News
Ambitious economic target set to lead to expansion of Chilean
legal market
Firms could be forced into recruitment drives in order to ensure they have enough resources to meet
the rapidly increasing demand for legal services
With Chile´s President Sebastián
Piñera having pledged to double
economic growth in the country,
law firms are anticipating a
substantial rise in M&A, finance
and competition work. Indeed,
the increase in instructions
could be significant enough to
justify law firms embarking on
recruitment drives to ensure they
have the resources to meet client
demand. As Piñera’s first year in
office comes to a close, lawyers
are expecting growth in the
manufacturing and construction
sectors in particular.
Ricardo Abdala, partner at
Abdala & CIA Abogados, says
Piñera’s target is realistic, as the
“base of comparison is very low,
as the final year of President
Michelle Bachelet’s government
saw the lowest economic growth
in 35 years, at a meagre 1.5
per cent”. He adds: “Piñera’s
government has generated an
immediate improvement in
economic expectations, which
has translated into a considerable
increase in investment.”
However, in order for this
level of growth to become a
reality, economic activity will
have to be strengthened across
all sectors, and will require the
creation of new companies and
ventures, according to Abdala.
He adds that the agriculture and
banking sectors will generate the
most significant growth, with an
increase of 8 per cent expected in
agricultural exports in the next
year, and share offerings are
predicted to rise by 7 per cent.
Abdala points out that the
retail sector is also generating
substantial growth and is
predicted to expand by 5.4 per
cent this year. Meanwhile,
Chile’s manufacturing sector is
predicted to grow by 3.8 per cent,
construction by between 4.6 per
cent and 6.6 per cent, although
the mining sector is expected to
register growth of just 1 per cent.
“Mining is a central pillar of the
economy in Chile, and the value
of copper exports is predicted to
reach $43 billion this year, with
production close to 5.85 million
tonnes.”
This growth will bring an
increase in demand for legal
advice related to M&A, finance,
Santiago, Chile: The number of lawyers being admitted to the bar in Chile increased
34 per cent in the last five years
10 • THE LATIN AMERICAN LAWYER • December 2018
and competition as well as a surge
in environment-related matters
as international investors look to
Chile, says Abdala. Meanwhile,
new data protection regulations
will also lead to an increase in
instructions for law firms in Chile,
he adds.
Law firms will also see an
increase in work due to that fact
President Piñera is proposing
reforms to the country’s tax,
employment and environmental
laws. This, in turn, will lead to
an increase in size of the Chilean
legal market, according to
Abdala. “As the economy grows
and national and international
investment increases, so will the
creation of new companies or
subsidiaries, and that can’t be
achieved without comprehensive
legal advice, and clients will
also require assistance with the
legislative reforms undertaken by
Piñera’s government,” he adds.
Fees stable
Abdala also expects the ranks
of the law profession to swell,
with more Chilean universities
now offering law degrees, and
the number of lawyers being
admitted to the bar having
increased by 34 per cent over
the last five years.
José Luis Ilabaca, partner
at DS Abogados in Chile,
expects the Chilean mining,
infrastructure and public
works, energy, agrobusiness
and fisheries sectors to show
the most significant growth
if Piñera’s growth plans are
successful. He adds: “We
should expect important M&A
work due to potential foreign
investments, as well as mining,
energy and financial work.”
Ilabaca adds that, in general,
legal fees have remained stable
for the last few years. He adds
that the Chilean legal market
is growing, with “new firms
formed by younger lawyers
as well as the presence of
international firms coming from
Spain, the US and France”.
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