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Local business incentives - Legal forms of companies - Registration and licensing procedures - Legal framework - Foreign exchange control - Regulations concerning equity investment - FDI inflows - Expertise of the political risk

Local business incentives

The government began to set up various measures to encourage the economic development of far north and south areas of the country. The activities developed in the South of the strait of Magellan, in sectors such as industry, mining and tourism, fishery and transportation are privileged by the State which grants to companies an exemption of certain taxes, customs duties and VAT. In parallel, the government set up 2 commercial and industrial free trade zones in order to develop activities in the North and in the South : Punta Arenas and Iquique. The agency of foreign investment in Chile also provides numerous information.


Legal forms of companies

Form Number of partners/shareholders Minimum and/or maximum capital Liability Registration fee Release of financial documents
Sociedad de Responsabilidad Limitada (SRL) is a Private Limited Company. Minimum 2 partners. Maximum 50 partners. No minimum capital. Liability is limited to the amount contributed. Registration fees and legal fees represent about 2% of the capital. No
Sociedad Anonima (SA) is a Public Limited Company. NB: Can be Public or private. Minimum 2 partners. No minimum capital. 1/3 of the capital must be paid at the creation of the company and the remainder within three years. Liability is limited to the amount contributed. Registration fees and legal fees represent about 2% of the capital. Yes, for open companies
Sociedad en Commandita is a limited partnership. Two types of partners: active partners and sleeping partners. No minimum capital. Liability of active partners is unlimited, joint and several. Liability of sleeping partners is limited to the amount contributed. Expenses are lower as compared to a Private Limited Company or a Plc No

Legal framework
Depending on the qualification of the company in Chile, the foreign investment will under control of:
- The Law-Decree procedure (DLF) n°600 called "Status of the Foreign Investor" fixed by DLF 523 of the Ministry of Economy, Development and Reconstruction for productive investments
- The procedure in the 14th Chapter of the Central Bank International Exchange Regulation, controlling financial investments only
- The procedure of the chapter 19th of the Central Bank exchange regulation allowing a foreign investment, if creditor to a public or private Chilean enterprise, to finance a future investment.

Foreign exchange control
Exchange regulations allow free convertibility of currencies as well as the right to transfer (DLF N600, procedure Chapter 14 and 19).

Regulations concerning equity investment
A majority holding interest in the capital of a local company is legal, as long as Chilean procedures and agreement formalities are respected.  

Foreign Direct Investment inflows in Chile

FDI inflows 2003 2004 2005 World rank (*)
FDI inflows (USD million) 4 307 7 173 6 667 25/141
Source : UNCTAD - World Investment Report
Note : (*) World Rank = UNCTAD Inward FDI Performance Index. It is a measure of the extend to which a host country receives inward FDI relative to its economic size. It is calculated as a ratio of the country's share in global FDI inflows to its share in global GDP.


Last modified in 2006 - ongoing update
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