Por – Christina McKeon Frutuoso
L O Baptista Advogados has joined a growing number of Brazilian firms establishing closer links with the Chinese market, hiring a Beijing-based partner in a bid to boost transactional work between the two countries.
Luiz Eduardo Vidal Rodrigues, who has lived in Beijing for two years, was previously a partner at Almeida Tavares, Silva e Vidal Rodrigues. He was a founding partner at one of Almeida Tavares’ legacy firms, São Paulo-based Vidal Rodrigues Sociedade de Advogados, which also had a Beijing office. Latin Lawyer understands he joined L O Baptista last month.
Vidal Rodrigues focuses his practice on corporate, contracts and infrastructure matters. He will work with L O Baptista’s São Paulo partners Fernando Marcondes and Renata Castro Veloso, who will coordinate mandates involving Chinese businesses in Brazil and Brazilian companies investing in China.
Vidal Rodrigues is currently studying for a masters in Chinese law, though he will not practise it locally. “This is not our goal with his presence in the country,” Marcondes tells Latin Lawyer.
Vidal Rodrigues’ former firm Almeida Tavares, Silva e Vidal Rodrigues did not comment on his departure. The firm retains seven partners and says it will continue to offer services in China. It is in the process of rebranding as Almeida Tavares e Silva Sociedade de Advogados.
L O Baptista’s hire is part of a wider effort to capture Chinese infrastructure investment in Brazil, but the firm also expects a stronger presence in the country will create more work for its corporate, contract, tax, labour, regulatory and antitrust groups. “Negotiations and the structuring of partnerships, joint ventures, mergers and acquisitions, and disputes are also expected to increase both for Chinese businesses in Brazil and Brazilian businesses in China,” says Marcondes.
The firm is also building on current investment trends. “The Chinese movement into the Brazilian market is already established,” Marcondes explains. “A few years ago [Chinese investors] started looking at us and several of them are already here through the purchase of Brazilian companies, mainly in the infrastructure area, but also in several others,” he says. L O Baptista reports an increasing number of visits and consultations from Chinese companies this year.
The financial crisis of 2008, which hit Latin America’s traditional investor base in Europe and the US hard, opened the door for China to play a bigger role in Latin America. It has since transitioned from snapping up companies focused on natural resources to the purchase of more sophisticated targets in sectors like energy, power and banking. China’s foreign direct investment in Latin America and the Caribbean has increased at the same time. Data from the Chinese Ministry of Commerce shows capital inflows rising from less than US$40 billion in 2008 to US$250 billion last year.
Marcondes says L O Baptista’s new presence in China will give the firm an edge when landing a place on some of those deals. “Launching a presence is certainly a unique specialty which will benefit both the firm and our clients.”
Putting more boots-on-the-ground in China will depend on workload. For now, Marcondes says the firm’s focus is on boosting its infrastructure practice in São Paulo to support the increase in work it expects from the Chinese market.
L O Baptista’s decision to focus on China comes amid heightened political uncertainty in Brazil. Far right presidential candidate Jair Bolsonaro, who won the first-round vote earlier this month, has said in the past that he wants to restore the US as Brazil’s top trading partner. China surpassed it in 2009.
However, he has since backtracked and called China an “exceptional partner”, which Brazil would continue to do business with if he won the elections. Despite the speculation over what Bolsonaro – a self-professed fan of US President Donald Trump – may want, Marcondes does not expect the outcome of the run-off round on 28 October to affect Chinese-Brazilian business relations. “Chinese investors tend to focus on long-term investment – looking 20 or 30 years ahead – so their decision-making process is long and extremely well planned,” he says. “Regardless of who wins this election, investments will certainly be made.”
While L O Baptista has no official alliances with local firms in China, it is the Brazilian member of the ALFA International global network of law firms. Marcondes says ALFA has connected it with Grandall Law Firm, which is ALFA’s Chinese member firm. L O Baptista also signed a cooperation agreement last Tuesday to be part of the Belt & Road China-Latin America think tank, which has Chinese firm DeHeng Law Offices as its main sponsor.
In recent years, several other Brazilian Latin Lawyer 250-listed firms have structured relationships of varying degrees with China and east Asia more generally. Siqueira Castro Advogados recently formed an alliance with a Chinese firm; Demarest Advogados and Mattos Engelberg Advogados boast Chinese desks; and TozziniFreire Advogados has a Chinese practice group. International firms have also been strengthening their links. Hogan Lovells LLP recently appointed Venezuelan project finance partner Miguel Zaldivar as regional chief executive for its Asia Pacific-Middle East practice group. He will lead the firm’s Asian investment efforts in Latin America from Hong Kong.