identify any reasonably foreseeable risks that may be posed to the public during a pilot, and safeguards that will be put in place to mitigate these risks and protect clients.
  • Business Operating Permits – Any business permits required by the local or the provincial government must be obtained prior to operating the delivery model in Alberta.
  • Readiness – The applicant must indicate when they will be ready to implement the proposed delivery model in a live environment. Readiness will be established by having a well-developed business plan, that sets out clear objectives, measures for success, safeguards for the public along with the necessary tools and resources in place.
  • Exit Strategy – Applicants are required to have a clear exit strategy either for a pre-determined end date, or earlier if the IRWG determines that a delivery model must cease operations during the pilot.
How does an Innovation Sandbox operate?

The Innovation Sandbox operates as a standalone program at the Law Society and will not have an expiry date. Applicants who are accepted into the Innovation Sandbox will operate their delivery model through a pilot for a period of at least two years.

An applicant must submit an application that proposes a new model for delivering legal services. Applicants who apply for entry into the Innovation Sandbox will be required to explain their proposed delivery model and how it fits within the Law Society’s framework of an Innovation Sandbox.

The Innovation Sandbox has eligibility criteria that an application must meet. Those criteria been approved by the Law Society Benchers.

The Law Society reviews the application and determines if it meets the eligibility criteria. If the application is accepted (with or without conditions) into the Innovation Sandbox, the Rules or the provisions of the Code that prohibit the operation of the proposed delivery model are identified and relaxed or waived.

What happens once an application to operate has been approved?

Once the applicant’s delivery model is approved for the Innovation Sandbox, the applicant is required to sign an agreement with the Law Society, acknowledging the requirements with which the applicant is required to comply, potential risks and proposed conditions to mitigate identified risks.

The proposed delivery model will be tested and implemented in a controlled environment through a pilot for a specified operating period. The IRG and the applicant will together determine the duration of the pilot, but generally pilots will be two years in duration. The IRG will oversee and monitor the implementation of the delivery model during the pilot.

During the operation of the pilot, providers are encouraged to contact the Law Society for any information or support they may need. A contact person may be provided to check-in with the provider and offer support on an as-needed basis.

What happens if an applicant’s proposal doesn’t meet the eligibility criteria for the Innovation Sandbox?

If an application does not meet the eligibility criteria, the application will be denied in a written decision which will clearly articulate how the application did not meet the eligibility criteria. The applicant can modify their application to address any deficiencies and resubmit their application.

If the applicant’s proposed model is allowed by the Rules and the Code, the proposed model does not require access to the Innovation Sandbox and is permitted.

How long is a pilot supposed to operate?

An Innovation Sandbox is an opportunity to develop, implement, test and evaluate new models for delivering legal services in a pilot, for a specified period of time. The duration of a pilot within the Sandbox program should be of a period sufficient to obtain relevant and pertinent testing information to gauge the efficacy of the delivery model that is being tested. The IRG and the applicant will determine the duration of the pilot.

Approved applicants will operate their delivery model in a pilot generally for a period of two years, but this time frame may vary depending on the requirements of both parties. Upon the conclusion of each pilot the applicant may continue to operate the delivery model unless the Law Society determines otherwise.

Will sandbox participants be required to have insurance?

Application approval decisions will be made with reference to a detailed set of approval criteria, one of which is whether the applicant carries appropriate insurance commensurate to the risks involved in the delivery of its services. This may include errors and omissions insurance, product liability insurance, general commercial liability insurance, and/or cyber insurance.

Are Alberta lawyers participating in the Innovation Sandbox covered by the ALIA Group policy?

If Alberta lawyers are practising in the Innovation Sandbox, they need to either have indemnity coverage through ALIA or through professional liability insurance that they secure through the private market. Sandbox participants who are not lawyers are not eligible for ALIA coverage and require private professional liability insurance.

What sort of conditions may be imposed by the Law Society on applicants?

The IRG may determine that an application can be approved provided that conditions are imposed and complied with. Conditions that may be imposed on an approved application include:

Disclosure and Acknowledgment Requirements

Applicants may be required to disclose to prospective clients, subject to other disclosure requirements, that they are providing legal services in a pilot through an Innovation Sandbox.

Applicants may be required to provide clients with information about their delivery model, including:

  • that the delivery model is a test, of limited duration, operating through the Innovation Sandbox
  • that the delivery model has not been proven
  • there is no guarantee of longevity or completion of their matter using the delivery model
  • if the delivery model is provided by a non-Alberta lawyer, that specific regulatory requirements may not apply
  • other pertinent information, as determined by the Law Society.

If required, clients of approved delivery models must sign an acknowledgment that the information above has been disclosed.

Insurance or Indemnity Requirements

Applicants who are not insured Alberta lawyers must have insurance or indemnification in place that is appropriate for the delivery model piloted in the Innovation Sandbox.

What happens if a Sandbox participant does not comply with the Rules or Code?

While the Sandbox participants may seek to relax the application of a specific rule, that does not mean they are not being obligated to comply with other standards. The participants will only be permitted to operate under the terms of an agreement with the Law Society, which includes regular reporting on progress and/or challenges. The Rules or the provisions of the Code that are not relaxed remain in effect for Sandbox participants.

Where non-lawyers are part of the proposal, they will be contractually bound by the Sandbox agreement. Should they deviate from those terms, or if the Law Society, through its regular oversight, determines that the public is at risk, the project will be terminated. If despite the project’s termination the project continues to operate, the Law Society may seek injunctive relief to stop the delivery of service.

What are some of the elements that may be included in the agreement between the participant and the Law Society?

Applicants who are approved to operate a delivery model in the Innovation Sandbox are required to sign an agreement with the Law Society for the delivery of legal services. The agreement will set out the requirements with which the applicant must comply during the pilot, including:

  • duration of the pilot;
  • maintaining eligibility requirements;
  • conditions imposed;
  • disclosure;
  • complaint handling.
  • monitoring; and,
  • reporting.
What are some of the reporting requirements that might be expected of Innovation Sandbox participants?

Participants will be required to provide periodic reports to their contact person at the Law Society consistent with the objectives and nature of the delivery model. These reports will consist of broad, general information such as issues that have arisen, consumer feedback, general observations about the operation of the delivery model, and so on.

At the end of the pilot, participants are required to provide a final, formal report to the Law Society. The final report will provide specific information, including:

  • issues that affected the operation of the delivery model;
  • measures of success, including consumer interest and participation;
  • consumer feedback, including complaints and positive outcomes;
  • additional support required from the Law Society;
  • whether the delivery model achieved the objectives of the delivery model;
  • whether the delivery model met the objectives of innovation and access to justice;
  • performance and efficiency outcomes;
  • the cost of legal services delivered; and,
  • next steps.
Our entity has been authorized to offer legal services in the Sandbox. Does this mean I am immune from investigation or regulation?

Absolutely not. The Innovation Sandbox authorizes you to provide legal services through a nontraditional service model without being subject to regulatory discipline for your specific exemption. If your entity violates provincial or federal law (consumer protection, disclosure, securities, etc.), you can absolutely be investigated and be subject to discipline for those violations.

Lawyers working with your entity can be also disciplined if they violate the Rules or Code of Conduct. Any other licensed professionals in your entity (accountants, medical providers, social workers, etc.) can be subject to professional discipline by their regulators if they violate their rules.

Does Innovation Sandbox approval mean I can represent clients in court?

Under the Legal Profession Act, only active members of the Law Society may appear in court on behalf of others.

Unless a statutory exemption applies –  for example, section 62 of the Provincial Court Act allows individuals who are not lawyers to act as agents in the Civil Division of that court – non-lawyers must seek the Court’s permission before they can appear on behalf of others.

Being approved for the Innovation Sandbox does not change this.

What happens if a complaint is filed against a Sandbox participant?

A complaint regarding Alberta lawyers will follow the Law Society’s complaint process.

For complaints against a Sandbox participant who is not an Alberta lawyer, the Law Society will assess a complaint to determine the nature of the complaint, the issues raised and whether a complaint may be resolved through additional support. If the complaint is resolved to the satisfaction of the contact person, then no further steps are required.

Complaints can be filed through the Innovations Sandbox’s online Complaints form.

I’m an Alberta lawyer and I’ve been approached by an entity that has been authorized in the Innovation Sandbox. Can I work for them?

Yes. Alberta lawyers can deliver legal services in these new entities. However, the Rules of the Law Society of Alberta and the Code of Conduct still apply. For more clarity regarding the exemptions to the Rules or Code, contact the entity’s Law Society contact.

If my Sandbox ends in two years, what happens to my business?

At the conclusion of the pilot, the provider will prepare a comprehensive report for the Law Society’s review. We will evaluate the results of the testing and implementation to determine whether the provider will be allowed to continue to deliver legal services through their delivery model or whether the delivery model will cease. Providers that have completed their agreed term and have successfully exited the Sandbox may continue to provide legal services (contingent upon continuing to abide by the terms of their agreement with the Law Society).

Is the Law Society essentially giving a stamp of approval to Innovation Sandbox participants?

A provider’s approval to participate in the Sandbox means that they can operate for a limited period of time in the Sandbox with strict monitoring and reporting requirements. To gain approval, the participant must meet and maintain eligibility requirements and be in compliance with their agreement with the Law Society, acknowledging the requirements with which the applicant is required to comply, potential risks and proposed conditions to mitigate identified risks. It is likely that both consumers and participants will see Sandbox participation as an indication that the participant provides competent and ethical service.

Are other jurisdictions operating sandboxes?

The sandbox concept is widely used in the financial services sector and has more recently been introduced in the legal sector. Current sandbox environments are operated by the Law Society of British Columbia, Ontario, the State Bar of Utah and the United Kingdom. The State Bars of California and North Carolina have both announced their interest in sandboxes as well.

Will Innovation Sandbox participants compete with lawyers for clients and services?

The Innovation Sandbox is focused on innovative legal service delivery models, which is distinct from models that deliver legal advice. While the Innovation Sandbox is open to both lawyers and non-lawyers, the Sandbox will not permit any business model that seeks to deliver legal advice from non-lawyers. Under no circumstances will a Sandbox application that proposes a business model that seeks to deliver legal advice from non-lawyers be approved. The Sandbox will accept applications for non-lawyer ownership of organizations providing legal services and organizations that include non-lawyer partners. As with all the applications, our mandate of acting the public interest will provide the lens through which we view these proposals.

The mandate of the law society is to regulate the legal profession in the public interest. The Bencher-approved eligibility criteria does not consider whether or not a proposal competes directly with lawyers; it and is focused on benefit to the public.

Will sandbox participants further commoditize lawyers or create services that compete with lawyers?

Our goal with the Innovation Sandbox is to help address meet the unmet legal needs of Albertans and not to disrupt the good work already being done. We anticipate that many Innovation Sandbox participants will serve consumers who traditionally do not seek out a lawyer to assist with their issue.

Technology is changing how lawyers practise, just as it is changing how other professions practise, and innovations developed in the sandbox may create new opportunities for lawyers as well.

Why are there no application or licensing fees being charged to Innovation Sandbox applicants?

The mandate of the law society is to regulate in the public interest; using funds from our operating budget to support this initiative and our strategic plan is part of our ongoing operations. Additionally, there are no additional incremental costs to run the program.

Where can I find out who has been approved to operate in the Innovation Sandbox?

All approved Innovation Sandbox participants will be listed on the Law Society website, along with a description of the services they are offering.

Can Innovation Sandbox participants represent people in courts?

The Law Society has limited jurisdiction over who appears in court, as the Legal Profession Act and the courts themselves govern that process.

However, while the Innovation Sandbox is open to both lawyers and non-lawyers, the Sandbox will not permit any business model that seeks to deliver legal advice from non-lawyers. Under no circumstances will a Sandbox application that proposes a business model that seeks to deliver legal advice from non-lawyers be approved. The eligibility requirements for sandbox applicants do not permit us to authorize agents to appear in any level of court where they would not otherwise be permitted to appear by current legislation or relevant procedural rules.

The Sandbox will accept applications for non-lawyer ownership of organizations providing legal services and organizations that include non-lawyer partners. As with all the applications, our mandate of acting the public interest will provide the lens through which we view these proposals.

Where non-lawyers are part of the proposal, they will be contractually bound by the Sandbox agreement. Should they deviate from those terms, or if the Law Society, through its regular oversight, determines that the public is at risk, the project will be terminated. If despite the contractual breach the project continues to operate, the Law Society may seek injunctive relief to stop the delivery of service.

How did the Benchers decide to pursue the Innovation Sandbox project? Did they consult the profession?

The Benchers have taken a considered and thoughtful approach to the changing legal landscape over the last number of years. Recognizing that in addition to this issue being important for the regulator, it was an issue that would be of interest to the profession, and of significant interest to particular practice areas.

Two related previous engagements with the legal profession have informed the development of the Innovation Sandbox:

  • From May to June 2016, the law societies of Alberta, Saskatchewan and Manitoba collaborated to consult with lawyers on entity and compliance-based regulation. This involved early discussions on alternative business structures.
  • From October to December 2017, open houses and an online survey were available for lawyers throughout the province, regarding potential changes to the Legal Profession Act (Act) including general concepts for change in current legal service delivery and the governance of the profession.

The development of the Innovation Sandbox is in part a direct response to these engagements. With no changes having been made to the Act, and no changes have been proposed to the Act, the Innovation Sandbox allows the Law Society to understand, from a real-world perspective, how specific innovations might operate in a controlled environment and what, if any, risks they may pose.

Do I risk prosecution if I use products and services offered by Innovation Sandbox participants?

No. The Law Society will not prosecute you for using any products or services offered in the Sandbox. You may do so without fear of punishment and will not be offside the Rules or Code of Conduct for doing so. Sandbox participants must meet and maintain eligibility requirements before they are allowed to operate. You can rely on that approval when using Sandbox products and services.

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