We often make predictions at this time of year, forecasting what the legal industry might see in 2024. While this can be a useful exercise, it is the events we cannot foresee — unanticipated developments, unexpected outcomes — that have the greatest impact on the legal profession. Who, for example, would have foreseen at this time last year that Hamas terrorists would attack, brutally murder and take Israelis hostage, setting off a devastating war in Gaza — a fight that has had far-reaching ramifications and created divisions that even the legal community has been unable to avoid? Who would have predicted at the start of 2023 that Russia would invade Ukraine and that the resulting war would still be raging, continuing to impact the legal industry in a myriad of ways? And who, other than the most sophisticated and prescient techies, envisaged the incredibly rapid development of generative AI, with all its accompanying promise and perturbation? And those are just a few of the macro issues. Looking more narrowly at the legal industry, who expected that one of Canada’s major mid-size firms, Minden Gross — a firm that had a good year in 2023 — would announce it is shutting its doors after 70 years? Who would have anticipated that global ruptures would lead to the breakup of Dentons and Dacheng last year? And who would have foreseen that Allen & Overy and Shearman & Sterling would announce a merger, putting the combined firm on course to become the third-largest law firm in the world? Even when we know change is coming, it is uncertainty that has the greatest impact. And other than war, perhaps nothing produces more geopolitical uncertainty than national elections. As it happens, 2024 is a year in which 50 nations will hold elections in which 2 billion people — one in four of the world’s population — will be voting, according to Politico. The Big Four consulting firm EY calls it a global elections supercycle, noting that voters will go to the polls in markets that account for nearly 60% of global GDP. One of the big national elections coming this year takes place next week in Taiwan, where voters will elect a new president — a choice that will reflect whether the population wants to remain firmly separate from mainland China or move closer to Beijing. Either way, no one knows how long China President Xi Jinping will wait. He has long indicated that “reunification” is inevitable, and pundits have suggested he is likely to move into Taiwan within the next five years. If it happens this year, law firms with operations in Asia will experience even more fear and uncertainty. China’s relations with the West are already tense, and law firms have taken a hit as M&A activity in the Asia Pacific plummeted to a 10-year low last year. Geopolitical volatility and how it affects the business climate has already forced law firms to reconsider their China strategy and investment, with firms such as Latham & Watkins, Dentons, Proskauer Rose, and Ropes & Gray scaling down their operations in mainland China. Winston & Strawn and EY’s local affiliate also announced the closing of their operations in Hong Kong. However, some law firm leaders are hopeful that China’s relationship with the West will improve and interest rates will drop, making the economic environment more palatable to investors who are still sitting on plenty of dry powder. And some see more opportunity in the region, especially in tech and disputes work. Still, even without the Taiwan issue or China-Western tensions hanging over law firms and their clients, China’s ever-changing regulatory regime has created more unpredictability and fear, a fact that became clear last week when Chinese technology conglomerate Baidu called off its $3.6 billion acquisition of social media platform Joyy Inc.’s video-based entertainment live streaming business in China, saying the target company had failed to obtain necessary regulatory approvals from government authorities. But it’s not just China. The regulatory climate has become more cumbersome for law firms and their clients everywhere... | 