Flush with capital and in search of their next big payout, foreign litigation funders are exploring new opportunities to invest in litigation and arbitration in Latin America.
According to Litigation Finance Journal, Nivalion, the leader of litigation funding in Europe, has acquired “the portfolio and know-how of Carpentum Capital Ltd., a Swiss company that has been at the forefront of the development of litigation funding in Latin America, with lawyers on the ground in Argentina, Brazil and Chile.”
Nivalion’s CEO Marcel Wegmüller is quoted as saying the company will “proactively pursue business in the Americas … With the assistance of the experienced team at Carpentum in these markets, as well as Nivalion’s long-standing and substantial expertise with litigation funding in different markets, we will be perfectly placed to successfully expand our business in that part of the world.”
Similarly, Australian-owned litigation funder Omni Bridgeway announced expansion to Latin America last year with the formulation of the “Omni Latin America Group.” In its press release on the development, Omni’s CEO says the company has “already assessed more than 400 investment opportunities in connection with Latin America.” The new group will focus on litigation and arbitration proceedings in Brazil, Mexico, Argentina, Columbia, Chile, and Peru.
Other litigation funders, like U.S. and UK-based Woodsford Litigation Funding, have been involved in financing disputes in the region for years. In a 2017 white paper on litigation and arbitration funding in Latin America, Woodsford discusses why Latin America is particularly appealing for litigation financiers: “It has a sophisticated and well-developed legal services market, regulatory regimes that do not prohibit third party funding, legal systems that are increasingly pro-arbitration and aligned with international legal standards, and the region regularly sees substantial high-value disputes involving capital constrained entities.”
Woodsford concludes in their paper that “Latin America will be receptive to the use of litigation funding and we expect that the region will see a substantial increase in the use of litigation funding in the coming years.”
Other foreign funders with a significant presence in Latin America include Harbor Litigation Funding and Burford Capital.
While the foreign litigation funders claim that their entry into this region will expand access to justice (Woodsford mentions it six times in their white paper), Chambers Research has found that there is no market for small claims under $10 million in the region.
