Guatemala’s legal market stands against a backdrop of a comparatively large and stable economy in Central America. This, combined with the country’s proximity to Mexico, Latin America’s second-largest economy, meant that for some time local firms could remain busy and independent, shunning regionalisation strategies favoured by peers elsewhere in Central America.
For a market of this size, law firms did not see fit to open offices outside the capital, Guatemala City, let alone beyond the country’s borders. This has changed in recent years: Mayora & Mayora SC, one of the country’s most respected local players and once staunchly local, opened an office in the Honduran capital Tegucigalpa in 2016 and an additional San Pedro Sula office in 2019, while it also entered El Salvador in 2017. Costa Rica is next in the plan. More recently, QIL+4 Abogados, one of the largest firms in Guatemala, combined with other outfits to form regional firm Alta Legal together with Costa Rica’s Batalla; Valdés, Suárez & Velasco Abogados from El Salvador; and Melara & Asociados in Honduras. Entry into the Nicaraguan market could also be on the horizon for this new player. With potential expansion into Costa Rica and Nicaragua on the horizon for Mayora & Mayora, the move marks a demonstrable shift in this legal market.
Other established regional firms with offices in Guatemala are familiar names, such as Aguilar Castillo Love, Arias, BLP and Consortium Legal. Increased regionalisation for these firms has also meant further institutionalising, with firms determined to establish consistency as a key tenet of their presence in multiple offices across Central America.
The eye of international firms has also been drawn to Guatemala, such as global labour and employment firm Littler Mendelson PC, which established a presence in the country through a Swiss Verein with Costa-Rica based BDS Asesores, and Dentons Muñoz – which also opened a small outpost in the capital. EY Law is also present in the country following its 2018 merger with a legacy regional firm.
Some firms, however, have chosen to focus on consolidating their local practice rather than looking to expand across the region, including Carrillo y Asociados, Clarity Law and Legalsa, which prefer instead to make use of either alliances or referral strategies with other firms.
Guatemala’s legal market is well known for its transactional prowess, with both corporate and M&A mandates, as well as banking and finance work being long-standing strongholds of these firms. A noteworthy number of the lawyers in this market have significant expertise in multijurisdictional transactional work, across the country’s local and regional outfits.
With firms establishing an ever-enhanced regional presence, cross-border M&A mandates, as well as restructuring work have become increasingly frequent, while traditional banking and finance mandates also continue to be important here. Recently, space has also been carved out in this market by emerging local fintech and other start-up companies, further increasing the demand for legal counsel in the finance area.
However, non-transactional areas are also of note in this market, and firms have recently seen substantial uptake in this workload. Corruption scandals have engulfed the country for several years, with the country witnessing the dismantling of the International Commission against Impunity in Guatemala. Following this, the Special Prosecutor’s Office Against Impunity has taken the lead in corruption investigations. In light of this, growing awareness of the need to fight graft has created a new market for anti-corruption and compliance offerings, with firms reporting an increase in these mandates.
The year 2022 has also seen increased demand for regulatory work, particularly concerning health, registrations and licensing. Environmental mandates have also seen a significant uptake recently in response to recent regulations, as well as firms here seeing an increase in real estate mandates of late. Continued growing demand for tax expertise also complements firms’ existing capacities in litigation and arbitration. Companies can also depend on these lawyers for assistance in intellectual property and labour law issues.
Meanwhile, despite some challenging years recently, Guatemala reported GDP growth of 4% in 2022.