KPMG Law Seeks Alternative Business License, Shaking Up Legal Status Quo

KPMG Law U.S. is seeking approval under Arizona rules that allow non-lawyer firm ownership, something the Big Four networks cannot currently do in the U.S. although a similar regulatory approach has been in place in England and Australia for more than a decade.

Much like in the U.K., Arizona allows non-lawyers to have an economic interest or decision-making authority in firms offering legal services, so KPMG Law’s licence could be a game changer if approved, allowing the firm to practice law across the US.

KPMG Law’s plan is to partner with resources in other jurisdictions and serve clients nationally, including in Arizona, the firm said in a statement. KPMG Law U.S., a subsidiary of KPMG U.S., declined to comment on particulars of its application, including the number of lawyers and non-lawyers in the proposed ABS.

The application is scheduled for review on January 14 by the State of Arizona Supreme Court Committee on Alternative Business Structures.

“The State Supreme Court of Arizona has led the way in the U.S. in facilitating change and other states need to adapt or become less relevant,” said Crispin Passmore, of London-based Stratify consultancy.

“KPMG is one of a handful of businesses at the forefront of this and, if the court approves its application—which we do not know it will—then it will play a leading role in reshaping the U.S. and global legal market.”

Passmore, who sat on the U.K.’s Legal Services Board that introduced alternative business structures to England and Wales, advised Arizona on its regulatory reforms. The state granted its first ABS license in 2021 and by September 2024 had issued 100 licenses. Utah and Washington state, meanwhile, are assessing ABS pilot programs.

KPMG Law’s Master Plan

“Legal teams navigate complex challenges with the support of traditional law firms,” KPMG said in its emailed statement. “They also face substantial and wide-ranging process challenges that can benefit from legal expertise and technology at scale. We aim to solve those pain points, especially on tight timelines.”

“This focused effort is a natural extension of our capabilities and will complement the services of traditional law firms,” KPMG added.

KPMG Law’s application will also challenge the traditional separation between legal and non-legal professional services as US ABS licences have largely been granted to firms practicing personal injury, mass torts, and products liability law as well as trusts, estates, and probate law.

“The legal market is changing and that is being driven by clients rather than attorneys,” Passmore said. “As general counsels and finance directors seek predictable pricing, reliable quality, and a shift away from the same models of delivery for all legal work, we are seeing legal business adapt.”

Other countries have adopted ABS structures to varying degrees including in England, where London-based Reed Smith became the first global firm to gain an ABS licence in 2019, as well as in Australia and Spain.