Chile WT/TPR/S/220 
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  II. TRADE POLICY REGIME 
(1) OVERVIEW  
1. Since its last review in 2003, Chile has not ma de any fundamental changes to its foreign trade 
policy, whose key aim continues to be to deepen Ch ile's participation in the international economy, by 
promoting export development, investment prot ection, competitiveness and technological change, 
within a framework of stable rules a nd policies that enhance social equity. 
2. Chile is a founding Member of the WTO, wher e it is participating actively to bring the 
Doha Development Agenda (DDA) negotiations to  a successful conclusion.  Chile considers it 
essential to have a stronger multilateral trading syst em, and believes that the WTO is the only forum 
available to resolve some of the outstanding problems on the global trade agenda, such as the 
elimination of agricultural subsidies.  Chile h as submitted a large number of notifications to the 
various WTO bodies during the review period.  It has also made use of the dispute settlement 
mechanism, having been involved as a respondent in four cases, as complainant in two and as a third 
party in 11 cases. 
3. One of the most prominent features of Chile's tr ade policy regime is the central role given to 
regional trade agreements (RTAs).  As at mid-200 9, Chile had 21 RTAs in force with 57 trading 
partners;  and 92 per cent of its tota l merchandise trade is carried out w ith its preferential partners.  As 
is the case with other WTO Member s that are actively involved in RTAs, the economic implications 
of the agreements negotiated by Chile are complex,  and could either enhance or diminish economic 
well-being.  In the specific case of Chile, possible concerns about its wide and expanding network of 
RTAs are allayed by its strong support for the multilateral trading system. 
4. Chile grants national treatment to foreign inv estors, with a few exceptions for activities such 
as coastal shipping (cabotage), air transport, fisher ies and communications media.  Chile has a large 
number of agreements in force to promote and pr otect investments and to avoid double taxation. 
(2) TRADE POLICY AND INVESTMENT FRAMEWORK  
(i) General legal and institutional framework 
5. Chile is a unitary and democratic republic governed  by three powers of State:  the Executive, 
the Legislature and the Judiciary.  For administrativ e purposes, the country is divided into 14 regions 
and a metropolitan area.  The regions are divided into  provinces, which in turn consist of communes. 
6. The President of the Republic, elected by direct universal suffrage, serves as both Head of 
State and Head of Government.  A constitutional reform adopted in 2005 reduced the presidential 
term from six to four years, with no possibility of immediate re-election.1  Ministers of State are 
appointed by the President.  The most recent pr esidential election was held in December 2005, 
synchronized with elections for the entire Chamber of Deputies ( Cámara de Diputados ) and half of 
the Senate. 
7. Legislative power rests with the Nationa l Congress, consisting of the House of 
Representatives and the Senate.  The Chamber of Deputies is composed of 120 deputies directly 
elected for a four-year term.  The Senate consists of 38 members directly elected by senatorial 
                                                      
1 Article 25 of the Political Constitution of the Rep ublic of Chile of 1980 (O.J. 24.10.1980), amended 
by Constitutional Reform Law No. 20.050 (O.J. 26.08.2005). WT/TPR/S/220 Trade Policy Review 
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  constituencies representing the country's regions.  Se nators serve eight-year terms and are renewed 
alternately every four years.2  The 2005 constitutional reform abolished seats for appointed senators, 
which were awarded to former representatives of the various State bodies including the armed forces, 
along with lifetime Senate seats given to former Presidents of the Republic. 
8. Judicial power is vested in the Supreme Cour t of Justice, which consists of 21 judges 
appointed by the President and confirmed by a two- thirds majority in the Senate.  Hierarchically, 
below the Supreme Court, there are regional appeal courts distributed throughout national territory;  
their members are appointed by the President from sh ort lists proposed by the Supreme Court.  Appeal 
court judges can be assigned to civil, criminal, fa mily and labour law cases depending on the appeal 
court in question.  There are also regiona l electoral tribunals and military tribunals. 
9. The President of the Republic has the power to conclude, sign and ratify international treaties, 
which must be submitted for approval by the National Congress3, along with information on their 
content and scope.  The President also has the exclusive right to denounce or withdraw from a treaty, but must obtain the opinion of both legislative chambers if the treaty has been approved by Congress.
4  
The National Congress has the right to approve or reject international treaties presented by the 
President of the Republic before ratification.  It  may also formulate reservations and interpretative 
statements in respect of international treaties, provi ded they are in accordance with the provisions of 
the treaty itself or international law.  Congressiona l approval is not required for measures adopted by 
the President or agreements reached to implement a current treaty, unless they concern specific legal issues;  nor is such approval required for treaties a dopted by the President in exercise of his or her 
legal powers.
5 
10. Legislative procedures in Chile distinguish be tween laws that interpret the Constitution, 
organic constitutional laws (LOCs), qualified quorum laws, ordinary laws, decrees with force of law 
(DFLs), and decree laws.  Laws interpreting the Constitution clarify the meaning or scope of a 
concept or an expression contained in  the Constitution, and require a three-fifths majority of currently 
serving deputies and senators to be a pproved, amended, or repealed.  LOCs relate to certain issues that 
are expressly stipulated in the Constitution, and requ ire a four-sevenths majority of currently serving 
deputies and senators for their approval, amendment or repeal.  Laws interpreting the Constitution and 
LOCs must be submitted for constitu tional review by the Constitutional Court before they are enacted.  
Qualified quorum laws are approve d, amended and repealed by an absolute majority of currently 
serving deputies and senators.  Ordinary laws require a simple majority of the votes cast by members 
of Congress present at the time of voting.  DFLs concerning specific legal matters are issued by the 
President of the Republic on the basis of laws en acted by Congress delegating certain powers to the 
President.  Decree laws were issued by the Execu itive on matters pertaining to a specific law at times 
when Congress was barred from fulfilling its functio ns.  The Constitution takes precedence over all 
other laws. 
11. Deputies, Senators and the President of th e Republic may all propose draft laws.  The 
Constitution gives the President of the Republic the exclusive right to propose draft laws on issues 
concerning changes to the country's political or ad ministrative organization, the annual budget, taxes 
and tariffs.  Laws are published in the Official Journal ( Diario Oficial ) and enter into force on the day 
of publication, unless otherwise stated. 
                                                      
2 Articles 47 and 49 of the Political Constitution of 1980, amended by Law No. 20.050. 
3 Article 32 of the Political Constitution of 1980. 
4 Article 54 of the Political Constitution of 1980, amended by Law No. 20.050. 
5 Article 54 of the Political Constitution of 1980, amended by Law No. 20.050. Chile WT/TPR/S/220 
 Page 15 
 
 
  12. International treaties are incorporated into Ch ilean legislation.  Once the National Congress 
has approved a treaty, the Executive issues a Suprem e Decree officially informing the nation of its 
existence and ordering compliance therewith.  The WTO Agreements were integrated into national 
legislation through Supreme Decree No. 16 issued by the Ministry of Foreign Affairs on 
5 January 1995;  they have the same status as ordi nary laws and may be invoked before the Chilean 
courts.  WTO Agreements take precedence over domest ic legislation if they contain a greater degree 
of specificity, when covering the same subjects, or  if they establish a new set of rules covering 
subjects not dealt with by domestic legislation, or when they regulate institutions or subjects setting 
rules whose legal significance and effects are in contradiction with the significance and effects of 
prior domestic legislation.  Moreover, in cases wh ere the WTO Agreements were enacted after the 
relevant domestic legislation, the pr inciple of tacit derogation applies. 
13. In October 2003, Law No. 19.912 was passed for the purpose of adapting various provisions 
of Chilean legislation to the WTO Agreements, in areas such as customs valuation, technical 
regulations, taxation, intellectual property and trad e-related investment measures in the automotive 
sector. 
14. The Law on Access to Public Information (Law No . 20.285) entered into force in April 2009, 
with the aim of regulating the principle of civil service transparency.  Among other issues, the law 
establishes the principles of freedom of information, openness, maximum disclosure and no-fee access.  It also requires the Government to keep certain information, including documents that have 
been published in the Official Journal, up to date  and permanently available to the public through its 
Internet sites.  The law also creates the Transparency Council ( Consejo de Transparencia ) to promote 
transparency, enforce regulations on transparency and guarantee the right of access to information.  
This legislation was enacted partly in response to a 2006 ruling by the Inter-American Court of 
Human Rights, which found Chile guilty of deny ing access to information possessed by the Foreign 
Investment Committee concerning an investment in  the Magallanes region (see also section (3) 
below).
6 
(ii) Trade policy formulation and objectives 
15. There have been no fundamental changes in the direction of Chile's foreign trade policy since 
2003, the aims of which continue to be to deepen  the country's engagement in the international 
economy, combining export development with inv estment promotion and protection;  promoting 
competitiveness and the dissemination of technological change, within a framework of stable rules, 
monitoring of unfair competition, and policies to enhance social equity.7 
16. During the period under review, Chile has accord ed a fundamental role to concluding RTAs 
in the framework of its trade policy, while seeking to ensure that these are also consistent with 
multilateral rules.  Chile has also played an activ e role in WTO negotiations, where it is endeavouring 
to ensure a successful conclusion of the Doha Round. 
17. Foreign trade policy is formulated by the Government.  The Directorate-General of 
International Economic Affairs (DIRECON), in the Minist ry of Foreign Affairs, takes the lead role in 
international trade negotiations and export promotion.   Other institutions involved in trade policy are 
the Ministries of Finance, Economic Affairs and Ag riculture, and the Secretar iat General of the Office 
of the President, grouped together in the Inte rministerial Committee for International Economic 
                                                      
6 The legislative history of Law No. 20.285 may be viewed at:  http://www .bcn.cl/ley-transparencia 
7 DIRECON online information.  Viewed at:  http://www.direcon.cl WT/TPR/S/220 Trade Policy Review 
Page 16 
 
 
  Relations, chaired by the Minister of Foreign Affair s.  DIRECON holds regular consultations with the 
National Congress on trade policy issues. 
18. With the aim of supporting the Interministerial  Committee, the Private Sector Participation 
Committee was set up in 1992, to keep the priv ate sector informed of the progress of trade 
negotiations and to obtain the sector's points of view.  The Committee is chaired by the Ministry of 
Economic Affairs and consists of the Ministries of  Foreign Affairs, Finance and Agriculture, the 
Secretariat General of the Office of the President and the Director-General of DIRECON, together with two representatives from the private sector, tw o labour union representatives and three experts in 
the field of international trade negotiations. 
19. The Government holds permanent consultations with the private sector, business associations 
and civil society generally.  The most important pr ivate-sector participation mechanisms include the 
Public-Private Council for Export Development, wh ich brings together en trepreneurs from the 
Confederation of Production and Commerce (CPC) a nd officials from public institutions involved in 
trade policy formulation and administration.  Th e Council's basic objective is to enhance Chile's 
export capacity.  Its main areas of work are trade facilitation;  promotion of productive and 
technological development and quality;   international integration;  promotion of exports, investment 
and tourism;  and transport and lo gistics.  Another mechanism for dialogue between the private sector 
and the authorities is the International Negotia tions and Foreign Trade Council, set up by the 
Industrial Development Society (SOFOFA).  The pr ivate sector in Chile also participates in the 
Business Advisory Council of Asia-Pacific Economic Cooperation (APEC) forum. 
20. The authorities state that dialogue is also main tained, on the various trade negotiations Chile 
has been involved in, with the Unitary Workers Congress (CUT) and other union organizations.  Civil 
society participates in the discussion of trade policy issues through non-governmental organizations, professional bodies, academic entities, indigenous  organizations, personalities from the cultural 
domain and other stakeholders.
8 
(3) FOREIGN INVESTMENT  
(i) Legal framework 
21. The authorities consider that the capacity to attr act foreign investment is essential to Chile's 
economic growth and forms an integral part of its open trade policy.  It also believes that Chile's 
comparative advantages for attracting foreign inv estment flows include a clear and stable legal 
framework, free-market policies and export-led growth.9 
22. Chile has no general law on investments.  The legal bases for bringing foreign investment into 
Chile are Chapter XIV of the Central Bank's Compe ndium of Foreign Exchange Regulations and the 
Foreign Investment Statute (Decree Law No. 600 of 1974, hereinafter DL No. 600).10  F o r e i g n  
investors may choose between these two instruments to bring their capital into the country:  in 
2003-2008, 46 per cent of foreign investment in Chile entered under DL No. 600. 
23. Chile generally grants national treatment to fo reign investors and allows them to hold up to 
100 per cent of the equity of an enterprise in the vast majority of economic sectors.  Nonetheless, 
                                                      
8 DIRECON online information.  Viewed at:  http://www.direcon.cl 
9 Foreign Investment Committee.  Viewed at:  http://www.inviertaenchile.cl 
10 Decree Law No. 600, amended on 16 December 1993 and 16 June 2005 by Law No. 20.026, in turn 
amended by Law No. 20.097 of 8 April 2006. Chile WT/TPR/S/220 
 Page 17 
 
 
  specific laws limit national treatment or market ac cess in certain areas of activity, including coastal 
shipping, air transport, fisheries and communications media (see Table AII.1).  In some cases, the restrictions are subject to the principle of intern ational reciprocity.  In addition, land owned by the 
State, within a distance of ten kilometres from th e borders and five kilometres from the coast, cannot 
be sold to foreigners.
11 
24. Some activities are reserved to the State, such as the exploration and exploitation of lithium, 
oil or gas deposits located in maritime zones under national jurisdiction, or in areas legally classified 
as important for national security;  and nuclear power  production.  However, both national and foreign 
firms can participate in these sectors in certain circ umstances, subject to presidential authorization. 
25. Any foreign natural or legal person, and Chilean  citizens with residence and domicile abroad, 
can invest under DL No. 600.  The investment ma y take the form of freely convertible foreign 
exchange, physical assets, various forms of technol ogy, loans associated with a foreign investment, 
capitalization of foreign loans and de bts, and capitalization of profits. 
26. Pursuant to DL No. 600, foreign investors wishing to invest in projects worth more than 
US$5 million12 must file an application13 with the Foreign Investment Committee14, which is 
responsible for reviewing and a pproving each application, as appropriate.  The Committee did not 
reject any application during the review period.  The Committee consists of the Ministers of Economic Affairs (Chair), Finance, Foreign Affair s, Planning and Cooperation, the Minister for the 
sector related to the investment application, and the Governor of the Central Bank. 
27. For some foreign investment projects, additional information must be provided to the sector 
authorities, who in turn submit a report to the Fore ign Investment Committee.  Thus, the Supervisory 
Authority for Banks and Financial Institutions issu es reports on investment projects in the banking 
and finance area;  and the Securities and Insuranc e Supervisory Authority does so with respect to 
operations involving investment and insurance funds  (see also Chapter IV(7)(iii)).  The Chilean 
Copper Commission files a report on every mining invest ment project;  while the Fisheries Secretariat 
issues reports on fisheries investment projects (s ee also Chapter IV(3) and (4)).  The National 
Environment Commission assesses the environmental impact of projects. 
28. Authorization for a foreign investment under DL  No. 600 takes the form of a contract of 
indefinite duration between the Chilean State and th e foreign investor, which may not be unilaterally 
amended by the State.  The contract, which is cost -free to the investor, sets a deadline for the investor 
to bring capital into the country, which may not exceed eight years for investments in the mining 
sector and three years in other sectors.  The Comm ittee may extend the deadline to 12 years in the 
case of mining investments that require prior exploration, and up to eight years for non-mining projects worth US$50 million or more, when the nature of the project so requires.
15 
                                                      
11 Decree Law No. 1939 of 10 November 1977, and DFL No. 4 of the Ministry of Foreign Affairs of 
10 November 1967. 
12 When the investment consists of physical assets, technology and the capitalization of profits or loans, 
the minimum amount is US$2.5 million. 
13 Foreign investment application forms are available at http://www.invierta enchile.cl 
14 Article 16 of DL No. 600.  The following also require authorization from the Committee:  foreign 
investments relating to activities normally undertaken by the State, or investments to be made in public utilities or mass communications media, as well as those undertaken by a foreign State or foreign legal entity established 
under public law. 
15 Article 3 of DL No. 600. WT/TPR/S/220 Trade Policy Review 
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  29. Under Article 9 of DL No. 600, foreign inv estment and the enterprises involved are covered 
by the legal regime applicable to national invest ment and may not be subject to discrimination. 
30. DL No. 600 entitles foreign investors to repatriate  invested capital after one year and profits 
as soon as they are generated, as well as guaranteei ng access to the formal foreign exchange market.16  
Foreign investors covered by DL No. 600 also have the right to include in their contract a clause 
establishing the invariability of value-added tax and customs duties on imported capital goods for the 
period authorized for effecting the investment.  This  provision applies to goods that are not produced 
in Chile and that figure on a special list.17 
31. Foreign investors covered by DL No. 600 may opt for a Special Tax Invariability Regime, 
whereby the firm's income is taxed at a fixed rate  of 42 per cent for up to ten years (Article 7 of 
DL No. 600).  The invariability period can be exte nded to 20 years for industrial and extractive 
projects worth at least US$50 million (Article 11 bis).  Investors may waive their rights under this 
option, on a once-only basis, and ask to be subject to ordinary tax laws. 
32. In January 2006 Law No. 20.026, amending DL No. 600, entered into force.  Under this law, 
new mining investments worth US$50 million or mo re are guaranteed invariable tax rates for a 
15-year period on income earned specifically from mining activity, as well as other taxes, including 
royalties or similar charges, and mining exploration and production patents.  To be eligible for this 
special regime, foreign investors with current c ontracts must not be covered by the invariability 
regimes mentioned in Articles 7 and 11 bis of DL No. 600, or else they must renounce them when they 
are admitted to the special regime (Article 11 ter of DL No. 600). 
33. To simplify procedures and eliminate certain rest rictions previously contained in DL No. 600, 
in December 2006 foreign investors were allowed to reinvest up to 100 per cent of their profits 
(eliminating the previous limit of 65 per cent), and were offered the possibility of reinvesting such 
profits in other companies (not only in the firm that generated the profits in question, or its 
subsidiaries).  In addition, the requirement to subm it official translations of documents accompanying 
authorization applications filed with the Fo reign Investment Committee was abolished. 
34. Chapter XIV of the Central Bank's Compendium  of Foreign Exchange Regulations sets out 
the rules applicable to international exchange opera tions in respect of loans, deposits, investments and 
capital injections from abroad.  Under the terms of  this instrument, while the Central Bank cannot 
reject a foreign investment, it can set conditions for the transfer of funds to and from Chile to ensure 
stability of the currency and the normal functioning of domestic and external payments.  Foreign 
capital entering Chile under Chapter XIV receives nati onal treatment, but it is ineligible for the 
benefits of DL No. 600, including the tax invari ability facilities.  Moreover, such capital must be 
registered with the Central Bank, which can be done at any commercial bank before its conversion 
into Chilean pesos.  There are no restrictions  on the repatriation of capital entering Chile under 
Chapter XIV. 
35. Law No. 19.840, published in November 2002, encourages multinational companies to use 
Chile as a regional platform for investing in thir d countries.  The law provides a special tax regime 
whereby companies established in Chile under this law can make investments abroad without being 
liable in Chile for taxes on the income generated by those investments.18  In addition, Law No. 19.840 
contains provisions aimed at preventing the use of Ch ile as a tax haven, or the misuse of this regime 
                                                      
16 Article 4 of DL No. 600. 
17 Article 8 of DL No. 600. 
18 Article 41 D of the Income Tax Law. Chile WT/TPR/S/220 
 Page 19 
 
 
  by domestic firms to avoid paying domestic taxes.  Firms covered by this regi me are required to file 
reports and are not covered by the rules on banking secrecy and confidentiality.  They also have to 
accept stricter controls by the tax authority in relatio n to transfer prices.  The authorities reported that 
22 firms had joined this regime as of March 2009. 
(ii) International investment agreements 
36. Chile has adopted investment disciplines in most  of the preferential trade agreements it has 
signed.  In general, the investment chapters in cluded in these agreements contain disciplines on sector 
liberalization (through negative lists), national treatment, MFN treatment, minimum standard of 
treatment, performance requirements, free transfer of capital, expropriation and compensation, and 
dispute settlement (including investor-State arbitration). 
37. Chile also has a large number of investment promotion and protection agreements (IPPAs) in 
force (35 as at mid-2009)19, although it has not negotiated this type  of agreement in recent years, 
preferring to include investment di sciplines in its trade agreements. 
38. Since 1991, Chile has been a signatory of the Washington Convention (1965) which set up 
the International Centre for Settlement of Investment  Disputes (ICSID).  It is also a member of the 
Multilateral Investment Guarantee Agency (MIGA) and the Overseas Private Investment Corporation 
(OPIC).  Chile has also ratified Inter-American C onvention on International Commercial Arbitration 
and the Convention on the Recognition and Enforc ement of Foreign Arbitral Awards.  In 
September 2004, it promulgated the Law on Internat ional Commercial Arbitration (Law No. 19.971). 
39. During the period under review, Chile conclude d a large number of agreements to avoid 
double taxation.  As at mid-2009, agreements of this type were in force with 20 countries;  it had also 
signed agreements with five countries that have yet to enter into force20;  and it had completed 
negotiations for an agreement with another coun try.  At the same date, Chile was negotiating 
agreements with a further 14 countries.21 
(4) INTERNATIONAL TRADE RELATIONS  
(i) World Trade Organization 
40. Chile is a founding Member of the World Trade Organization;  and it took part in the 
negotiations on telecommunications and financial services after the Uruguay Round.  The Fourth and 
Fifth Protocols to the General Agreement on Trade in  Services (GATs) entered into force for Chile on 
16 June 1998.  Chile is not a signatory to th e WTO Information Technology Agreement or the 
Plurilateral Agreements.  It grants MFN treatment to  all its trading partners.  Chile's mission to the 
WTO is under the Ministry of Foreign Affairs. 
41. Chile participates actively in the work of the WTO and supports the successful conclusion of 
the Doha Development Agenda negotiations, within which it has submitted a large number of 
proposals either individually or in conjunction with  other Member countries.  Chile has participated 
                                                      
19 The list of IPPAs signed by Chile may be  viewed at:  http://www.inviertaenchile.cl 
20 Argentina, Brazil, Canada, Croatia, Denmark, Ecuador, France, Ireland, Republic of Korea, 
Malaysia, Mexico, Norway, New Zealand, Paraguay, Peru, Poland, Portugal, Spain, Sweden and the 
United Kingdom. 
21 Current double taxation agreements, negotiated and signed by Chile, may be viewed at:  
http://www.sii.cl/pagina/jurisprudencia/convenios WT/TPR/S/220 Trade Policy Review 
Page 20 
 
 
  with special interest in the negotiations on agricult ure, pursuing the elimination of export subsidies 
and a substantial reduction in trade- distorting domestic support and other market access barriers.  It is 
also working to ensure the elimin ation of tariff escalation on industrial products;  and it is lobbying 
for improvements in trade rules, particularly to prevent the abuse of anti-dumping measures;  the 
elimination of fishery subsidies;  and reforms to the dispute settlement provisions.  In the services 
area, Chile is pursuing greater market access for prof essional services, maritime and air transport, and 
information technology services.22 
42. Chile believes there is a fundamental need for a stronger multilateral trading system, with full 
legitimacy and clear principles and rules on global trade.  It also sees the WTO as the only forum 
capable of resolving certain problems that bilateral or regional agreements have been unable to settle, 
such as the use of anti-dumping measures for protec tionist purposes, and the abolition of agricultural 
subsidies.23 
43. The Chilean authorities are pursuing a trade st rategy that simultaneously involves unilateral 
market opening, multilateral negotiations and libera lization negotiated throug h broad-scope bilateral 
or regional agreements that are consistent with WTO rules.24 
44. During the period under review, Chile submitted a large number of notifications in the 
framework of the various WTO Agreements.  Table A.II.2 contains a selection of these. 
45. Chile recognizes the importance of the WTO dispute settlement mechanism and has 
participated in it actively.  Since January 2003, Ch ile has been involved as a respondent in four cases 
and as a complainant in two25 (Table II.1).  It has also been a third party in 11 disputes, mostly 
relating to various restrictions applied to agricultural products. 
46. Two of the cases in which Chile was a responde nt concerned the application of initially 
provisional and subsequently defi nitive safeguard measures on certa in milk products.  Argentina 
requested the establishment of a panel in both disput es, but then asked for the panel's work to be 
suspended when Chile abolished the measure.26  Another case concerned steps taken by Chile to fulfil 
recommendations made by the Dispute Settlement Bo dy in relation to a dispute with Argentina on 
Chile's price band system for certain agricultural pr oducts.  In the fourth case, Argentina requested 
consultations on anti-dumping measures imposed by Ch ile on imports of wheat flour from Argentina.  
No panel had been set up as this report was being written. 
47. Cases in which Chile acted as a complainant related to safeguard measures applied by 
Ecuador on medium density fibreboard and by the European Communities on salmon.  In neither case 
was a WTO panel established. 
                                                      
22 Presentation by Foreign Minister Alejandro Foxley in the WTO on 24 July 2008, Geneva. 
23 WTO document WT/MIN803)/ST/47 of 11 September 2003.  See also WTO document TN/C/W/39 
of 24 April 2006. 
24 DIRECON online information.  Viewed at:  http://www.direcon.cl 
25 This report only takes account of dispute settlement  cases initiated since 2003, i.e. those in which the 
request for consultations was submitted in that year or later. 
26 Exempt Decree ( Decreto Exento ) No. 740 of the Ministry of Finance, published in the Official 
Journal on 28 July 2007. Chile WT/TPR/S/220 
 Page 21 
 
 
  Table II.1  
WTO dispute settlement cases involving Chile, January 2003-June 2009a 
Matter Defendant/ 
complainant Status WTO documents 
Complaints filed against Chile  
Price band system and 
safeguard measures relating 
to certain agricultural 
products. Chile/Argentina Request for consulta tions pursuant to Article 21.5 of 
the DSU (May 2004);  Request for establishment of a 
WTO compliance panel (December 2005);  
Constitution of the Panel (April 2006);  Distribution 
of the Panel report (December 2006);  Appeals by Chile and Argentina (February 2007);  Distribution of the Appellate Body report (May 2007).  Adoption 
of the reports of the Appellate Body and the 
WTO Panel (May 2007) WT/DS207/17 
WT/DS207/18 
 
WT/DS207/19 
WT/DS207/RW and Corr.1 WT/DS207/22 and 23 
WT/DS207/AB/RW 
 WT/DS207/26 
Provisional safeguard 
measure on certain milk 
products Chile/Argentina Request for consultations (October 2006); 
Request for the establishment of a panel for disputes 
DS351 and DS356 (March 2007);  Constitution of the WTO Panel (June 2007);  Suspension of the work 
of the WTO Panel (July 2007).  Lapse of authority 
for the establishment of the Panel (August 2008) WT/DS351/1 
WT/DS351/2 
 WT/DS351/3 
WT/DS351/4 
WT/DS351/5 
Definitive safeguard measures on certain milk 
products Chile/Argentina Request for consultations (December 2006) 
Request for the establishment of a panel for disputes 
DS351 and DS356 (March 2007);  Constitution of 
the Panel (June 2007);  Suspension of the work of the Panel (July 2007);  Lapse of authority for the 
establishment of the Panel (August 2008) WT/DS356/1 
WT/DS356/2 
 
WT/DS356/3 WT/DS356/4 
WT/DS356/5 
Anti-dumping measures on imports of wheat flour from 
Argentina Chile/Argentina Request for consulta tions (May 2009).  As at late 
June 2009, no. panel had been set up, nor had a 
settlement been notified. WT/DS393/1 
Complaints filed by Chile 
Definitive safeguard measure 
on imports of medium density 
fibreboard Ecuador/Chile Request for c onsultations (November 2003) 
No panel has been set up, nor has a settlement been 
notified. WT/DS303/1 
Definitive safeguard measure 
on salmon European 
Communities/ Chile Request for consultations (February 2005);  In 
May 2005, Chile formally w ithdrew its request for 
consultations, thus putting an end to the dispute, 
since the contested measure had been discontinued in 
April 2005. WT/DS326/1 
WT/DS326/4 
a. This table only covers dispute settlement cases initiated sin ce 2003, i.e. those in which the request for consultations was 
submitted in that year or later. 
Source : WTO Secretariat. 
(ii) Regional Trade Agreements 
48. With the aim of expanding its export markets an d ensuring stable trade rules, Chile has 
intensified its strategy of nego tiating regional trade agreements (RTAs) in which the parties grant 
reciprocal trade preferences, ra ther than deepening agreements reached under the auspices of the 
Latin American Integration Association (LAIA).  Since 2003, Chile has signed new RTAs with the 
following countries:  the Republic of Korea, the Un ited States, the European Free Trade Association 
(EFTA) (Iceland, Liechtenstein Norway and Switzer land), China, Panama, Peru, Colombia, Australia, 
Japan and Turkey, as well as a Trans-Pacific Strategic Economic Partnership Agreement with New Zealand, Singapore and Brunei Darussalam (P-4),  and a partial scope agreement with India.  All 
of these agreements were in force in June 2009. WT/TPR/S/220 Trade Policy Review 
Page 22 
 
 
  49. Chile also has RTAs in force with Canada, Mexico and Central America (Costa Rica, 
El Salvador, Guatemala, Honduras and Nicaragua)27, and an Economic Part nership Agreement with 
the European Community.  In addition, it has Ec onomic Complementarity Ag reements (ECAs) under 
LAIA with the Plurinational State of Bolivia, Ecuador28, the Bolivarian Republic of Venezuela and 
MERCOSUR (Argentina, Brazil, Paraguay and Urugua y), as well as a partial-scope agreement with 
Cuba. 
50. With a current total of 21 RTAs signed with 57 trading partners, Chile has one of the largest 
number of agreements and preferentia l partners in the world.  In 2003, it had signed eight RTAs with 
39 trading partners;  and, as a result of the significant increase between then and 2008, the proportion 
of Chile's total merchandise trade (imports a nd exports, both MFN and preferential) with its 
preferential partners has increased from 52 per cent to 92 per cent.29  No information is available on 
the value of Chile's imports or exports covered by RTAs. 
51. As is the case with other WTO Members activel y involved in RTAs, the economic effects of 
Chile's network of agreements are complex.  In  the case of Chile, concerns about its wide and 
expanding network of regional trade agreements are allayed by its strong support for the Transparency 
Mechanism for RTAs, the Doha Round, and the multilateral trading system.30 
52. As of mid-2009, Chile was involved in negotiations , in various stages of progress, to conclude 
RTAs with Malaysia, Thailand and Viet Nam.  Its wide-ranging programme of trade negotiations also 
includes closer ties with Hong Kong, countries in  the Middle-East, Israel, Russia and the Gulf 
Cooperation Council. 
53. Table AII.3 summarizes the key features of Ch ile's RTAs in force as at January 2009 
(excluding both ECAs and partial scope agreements).31  As the table shows, the RTAs signed by Chile 
are generally of broad scope, including provisions on goods and services trade and covering issues 
such as investment, intellectual property, competition policy, government procurement, transparency and dispute settlement, among others. 
54. The timetables set in the RTAs for complete elimination of tariffs vary between six and 
18 years, although, in the vast majority of cases, the bulk of tariff lines were liberalized when the 
agreement concerned entered into force or else dur ing its first few years.  Products excluded from 
tariff reduction by Chile also vary between agreemen ts, but generally relate to agricultural products, 
mainly those subject to the price band system (wheat, wheat flour and sugar), and a number of headings in respect of chemicals, minerals, w ood, textiles and clothing, footwear and electrical 
appliances. 
55. The RTAs contain traditional disciplines on merc handise trade, such as market access, rules 
of origin, customs procedures, technical regulati ons, sanitary and phytosanitary measures, and trade 
                                                     
 
27 Bilateral protocols signed by Chile with Costa Rica, El Salvador and Honduras were in force in 
June 2009, within the framework of the Chile-Central Am erica FTA.  The bilateral protocol with Guatemala had 
been signed but was not yet in force;  and the bilateral protocol with Nicaragua had not yet been signed. 
28 Chile and Ecuador signed a new ECA (2008), which had not yet entered into force in mid-2009. 
29 Table AII.3 shows the total value of Chile's tr ade with selected preferential trading partners. 
30 Detailed information on the RTA transp arency mechanism can be viewed at:  
http://www.wto.org/spa nish/tratop_s/region_s/region_s.htm 
31 Chile's ECAs with the Plurinational State of Bo livia, Ecuador, the Bolivarian Republic of Venezuela 
and MERCOSUR were described in the Secretariat reports of Chile's previous reviews.  See WTO (1997 and 
2003). Chile WT/TPR/S/220 
 Page 23 
 
 
  defence measures, among others.  On the issue of anti-dumping measures, several RTAs merely refer 
to the WTO Agreement (e.g. the P-4 and the agreem ents with the United States and China), whereas 
others provide for the elimination or non-applicati on of such measures (the RTAs with Canada and 
EFTA), or otherwise do not address this area at all (the agreement with Japan).  With regard to 
subsidies, several RTAs provide for the non-app lication of agricultural export subsidies (the 
agreements with Canada, Mexico and the P-4), wher eas others omit any reference to the subject (the 
agreements with the United States, Central Amer ica and the European Community), or else merely 
restate commitments undertaken in  the framework of the respectiv e WTO Agreement (the agreement 
with China). 
56. In general, the RTAs signed by Chile contai n the usual provisions on cross-border trade in 
services, such as market access, non-discrimination (national and MFN treatment), local presence, 
denial of benefits, non-conforming measures and reservations, among others.  Although most of the 
agreements also have chapters and/or annexes with provisions on telecommunications, professional 
services and temporary entry for business persons, this is not true of financial services.  For example, whereas several RTAs contain chapters on financia l services (the agreements with Japan, Australia, 
the United States and the European Community), othe rs call for future negotiations to include such 
services (the RTAs with Korea, the P-4, EFTA, Co lombia, Peru and China) or else exclude them 
altogether (the RTA with Central America). 
57. The scope of investment disciplines also varies between the different RTAs.  Those with the 
European Community and EFTA are re stricted to granting national tr eatment to the establishment of 
investors of the other party in designated sectors, although their scope is augmented by reciprocal 
investment protection agreements signed by Chile w ith those countries on a bilateral basis.  The RTA 
with the United States and other similar agreements include commitments on sector liberalization, national treatment, MFN treatment, minimum standa rd of treatment, performance requirements, 
expropriation and compensation, and dispute settlement  (including investor-State arbitration), among 
others. 
58. The Chilean authorities attach great importance to proper administration of the country's RTA 
network and they believe that the high technical le vel and continuity of the personnel that negotiate 
and administer the agreements have made  it possible to achieve this objective. 
(iii) Other agreements and arrangements 
59. Chile has been a member of the Asia-Paci fic Economic Cooperation Forum (APEC) since 
1994, and was the forum's host economy in 2004.  The developed-country members of APEC have 
undertaken to liberalize trade in goods and serv ices in the Asia-Pacific region in 2010, while 
developing members will do so by 2020.  Chile has undertaken to liberalize its goods and services 
trade by 2010 in line with the developed members of the forum.
32  In relation to this review, the 
authorities have confirmed that these targets will be fulfilled thanks to the trade agreements signed by 
Chile, which have resulted in an average preferen tial tariff of roughly 1.3 per cent, and because Chile 
maintains open regimes for services trade a nd investment, with very few exceptions. 
60. Chile also participates in the Latin American Paci fic Basin (Pacific Rim) Initiative.  This is a 
forum for coordination and cooperation on economic and trade issues, involving 11 Latin American 
                                                      
32 The list of APEC members may be viewed at http://www.apec.org/apec/member_economies.html WT/TPR/S/220 Trade Policy Review 
Page 24 
 
 
  countries that have Pacific Ocean coastlines and d esire to strengthen their relations with the 
economies of the Asia-Pacific region.33 
61. Chile has also participated in negotiations to  establish the Free Trade Area of the Americas 
(FTAA), an initiative embarked upon in 1994 with a view to progressively removing barriers to goods 
and services trade between 34 western hemisphere nations.  As at early 2009, however, the process 
had been suspended without reaching a conclusion. 
62. Chile is a beneficiary of the Generalized System  of Preferences (GSP);  and, in the period 
under review, it received preferences in the framewo rk of the respective schemes operated by Japan, 
New Zealand and Switzerland.  According to figures provided by the authorities, during the period 
2005-2008, Chile issued around 28,000 certificates of  origin for exports of products covered by 
preferences in the GSP framework.  Although Chile also forms part of the Global System of Trade 
Preferences among Developing Countries (GSTP), the au thorities have stated th at no certificates of 
origin had been extended for exports covered by this scheme.  Chile has participated in the third round 
of GSTP negotiations which began in 2004. 
63. Chile is currently negotiating its admission to  the Organisation for Economic Co-operation 
and Development (OECD), which is expected to occur in late 2009 or early 2010. 
                                                      
33 The member countries of the Latin American P acific Basin Initiative are:  Colombia, Costa Rica, 
Chile, Ecuador, Guatemala, Ho nduras, El Salvador, Mexico, Nicaragua, Peru and Panama.