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Otto Schmidt Answers
Otto Schmidt Answers is the AI research assistant of Verlag Dr. Otto Schmidt, the Cologne legal and tax publisher, built into its Otto Schmidt online databases. A user asks a legal or tax question in plain language and receives a short answer within seconds. The answer is generated only from the publisher's own collection of commentaries, handbooks, journals, statutes, administrative instructions and recent decisions, with links to the passages it drew on.
The publisher describes the technology as an agentic retrieval system that combines semantic search over that collection with generative language models. It is powered by Taxy.io, an Aachen software company that began as a spin off of RWTH Aachen University, and the model runs on servers in Germany. What Answers can draw on depends on the modules a customer subscribes to, which span tax, civil, employment, family, corporate, insolvency and white collar criminal law.
Every module subscription includes five prompts a day per user, and an Answers license for unlimited use costs 79 euros a month per person plus VAT. It is sold to lawyers, tax advisers, auditors and companies, and launched on 1 December 2023.
Capability grades
All 15 axes, graded from public sources on the date shown. Hover a grade to see what the letter means on that axis.
AI Centrality
How much of the product is actually AI. Whether the machine learning is the mechanism the buyer is paying for or a feature layered onto conventional software, and whether the vendor is specific about which is which.
The product page and FAQ describe Answers as an agentic retrieval system that searches the Otto Schmidt online collection semantically and then writes a short answer with links to the passages used. Section 2.8.1 of the publisher's Terms says the publisher offers AI functions through Answers using large language models in a protected environment. Customers subscribe to modules of the database, the commentaries, handbooks, journals, statutes and decisions of a practice area, priced per module and usable through ordinary search and reading.
Every module includes five Answers prompts a day per user, and a separate Answers license of 79 euros a month per person removes the limit. The license pays for the AI function only, since the content behind each answer must already be subscribed. Section 2.4.5 of the Terms forbids customers to run the database through AI systems the publisher has not authorized.
Citation Accuracy and Hallucination Disclosure
Whether the vendor publishes measured accuracy on citations and assertions, grounds output to primary sources, and says plainly what its system does when it does not know. Legal has a documented public record of fabricated citations reaching filed briefs, so an untested claim of accuracy is not evidence.
The Answers FAQ says Answers generates content only from the scientifically reviewed literature in the Otto Schmidt online database, works by semantic search rather than keywords, and links the literature it drew on for each answer. A reader with the module can open the commentary, handbook or journal passage behind a statement. The same FAQ says hallucinations, meaning invented assertions, are excluded, because the system draws only on reviewed sources.
No evaluation, error rate, test set or comparison is published on the product page, the FAQ or the press releases of November 2023 and May 2024 to support that claim. The Taxy.io terms for Answers of 4 October 2023 describe answers in prose with source references where available, which allows for answers without a source, and section 6.5 of those terms disclaims liability for the correctness of results. Section 2.3.3 of the publisher's Terms adds that author content is usually not updated between print editions, so a linked commentary can lag the law it describes.
Autonomy and Oversight Model
What the system decides on its own, what a lawyer must approve, and whether the vendor documents where the review point sits. A tool that drafts under review and a tool that files without one are different products and different risks.
Section 2.8.2 of the publisher's Terms says the user bears responsibility for the content of results obtained with the AI functions, and that using them does not release the user from the duty to research and examine specific legal questions personally. Section 2.4 of the Taxy.io terms for Answers of 4 October 2023 says the user must check the answers separately and may not use them unchecked, because Answers is software based on machine learning.
Each answer links to the cited passage in Otto Schmidt online, and a history keeps prompts and answers. Answers works only inside the database. It does not draft into a document, send anything or change a file. Nothing describes a point at which the system declines or flags low support, a record that a user checked an answer, or what the publisher does after an answer proves wrong.
Operational and Outcome Evidence
Named, dated evidence that the product works in production at real firms or legal departments. Case studies with figures and identified customers count. Unattributed testimonials and launch announcements do not.
The press release dated 17 May 2024 reports that Answers was named the best AI solution among the specialist media of the year by the German trade press association, with the jury saying it delivers real added value in practical use. The product page adds a WELT German AI prize of 2025 in the users' category. The launch release dated 15 November 2023 claims time savings of up to 30 percent and a clear productivity gain over classic database use, without saying who measured it or how.
No named customer, firm, case study, testimonial with a name, or count of users is published on the product page, the FAQ or the press page. A press release dated 30 April 2026 on Otto Schmidt content inside Legora concerns the publisher's content in another vendor's product, not use of Answers.
Privilege and Confidentiality Posture
How client confidences are handled: attorney client privilege and work product treatment, segregation of one client matter from another, whether client data trains any model, and what the vendor commits to in writing rather than in marketing.
Section 2.8.1 of the publisher's Terms says searches and answers are not used to train the language models. The Answers FAQ says the AI solution runs on servers in Germany and that no data flows to the United States or outside the EU. It says Answers is available for agreements with external service providers under section 43e paragraph 3 of the Federal Lawyers' Act, meeting the legal requirements for a confidentiality agreement between firms and IT providers.
Section 2.8.3 puts the burden on the user: questions must contain no personal data, and anonymization is the user's responsibility. Section 2.8.4 says the Taxy.io terms apply in addition for Answers. Section 3.3 of those terms, dated 4 October 2023, grants Taxy.io a simple right to use user content such as input texts and documents, unlimited in space, time and content, including modifying it and creating derived versions.
No published document addresses privilege, separation between users or firms, or what the model provider retains. The section 43e agreement is not published.
UPL and Professional Responsibility Posture
Whether the vendor is clear that it supplies a tool rather than legal advice, who its audience is, and how it addresses unauthorized practice of law, competence and supervision duties, and jurisdiction limits. ABA Formal Opinion 512 is the reference point. Where the advice line is not the duty a product raises, the axis is read through the nearest professional duty it does raise: judicial conduct rules and the reviewing duty for products sold only to courts, and the duty to bill for time actually spent for products that draft time entries.
Section 2.8.2 of the publisher's Terms places responsibility for AI results on the user and keeps the duty to research and examine specific legal questions. Section 2.4 of the Taxy.io terms for Answers of 4 October 2023 forbids using answers unchecked. Section 2.3 of the Taxy.io terms says Answers is directed only at businesses acting in their trade or profession, and the product page names lawyers, tax advisers, auditors and companies as users.
Consumers are therefore excluded from the AI product, even though the publisher's general Terms also serve consumers for other products. The Answers FAQ offers the agreement that section 43e of the Federal Lawyers' Act requires for a firm's IT providers. No statement says answers are not legal or tax advice. Nothing treats how a lawyer's competence and supervision duties apply to an AI answer, and no jurisdiction limit is stated beyond the German literature the modules contain. Companies are a named audience with no word on in house versus non lawyer users.
AI Governance and Bias Disclosure
Published governance over model behavior: who owns it inside the vendor, what is tested before release, and what is disclosed about disparate output across matter types, parties, or populations.
No governance position for the AI is published. No published document names an accountable owner at the publisher or Taxy.io, a testing or evaluation regime, an AI policy, a classification under the EU AI Act, or any finding about output. The FAQ explains why the publisher connects knowledge to the model rather than training it, and the Terms forbid customers to run the database through unauthorized AI systems. Both describe design and rights, not oversight of the model.
The editorial review of the underlying literature is the publisher's long standing process for its content and is not described as applying to the AI answers. Nothing addresses uneven answers across practice areas or modules.
AI Safety and Data Stewardship
Retention, deletion, access control, and what happens to prompts and documents after they are processed. Whether the vendor states its subprocessors and its incident practice, or leaves the buyer to assume.
The Answers FAQ says the AI solution and the integrated model run on servers in Germany, so data flows neither to the United States nor anywhere outside the EU. It says Answers keeps all prompts and the AI's answers in a history, and that chats can be renamed and deleted. Section 10.1 of the Taxy.io platform terms of August 2023, which the Answers terms incorporate for account registration, deletes personal data and the account 30 days after the end of the contract.
Section 5 of the Answers terms lets Taxy.io delete content irretrievably. Section 2.8.3 of the publisher's Terms asks users to keep personal data out of questions. No subprocessor list, model provider, retention period for the history, breach notice period or access control description for Answers is published. The publisher's privacy policy is dated January 2019 and does not mention Answers or Taxy.io. The data processing agreement linked from the Taxy.io platform terms covers a different Taxy.io product.
AI Liability and Recourse
What the vendor stands behind contractually when its output is wrong. Indemnities, caps, carve outs, insurance, and whether any of it is published or only reachable through a negotiated agreement.
Section 2.6 of the publisher's Terms excludes liability for interruptions of database access short of intent or gross negligence. It lets the customer terminate without notice after five working days in a row without access, and limits liability in the ordinary case to one year's usage fee for the database. The Taxy.io terms for Answers of 4 October 2023 apply in addition under section 2.8.4 of the publisher's Terms.
They make Taxy.io liable for intent and gross negligence and, for essential contractual duties, for any fault, with liability limited to the damage typically foreseeable when the contract was concluded (sections 6.1 and 6.2). Liability for lost data is limited to the cost of recovery from proper backups (6.3), and section 6.5 excludes liability for the correctness of the results and content of Answers. Section 2.8.2 of the publisher's Terms leaves responsibility for AI results with the user. No indemnity, warranty on output or insurance for the customer is published.
Practice Systems Integration Depth
How deeply the product reaches into the systems legal work already lives in: document management such as iManage and NetDocuments, Word and Outlook, contract lifecycle management, matter management, e-billing, and court filing systems.
Answers works inside the publisher's own database. No Word or Outlook add in, document management connection, practice management integration, API or export to a case file is described for it. Users ask questions in Otto Schmidt online and read the linked passages there, and the FAQ describes a history of chats that can be renamed and deleted. The publisher's content does reach other tools through licenses to other vendors.
A press release of 30 April 2026 describes Otto Schmidt literature inside Legora since autumn 2025, and other legal AI products sell Otto Schmidt modules as sources. That is distribution of the content rather than an integration of Answers. Section 2.4.5 of the Terms forbids customers to process the database with AI systems the publisher has not authorized, so a firm cannot connect its own tools to the content either. A lawyer moves an answer into a draft by copying it.
Deployment Model and Data Residency
Where the software runs and where the data sits. Multi tenant cloud, single tenant, private deployment, on premises, and whether region of residence is a published option or an enterprise conversation.
The Answers FAQ says the AI solution runs on servers in Germany and that the model integrated into the system is operated on servers in Germany. It says data therefore flows neither to the United States nor to any other region outside the EU. Section 2.8.1 of the publisher's Terms describes the use of large language models in a protected environment. Answers is delivered inside Otto Schmidt online as a hosted service under a named user license, with Taxy.io as the technology partner whose terms apply alongside the publisher's. The hosting or cloud provider, where the history of prompts and answers is stored, whether storage and model processing share a location, and whether any private or dedicated option exists for larger customers are not stated.
The FAQ refers multi seat solutions to customer service without describing a different deployment. The Taxy.io platform terms of August 2023 and the publisher's privacy policy of January 2019 do not name a hosting location.
Security Certifications and Trust Center
Independent attestation a buyer can pull without a sales call: SOC 2, ISO 27001, penetration test summaries, a trust center with current reports and named scope rather than a badge image.
No security attestation is claimed for Answers, the publisher or its technology partner. The Answers product page, the FAQ, the publisher's Terms, the privacy policy of January 2019, the Taxy.io terms for Answers of 4 October 2023, the Taxy.io platform terms of August 2023 and the publisher's press releases name no ISO 27001, SOC 2, BSI C5 or other certificate, audit report, penetration test or trust center for Verlag Dr. Otto Schmidt, for Taxy.io or for the servers in Germany on which the model runs.
The Terms describe password confidentiality and named user access, and the FAQ describes the environment as protected and data as staying in Germany. The data processing agreement linked from the Taxy.io platform terms covers another Taxy.io product and lists cloud subprocessors whose certifications, if any, would belong to them.
Model Supply Chain Disclosure
Which models sit underneath, whose they are, where they run, and whether the vendor commits to telling customers when that changes. A legal buyer inherits every dependency it cannot see.
The Answers FAQ describes an agentic retrieval augmented generation system that combines semantic search over the Otto Schmidt online collection with generative language models. It explains that knowledge is connected to the model rather than trained into it, and says the integrated model runs on servers in Germany. The product page says Answers is powered by Taxy.io and uses advanced language models. The FAQ describes Taxy.io as a spin off of RWTH Aachen University founded in 2018 that develops AI software for automating business tax advice.
Section 2.8.4 of the publisher's Terms applies the Taxy.io terms for Answers in addition to its own. No model name, model provider, version or hosting company is given on the product page, the FAQ, the Terms or the press releases, and no commitment to tell customers when the model or provider changes is published. Section 8 of the Taxy.io terms allows Taxy.io to change those terms unilaterally where objectively justified, with changes deemed approved after four weeks without objection.
Commercial Transparency
Whether a buyer can learn what this costs without entering a sales process: published rates, the unit being charged, what sits behind an enterprise tier, and what implementation adds.
The Answers FAQ says each module subscription includes five prompts a day per user, and that lifting the daily limit requires an Answers license at 79 euros a month plus VAT, for one person. The product page prices example modules that include Answers: the Aktionsmodul Steuerrecht at 540 euros, the Aktionsmodul Zivilrecht at 198 euros and the Beratermodul Steuerrecht at 178 euros. Each is for three months plus VAT and shown against higher list prices.
Section 2.1.2 of the publisher's Terms sets a start subscription of three months, paying for two, followed by six month terms with four weeks' notice. Section 9.1 reserves price adjustments for subscriptions and databases when production costs rise. Multi seat solutions are available on request through customer service, without a price. The launch release of November 2023 and the award release of May 2024 gave 99 euros a month per user, and the Taxy.io terms of October 2023 still describe a basic package of three firm users. No implementation fee applies.
Firm and Practice Coverage
Who the product is actually built for. AmLaw, midlaw, small firm and solo, in house departments, government and courts, and which practice areas are supported rather than merely claimed.
The product page names lawyers, tax advisers, auditors and companies as users, and the Taxy.io terms limit Answers to businesses. Answers modules cover tax law, with separate modules for procedure, income, inheritance, international and value added tax, along with civil law, employment law, family law with the FamRZ journal, corporate law, insolvency law, white collar criminal law, accounting, nonprofit law and occupational pensions.
Named standard works include Zöller on civil procedure, Tipke and Kruse on the tax code and the Staudinger commentary on the Civil Code. The Answers FAQ says Answers draws only on the Otto Schmidt online collection, so what it can answer depends on the modules subscribed, and the Taxy.io terms say full source views need the matching publisher licenses. Otto Schmidt does not say how the product serves the different segments, what it handles poorly, whether case law outside the publisher's collection is reached, or whether companies means in house legal departments or business users generally.
2 public documents
The public pages on file for Otto Schmidt Answers, with the recorded signals each one supports and the date it was last read. Open any of them and check the reading against the record.
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otto-schmidt.de/agb1 signal
Client Data in Training
Read Oct 2, 2026
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Prompt and Output Retention
Read Oct 2, 2026
€79 per user/monthEUR, as published, never converted
- Otto Schmidt Answers comes with the publisher's online databases.
- Every database subscription includes five AI questions a day.
- Unlimited questions cost 79 euros a month per person, plus VAT.
- The answers only use books and journals you subscribe to.
- Teams ask customer service for a price.
Five Answers prompts a day per user are included in every Otto Schmidt online module subscription. An Answers license for unlimited prompts costs 79 euros a month plus VAT, for one person. Example modules that include Answers are the Aktionsmodul Steuerrecht at 540 euros, the Aktionsmodul Zivilrecht at 198 euros and the Beratermodul Steuerrecht at 178 euros, each for three months plus VAT. Multi seat solutions are priced on request.
Implementation: None stated.
Confidentiality and data terms: Not applicable in the German market. The Answers FAQ says an agreement under section 43e of the Federal Lawyers' Act is available. It is not published.
Note: Prices exclude VAT. Module subscriptions start with three months, paying for two, then run in six month terms with four weeks' notice (section 2.1.2 of the publisher's Terms). Earlier publisher releases (November 2023, May 2024) gave 99 euros a month per user. The content behind each answer requires the matching module subscription.
Legal Signals
What each signal meansA signal records what public sources say on the date shown. It is not a grade and it is not a recommendation. Where a signal reads Not addressed, it means the index did not locate the material in public sources on that date, which is a statement about disclosure rather than about the product.
Client Data in Training
Can material a lawyer puts into this product be used to train a model?
The published terms prohibit training on customer content. Not a policy page, the agreement.
Section 2.8.1 of the publisher's Terms says searches and answers are not used to train the language models. Section 3.3 of the Taxy.io terms for Answers of 4 October 2023, which apply in addition, grants Taxy.io a simple right to use user content such as input texts and documents that is unlimited in space, time and content, and does not mention training either way.
Prompt and Output Retention
How long does the product keep what a lawyer typed, and can that be set to zero?
The customer controls the retention window, by product configuration or by contractual instruction, but zero retention is not stated as available.
The Answers FAQ says Answers keeps all prompts and the AI's answers in a history and that chats can be renamed and deleted. No retention period for the history is stated, and the Taxy.io platform terms of August 2023 delete personal data and the account 30 days after the contract ends.
Ethical Walls and Matter Segregation
Does retrieval respect the firm’s ethical walls, or can the model read across them?
No located public material addresses walls or matter level segregation.
Access is licensed per named user, and login details may not be shared within the customer's organization. Nothing on the product page, in the FAQ, the publisher's Terms or the Taxy.io terms addresses separation between users, firms or matters inside Answers.
Third Party Request and Subpoena Notice
If someone subpoenas the vendor for a firm’s data, does the firm hear about it first?
No located term or policy addresses third party requests for customer data.
None of the publisher's Terms, its privacy policy of January 2019, the Taxy.io terms for Answers of 4 October 2023, the Taxy.io platform terms of August 2023 or the FAQ addresses requests from courts or authorities for customer data. No transparency report is published.
Primary Law Corpus Provenance
Where does the law in this product come from, and does the vendor have the right to use it?
The vendor names its primary law sources and the license or public domain basis for each, with an update cadence.
The Answers FAQ says Answers draws only on the publisher's own Otto Schmidt online collection of commentaries, handbooks, journals, statutes, administrative instructions and recent decisions. The modules are named work by work, and the content is the publisher's own. The FAQ also says the content is updated continuously, with new statutes and decisions added immediately after publication, while section 2.3.3 of the Terms says author content is usually not updated between print editions.
Good Law Verification
Does the product tell you when the authority it just cited has been overruled?
The product instructs the reader to check the citation without performing the check.
Section 2.8.2 of the publisher's Terms keeps the user's duty to research and examine legal questions personally, and the Taxy.io terms forbid using answers unchecked. No check of whether a cited decision or provision has later been overturned or amended is described.
Refusal and Uncertainty Behavior
What does the product do when the answer is not in the corpus?
No located public material addresses what the product does when it cannot ground an answer.
The Taxy.io terms describe answers with source references where available. Nothing on the product page, in the FAQ or in either set of terms describes what Answers does when the collection holds no support for an answer.
Fabricated Citation Record
Does a public court record exist addressing fabricated or hallucinated legal citations in output from this product?
No court order, opinion or disciplinary record addressing fabricated or hallucinated legal citations produced by this product has been located as of the date shown. This is a statement about the public record on that one subject, not a finding about the product, and this signal is not a litigation history.
The AI Hallucination Cases database maintained by Damien Charlotin records no case involving Otto Schmidt Answers, Otto Schmidt or Taxy.io. No court order, opinion or disciplinary record naming the product is on the public record.
Bar Guidance Alignment
Has the vendor engaged in public with the ethics opinions its buyers are bound by?
Public materials refer to professional responsibility in general terms without naming guidance.
The Answers FAQ says Answers is available for the agreements with external service providers that section 43e paragraph 3 of the Federal Lawyers' Act requires, a statute. No bar association guidance, professional code or ethics opinion on AI is named.
Billing and Fee Posture
Does the vendor address what happens to the bill when the work takes an hour instead of six?
Public materials claim time savings without addressing billing or disclosure, and the product sits inside a fee relationship between a lawyer and a client where those savings would change the bill.
The launch press release dated 15 November 2023 claims time savings of up to 30 percent and a clear productivity gain over classic database use. Nothing addresses how AI assisted work is recorded, billed or disclosed to clients.
Outside Counsel Guideline Readiness
Can a firm get this vendor through a client’s AI clause without a bespoke negotiation?
No located public material supports a client side disclosure obligation.
Taxy.io is named as the technology partner. No subprocessor or model provider list and no client facing disclosure material for Answers is published on the product page, in the FAQ, the publisher's Terms and privacy policy or the Taxy.io terms.
Court Disclosure Support
If a judge’s standing order requires an AI disclosure, can the product produce one?
No located public material addresses court disclosure or verification certification.
Nothing on the product page, in the FAQ or in either set of terms describes a record of the model, sources and human verification behind an answer for a court filing, or guidance on disclosing AI use to a court.