Under this law, foreign investment must be approved by the government's foreign investment committee, but approval procedures are expeditious and not burdensome. Typically, applications are approved within a matter of days, and almost always within one month. The rare cases in which applications have been rejected reportedly involved suspected investor fraud. Foreign investors have purchased many of the assets privatized by the Chilean government over the last decade. Continuing privatization efforts may offer further such opportunities.
Foreign firms compete on an equal basis in privatization processes.
Despite Chile's generally positive attitude toward foreign capital, some restrictions persist. Profits may be repatriated immediately, but capital may not be repatriated until after one year. This discourages the use of financing sourced abroad by raising its cost. Supplier credits are exempt from the encaje requirement. Foreign investors can choose to have their profits taxed at a 42 percent rate for the first ten years of their investment or at the rate that applies to local firms, currently 35 percent on fully -distributed earnings.