Should anyone ever write a comprehensive history of international law firms, a good place to start would be Caracas. Over half a century ago, the Chicago-based pharmaceutical company Abbott Laboratories headed to Latin America to establish an operation in the Venezuelan capital. It needed a reliable local law firm on the ground, where the lawyers had a good command of English. Its hometown law firm at the time was a relatively young outfit, just seven years old, called Baker & McKenzie. It was a single-site law firm, but eventually Abbott Laboratories persuaded it to come south and establish an office in Venezuela. Ultimately, both client and law firm would walk away happy. Abbott Laboratories retained a consistent standard of legal advice, while Baker & McKenzie retained a lucrative client, plus a guaranteed workflow in a new and untapped jurisdiction. The year was 1955.
A lot has happened since then, but the business case behind why most firms open international offices remains relatively unchanged. Caracas helped Baker & McKenzie develop a taste for foreign jurisdictions, and in time the Western legal industry as a whole would become increasingly bold in its attempt to enter new and emerging markets. The past two decades in particular have seen a flurry of flags being placed in maps, with almost every global region enjoying its moment in the sun, from Eastern Europe and the former Soviet Union, through to Asia and the Middle East. The last destination of choice was Dubai in the heady, halcyon days before the global financial crisis took hold. Throughout all of this, Latin America was relatively unloved, despite Baker & McKenzie’s pioneering attentions. The firm remained loyal to the continent where it all began, establishing 14 offices across Argentina, Brazil, Chile, Colombia, Mexico and Venezuela, but a combination of volatile politics and economics meant that most other law firms weren’t interested in committing to the region, except for a few small US outposts in Mexico City. The recent move by Argentina to nationalise its New York-listed oil and gas company RPF, at the expense of the Spanish energy company Repsol’s majority shareholding, is a reminder of the inherent risks that are still perceived to exist in certain Latin American countries.