The Nicaraguan market remains characterised by economic instability and political turmoil.
‘Since April 2018, a variety of State and non-State actors, following orders from the President and the Vice-President, perpetrated serious human rights violations and abuses against part of the Nicaraguan population by reason of their political identity. These violations and abuses were found to be consistent, prima facie, with the elements that constitute the international prohibition and the international criminal law definition of crimes against humanity,’ concluded the UN Human Rights Council in its February 2024 report.
The announcement comes on the heels of the report released in March 2023 by a team of UN-appointed criminal justice experts which investigated the conduct of President Daniel Ortega, Vice-President and First Lady Rosario Murillo and his government in the years following the anti-Ortega protests of April 2018 and the violent government crackdown (which left at least 300 dead and over 100,000 fleeing persecution).
Said Jan-Michael Simon, who led the team:
‘The Nicaraguan state, in fact, has been weaponising literally all institutions of the state in terms of control and repression. The word is weaponising. They have been weaponising the justice system, weaponising the legislative function, weaponising the executive function. These violations and abuses are being perpetrated in a widespread and systematic manner for political reasons, constituting the crimes against humanity of murder, imprisonment, torture, including sexual violence, deportation, and politically motivated persecution.’
The announcement of the investigation’s findings occurred only weeks after the Nicaraguan government stripped over 300 political opponents of their citizenship, including 222 political prisoners released to the US one week prior. In a statement, United States Secretary of State Antony J. Blinken called the action ‘another step backward for the Nicaraguan people and a further step toward solidifying an autocratic regime’.
The Ortega regime’s human rights record has taken an economic toll, as has its support for Russia over the invasion of Ukraine, leading to the October 2022 signing by President Biden of an executive order expanding the US government’s sanctions programme and allowing for future restrictions on trade with Nicaragua, as well as imposing visa restrictions on 500 Nicaraguan government officials, for the government’s ‘continued dismantling of democratic institutions, attacks on civil society, and increasing security cooperation with Russia’.
In May 2024, in an attempt to stem migration into the US and alleging a system had been created to charge migrants visa fees upon arrival in Nicaragua only to expel them within 96 hours, the Biden administration announced it would impose visa restrictions on 250 people, including workers and family members of individuals connected to the Ortega government.
As the trading partnership between the US and Nicaragua continues to deteriorate, Russia has emerged as a potential candidate to fill the trade vacuum – as has China, following the Ortega government’s December 2021 severing of ties with Taiwan and its recognition of the Chinese Communist Party’s One China policy. On 31 August 2023, the Free Trade Agreement between the government of the People’s Republic of China and the government of the Republic of Nicaragua, which became effective on 1 January 2024, was signed.
In addition, following a trip in early 2023 by an Iranian delegation led by Iran’s former Foreign Minister Hossein Amir Abdollahian to Nicaragua, President Ortega’s son Laureano, who manages the regime’s most important foreign relationships, was quoted in a government-affiliated newspaper as stating, ‘We are countries with sister revolutions that defend our right to choose our own path to development and prosperity.’
The effect of the regime’s actions can also be seen all across the legal market.
In the corporate and finance sphere, respondent firms spoke of the challenges of facing a shrinking legal marketplace, in which lawyers operating in the practice area have had to flee the country as a result of government persecution, resulting in increased competition. Teams interviewed indicated a rise in interest from potential Chinese clients since China’s Free Trade Agreement with Nicaragua came into force.
In the intellectual property space, firms interviewed described the challenges of having a slow trade mark registration process still dependent on physical visits to the Intellectual Property Registration Office.
In terms of real estate, firms interviewed describe a market slowly reactivating in the post-COVID era and an increase of both commercial and tourism-related projects.
In terms of the performance of ranked firms, the Nicaraguan legal marketplace remained stable in 2023.
Regional firms Arias, Consortium Legal and García & Bodán remain dominant forces in the market; other Central American firms active in Nicaragua include BLP, Lexincorp and Aguilar Castillo Love, while global firm Dentons has also established a strong foothold in the country. When it comes to domestic firms, full-service practice Alvarado y Asociados is a key player and boutique firm Guy José Bendaña-Guerrero & Asociados continues to lead in the IP space.
With regards to firm movements, Munguia Vidaurre Law, which had been developing a niche in fintech and crypto, saw the departure of two managing partners: Pastor Lovo Castellon, who left in March 2023 to form Lovo Castellon Abogados, and Elvis Martínez, who departed to join Dentons‘ litigation practice in May 2023. In addition, in June 2024, ECIJA Castillo & Fiallos incorporated Roberto Benard, the managing partner of Benard & Associates, along with a team of eight lawyers.