The report Market Surges for Outside Privacy Counsel, commissioned by Bloomberg Law and conducted by the International Association of Privacy Professionals, found that more than 75 per cent of privacy experts at work inside corporations rely on legal advice from outside counsel, with most planning to increase their outside spend in the coming year. In fact, only 6 per cent of 353 privacy professionals included in the survey, most of whom were in-house counsel or compliance officers, said that their team would reduce their outside legal spend over the next 12 months.

According to the survey findings, 63 per cent of privacy professionals seek help from outside counsel on an 'as needed' basis, while a further 13 per cent employ them on a retainer basis. The rates paid to outside counsel for issues relating to data security and privacy are also high compared to other contracted legal services, averaging $474 per hour for transactional services, $539 an hour for litigation but as much as $623 an hour for 'specialised services' in data security. On average, companies spend about $170,000 a year on outside counsel handling of privacy and data security matters.

When companies rely purely on in-house lawyers to support their privacy and security needs, it is a generally a matter of means rather than preference. The general trend of the survey's findings is that if companies have the budget capacity to hire outside counsel for privacy issues, and if they perceive the need, they will almost always make the choice to spend.

Interestingly, only 20 per cent of survey respondents who said that they engaged outside counsel for privacy and security matters said that they did so to tackle breach preparedness, while just 14 per cent sought outside counsel for privacy engineering issues or privacy by design. More than half said that they would turn to a consultant rather than an attorney for advice on privacy engineering or privacy be design—though this could change as needs grow, presenting a potential opportunity for privacy lawyers.

Sources: Bloomberg Law; Corporate Counsel