‘Legal due diligence is key in acquisitions. AI can help by reading documents and finding things faster. In this piece, we explain what AI is and how it can be effective in due diligence.’
The above paragraph was written by ChatGPT and is not particularly accurate about how AI is used in legal due diligence. Incidentally, the final paragraph of this article was also written by ChatGPT and does give a good description. If you read the part in between, you will know why this is for both. AI’s rapid evolution has not gone unnoticed and is increasingly being applied in the legal sector.
One legal activity that is particularly suited for using AI is the due diligence investigation performed in transactions to acquire a company. It usually involves analysing large numbers of agreements, articles of association and other documents to assess the company’s legal and other affairs. This work is labour-intensive and (partly) repetitive – precisely where AI proves its worth through greater speed and efficiency.
This article aims to examine the current impact of artificial intelligence (AI) on how lawyers work in merger and acquisition (M&A) transactions, and how this may evolve over time. The primary focus is on the use of AI in legal due diligence within M&A transactions. Ivar begins by briefly outlining what legal due diligence entails. This is followed by an overview of developments in the field of AI and their influence on legal due diligence practices. Finally, Ivar highlights key challenges and points of attention regarding the use of AI in this context, and concludes with a summary of insights.
Read the whole article (in Dutch).
