WT/TPR/G/315/Rev.1  
7 October 2015  
(15-5206)  Page: 1/22  
Trade Policy Review Body  Original: Spanish  
 
  TRADE POLICY REVIEW  
REPORT BY 
CHILE 
Revision 
Pursuant to the Agreement Establishing the Trade Policy Review Mechanism (Annex 3 of the 
Marrakesh Agreement Establishing the World Trad e Organization), the policy statement by Chile 
is attached. 
 
 WT/TPR/G/315/Rev.1 • Chile 
- 2 - 
  Table of Contents  
1  MACROECONOMIC ENVIRONMENT ............................................................................... 3  
1.1  External  situation .......................................................................................................  3 
1.2  Monetary and exch ange rate policies ............................................................................. 4  
1.3  Fiscal policy ............................................................................................................ ... 4 
1.4  Outlook ..................................................................................................................... 5  
2  TRADE POLICY ............................................................................................................. 6  
2.1  Overview ................................................................................................................... 6  
2.2  Chile and its bilateral relations ...................................................................................... 7  
2.3  Chile in the mult ilateral se tting ..................................................................................... 8  
2.3.1  Participation in the World Trade Organization (WTO) ..................................................... 8  
2.3.2  Participation in the Organisation for Economic Co-operation and Development 
(OECD) ........................................................................................................................ ... 9 
2.3.3  Participation in the Asia-Pacific Economic Cooperation Forum (APEC) .............................. 10 
2.3.4  Participation in the World Intellectual Property Organization (WIPO) ............................... 10 
2.4  Regional and plurilateral initiatives ............................................................................... 11 
2.4.1  Trans-Pacific Strategic Econ omic Partnership Agreement (TPP) ...................................... 11 
2.4.2  Trade in Services Agreement (TISA) .......................................................................... 11 
2.4.3  Pacific Alliance (AP) ................................................................................................. 12 
2.4.3.1  Policy of conv ergence amid diversity ....................................................................... 12 
2.5  Domestic initiatives ................................................................................................... 13 
2.5.1  Educational reform, the basis for a more inclusive country and more sustainable 
development focused on production sectors of nation al importance ......................................... 13 
2.5.2  Labour reform, the basis for more inclusive development .............................................. 14 
2.5.3  Tax reform, the key to a responsive and viable approach to initiatives aimed at 
achieving inclusive national develo pment and reducing  inequality ........................................... 15 
2.5.4  Domestic measures to promot e and facilitate busi ness development .............................. 15 
2.5.5  New institutional framew ork for environm ental ma tters ................................................ 16 
2.5.6  Initiatives in the fiel d of social re sponsibility ............................................................... 17 
2.5.7  Gender equity in the country's develo pment policies .................................................... 17 
2.5.8  Intellectual property ................................................................................................ 19 
2.5.9  Furtherance of the Energy Agenda ............................................................................ 19 
2.5.10  Furtherance of the Productivi ty, Innovation an d Growth Agenda................................... 20 
 WT/TPR/G/315/Rev.1 • Chile 
- 3 - 
  1  MACROECONOMIC ENVIRONMENT 
1.1.  Chile's macroeconomic policy rests on three pillars: (i) a monetary policy geared to achieving 
inflation targets; (ii) exchange rate flexibility; and (iii) a prudent tax policy design, based on the structural balance rule. 
1.2.  Together with its strong institutional framework, outward-looking trade regime and robust 
financial system, this policy framework has allowed Chile's economy to adjust sustainably to the new external cycle and to return to economic growth. Moreover, this has occurred against 
a background of change on the world scene caused  by the end to the cycl e of high prices for 
primary goods and the normalization of monetary conditions in the United States. 
1.1  External situation 
1.3.  In the wake of the global financial crisis, the external scenario for Chile was marked by 
a period of high terms of trade and very favourab le financing conditions that generally benefited 
the emerging economies between the years 2010 and 2012. 
1.4.  The cycle of world growth during that period showed a lack of balance between the emerging 
and developed economies' performance, with growth being mainly driven by the strong 
performance of the emerging Asian economies, especially China and India. This buoyancy 
substantially boosted demand for raw materials and resulted in historically high copper prices. 
1.5.  The emerging economies also enjoyed very favo urable conditions of financing during that 
period. Against the backdrop of the interest ra te differentials between developed and emerging 
economies and the abundant liquidity created by  the implementation of ultra-expansionary 
monetary policies in the developed world, the quest for higher returns on the part of investors 
generated substantial capital flows to the emerging economies. 
1.6.  Since 2013 the international economy has moved towards more balanced growth and the 
developed economies have begun to show somewhat better performance. In mid-2013 this 
situation led to the announcement of the first stage of a pullback in monetary stimulus in the 
United States, causing a rise in long-term interest rates both in the United States and across the world. This in turn prompted capital outflows from the emerging economies, falls in asset prices 
and an overall appreciation of the United States dollar. 
1.7.  Together with the slowdown in the Chinese economy since the beginning of 2012, 
the normalization of financial conditions resulted in a sharp correction in commodities prices and a deterioration in the terms of trade in countries exporting primary goods. Chile was 
no exception: its terms of trade fell by 4.8% in 2012, 2.8% in 2013 and 1.4% in 2014. 
1.8.  The economic slowdown in the Latin American economies, including Chile's, continued 
in 2014 and was even more pronounced than in 2013. 
1.9.  Despite the effects of the international financial crisis and the deterioration in the external 
conditions for the economy towards the end of th e period under review, average growth in GDP 
was relatively high, inflation was kept under control and unemployment remained low. Additionally 
the current account underwent significant adjustment towards the end of the period to stand at 
levels that are fully sustainable over time. The table below shows the main indicators and compares the six-year period 2009-2014 with the periods 1997-2002 and 2003-2008. 
Period Average 
GDP growth  
(%) Average 
growth in 
domestic 
spending (%) Average 
annual 
inflation 
(%) Rate of 
investment 
(% of GDP)  Average 
unemployment 
rate (%) Current 
account 
deficit 
(% of GDP)  
1997-2002 3.6 3.2  4.1 22.9 8.6 -2.0  
2003-2008 5.2 7.9 3.9 21.0 8.6 1.4 
2009-2014 3.7 4.6  2.6 22.5 7.3 -1.0  WT/TPR/G/315/Rev.1 • Chile 
- 4 - 
  1.2  Monetary and exchange rate policies 
1.10.  Chile's monetary policy is geared to achieving an inflation target of 3% in the medium term 
together with a fully flexible exchange rate regime. The policy is wholly credible, and thus provides ample room for manoeuvre. 
1.11.  The global financial crisis precipitated by the collapse of Lehman Brothers resulted in a short 
period of scarce liquidity to which the Central Bank responded with a number of measures. On the one hand, it provided liquidity in national and foreign currency, allowing the financial 
market to resume normal operations after a few weeks. 
1.12.  After implementing the liquidity measures, th e Central Bank reduced the monetary policy 
rate (MPR) over the period from January to July  2009 by 775 basis points to a historical minimum 
of 0.5%. Subsequently, it introduced the Term Liquidity Facility (FLAP) under which it set a 0.5% 
MPR window for a term of up to six months. This was a way of indicating that the MPR would 
remain at that value for an extended period. Together with the significant fiscal stimulus implemented in response to the international cr isis, these measures enabled the Chilean economy 
to recover rapidly. 
1.13.  In the second quarter of 2010 the Central Bank began to phase out the monetary stimulus 
against a background of more buoyant domestic activity. In May 2010 it finalized the liquidity 
facilities programme and in June of the same year it began steadily increasing the MPR until 
it reached 5.25% in June 2011. 
1.14.  In response to the economic slowdown, the Central Bank began to reduce its monetary 
policy rate from October 2013. Between October 2013 and October 2014 it lowered the benchmark 
rate by 200 basis points to 3%. There have been  no further reductions in the MPR since then. 
Despite the depreciation in the Chilean peso and the temporary inflationary impact that it produced, the Central Bank has maintained an expansionary monetary policy. 
1.15.  Although the monetary policy framework is ba sed on a flexible exchange rate regime, the 
Central Bank has intervened in the exchange market on a few occasions. The last time it did so was in early January 2011. On that occasion the Central Bank announced a programme for the 
whole of the year 2011 to build up internat ional reserves of US$12 billion (5% of GDP). 
At the same time, short and long-term debt instruments were issued in the national currency with a view to neutralizing the monetary impacts of foreign currency purchases. The aim of the intervention was to strengthen the country's international liquidity position at a time when the 
peso was appreciating sharply. The measure also he lped to attenuate the appreciation of the peso. 
1.3  Fiscal policy 
1.16.  Chile's fiscal policy is characterized by the sound  and orderly management of public finances 
in compliance with the rule of structural balance. Under this approach, the level of public 
expenditure is set each year to fulfil a specific structural balance-related objective determined in advance by the economic authority. 
1.17.  The structural balance is obtained by adjusting the effective balance by the difference 
between the medium-term price of copper and its actual level and by the difference between GDP 
and its trend value. 
1.18.  This methodology makes procyclical adjustment unnecessary and gives a clear indication 
of the trend in public spending in the medium te rm. By following the structural balance rule the 
Government was able to build up significant re serves over the period 2005-2008 when the price 
of copper was much higher than the projected medium-term values. 
1.19.  Sound public finances and the Government's financial position, combined with the credibility 
gained over several years of implementing a fiscal policy based on the rule of structural balance, have enabled the automatic stabilizers to work effectively. Both in 2009 and in the current 
economic climate the Government has been able to sustain real growth in public expenditure 
in order to stimulate the economy despite slow er revenue growth, without jeopardizing fiscal 
sustainability or affecting the country's  credit rating or sovereign spread. WT/TPR/G/315/Rev.1 • Chile 
- 5 - 
  1.20.  In January 2009 an extraordinary fiscal expenditure plan was announced, committing 
around US$4 billion in resources, equivalent to 2. 8% of GDP, to finance public investment, direct 
transfers, and the capitalization of State enterp rises along with other measures. In March 2009 the 
plan was supplemented by 20 new measures to stimulate the credit market and one month later 
by an unpublished pro-employment agreem ent between the Government, workers and 
entrepreneurs. These measures included temporary tax cuts in a number of fields with an attendant fall in tax revenues in 2009 amounting to some US$1.2 billion. 
1.21.  As part of the fiscal stimulus package to tackle the international financial crisis, together 
with deficit financing and other measures, a sum of around US$9 billion was withdrawn from the Economic and Social Stabilization Fund (FEES) in 2009. The fund subsequently increased its market value both through new contributions and through capital gains. Thus, as a result 
of sound management of surpluses, the market value of the Pension Reserve Fund (FRP) and 
the Economic and Social Stabilization Fund (FEES) rose to US$7.944 billion and US$14.689 billion, respectively, by the final quarter of 2014. 
1.22.  In June 2013 the Tax Advisory Board was established to promote strengthening of the 
institutional framework for the fisca l rule (a rule established in 2001), especially with regard to 
calculating the structural balance or the cyclically adjusted balance. The Board's purpose is to 
collaborate in the process of discussing, analysing and issuing recommendations on matters 
related to computation of the cyclically adjusted balance (BCA). The Board is a high-level technical body which seeks to safeguard independence in the assessment of structural variables. 
1.4  Outlook 
1.23.  Despite the severity of the international financial crisis, the Chilean economy coped well with 
the international situation. Its robust underpinnings - fiscal solvency, a properly regulated and capitalized financial system, a high level of credibility among macroeconomic institutions and 
an appropriate monetary and exchange rate policy regime - enabled it to overcome the economic 
crisis rapidly. Towards the end of 2009 the economy had returned to a path of strong growth. 
1.24.  After growing at an average rate of 5.7% between 2010 and 2012, the economy began to 
show signs of slackening towards the end of 2013. In the second quarter of 2013 the annual 
growth rate fell to 4% and in the final quarte r of that year the economy grew by only 2.8%, 
bringing the annual rate to 4.2%. The economic slowdown deepened in 2014, with growth standing at only 1.9%. 
1.25.  The slowdown in activity was largely due to the deterioration in external conditions. The end 
of the cycle of high prices for primary goods, ch iefly copper, lowered the terms of trade and curbed 
investment. This was followed by the announcement of the first stage of withdrawal of the 
monetary stimulus in the United States, which pushed up long-term interest rates worldwide, 
increasing the cost of external financing and resulting in a reversal of capital flows from the emerging economies. 
1.26.  The external causes of the slowdown were ex acerbated by a number of domestic factors. 
The strengthening of the peso during the years of high copper prices, along with higher production 
costs due largely to the high cost of energy in the country, reduced competitiveness in a number of tradeable goods sectors. Other factors included  the difficulties in executing new investment 
projects, chiefly in the energy and mining sectors, and the stagnation in productivity observed 
since the middle of the previous decade. 
1.27.  Looking ahead, a recovery in economic activi ty is projected for 2015. First, the real 
exchange rate has depreciated significantly. This  has enabled the export sector and the import 
substitution sector to increase their competitiveness on international markets, a critical factor in generating the reallocation of resources required to contend with the new external cycle. Secondly, 
the Central Bank's credibility has enabled it to implement an expansionary monetary policy in 
response to the new cycle, reducing the benchmark rate by 200 basis points since October 2013. The cut in rates was possible despite exchange rate depreciation because the two-year inflation projections have remained steady at 3%. This will have a significant impact on investment and 
consumption decisions and will lead to a gradual recovery in domestic demand. Finally, the 
Government has been implementing a more expansio nary fiscal policy, and will continue to do so, WT/TPR/G/315/Rev.1 • Chile 
- 6 - 
  deploying its automatic stabilizers but without endangering fiscal sustainability. In this context, 
the budget for 2015 reflects a fiscal policy of a cl early countercyclical nature; expenditure will 
increase by 9.8% with a strong emphasis on public investment, which will grow by 27.5% to help boost the economy effectively and generate employment. Most recently there has also been a fall 
in the international oil price, a development highly advantageous to Chile because the country 
imports more than 95% of the crude oil it consumes. 
1.28.  Additionally the projections for 2015 include a fall in inflation which should gradually 
converge on the Central Bank target towards the end of this year or the beginning of the next. 
According to the most recent Central Bank Monetary  Policy Report available when this report was 
being prepared (December 2014), the trends and outlook for the main economic variables were 
as follows: 
 2013  2014 2015a 
GDP 4.2  1.9 2.5 to 3.5  
Domestic income 3.6 1.9 3.7 
Domestic demand 3.7  -0.6 3.0  
Exports of goods and services 3.4 0.7 4.0 
Imports of goods and services 1.7  -7.0 3.7  
Current account (% of GDP) -3.7 -1.2 -1.1 
Copper price* 332  311 295  
Inflation 1.8%  4.4% 3.4%  
* Cents per pound on the London Metal Exchange, average. 
a Estimate. 
Source: Central Bank of Chile. 
2  TRADE POLICY 
2.1  Overview 
2.1.  Over the past 30 years Chile's trade policy has been characterized by a slant towards trade 
liberalization, facilitating and broadening entry and access for goods and services to all markets, 
as well as stimulating domestic and foreign investment. To that end, all available channels have been used, including unilateral market opening and multilateral and bilateral trade negotiations. 
The policy's effectiveness is reflected in the share of external trade in Chile's GDP, which grew 
from 44% in 1990 to 67% in 2014.
1 
2.2.  International trade plays an important role in people's lives and in the reduction of poverty. 
It is therefore necessary to meet the challenge of making international trade a driving force for 
human development, reducing inequalities and fostering social inclusion. Trade has a vital part to play in that process because it helps to underpin social connections between individuals as well as 
nationally and internationally. There can be no de velopment, no justice and no welfare for people 
if we do not take up the challenges and opportuni ties provided by trade. In this connection, the 
experience of linking open trade to growth and development has been key to continuing Chile's 
progress towards trade liberalization. 
2.3.  In terms of unilateral market opening, the Chilean MFN tariff has remained stable at 6% 
since 2003. The level and uniformity of this tariff have been a distinguishing feature of Chile's 
trade policy that has established the basis for non-differential treatment of the various production 
sectors, and has also enabled Chile to negotiate preferential agreements with various countries. 
The unilateral tariff reduction adopted by Chile formed the basis for the outward orientation of the country's economy over recent decades. For a relatively small, developing economy that is unable 
to influence its terms of trade, this process has been effective because of the speed and efficiency 
of its implementation, relying solely on the country's will to act, at a pace set by Chile for that purpose. 
2.4.  Although unilateral liberalization has been effective, it does not improve the conditions 
of access to other markets. That is why, in addition to participating in negotiation rounds within 
the multilateral trading system, for more than 20 years ago Chile has pursued a policy of bilateral 
                                               
1 Calculation based on data from the Central Bank of Chile. WT/TPR/G/315/Rev.1 • Chile 
- 7 - 
  openness with trading partners that are important to its economy; this creates a framework 
of certainty for trade relations by placing countries of varying economic weight on an equal footing and providing an effective mechanism to resolve trade disputes arising from the liberalization process. 
2.5.  By the same token, Chile views domestic measures that do not restrict trade as key to 
developing its open markets policy; thus, the country does not apply measures such as import licensing or the granting of export subsidies for agricultural products. 
2.6.  Lastly, Chile's open trade policy in recent years has covered not just goods, but services and 
investments as well. In these areas Chile has an open, transparent regime which as a matter of general policy does not discriminate between nationals and foreigners. This regime has been 
consolidated in the free trade agreements signed by Chile and in its GATS commitments. 
2.2  Chile and its bilateral relations 
2.7.  Bilateral and plurilateral initiatives provide a useful additional way of achieving substantial 
outcomes more expeditiously than would be feasible at the multilateral level. All in all, despite 
some overlap between the objectives of bilateral an d plurilateral agreements on some issues, both 
are effective in achieving the objectives of openness because of the complementarity of outcomes in the different areas. 
2.8.  Thus, trade liberalization has been a pillar of Ch ilean foreign policy since 1992, as reflected in 
the signing of new trade agreements and the cons olidation of those already in place, thereby 
widening the opportunities and destination markets for Chile's exportable supply and diversifying the origin and variety of imports for its population, with a consequent reduction in prices. 
At end-2008, Chile had signed 21 preferential agreements with 57 countries. In March 2015 the 
number had risen to 24 agreements with 63 partners that together account for 63% of the world's population, 85% of world GDP and close to 94% of Chilean shipments abroad. 
2.9.  The agreements that entered into force during the period 2009-2014
2 are: 2009: Australia, 
Ac.S.3 Colombia, Ac.S. Peru; 2010: Ecuador; 2011: Turkey; 2012: Malaysia; 2014: Viet Nam and 
Hong Kong, China. Negotiating processes are currently under way in relation to the Trans-Pacific 
Partnership (TPP) and the Strategic Associatio n Agreement with Indonesia. Additionally, 
negotiations have concluded on both the Free Trade Agreement with Thailand, which is currently before Parliament, and the enhanced Partial Scope Agreement with India. 
2.10.  The challenge that faced Chile from the en d of 2003 was therefore to promote greater 
rapprochement with the Asia-Pacific region, and that process was gradually consolidated up to the 
end of 2008. The agreements currently in force sh ow that the consolidation process has achieved 
more than 93% coverage of trade with the regi on. Chile therefore has agreements that cover 
a significant proportion of its trade with the world,  and in particular with America, Europe and the 
Asia-Pacific region. 
2.11.  Notwithstanding the fact that the negotiation process for bilateral agreements has achieved 
high coverage in terms of the country's external trade, Chile has sought to enhance both its 
existing agreements and those currently under nego tiation. The purpose of doing so is to ensure 
that the trade benefits, meaning chiefly reductions in tariffs on goods, can also be broadened by adopting new trade disciplines to facilitate, boost and improve transparency in cross-border trade, 
including in areas such as trade in services, investment, telecommunications, government 
procurement, intellectual property, competition policy and others. 
2.12.  Trade agreements that include services-related disciplines account for 66% of the total. 
The inclusion of disciplines regulating this sector has been made a priority in recent years because 
exports from the sector have increased by 250% over the last 10 years and account for 
a considerable share of GDP. They therefore play an important role in the process of economic and 
social development and make a significant contribution to national employment. 
                                               
2 Situation at March 2015. 
3 Supplementary Agreement. An agreement had been in force with Colombia since 1994 and with Peru 
since 1998. WT/TPR/G/315/Rev.1 • Chile 
- 8 - 
  2.13.  Competition clauses are included in 54% of the agreements in force and present a challenge 
in terms of strengthening current agreements and in new negotiations. It is important to include such clauses because they help maximize the potential benefits of trade agreements by preventing behaviour that is harmful to free market competition. 
2.14.  Concerning other types of agreement, Chile initiated the negotiation process for double 
taxation agreements in 1997
4, seeking to open the economy to new markets through reductions in 
tax rates (where a system of ordinary credit applies), thus promoting cross-border trade and 
national and foreign investment as well as supporting governments' efforts to combat tax evasion. 
Chile has 25 agreements for the avoidance of double taxation in place (and three further agreements have been signed with Austria, th e United States and South Africa, pending entry 
into force). 
2.15.  In addition to trade agreements that includ e provisions covering the air and maritime 
transport sector, 57 agreements specific to this sector have been negotiated and are in force (and two further air transport agreements have been signed) under the open skies  policy for 
air transport adopted by Chile in the last 30 years. The aim of the policy is to promote 
better-quality, more efficient and cheaper air services.
5 
2.16.  Chile's policy of concluding bilateral market-opening agreements that incorporate clear 
rules, guarantee predictability and transparency in trade relations and take an approach that is in 
line with the WTO regulatory framework is an example of a country development strategy based on an economy that is open to the outside world, competitive in terms of products and does not allow discriminatory treatment between sector s. This has helped to reduce the external 
vulnerability of the Chilean economy, consolidate and extend access for goods and services to 
the leading world markets, make the country more attractive to foreign investment, and diversify exports. 
2.3  Chile in the multilateral setting 
2.3.1  Participation in the World Trade Organization (WTO) 
2.17.  As one of the founding Members of the WT O, Chile has unwaveringly maintained its 
commitment to the organization and views it as a central pillar of support for the multilateral 
trading system. Through its agreements the WTO establishes binding disciplines that are the subject of ongoing monitoring by its various bodies. Trade measures adopted by Members are thus made subject to the scrutiny of these bodies, th ereby strengthening the key principle of trade 
relations, namely transparency. 
2.18.  Chile reaffirms the importance of a robust, reliable multilateral trading system: 
multilateralism and global governance ensure peace, development and cooperation. The vast 
majority of the provisions and disciplines agreed in Chile's free trade agreements are taken directly 
from WTO rules. 
2.19.  Since its last trade policy review, Chile has been an active participant in various initiatives. 
First, Chile strongly supported the launch of the Doha Development Round and welcomed the 
outcome of the Bali Package at the Ministeria l Conference of 2013 and the General Council 
Decision of 27 November 2014 adop ting the Protocol on the Trade Facilitation Agreem ent. Chile is 
in the process of incorporating that Agreement into its legal order, a process that requires the 
approval of the National Congress before the country can ratify the Agreement in Geneva. 
Similarly, Chile continues to be an active participant in negotiating groups and renews the commitment it made, together with other Members, to approve the Work Programme on the 
outstanding Doha Round issues in July 2015. On this point, the 10
th Ministerial Conference in 
Nairobi will be a politically favourable time to move the Doha Round forward given that a successful conclusion will reinvigorate the multilateral trading system. 
2.20.  Domestically, a positive outcome to the negotiations will pay Chile dividends in terms 
of access to markets for goods and services in Member countries with which it does not have 
                                               
4 The first double taxation agreement entered into force in 1999 with Canada. 
5 Online information about Chile's air transport policy. Viewed at: 
http://www.jac-chile.cl/politica-aerocomercial. WT/TPR/G/315/Rev.1 • Chile 
- 9 - 
  trade agreements. Moreover, the WTO has the advantage of being a unique forum to discuss 
matters on which no progress has been forthcoming by way of free-trade agreements. Such matters include agricultural subsidies and anti-dumping duties. 
2.21.  Additionally, in 2013, Chile ratified the Protocol Amending the TRIPS Agreement 
(the Paragraph 6 System ) and contributed to the process by which the Protocol is soon to enter 
into force. In that regard, Chile echoes the call urging Members to confirm their approval of this 
important amendment, which recognizes the public health needs of developing countries and 
highlights the need for intellectual property rights  to be enforced in a way that does not prevent 
the adoption of public health protection measures. 
2.22.  In 2014 Chile notified Law 20.690
6 to the WTO, which phases out import tariffs on goods 
from less developed countries. This made Chile the first Latin American country to adopt the 
duty-free and quota-free (DFQF) initiative, in accordance with the invitation issued by the WTO 
in a Ministerial Declaration. Thus, Chile has taken an effective step to promote the principle of special and differential treatment under the development mandate. 
2.23.  Beyond the progress made in the Doha Round on the basis of mandates, it is equally 
important for this forum to generate discussion of ways to provide the WTO with a renewed vision with which it can address increasingly pressing trade-related issues such as climate change, 
renewable energy, energy security, competition and investment policy. 
2.24.  Finally, Chile will always support any political call for countries to refrain from adopting 
protectionist or trade-restrictive measures. 
2.3.2  Participation in the Organisation for Economic Co-operation and Development 
(OECD) 
2.25.  Chile became a full member of the OECD on 7 May 2010 following an invitation in 2007 to 
begin a process of review of its public polici es and laws, as well as their implementation. 
Even before the 2007 invitation, Chile had adop ted various OECD recommendations, conventions 
and guidelines as part of its policy of State modernization, thus incorporating OECD standards for the improvement of statistical measurement, the fight against bribery in international transactions, 
and accountability of multinational enterprises. 
2.26.  Chile's accession to the OECD is an important milestone for both the country itself and the 
region because Chile is only the second Latin American country to join the organization. It is also important because it challenges the country technically and politically to compare and enhance its 
public policies and then align them with international practice. Membership has enabled it 
to pursue institutional strengthening in legal matt ers and to develop high-level policies in various 
areas including education, labour markets, financial regulation, environmental protection, reform 
of the State, international trade and investment. Another important factor is that the member 
countries of the OECD account for 80% of investments in Chile and 60% of Chile's exports. 
2.27.  Chile faced major challenges as part of its commitment to comply with all the legal 
instruments and drove through a series of institutional reforms, including the amendments to the 
Criminal Code in areas such as the definition of the offence of bribery of public officials (pursuant to Law Nos. 19.829 and 20.341); the Judicial Organiza tion Code, on bribery by Chileans of foreign 
public officials (pursuant to Law No. 20.371); corporate governance in businesses (pursuant to 
Law No. 20.382); and the amendment of the founding charter of the National Copper Corporation 
(CODELCO) and the rules on the disposal of its mining assets (pursuant to Law No. 20.392).
7 
Also worthy of note are the enactment of Law No. 20.393 establishing the criminal liability of legal 
persons in respect of the offences of money laundering, financing of terrorism and bribery of a 
Chilean or foreign public official, and Law No. 20.406 amending the Tax Code, which governs the procedure to be followed by the tax authorities in order to access secret or confidential banking 
information for the purpose of preventing tax evasion. 
                                               
6 In force since 1 November 2013. 
7 Online information viewed at: http://www.leychile.cl/Navegar?idNorma=1007982 . WT/TPR/G/315/Rev.1 • Chile 
- 10 - 
  2.28.  Chile has also benefited from the OECD's technical experience in supplementing its policy 
design procedures in a wide variety of areas such  as anti-corruption, the environment, education, 
reduction of inequalities, governance, regional development and transparency, as part of the 
strategy to achieve inclusive growth and econom ic development, and to narrow inequality gaps. 
2.29.  Chile has retained its status as a developing country within the OECD and seeks to 
exemplify the reality of a middle-income Latin American country, a reality different from that of the other members of the organization. Chile has strongly supported the accession processes 
of other Latin American countries currently at the pre-accession stage with the OECD, such as 
Colombia, Costa Rica and Peru, in a quest for gr eater regional balance within the organization. 
2.3.3  Participation in the Asia-Pacific Economic Cooperation Forum (APEC) 
2.30.  As a full member of APEC since November 1994 Chile's active participation in the Forum's 
various bodies
8 has afforded it a unique opportunity to meet and exchange high-level policy ideas 
on economic trends in the Asia-Pacific region, while also enabling it to hold bilateral meetings and implement initiatives that enhance both regional economic integration and cooperation and 
development projects. Chile has implemented projects of national interest that provide training for 
officials and contribute to better development. 
2.31.  As part of the goal of trade and investment liberalization and facilitation in the Asia-Pacific 
region, the developed economies members of the Forum undertook to liberalize trade in goods and 
services in the region by 2010, while the developi ng economies would do so by no later than 2020. 
Chile undertook to liberalize its trade in goods an d services by 2010, and has achieved that target 
through trade agreements that have resulted in an  effective preferential tariff of roughly 0.93%. 
Chile maintains open, transparent, non-discriminatory regimes to facilitate and incentivize trade in 
services and investments. 
2.32.  In the area of intellectual property, Chile has participated in the Intellectual Property Rights 
Experts Group (IPEG), where it has been able to  pool experience, identify best practices and 
promote technical cooperation with the other APEC economies. Participation has also facilitated dialogue and given rise to synergies in intellectual property matters. 
2.33.  In the context of its involvement in APEC, in 2012 Chile was invited by Mexico to the 
seventh G-20 Leaders' Summit, which has become one of the most important economic and financial cooperation forums for developed and developing countries in the world. It afforded a unique opportunity to participate in the important global economic and financial discussions 
of our time and gave Chile legitimacy and repres entative status as a developing country that 
supports the priorities set by Mexico which, in addition to financial matters, include food security, sustainable development, disaster risk management and combating corruption. 
2.34.  Among APEC's most significant achievements by end-2014, those worthy of special note 
include its work in trade and investment facilitation in the Asia-Pacific region. In particular, the November 2014 Leaders' Summit agreed to launch a strategic study into a possible Free Trade 
Area of the Asia-Pacific (FTAAP); discussed and reached consensus on the Accord on Innovative 
Development, Economic Reform and Growth (the Accord will coordinate work in the field of economic cooperation based on five pillars: Economic Reform, New Economy, Innovative Growth, Inclusive Support, and Urbanization); and finally, agreed to adopt a connectivity roadmap 
incorporating a consensus on the APEC Connectivity Blueprint to achieve the goal of strengthening 
physical, institutional and people-to-people connectivity in the region. It is also important to mention Chile's strong support for the multilateral  trading system within the various APEC bodies. 
2.3.4  Participation in the World Intellect ual Property Organization (WIPO) 
2.35.  As part of its commitment to multilateralism, Chile participates actively in the 
World Intellectual Property Organization (WIPO) by following and participating in the various 
committees and initiatives within the organization. 
                                               
8 APEC Leaders' Summits and Ministerial and Senior Officials' Meetings (SOMs). WT/TPR/G/315/Rev.1 • Chile 
- 11 - 
  2.36.  Since its last trade policy review, Chile has signed two treaties administered by WIPO: the 
Beijing Treaty on Audiovisual Performances (24 June 2012)9 and the Marrakesh Treaty to Facilitate 
Access to Published Works for Persons Who Are Bl ind, Visually Impaired or Otherwise Print 
Disabled (28 June 2013). Also during the period und er review, Chile ratified the Budapest Treaty 
on the International Recognition of the Deposit of Microorganisms for the Purposes of Patent 
Procedure (2011), the Trademark Law Treaty (2011) and the Brussels Convention Relating to the 
Distribution of Programme-Carrying Signals Tr ansmitted by Satellite (2011). Concerning the 
Budapest Treaty, the Chilean Collection of Microbial Genetic Resources (CChRGM) was designated 
an international authority for the deposit of micro-organisms in 2014. 
2.37.  Similarly, in 2012 the National Industrial Prop erty Institute (INAPI) of the Ministry of the 
Economy, was appointed by the WIPO Assembly of the International Patent Cooperation Union 
(PCT Union) as an International Searching and Preliminary Examining Authority (ISA/IPEA) under 
the Patent Cooperation Treaty (PCT). It started operations in October 2014. 
2.4  Regional and plurilateral initiatives 
2.4.1  Trans-Pacific Strategic Economic Partnership Agreement (TPP) 
2.38.  Chile is participating in the negotiation of the TPP, an ambitious process of economic 
integration in the Asia-Pacific region involving 12 countries: Australia, Brunei Darussalam, Canada, 
Chile, Malaysia, Mexico, Japan, New Zealand, Peru, Singapore, United States and Viet Nam. 
2.39.  The TPP negotiation is a product of the Trans-Pacific Strategic Economic Partnership 
Agreement (P-4) signed in 2005 by Chile, Brunei Darussalam, New Zealand and Singapore. The TPP was intended to be a regional economic integration mechanism open to accession by other 
member economies of the APEC Forum, several of which expressed an interest in joining the P-4 
scheme and agreed to enter into a new negotiating process, resulting in the adoption of the name 
TPP. Formal negotiations began in March 2010. 
2.40.  Chile's participation in this regional initiative is in line with the strategy of openness and 
regional economic and trade integration that the country has developed over recent years with the Pacific Basin countries. It will be an important tool in implementing measures to increase and 
develop the country's participation in global  and regional supply chains, especially in 
Latin America; increase the supply of services; diversify the range of products for export; and improve SME participation in international trade. Another goal under this agreement is to transform Chile into a business gateway to the markets of the Pacific Basin. The fact that Chile is 
a small market has implications for attracting foreign direct investment; the conclusion 
of plurilateral agreements therefore extends th e range of available export markets and makes 
investing in Chile a more attractive prospect. Similarly we cannot ignore the immediate 
consequence, namely the role that investment plays for Chile in the transfer of new technologies. 
After more than four years, the negotiations are nearing conclusion and the aim of the 12 participants is that they sh ould end in the first half of 2015. 
2.4.2  Trade in Services Agreement (TISA) 
2.41.  Chile has been involved in the TISA negotiation since discussions began in 2012. There are 
currently 24 participants in the process, account ing for around 70% of world trade in services; 
they have an interest in further liberalizing trade in services in order to support the multilateral 
trade negotiations. 
2.42.  Chile regards this negotiation as an opportunity to update and strengthen the rules 
governing world trade in services and to reach important agreements between various 
WTO Members, thus boosting the Doha Round. Chile considers strengthening the multilateral 
trading system to be a priority and that is why it is an enthusiastic supporter of the future 
multilateralization of TISA and of opening the negotiations to new participants. 
                                               
9 The parliamentary approval process for this treaty was finalized in March 2015. WT/TPR/G/315/Rev.1 • Chile 
- 12 - 
  2.4.3  Pacific Alliance (AP) 
2.43.  Chile has actively participated in the AP economic and trade integration process, which also 
includes Colombia, Mexico and Peru and involves 32 Observer States.10 The Alliance has its origins 
in the 20th Ibero-American Summit held on 4 December 2010 at Mar del Plata, where the 
Presidents of Colombia, Mexico, Peru and Chile decided to launch an initiative aimed at building 
an area of deep integration. 
2.44.  In the Presidential Declaration on the Pacific Alliance of April 2011, the Heads of State 
agreed to establish the AP and to consolidate its existence. Subsequently, on 6 June 2012, 
Chile, Colombia, Mexico and Peru signed th e Pacific Alliance Framework Agreement, which 
highlights three strategic objectives: 
 To build, in a participatory and consensual manner, an area of deep economic integration 
and to move gradually toward the free movement of goods, services, capital, and persons. 
 To boost the growth, development and competitiveness of the Parties' economies, with 
a view to enhancing the welfare of their citizens overcoming socioeconomic inequalities, and 
promoting their social inclusion. 
 To act as a platform for economic and trade integration, and for outreach to the world, with 
special emphasis on the Asia-Pacific region. 
2.45.  Developments include, in June 2014, the holding of the 9th Presidential Summit of the AP, 
where President Michelle Bachelet took part fo r the first time in this regional integration 
mechanism. 
2.46.  At the summit, the Presidents delivered mandates for the continuation of work within the AP 
and Ministers met the 32 Observer States to ou tline the work and progress of the Alliance's 
Technical Groups; reference was made to the main guidelines for external relations and the future 
prospects for the Alliance. Alongside the Presidential Summit there was a meeting of the Business 
Council of the Pacific Alliance (CEAP) and the Executive Committee of the Integrated 
Latin American Market (MILA). 
2.47.  One specific outcome of the trade negotiations in the Pacific Alliance integration process was 
the signature in February 2014 of the Additional  Protocol to the Alliance Framework Agreement, 
an important step forward in building an area of  free movement of goods, services and capital. 
The protocol must be approved by Congress and once in force, 92% of products traded between the four countries will immediately have a zero tariff, and the other 8%, consisting of sensitive 
goods, will be the subject of short- and medium-term tariff reduction schedules. 
2.48.  Another positive aspect of the Additional Protocol is the outcome of the negotiations on rules 
of origin, namely the establishment of a cumulation mechanism that will make it possible to 
diversify the supply chain by authorizing the export  of products manufactured with inputs imported 
from non-AP countries, thereby developing production chains and strengthening trade integration within the Pacific Alliance. 
2.4.3.1  Policy of convergence amid diversity 
2.49.  Upon taking office, the current President, Michelle Bachelet, prioritized economic and 
political relations with Latin America and the Caribbean, and with South America in particular, by bolstering the country's presence within the various integration mechanisms and creating 
avenues of agreement passing over ideological or subregional differences. This process of building 
bridges between Mercosur and the Pacific Alliance will improve the country's competitive position 
in the globalized world, contribute to greate r growth and help build regional value chains. 
                                               
10 Australia; Belgium; Canada; China; Costa Rica; Do minican Republic; Ecuador; El Salvador; Finland; 
France; Germany; Guatemala; Honduras; India; Israel; Italy; Japan; Morocco; Netherlands; New Zealand; 
Panama; Paraguay; Portugal; Singapore; South Korea; Spain; Switzerland; Trinidad and Tobago; Turkey; 
United Kingdom; United States and Uruguay. WT/TPR/G/315/Rev.1 • Chile 
- 13 - 
  2.50.  That is why since 2014 Chile has promoted the idea of Convergence amid Diversity 
for Latin American regional integration. The aim is to further the process of integration in the region while safeguarding its autonomy so that the region can promote joint actions and responses 
as a bloc, based on shared development interests within the international framework. The hope is 
that Convergence amid Diversity will generate an essential impetus for diversifying the national 
production matrix to support exports of more indust rialized products as well as exports of services 
with greater value added. 
2.51.  In terms of institutions, in the Pacific A lliance Framework Agreement of 2012 the four 
countries expressed their determination to stre ngthen the various integration groupings in 
Latin America as a means of concerted cooperation and integration aimed at promoting open regionalism that incorporates the Parties efficiently in a globalized world and links them to other 
regionalization initiatives. 
2.5  Domestic initiatives 
2.52.  Chile has experienced significant economic growth, with a considerable reduction in poverty. 
However, the country has not succeeded in overcoming the major inequalities affecting its citizens, 
who have called strongly for changes to make growth more inclusive. 
2.53.  To tackle the inequality gaps, which quite apart from serious social problems can lead to 
significant falls in per capita GDP, President Bachelet's Government has backed a programme 
of major changes that simultaneously seek  to improve the quality of development. 
2.54.  The most important of these changes is to buil d an education system that provides fairer, 
high quality education at all levels. This will not only result in greater social inclusion to the benefit 
of thousands of children, young people and thei r families who want to improve their standard 
of living, but it will also enable many professi onals and technicians, with their growing levels 
of skill, to contribute to the increase in productivity that the economy requires in order to make 
a qualitative leap forward. Such is the scale of both this task and other programmes that aim 
to achieve greater equality, that they have necessitated reform of the tax system. The new 
education system and other reforms proposed by the Government require greater fiscal resources 
to make these changes a reality. 
2.55.  The new Government has considered the reco mmendations of the OECD, which has urged 
its members to invest in education as a long-term solution to the economic crisis because school failure has high costs for society as well as for individuals. In its study on Equity and Quality in 
Education (February 2012), the OECD states that poorly educated people limit economies' capacity 
to produce, grow and innovate, and that school failure damages social cohesion. 
2.56.  The Government also understands the close link between equity and productive 
development and is very conscious of the fact that  the Chilean economy, with its high dependence 
on the external sector, has no alternative but to enhance its competitive capacities in a globalized world. Accordingly, improving education, investment in science and technology and greater fiscal 
resources to support SMEs are key factors for improved participation in the international economy 
and, in the medium term, for diversifying the export matrix away from natural resources and towards goods and services with greater national added value. 
2.57.  The principal reforms and initiatives include the following: 
2.5.1  Educational reform, the basis for a more inclusive country and more sustainable 
development focused on production sectors of national importance 
2.58.  Chile faces major challenges if it is to become a developed country, among which education 
is the top priority. First, equal access to high-quality education will afford all Chileans greater 
opportunities for economic and social progress. Secondly, it will increase productivity gains and help to improve the economy's competitive positi on on world markets. Both of these aspects 
are crucial to crossing the development threshold and reaping greater benefits from 
the global economy. WT/TPR/G/315/Rev.1 • Chile 
- 14 - 
  2.59.  What is proposed is a paradigm shift in education. In other words, a move away from 
education as an asset that is currently traded on the market towards a system that offers Chile's children and young people a social right. As  a result of the reform, the State will underwrite 
the right to a high-quality education regardless of a family's ability to pay. The aim is to move 
decisively towards free universal provision. 
2.60.  Putting an end to profit-making in education do es not mean scrapping the subsidized private 
sector. Parents will be guaranteed a choice of th e educational model they want for their children; 
however, profit-making from public  funds will be abolished and public funding will therefore be 
channelled solely into non-profit-making bodies th at aim to deliver high-quality education by way 
of a social right. 
2.61.  In January 2015 Congress approved the first stage in the educational reform which puts 
an end to selection, the profit motive and copayment for schooling, with the aim of improving 
quality and eliminating segregation. 
2.62.  Furthermore, not only will better education and a higher-quality offering to broader sectors 
of Chilean society reduce inequalities, it will also increase the productivity of the economy, 
contributing to a greater presence and greater comp etitiveness on the global market. This is a key 
factor for the Chilean economy, where the linchpin of economic growth has been the 
external sector. Additionally, more highly skilled  human capital will make it possible to address 
another challenge: that of changing the production matrix with a greater presence of goods and services that add national value both to the domestic economy and to exports of manufactures 
and services. 
2.5.2  Labour reform, the basis for more inclusive development 
2.63.  On 29 December 2014 President Bachelet sign ed the draft labour relations reform law 
currently before Congress for discussion. The key proposal of the bill is to give workers access to 
higher quality jobs with fairer remuneration. 
2.64.  The bill extends the coverage of collective bargaining at enterprise level; recognizes trade 
union entitlements; provides for the right to benefits negotiated by a trade union; streamlines 
regulated collective bargaining procedures; strengthens the balance between the parties, in other 
words safeguards the right to strike and guarantees minimum levels of service; broadens the areas for negotiation; increases the working hours available for trade union training; and enhances the rights of women workers by including them in  negotiations and empowering unions to request 
information on remuneration so that they can address the pay gap. 
2.65.  What is sought therefore is greater productivity and growth to benefit labour and capital 
more equally. At the same time, the draft law seeks to reduce the costs of globalization to the 
workplace: very intense competition often undermines workers through job insecurity, informal 
labour practices and unemployment. 
2.66.  Accordingly the reform is in line with the ILO recommendations to promote decent work. 
It emphasizes the importance of generating employment in order to raise living standards and 
broaden access to income; however, it also focuses on social protection to achieve income security in the workplace. These aspects of decent work are enhanced by a stronger trade union movement and ongoing dialogue between workers and businesspeople. This is another area where 
educational reform will pay dividends because it will improve human capital to the benefit 
of business and competitiveness in the international market. 
2.67.  The reform is also in line with the Chilean economy's need to improve its competitive 
position in the world. There is no doubt that when economies open up to the world market the fate 
of both the employer and his or her workers de pends on the global success of the business as 
a whole. Profits are generated by team effort to  improve productivity and compete. Consequently, 
good labour relations are good for both capital and labour. The main concern ultimately is 
to improve management of competition abroad. WT/TPR/G/315/Rev.1 • Chile 
- 15 - 
  2.5.3  Tax reform, the key to a resp onsive and viable approach  to initiatives aimed at 
achieving inclusive national development and reducing inequality 
2.68.  The aim of the Government-led tax reform is to improve redistributive justice through 
a more progressive system of raising taxes that will be earmarked chiefly for educational reform. 
Chile will move closer to the taxation structures currently in place in the OECD countries while 
ensuring at the same time that the economy grows in a more socially and environmentally balanced way. 
2.69.  The reform is centred on four priorities: increasing the tax burden to finance permanent 
expenditure (such as educational reform and other social protection policies) with permanent revenues; improving tax equity through better income distribution; increasing incentives to save and invest; and improving control mechanisms against tax evasion and avoidance. 
2.70.  The reform establishes two alternative taxation systems: an integrated system on 
an allocation basis, and a semi-integrated system. Under both systems, the Taxable Profits Fund Ledger (FUT)
11 will be abolished from 1 January 2017 (2018 tax year). Taxpayers will be able 
to choose freely between the two systems for paying  their taxes, but once they have made their 
choice they will not be able to change it for five years. Under the semi-integrated system, first 
category tax rises to 27%, 65% of which may be credited against the supplementary overall or 
additional tax (a personal tax) set at 35%. Under the income allocation system, first category tax 
rises to 25% and corporation tax continues to  be fully integrated with personal tax. 
2.71.  The proposal also covers investment incentives for enterprises, personal savings, measures 
providing preferential treatment for SMEs (MiPYM E Statute) and other specific amendments such 
as the tax increase on polluting technologies, alcoholic beverages and cigarettes. 
2.72.  The aim of this reform is to collect 3% of GDP, of which 2.5% will come through changes 
to the tax structure and the remaining 0.5% from measures to reduce evasion and avoidance. 
2.5.4  Domestic measures to promote an d facilitate business development 
2.73.  The concern to generate a domestic environment that is conducive to business 
development, and embraces streamlined procedures and domestic rules for the processes involved 
in entrepreneurship and trade, is key to Chile developing and growing into the country we want 
it to be. 
2.74.  The country has made great strides in this area but nonetheless there is still room 
for streamlining further measures in various areas. According to the World Bank's 
Doing Business 2015 ranking,  which reports on the ease of doing business and the regulations 
affecting SMEs, and is thus used as a means of  gauging the favourability of the business and 
investment climate, 65% of the 189 economies surv eyed reported improvements in the regulatory 
framework between June 2013 and June 2014. They  noted business reforms mainly focused on 
reducing the complexity and cost of complying with business regulations and on strengthening 
legal institutions. 
2.75.  Chile was placed 41st in the 2015 rankings, two places lower than the previous year and also 
fell back within Latin America. In the calculation for the index, which covers ten areas measuring how far the country is from international best practices, Chile had lost places in starting a business, access to energy, access to credit and protection for minority investors, but received its 
highest ranking in payment of taxes. Other areas where a good assessment was given were 
construction permits, registering property and, to  a lesser extent, resolving insolvency and trading 
across borders. 
                                               
11 The FUT is a ledger that must be kept by all taxp ayers who declare first cate gory effective income as 
evidenced through complete accounting records and a balance sheet setting out the record of taxable and 
non-taxable income generated by th e enterprise and earned from companies in which the taxpayer has 
a shareholding. The records covered by the FUT include taxable income, shareholdings and dividends received 
and withdrawals or distributions of di vidends. The ledger must be stampe d by the Internal Taxation Service 
(SII) and is mandatory for taxpayers that fall into the category described above. WT/TPR/G/315/Rev.1 • Chile 
- 16 - 
  2.76.  Driven by awareness of the importance of this situation to the country's objectives in terms 
of development, investment and modernization of the State, several pro-competitiveness initiatives have been or are being rolled out, as follows: 
 Enactment in December 2013 of Law No. 20.720
12 (Law on Bankruptcy), replacing the 
prevailing bankruptcy system. The law seeks to improve the situation of people whose 
businesses are unsuccessful. The enactment of this law establishes a more modern, flexible and transparent body of law that increases the efficiency with which an insolvent company 
can be closed, increases creditors' recovery rates and releases the owner for new ventures. 
 A streamlined, cost-free process for starting a business in one day through the web portal 
Tu empresa en un día
13, (Advanced Electronic Signature (FEA), Signature via a Notary). 
 Establishment of the Integrated  Foreign Trade System (SICEX)14, as a result of 
a government initiative backed by an Advi sory Commission of the President of the 
Republic.15 The project, led by the Ministry of Fi nance and developed in cooperation with 
other public bodies16, seeks to implement a single electronic portal in Chile to integrate 
all external trade processes into a cost-free, voluntary system built to international 
standards. The stages in the project cover the design, implementation and initiation 
of external trade operations and take the form of three modules: exports, imports and 
transit. Thus, it marks a significant step forward in the country's efforts not only to make 
processes efficient and transparent but to increase competitiveness. 
2.77.  Currently the export module is operational and it is anticipated that the import module will 
be by end-2015. Significant challenges for the future include: 
 connecting SICEX to logistics platforms in place in ports; this will allow online management 
of both the logistics of shipments and the processing of documents nationally; and 
 connecting to other countries' platforms so that in-country online processing can continue 
electronically through to the destination point making the whole foreign trade operation 
traceable and transparent. Work is under way in this connection with the Pacific Alliance countries – Peru, Colombia, Mexico and Chile – on a pilot programme for online processing 
between them of phytosanitary certificates. Once successfully in place, other documents 
could be added and the model rolled out to include other countries that want to take part in the initiative. 
2.5.5  New institutional framework for environmental matters 
2.78.  The link between environmental matters and trade has grown steadily over the years. 
By electing to follow an export-led strategy for economic growth, Chile faces particular challenges posed by the nature of its exports which are natural resource-intensive, although diversification is 
increasing. Chile has negotiated free trade agreements with most of its trading partners and 
recognizes the importance of greening the process of internationalization. 
2.79.  More than a decade after the entry into force of Law No. 19.300
17 and having taken account 
of one of the recommendations made by the OECD in its Environmental Performance Review 
                                               
12 Online information viewed at: http://www.leychile.cl/Navegar?idNorma=1058072 . 
13 Online information viewed at: https://www.tuempresaenundia.cl/Default.aspx . 
14 Online information viewed at: http://www.sicexchile.cl/portal/web/sicex/inicio . 
15 Online information viewed at: 
https://www.sicexchile.cl/portal/documen ts/10180/13189/Decreto+N per centC2 per 
centB0%201049/fa487d89-5888-4ef3-ba6b-60827a5090e0 (https://www.sicexchile.cl/portal/documents/10180/13189/Decreto+N%C2%B0 1049/fa487d89-5888-4ef3-
ba6b-60827a5090e0 ) . 
16 The public bodies involved include: the National Customs Service, the National Fisheries Service, 
the Public Health Institute, the National Agriculture and Livestock Service, the Chilean Copper Commission, the Ministry of Health, the Internal Revenue Service, the General Treasury of the Republic, the Civil Registry and the General Government Secretariat. Online information viewed at: 
http://www.sicexchile.cl/portal/objetivos-alcances . 
17 Environmental Framework Law. Online information viewed at: 
http://www.leychile.cl/Navegar?idNorma=30667 . WT/TPR/G/315/Rev.1 • Chile 
- 17 - 
  of Chile in 2005, which emphasized the need to strengthen the environmental framework, 
Chile embarked upon a process to redesign the environmental institutions. This resulted in the enactment in January 2010 of Law No. 20.417 esta blishing the Ministry of the Environment, 
the Environmental Assessment Service and the En vironmental Regulatory Authority. It also 
established a Council of Ministers for Sustainability and Climate Change. 
2.80.  The Ministry's responsibilities are to formul ate and implement environmental policies and 
plans and to design regulations. The principal task  of the Council of Ministers is to make proposals 
to the President of the Republic concerning sustai nability policies and criteria. The Environmental 
Assessment Service administers the environmental assessment system and issues decisions on the 
environmental certification of the projects that fall within the scope of the system. 
The Environmental Regulatory Authority conducts inspections and imposes any relevant sanctions 
in the event of a failure to comply with thos e decisions and/or with any other environmental 
management instrument. 
2.81.  Subsequently, on 28 June 2012, Law No. 20.600
18 established the Environmental Courts. 
These courts are special judicial bodies subject to the Supreme Court whose role is to resolve 
environmental disputes that fall within their jurisdiction and to deal with other matters laid before them. 
2.82.  The changes and progress in strengthening environmental law are a milestone in the 
country's development because they provide international standards by which to assess projects and investments. They also provide national an d foreign businesses with the clear regulatory 
framework required for decision-making in any productive environment. Moreover, they also 
reaffirm Chile's commitment to the principles of sustainable development and demonstrate the 
depth of its efforts to harmonize the three basic pillars on which it stands: economic growth, social equity and environmental protection, and conservation of natural resources. 
2.5.6  Initiatives in the field of social responsibility 
2.83.  The Government of Chile notes that in order to extend and deepen inclusive economic 
growth, the long-term management model must, firs t, incorporate social responsibility, which is 
understood to mean the responsibility incumbent upon organizations with regard to their impact 
on society and the environment; and secondly regard social responsibility as a strategic condition 
for development . 
2.84.  In April 2013 Decree No. 60
19 was enacted, establishing the Social Responsibility Council for 
Sustainable Development (CNRS) as an adviso ry body of the Ministry of the Economy, 
Development and Tourism. The Council is headed by  the Minister with the relevant portfolio and 
incorporates various relevant stakeholders from the public and private sectors, civil society, 
academia and the business world. 
2.85.  The role of the CNRS is to act as a coordina ting body between the various entities in the 
State administration, the private sector and civil society on matters connected with the formulation 
of public policies concerning social responsibi lity for the sustainable development of Chile. 
Its role also involves identifying and reporting on policies, good practices and initiatives in the field 
of social responsibility which may arise nationally and internationally and, finally, making proposals for public policy measures and actions in that regard. 
2.5.7  Gender equity in the count ry's development policies 
2.86.  In addition to educational and labour reform, Government initiatives to reduce inequality, 
achieve a more inclusive country and generate the desired progress and growth include reforms to 
achieve the necessary equity between boys and girls, and between men and women. Closing the 
gender gap is especially important because of its correlation with per capita income and hence the country's growth and development. 
                                               
18 Establishes the Environmental Courts. Online information viewed at: 
http://www.leychile.cl/Navegar?idNorma=1041361 . 
19 Decree of the Ministry of the Econ omy. Online information viewed at: 
http://www.leychile.cl/Navegar?idNorma=1051588 . WT/TPR/G/315/Rev.1 • Chile 
- 18 - 
  2.87.  The Global Gender Gap Report 2014, publishe d by the World Economic Forum, notes that 
although gender inequality has been falling worldwid e, no country has fully closed the gender gap, 
and that closing it will take a further 81 years. The report ranks Chile 66th out of 142 countries. 
While this is better than in 2013, when it was ranked 91st (its lowest position since 2006), it is still 
a long way from the 46th place it achieved in 2011. This raises a particular concern in terms of 
economic equality because according to the 2014 re port Chile fell sharply in only one of the areas 
considered in the rankings, economic participation and opportunity, to 119th place. On the other 
hand, there was a significant improvement in the field of political empowerment, an area where 
President Bachelet's administration has played an important role, and the gap here has closed by 8% in real terms since 2006. Thus, although the country has made significant progress, now has very small gaps in education and health, and has closed 70% of the gender gap as a whole, some 
important challenges remain in the fields of political empowerment and economic equality. 
2.88.  On economic equality specifically, the integration of Chilean women into the workplace is 
a matter of particular concern. Women came to the workplace relatively late in Chile, and the level 
of their integration is one of the lowest in Latin America.
20 Women account for just over 36% 
of the workforce and are found mainly in low-skilled, low-paid jobs. Figures from the New Supplementary Income Survey 2012 (NESI) sh ow that women earned on average 32.3% less 
than men for equal work. Additionally, statistics from the Economic Commission for Latin America 
estimated women's labour participation rate in 2011 at 52.8%, while the OECD in the same year noted that the country should seek to raise that proportion because it was well below the 63% average of its member countries.
21 
2.89.  The reality of the situation raises the need for a new gender agenda based on rights, 
equality and autonomy for women and underpinned by a renewed institutional framework that gives gender equity a high profile on the politi cal agenda. Thus, it is intended to incorporate 
a gender perspective into educational, labour and other policies, the electoral system and the 
new Political Constitution. 
2.90.  The main actions under way and already implemented include: 
 the establishment of the Ministry of Women and Gender Equity. The Ministry will have 
responsibility for designing, coordinating and evaluating policies, plans and programmes aimed at promoting gender equity and eliminating all forms of discrimination against women
22; 
 the revival of the Council of Ministers for Equal Opportunities, a body established 
in 2000 with the aim of mainstreaming the gender perspective at State level. Its task is to drive forward the Equal Opportunities Plan under which each portfolio must take on specific 
challenges, thereby evidencing the political will to improve women's living conditions; 
 the replacement of the binominal electoral system  with a proportional, inclusive system that 
increases the representativeness of the National Congress
23; 
 the forwarding to Congress by the Executive of a draft law decriminalizing abortion in 
three sets of circumstances and the amendm ent of the Criminal Code in this area24; 
                                               
20 Labour Directorate, Ministry of Labour and Social Welfare. Online information viewed at: 
http://www.dt.gob.cl/1601/w3-article-59923.html . 
21 Statistical Yearbook for Latin America and the Caribbean, 2011, ECLAC. OECD (2011), Maintaining 
Momentum: OECD Perspectives on Policy Challenges in Chile. 
22 The legislative formalities have been complete d and this legislation is  ready for enactment. 
Bulletin 9287-06, online information viewed at: http://www.camara.cl/pley/pley_detalle.aspx?prmID=9696 . 
23 Objectives of the draft law: reduce voting inequality, allow representation and inclusion of all 
significant political movements, increase competitiveness and uncertainty as to election results, give a voice to the will of the majority and provide for the representati on of minorities, promote a Congress that reflects the 
diversity of society and prevent candid ates who gain a large share of the vote from not winning a seat. By end 
January 2015 the third constitutional procedure in the Chamber of Deputies had been completed. 
Bulletin 9326-07, online information viewed at: http://www.camara.cl/pley/pley_detalle.aspx?prmID=9742 . 
24 Undergoing the first constitutional procedure / Chamber of Deputies. Bulletin 9895-11, online 
information viewed at: http://www.camara.cl/pley/pley_detalle.aspx?prmID=10315&prmBL=9895-11 . WT/TPR/G/315/Rev.1 • Chile 
- 19 - 
   the introduction of a judicial mechanism to effectively re-establish the rule of law when 
an arbitrary act of discrimination occurs, under Law No. 20.609 (2012); and 
 the amendment of maternity protection rules and incorporation of parental postnatal leave 
under Law No. 20.545 (2011). 
2.5.8  Intellectual property 
2.91.  During 2010 the National Congress approved Law No. 20.435 introducing one of the most 
important reforms of the last 40 years to the Intellectual Property Law (No. 17.336), and bringing 
national legislation into line with international standards and recommendations. The reform 
substantially improved copyright protection by incorporating new civil and criminal procedures 
including indemnities, confiscation and destruction of goods deemed to be in breach, a system of liability for Internet Service Providers (ISP s), a catalogue of exemptions and restrictions 
on users and a new procedure for settling disput es over fees between users and collective 
management associations. 
2.92.  Additionally, through its free trade agreements, Chile has adopted more precise intellectual 
property standards in line with the challenges re quired by our level of development. These also 
take account of the new forms of exploitation that are the natural consequence of technological progress. The bilateral treaties dealing with these matters include agreements signed with 
the United States, the European Union and Mexico. 
2.93.  With the opening of the National Industrial Property Institute (INAPI) in 2009, a new 
institutional framework for industrial property began operating in the country, leading to the introduction of a more modern service that is recognized internationally. INAPI has conducted 
a series of projects and initiatives to improve th e management of services delivered to the public 
and has generated extensive publicity for intellectual property through use of the platform INAPI Proyecta . 
2.94.  Parallel to these efforts, Legislative Bulletin No. 8907-03 came before Congress in 2013. 
It seeks to introduce important amendments to Chil e's intellectual property legislation. The draft 
covers all areas of industrial property law and aims to improve protection of rights by incorporating 
new types of protection, improving the efficiency and effectiveness of procedures for registering 
industrial property and strengthening compliance standards.
25 
2.95.  These measures are particularly important given that piracy and other unlawful practices not 
only constitute a breach of intellectual copyright law but also distort the normal operation of the 
market, thereby causing serious financial losses not only to industry whose chief asset is copyright 
and neighbouring rights, but also to the State because of the tax evasion it entails. 
2.5.9  Furtherance of the Energy Agenda 
2.96.  One of the first measures undertaken by the current Government under President Bachelet 
was to formulate an Energy Agenda to serve as a roadmap for formulating and implementing a long-term energy policy. The Agenda was pr esented in May 2014 and seeks to address the 
energy infrastructure deficit that has accumulated in recent years and to unblock bottlenecks 
that prevent projects from being implemented. It also seeks to achieve a secure, efficient, 
affordable energy supply for the country that makes sustainable use of renewable resources. The specific targets and goals of the Agenda are as follows: 
 to achieve a 30% reduction in marginal electricity costs for the central grid (SIC) during the 
tenure of this Government. 
 to achieve a 25% reduction in tender prices for the supply of electricity to domestic 
consumers over the next 10 years. 
                                               
25 On Wednesday 18 March, the Senate  Economic Committee forwarded th e draft industrial property law 
to the Finance Committee. The draft law seeks to promote innovation, transfer knowledge and enable 
consumers to compare products and services on the market more easily. Online  information viewed at: 
http://www.inapi.cl/portal/prensa/607/w3-article-5887.html . WT/TPR/G/315/Rev.1 • Chile 
- 20 - 
   to remove the existing barriers to non-conventional renewable energy sources (ERNC) and 
meet the target of a 20% feed-in of ENRC to the national grid by 2025 under the law 
in force; 
 to promote efficient energy use by establishing a savings target of 20% by 2025. 
 to design a Fuel Price Stabilization Mechanism (Mepco) to reduce price volatility; 
 to transform the National Petroleum Company (ENAP) into a robust company so that it can 
become a strong player with a leading role in meeting the energy challenges that the 
country faces; and 
 to develop in 2015 a long-term energy policy endorsed by Chilean society through 
a participative, regional process. 
2.97.  One of the most recent advances in the Agen da was the approval, in January 2015, of the 
Draft Law amending the general electrical services law refining the system of tendering 
for electrical supply services for clients subject to price regulation . 
2.5.10  Furtherance of the Productivity, Innovation and Growth Agenda 
2.98.  The commitments and priorities of the current Government under President Bachelet include 
defining and implementing far-reaching measures to address the challenge of productivity and thereby close the gap on the world's developed economies. These measures provide a roadmap for 
a change in production patterns to achieve economic diversification by producing new goods and 
services, developing new industries and generating new innovation clusters on the basis of four strategic objectives that seek to: 
1. Promote diversification of production. 
2. Boost sectors with high growth potential. 
3. Increase Chilean businesses' productivity and competitiveness. 
4. Generate a new boost for exports. 
2.99.  These objectives are being implemented in seven areas of action through various initiatives, 
draft laws and administrative measures that ensure active State participation in promoting production sectors, strengthening competition and investing in public infrastructure, with particular 
emphasis on SMEs. 
2.100.  Where strategic investment and sectoral development plans are concerned in particular,  
the agenda introduces the idea of implementi ng programmes to develop production, support 
the competitiveness of national agriculture through the coordinated efforts of the 
Ministry of Agriculture and the Economic De velopment Agency (CORFO) in strengthening 
instruments that support technological innovation, improve access to internal and external markets, certify quality and develop traceability systems. 
2.101.  This area of the agenda also boosts the Worl d Class Mining Suppliers Programme, in order 
to consolidate the cluster, increase participation in the industry and broaden its field of action. This has resulted in the establishment of the Chilean Mining and Development Commission 
coordinated by the National Council on Innovation for Competitiveness which has agreed an action 
plan for the next 20 years that is endorsed by stakeholders in the mining industry and the State. It is hoped that by 2035 this long-term agenda  will enable Chilean mining to produce 250 new 
world-class suppliers exporting knowledge-intensive services and technologies. 
2.102.  To promote the implementation of projects in sectors with high potential for growth, 
the Strategic Investment Fund will be establishe d and funded for the next four years. The aim 
of the fund will be to finance goods and public  services that help implement new projects in 
sectors with high potential for growth and job creation, alongside development policy and 
production chain activities. WT/TPR/G/315/Rev.1 • Chile 
- 21 - 
  2.103.  In the area of infrastructure for further development,  the agenda sets out plans 
for: a major port in the country's central macrozone; port services coordination committees to work with State port enterprises in order to simp lify and streamline administrative and regulatory 
processes within ports; the promotion of collaborative platforms between ports (along the lines 
of a port community system); the establishment of an OECD-standard National Logistics 
Observatory to support public policy decisions and propose standards to improve operations in 
the sector; and finally establishment of a logistics competitiveness and innovation programme 
involving public and private sector stakeholders working together to identify gaps in the sector. 
2.104.  I n  t h e  a r e a  o f  s u p p o r t  f o r  S M E s  and given their importance for job creation, 
the Government has set itself the challenge of significantly boosting productivity, growth and 
internationalization in this sector, which accounts for close to 37% of all jobs and therefore 
supports thousands of families' livelihoods. It is also important because of its role in the 
diversification of the national production matrix, which is necessary for an economy still very dependent on mining. 
2.105.  According to information from 2012, enterprises in the sector accounted for 20% of the 
national total but fewer than 2% of them were exporters that year, in contrast with the figure of 21% for large enterprises. A similar pattern was observed in respect of SMEs' share of national 
exports; although 49% of all exporters were from this sector, their remittances accounted for only 
2.1% of the total, with large enterprises accounting for 97.4%. 
2.106.  According to the ECLAC report Building SME Competitiveness in the European Union and 
Latin America and the Caribbean 2013 , one of the main problems affecting SME performance 
in Chile and throughout Latin America is the large productivity gap between SMEs and large 
companies. In view of the importance of the sector and the production weaknesses and higher 
costs faced by SMEs because of their size and low level of participation in trade, the Government 
has put in place a range of support initiatives. 
2.107.  These initiatives include a network of SME business development centres, which are 
currently in the process of being established. The aim is to have 50 centres nationwide by 2017. 
There will also be regional centres to coordinate ac tivities and tools in suppo rt of the export drive, 
focusing particularly on smaller businesses. Th e work done by the national export promotion 
agency, PROCHILE, will inform the way the centres are organized. 
2.108.  Finally, where the New Institutional Framework is concerned , the Productivity, Innovation 
and Growth Agenda provides for the modernization of the legal framework governing foreign direct 
investment by providing guarantees on a non-discriminatory basis to foreign investors through improvements to the current regulations gove rning such investments (Decree Law No. 600). 
The agenda also provides for passage of a draft law
26 establishing a new institutional architecture 
to promote and encourage foreign direct investment in Chile, comprising a Committee of Ministers to advise the President of the Republic on policy formulation and a Foreign Investment Promotion 
Agency, complying with OECD standards, to implement those policies. 
2.109.  The new institutional framework will enable the new agency to channel foreign investment 
towards sectors with a strategic role in development and diversification of production, especially those sectors where Chile has clear competitive advantages, a greater need for knowledge and 
technology or the opportunity to spawn new industries. The framework will also vest the agency 
with the powers it needs to act as the coordinating body for efforts to attract investment into Chile. These include establishing a strategy to promote and encourage foreign investment, 
linking investment to the development of production in Chile and the possibility of establishing 
a Consultative Advisory Council that includes representatives from the private sector who can bring their experience to bear in improving the running of the agency. 
2.110.  Modernizing the institutions responsible for promoting foreign investment in this way is 
compatible with the democratic and political consolidation of Chile. Currently, foreign enterprises wishing to set up business in the country do not require a special set of guarantees of the kind 
                                               
26 Draft law before Congress, Message No. 1237-362 establishing a Framework Law for Foreign 
Investment in Chile and the relevant institutional architecture. Online information viewed at: 
http://alertas.directoriolegislativo.org/wp-content/uploads/2015/02/Proyecto-de-Ley-Inversiones-
Extranjeras.pdf . WT/TPR/G/315/Rev.1 • Chile 
- 22 - 
  stipulated in Decree Law No. 600, which was devised at a very complex time in our history. 
Chile is recognized worldwide as a trustworthy, law-abiding country whose institutions work, and therefore investors require other kinds of incentives. 
2.111.  Specifically, the draft law guarantees foreign investors access to the official exchange 
market and remittance of capital and earnings with full safeguards for the powers vested 
in the Central Bank of Chile in this area. It also guarantees that they shall not be subject 
to arbitrary discrimination. 
2.112.  Additionally, steps are under way to modernize and update the procedure for exemption 
from sales and services tax on imports of capital goods by foreign investors for projects covered by Decree Law No. 600. The amendment seeks to  promote the execution in Chile of major 
investment projects whose profile implies a lengthy timescale, and to prevent them from running 
up high costs in the preliminary and initial stages. 
2.113.  In line with the proposals made by the Adviso ry Commission, in order to allow stakeholders 
to adjust to the change in the system for foreign investment, for a maximum period of four years 
foreign investors may apply for foreign investment authorizations pursuant to Article 3 
of Decree Law No. 600, subject to the rights and obligations laid down therein, but with a total tax invariability rate of 44.45%. 
2.114.  The draft law also governs the effects of legal contracts entered into while Decree Law 
No. 600 was in force, in order to ensure the full applicability of the rights and duties acquired 
by foreign investors under that legal regime. 
__________