CHILE Law and Practice Contributed by: Jorge Bofill and César Ramos, Bofill Escobar Silva Abogados
There are criminal sanctions, however, regard - ing partners of external auditing companies that maliciously issue an opinion or provide false information on a financial situation or other mat - ters by issuing a certification or report. In addi - tion, those who provide services in an external auditing firm and alter, conceal or destroy infor - mation about an audited entity in order to issue a false opinion about its financial situation are committing a criminal offence. The Financial Market Commission ( Comisión para el Mercado Financiero ) is the public entity that supervises corporations in these matters. The Securities Market Law There are, nevertheless, specific criminal sanc - tions for acts that consist of providing false or misleading information to the market (including false information contained in financials deliv - ered to the Financial Market Commission) in connection with publicly traded securities. The relevance of information in stock transactions is recognised in several provisions of the Securities Market Law (Law No 18,045). This law includes several offences that violate the protection of information in transactions of securities, includ - ing adulteration, misuse and concealment or improper disclosure of information to be consid - ered in sales decisions, or in the terms of com - mercial acts involving publicly traded securities. Stock market abuse Articles 59 and 60 of Law No 18,045 contain a catalogue of crimes related to stock market abuse. Article 59 punishes the provision of false information to the market. Article 60 contains a series of offences involving the fraudulent acqui - sition of shares without making a tender offer in cases where it is mandatory to do so; the use or disclosure of privileged information to obtain benefits or to avoid a loss in transactions of
public offer values (insider trading); the improper use of values in custody; and the deliberate con - cealment or elimination of accounting records or custody of securities. Insider trading The Chilean legal system defines privileged information (insider trading) as any information related to one or more issuers of shares, to their businesses or to one or more shares issued by them, that is not disclosed to the market, where this knowledge, by its nature, is capable of influencing the quotation of the issued shares, as well as information held on the acquisition or disposal operations to be carried out by an institutional investor in the stock market. Law No 18,045 assumes that the directors, managers, administrators, main executives and liquidators of an issuer of securities or an institutional inves - tor are in possession of privileged information. 2.4 Public Officials In addition to the different types of bribery, Chil - ean legislation contemplates a wide catalogue of crimes regarding public officials; the most rel - evant related to corruption are embezzlement of public funds, grant fraud and unlawful negotia - tion. Embezzlement of Public Funds This includes: • embezzlement by subtraction, which is a crime committed by a public employee who subtracts, or consents to the subtraction by another, from the funds or effects for which they are responsible (Article 233 of the Crimi - nal Code); • reckless embezzlement, which is a crime committed by a public employee who, through inexcusable negligence or abandon - ment, provides an opportunity for another
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