Doing business

Chile

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Setting up a company | FDI in figures | Why you should choose to invest | Procedures relative to foreign investment | Finding assistance for further information

Setting up a company

Types of companies and capital (max/min)	Number of partners/shareholders and liability
Sociedad de Responsabilidad Limitada (LTDA) is a Private Limited Company. No minimum capital.	Minimum 2 partners. Maximum 50 partners. Liability is limited to the amount contributed.
Sociedad Anonima (SA) is a Public Limited Company. NB: Can be Public or private. No minimum capital. 1/3 of the capital must be paid at the creation of the company and the remainder within three years.	Minimum 2 partners. Liability is limited to the amount contributed.
Sociedad en Commandita is a limited partnership. No minimum capital.	Two types of partners: active partners and sleeping partners. Liability of active partners is unlimited, joint and several. Liability of sleeping partners is limited to the amount contributed.

Business setup procedures

Setting up a company	Chile	Latin America & Caribbean
Procedures (number)	8.0	9.3
Time (days)	22.0	56.7

Source: Doing Business.

For further information: Consult Doing Business Website, to know about procedures to start a Business in Chile.
Register of commerce
The competent organization: All businesses from foreign capital must be registered with the Chilean committee for foreign investments.

FDI in figures

Foreign Direct Investment	2008	2009	2010
FDI inward flow (millions USD)	15,181	12,874	15,095
FDI stock (millions USD)	99,576.0	121,395.1	139,538.2
Performance Index*, ranking on 141 economies	27	26	-
Potential Index**, ranking on 141 economies	53	-	-
Number of Greenfield investments***	70	112	-
FDI inwards (in % of GFCF****)	36.4	8.8	-
FDI stock (in % of GDP)	58.3	74.5	-

Source:

Note: * The UNCTAD Inward FDI Performance index is based on a ratio of the country's share in global FDI inflows and its share in global GDP. ** The UNCTAD Inward FDI Potential index is based on 12 economic and structural variables such as GDP, foreign trade, FDI, infrastructures, energy use, R&D, education, country risk. *** Green field investments are a form of foreign direct investment where a parent company starts a new venture in a foreign country by constructing new operational facilities from the ground up. **** Gross fixed capital formation (GFCF) measures the value of additions to fixed assets purchased by business, government and households less disposals of fixed assets sold off or scrapped.

Why you should choose to invest Chile

Strong points: Its macro-economic stability, its growth perspective and the low level of risk, are among the most promising points of the Chilean economy. The country is the top Latin-American importer per capita, it enjoys an excellent solvency and the economic players have the highest purchasing power in South America.

Labor laws are favorable to business, mainly due to the flexibility of working hours and uncomplicated procedures for the dismissal of employees.

The restricted size of the Chilean market has become less of a handicap due to the country's increase in economic weight at a regional level and its open trade. Foreign companies established in Chile can benefit from privileged access to regional markets through different free trade agreements.
Weak points: The main three weak points of the country are:
- Its lack of innovation: Its spending in research and development is still very weak ;
- Its investment in network industries is not substantial ;
- A lack of qualified workforce. The active population rate is still very low especially among women and young people.
Government measures to motivate or restrict FDI: The Chilean policy for reception of investments has always been based on simplicity, transparency and non discrimination towards foreign investors. The process of direct investment DL 600, offers security of investment. The government continues to develop and improve laws such as the simplification of administrative procedures or the increased appeal for credit. On a fiscal level, foreign investors benefit from a moderate income tax on companies and their capital can be repatriated without being taxed at the level of the invested funds. The country also offers a large range of investment solutions and has established a program called: "Chile Plataforma" in order to encourage investment. These courses have notably allowed the development of a new type of company "The Simplified Limited Company" which allows a foreigner to create a business in Chile without needing a local partner.
For more information, consult the Foreign Investment Committe from the chilean Government.

Procedures relative to foreign investment

Freedom of establishment: YES
Acquisition of holdings: A majority holding interest in the capital of a local company is legal, as long as Chilean procedures and agreement formalities are respected.
Obligation to declare: 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.
Competent organization for the declaration: Chile Foreign Investment Committee
Requests for specific authorizations: Foreign investors must obtain specific authorisation to invest in certain strategic sectors such as exploration and exploitation of hydrocarbons or the production of nuclear energy.

Finding assistance for further information

Investment aid agency: Chile Foreign Investment Committee
Other useful resources: Information pages of the Government