CHILE Law and Practice Contributed by: Patrick Humphreys, Daniela Gazmuri Larraín, Paula Lühr, Ian Hinzpeter, Camila Leviante, Beatriz Riveros and José Luis Bravo, Garnham Abogados
ers, acquisitions and joint ventures must be notified to the Fiscalía Nacional Económica (FNE) before they are completed. A transaction must be notified when two cumula - tive conditions are met. First, the transaction must qualify as a concentration operation under DL 211. This includes mergers, acquisitions of rights that allow decisive influence over another business, acquisitions of assets or contracts that transfer a business activity, and the creation of an independent and permanent joint venture. Second, the transaction must meet the Chilean sales thresholds set by the FNE. Notification is required where: • the combined sales in Chile of the parties reached at least UF ( Unidad de Foment o, an inflation- indexed Chilean unit of account) 2.5 million (USD107.6 million) in the financial year before notification; and • at least two of the parties each generated sales in Chile of at least UF 450,000 (USD19.4 million) in that same period. There is no market share threshold for mandatory noti - fication. However, market shares are important in the FNE’s substantive review. Foreign-to-foreign transac - tions may also be caught if they produce effects in Chile and the sales thresholds are met. Transactions below the thresholds may be notified vol - untarily. This can be useful where the parties expect competition concerns or want greater certainty before closing. 6.2 Merger Control Procedure Merger filings are submitted to the FNE. Chile allows ordinary and, in certain cases, simplified notifications. The applicable route depends on the complexity of the transaction and whether the parties overlap in their activities in Chile. In practice, preparing the filing can take several weeks, especially where the parties need to collect Chile-specific sales data, market information, internal
documents and details of competitors, customers and suppliers. Once the FNE accepts the filing as complete, the review proceeds in two phases. • Phase I: the FNE has 30 business days to approve the transaction unconditionally, approve it subject to remedies offered by the parties, or open an extended investigation. • Phase II: if the FNE considers that the transac - tion may substantially reduce competition, it may extend the review for a maximum of 90 additional business days. At the end of Phase II, the FNE may approve the trans - action, approve it subject to remedies or prohibit it. A prohibition decision may be challenged before the Competition Tribunal ( Tribunal de Defensa de la Libre Competencia , TDLC). Chile’s regime is suspensory. The parties cannot close a notified transaction until the clearance decision is final. Closing while FNE approval is still pending is treated as gun jumping (implementation of a transac - tion prior to clearance). 6.3 Cartels Anti-Competitive Agreements and Practices DL 211 prohibits any act, agreement or practice that prevents, restricts or hinders competition, or tends to produce those effects. This broad rule applies to formal contracts, informal understandings and co- ordinated conduct between competitors. Cartels are treated as especially serious infringe - ments. Chilean law specifically targets hard-core car - tel conduct, including: • price fixing; • output or production restrictions; • market, customer or quota allocation; and • bid rigging in tender processes. For these hard-core cartels, the unlawful nature of the conduct does not depend on proving market power, intent or actual anti-competitive effects. Other agree - ments or concerted practices may also be unlaw -
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