New technologies such as AI, process automation, and document scanning are being built into systems used by registered agent (RA) service providers. But not every process lends itself to being fully automated, given that a key requirement is having a brick-and-mortar location where physical documents can be served. This means selecting the right RA is more important than ever.
The use of registered agents (RAs) dates back to the early twentieth century, as the U.S. business landscape became more complex, and corporations expanded across state lines. Serving as the intermediary between a corporate entity and the state, RAs serve as a corporate entity’s frontline responder for managing service of process (SOP), the intake of legal matters, and other critical communications.
Despite its indispensable nature, the RA industry seems ripe for improvement—relying as it does on the fast, efficient routing of legal documents—and technology seems be the answer.
The introduction of efficient, technology-based methods of handling legal documents is changing how document-heavy processes are managed—especially when tools like process automation or AI are part of the solution.
The constraint of paper: Why physical locations are still key for registered agent services
One of the core requirements of providing RA services is maintaining a brick-and-mortar location in every jurisdiction in which the service is provided, i.e., there needs to be a physical place where someone can walk up and deliver paper documents. The underlying constraint of dealing with physical documents is unlikely to change in the near future because it would require fundamental change at federal and local levels.
At the same time, customers increasingly expect faster processing times for documents received by their RA provider. It’s this requirement that has driven the introduction of new technologies, such as AI summarizing a document or automatically collecting related information from other documents.
We’re beginning to see RA service providers partner with technology companies to develop solutions that facilitate faster SOP management. As a result, these RAs can demo new technologies that make big promises about being able to automate tasks and produce answers quickly.
The trouble with thrilling new technology and why human expertise is here to stay
The risk with new technology-driven RA systems is rooted in its own value proposition—cutting human interaction out of the process absolutely saves time, however it comes at the cost of professional certainty.
AI and machine learning certainly have a place in our workflow, and there are a lot of AI products that look like they work well because they quickly and confidently give you an answer that looks structurally correct. But if an experienced RA checks the answer, they may well uncover some flaws.
For instance, RAs routinely provide their clients summaries of what a document is, who the parties are, and what type of legal matter is pending. Getting any of those data points wrong can be hugely consequential. If the RA provides the wrong response date, their client can miss their opportunity to defend themselves in a case and be subject to a default judgement.
Moreover, AI tools often struggle with the legal and regulatory intricacies that vary significantly between jurisdictions, potentially leading to incorrect advice or actions. Without the oversight of experienced professionals, these limitations can expose clients to substantial legal risks.
When RAs need to inform their clients about compliance obligations, the risks associated with missing those obligations dictates how important efficiency is relative to accuracy. Being able to complete processes quickly may be of value, but doing so erroneously doesn’t benefit anyone. So it’s preferable to excel at being right—then build up speed—rather than the other way around.
Another example is that experienced RAs will ensure the right information goes to the right person. Litigation goes down one path, subpoenas down another, and bankruptcy filings down a third. While technology can help sort documents, it often lacks the nuance required for accurate routing, especially with complex or ambiguous cases.
Additionally, the lack of clarity in how many AI systems operate can make it challenging to understand the rationale behind their decisions, complicating error resolution and compliance audits. Maintaining transparency is essential for building client trust and ensuring that technology acts as a support rather than a liability.
Of course, there will be continued movement towards process automation and using tools like AI or machine learning—and RA service providers following that trend responsibly, within guardrails, will achieve results that benefit their customers.
In the meantime, asking the right questions will be key to avoiding the risks of working with an RA that relies too heavily on technology, and not enough on human expertise and an understanding of how the RA sector operates. Such questions could include:
- How are the results and outputs of your system monitored and measured?
- What controls are in place to correct errors?
- Is your service delivered by people with RA sector subject matter expertise?
- Why are your services so much cheaper than those from other providers?
How CSC supports registered agent services with technology and expertise
CSC is the standard bearer in the RA industry, building new technologies into our services, but always leveraging our team’s long-term expertise in the sector alongside our products.
We also ensure our RA software can be easily integrated with other corporate systems, such as legal matter management platforms. We can currently integrate our software with 45 commercial and proprietary applications, reducing friction in legal processes.
Finally, we run an expansive training program for our teams that’s linked to our quality management program, ensuring that any flagged issues can be addressed quickly and effectively and then responded to by product development.
CSC provides reliable, same-day scanning and electronic delivery of SOP documents with online tracking and proof of delivery. Read more about selecting the right RA to minimize legal risks and improve document management in our report, The Importance of Choosing the Right Registered Agent.
