CHILE Trends and Developments Contributed by: Ricardo Vásquez, Juan Araya Allende and Álvaro Jara Burotto, Vásquez Urra Abogados
Arbitration in Chile is swift to implement and difficult to stay A distinguishing feature of the Chilean system is the speed with which an award can become final. The three-month time limit for challenging the award is short; there is no possibility of appeal or subsequent complaint; and the courts give priority to nullity pro - ceedings in their docket. All of this reduces the time that may elapse between the award and its effective enforcement. For companies devising strategies for debt recovery or contract enforcement in Chile, this efficiency of the system is a key factor. International commercial arbi - tration in Chile offers a dispute resolution mechanism that combines legal certainty, swift enforcement and a low risk of judicial intervention.
Companies must pay particular attention to the follow - ing points when negotiating their contracts: • Precisely defining the scope of the matters subject to arbitration. • Clearly identifying the actions or claims that may be brought in the proceedings. • Including clear rules on the applicable law and the arbitration rules governing the proceedings. • Ensuring consistency between the arbitration clause and the other provisions of the contract, particularly the limitation of liability clauses. An imprecise or generic arbitration clause may open the door to disputes over the arbitral tribunal’s juris - diction and, in the worst-case scenario, to the com - plete annulment of the award once it has been made. Invoking “public policy” to overturn an unfavourable award is a high-risk strategy There is a tendency to use the ground of public policy as a last-resort argument when an arbitration is lost. However, the Chilean courts systematically reject this tactic. In none of the cases reviewed in recent years has an award been set aside on this ground. For companies that obtain a favourable award, this is good news: the opposing party will find it difficult to overturn it by claiming that the arbitrator misinter - preted the contract or incorrectly applied a rule. For those who lose, however, it is advisable to assess real- istically whether there are genuine grounds for nullity before embarking on a process that has little chance of success and may incur additional costs.
235 CHAMBERS.COM
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