For many strategists watching City giant Linklaters continue its painting by numbers exercise of integrating its European Alliance members, the firm's co-operation agreement with Brazilian firm Goulart Penteado Iervolino e Lefosse Advogados may seem an abstract brush stroke.The link-up with the 12-lawyer Sao Paulo outfit came into effect this month, but Linklaters -- in common with a handful of other firms -- has had a presence in Brazil for a number of years, and the expansion into the territory is a symptom of increasing interest both in Latin America in general and Brazil specifically.If Brazil has suffered in the past from its failure to live up to expectations -- commentators widely touted its capability to join the first world economies in the 1980s -- various factors are now in conjunction, auguring well for its future.And as ever, the lawyers are hot on the scent of the sweet smell of success.
Richards Butler is another regional player with its Sao Paulo-based firm Advocacia Rodrigues do Amaral & Richards Butler in association with Albino Advogados Associados.Clifford Chance also has a presence in the city -- Brazil's legal centre.
Only one firm with English lawyers, Beaumont & Son, has its Brazilian base outside Sao Paulo.
The small City firm co-ordinates its Latin American business, mainly aviation insurance liability and general UK-related work, from an office in Rio de Janeiro.Antonio Carlos Rodrigues do Amaral, a partner with Richards Butler's affiliate firm, says: 'Since the beginning of the 1990s, Brazil has continued to experience a period of intense privatisation and of opening of its economy.'This, in addition to the devaluation of the real in 1999, has boosted Brazilian exports and has significantly increased foreign direct investment.
As a result, our business has expanded both domestically and internationally.'Celia Gardiner, a banking partner with Pricewaterhouse-Coopers' tied law firm Landwell, which has just announced that it is creating a dedicated Latin American desk in its London office, says: 'There is generally a strong interest in energy and telecommunications work in Brazil.
It is also seen as being far more stable than it has been in the past.' She says many Latin American businessmen are keener to do business with European banking interests than with the US, because the latter can be perceived as having too much strength and influence in the region.For Landwell, there are regulatory complications with lawyers working for the firm on the ground.
However, Ms Gardiner says PwC has an excellent accountancy network throughout South America, and can deal with the Brazilian side of banking transactions on the ground in Sao Paulo using local legal contacts.But it is not only Landwell for whom regulatory practice issues pose a problem in Brazil.
Only Brazilian-qualified lawyers (that is, those duly registered with the Brazilian Bar Association) may practise Brazilian law.
Foreign qualified lawyers and foreign law firms may practise law in Brazil only under certain conditions.First, lawyers may register with the Brazilian Bar Association as 'foreign law consultants'.
As such, they are authorised exclusively to practise in Brazil the law of their own jurisdiction, but they may be hired by Brazilian law firms.Second, foreign law firms may register with the Brazilian Bar Association and operate in Brazil as 'consulting firms on foreign law'.
As such, they will only be authorised to practise the law of their (foreign) jurisdiction and are not entitled to hire Brazilian lawyers (with a view to intending to practise Brazilian law).Third, Brazilian law firms may enter into non-corporate, professional, co-operative associations with foreign law firms.
However, all matters regarding the business of the firm and Brazilian law can only be dealt with by the Brazilian lawyers.
In other words, Brazilian-qualified lawyers are entirely responsible for the practice and its management.Linklaters has formed a co-operation agreement with Goulart Penteado within the parameters of the Brazil Bar's guidelines.Its clients are mainly from the banking sector, including Brazilian players Banco Itau, BNDES, and Banco do Brasil as well as state oil company Petrobras.Landwell has similarly been fostering banking interest in its Brazilian operation among the European banks interested in development.
Ms Gardiner says banking interest is now strong.
'There is a feeling among the banking community now that -- although there are residual crises in the economy -- these are now weathered with more confidence .
.
.
Many bankers speak with more confidence about South America than about the former Eastern bloc European countries.'Mr do Amaral says: 'Brazil is probably the most rapidly expanding market of the developing world.'In explaining that banking clients are not the only ones available to European law firms in the region, Mr do Amaral boasts: 'We have clients in practically all sectors of the economy -- from cosmetics (Revlon) through commodities (Tradigrain), insurance (Alexander Forbes), the chemical industry (Rodhia, Solvay), to construction (Camargo Correa, Andrade Gutierrez).'However buoyant the level of transactions may be, there are always specific problems with the culture to overcome.'It really does help to know the right people who can press the right buttons,' says Ms Gardiner.Another English commercial lawyer working in Sao Paulo, who declines to be named, said that on a recent transaction on which his firm was acting, two different offices of the same Brazilian corporate firm had been retained to advise by the different sides.
They came to opposing opinions about one of the key transaction documents.
The lawyer comments: 'Needless to say there was a bit of a scramble to explain the apparent conflict of interest and opinion.'But set against this, Mr do Amaral says: 'Improvements in bureaucracy and the judicial and political systems [Brazil's political capital, Bras'lia, is not a focus for foreign lawyers] have helped Brazil to be more efficient and friendly to the foreign investor.'Ms Gardiner acknowledges that, with fierce competition between the US and European firms for i ncreasing influence in South America, there is a danger that English lawyers might be lumped together with those from the US as Anglo-Saxons.
She says that there are ways to set yourself apart as a lawyer in Brazil.
'I would only ever consider employing English lawyers in Brazil if they spoke the language,' she says, explaining that although English is widely spoken in the business community, this helps to build relationships with local business people on their own terms.David Fenwick, managing partner of Linklaters' Sao Paulo office, says that foreign legal work in Brazil is largely split between the Germans, who have a strong industrial presence in the country, the US and English firms, because of the predominant commercial use of their governing law, and the Spanish, because of the importance of Iberian investment.
Mr do Amaral adds that Spanish Portuguese and Italian lawyers are also active, for the obvious cultural and linguistic reasons.Whatever the competition, everyone is agreed on the compensations of working in Brazil.
For Mr Fenwick, it is about more than just the 'incredible natural beauty' of the coastal towns, and Saturday nights out in Sao Paulo, with its 'huge variety of theatre, show, and entertainment options'.
He adds that, as the largest Portuguese-speaking country in the world: 'It represents an interesting alternative to the Anglo/American/global culture which predominates elsewhere.'Of course, the weather helps.
Mr do Amaral says: 'Brazil is a very pleasant place to live: with most areas having a tropical climate throughout the year (as opposed to the lousy English weather), lovely beaches, good food, nice people and many other marvellous features.'Foreigners who come to live here -- lawyers included -- simply don't want to leave.'Of course, that is not always true.
When Ronnie Biggs traded sun, sea and freedom for Belmarsh prison he was attended by a media circus blazing his arrival home.They may not travel in private jets sponsored by The Sun, but shrewd English lawyers are likely to be heading in the opposite direction -- towards Sugar Loaf mountain.
No comments yet