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says. "You just have to take precautions." For Denis Boulianne, the best hedge against legal problems in South America is finding — and relying on — solid local legal counsel. Once part of the Latin Amer- ica practice group at Fasken Martineau DuMoulin LLP's Toronto office, where he worked on a big copper-mining project in Chile, Boulianne spent 10 years in Paris with Shearman & Sterling LLP doing mostly securities work on the New York and European stock exchanges before returning home last year to become an in-house law- yer in charge of international acquisitions for Ivanhoe Cambridge, the $13-billion, Montreal-based real estate subsidiary of the Caisse de dépôt et placement du Québec. One of his first tasks with Ivanhoe [and] that's wrong-headed," he says. "Depending on the country, you can deal with very wealthy people, families, and corporations that can make you feel disadvantaged, that you don't have the same access to the legal system, which can be real or perceived. That's why you need a local firm with strong local roots that can help by choos- ing, say, the right method of dispute resolution given the local context and the players involved. People who are investing their money in different parts of the world want and need that protection." For Faass, the different laws and legislations between Cambridge was on a project already in the works, with the company's Brazil-based partner Ancar, for the acquisition of São Marcos Real Es- tate Enterprises, co-owner of four high-quality shopping centres in Rio and São Paulo. Boulianne says the deal, which was completed last summer and announced on Aug. 4, was driven superbly by local lawyers according to local laws and agreements, including arbitration clauses for dispute res- olution. "One of the things I've noticed doing work [in South America] is that there are significant numbers of excellent law firms that are used to, and equipped for, catering to and advising North American companies." He notes that Canadian lawyers are still needed to advise and protect their clients in regards to tax structuring and project co-ordination if they have the in-house capabil- ity. "[The second thing] is that these countries have legal systems based on civil law like in Quebec . . . so a lot of the basic legal principles are the same." Because civil law differs from common law in areas such as ownership, and because of his belief that the civil code is better equipped to deal with local intricacies, Boulianne believes North American lawyers should open their minds — and check their egos — if they intend to do business in South America. "I think many have the attitude that their way of doing business is the best way, 36 OC T OBER 2008 www. C ANADIAN Law ye rmag.com "Sure there are risks, [but] there are many more good reasons to invest in South America." — DONALD COXE, BMO CAPITAL MARKETS countries — and even states — is another good reason for Canadian lawyers to rely on local firms in South America. He says while there are similarities in the kinds of things be- ing done by Macleod Dixon's two offices in the region — M&A-type work representing foreign clients who are purchasing local assets and/or making investments mostly in oil and gas and mining opera- tions; and commercial-type work representing international compa- nies, such as service providers which sell, lease, or manufacture equipment — the Venezuelan shop has developed a leading litigation practice, as well as an im- portant labour law practice. "Employment law is more important in South America than here in North America, [in that] it is very favourable to employees," he says, in part because the continent's brutal colonization history has left people there with an acute sense of social justice. "It's much harder to downsize there, [and] there is high financial exposure for companies who make em- ployment changes." He says Brazil is a whole different kettle of fish from its Spanish-speaking neighbours. "A major issue in Bra- zil is tax law. . . . It's the easiest area to get into trouble," says Faass. "Brazil is unusual in that it is a developing country [in which] legislation isn't always clear, [but] it has developed country enforcement [and] a very strict system of audits, assessment, and fines. It requires skilled experts to navigate through it all." Those complexities, together with Brazil's law that