This year is expected to see a jump in outbound mergers and acquisitions as more Korean companies look overseas, a prominent U.S.-based law firm said on Wednesday.

“We’re bullish on the prospects of M&As for this year, and we don’t expect the trend to be temporary,” said Kim Sae-chin, a partner at Paul Hastings.

Europe, the U.S. and China are expected to be the top destinations, along with Southeast Asia, he said.

Local firms have been increasingly seeking overseas M&As to enhance their global reach amid a rapidly saturating domestic market.

A difference from the past, Kim said, is the higher awareness among the companies of the requirements for a successful deal, such as aligning with the corporate culture of the markets they seek to venture into.

However, the hurdles are still there ― mainly the cumbersome approval process, according to Kim Woo-jae, another foreign legal consultant at Paul Hastings.

“In other countries, M&A teams exclusively handle the deals and are given wide discretion, but in Korea, the headquarters operate a complicated approval process that sometimes gets in the way of a successful deal,” Kim said.

Kim Jong-han, the chief representative of the law firm, called on Korean firms to implement more stringent compliance regulations, saying that a lack of such has led to the barrage of legal battles with U.S. companies over intellectual property over the past few years.

“Local companies, try as they may, still lack compliance regulations for obtaining new technology or trade secrets. This inexperience renders them vulnerable to high-profile litigations from U.S. companies,” Kim warned.

Korean firms also are being slammed from abroad on various antitrust allegations due to their lack of knowledge of and experience with the issues, he added.

Samsung Electronics is currently mired in a lengthy legal battle with U.S.-based Apple Inc. on intellectual property infringement, while Korean-made washing machines were hit for price fixing.

Paul Hastings opened its Seoul practice in November last year following Korea’s opening of its legal industry. It has handled cases including those involving Kolon against Dupont, LG Display and Korean Air.

By Kim Ji-hyun (jemmie@heraldcorp.com)