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Content last updated: 09-08-2019

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  • Merger Control Regime
  • Merger Screening
  • Merger Filing

1. Overall description of merger control regime

1.1 Supranationality

1.1.1 Is the jurisdiction a member of/party to a supranational jurisdiction?

No, Chile is not member of a supranational jurisdiction.

1.1.2 Is the jurisdiction itself a supranational jurisdiction?

No, Chilean jurisdiction is not a supranational jurisdiction itself.

1.1.3 If the answer to Section 1.1.1 and/or 1.1.2 above is in the affirmative, what are the implications hereof?

Not applicable.

2. Nature of merger control regime

2.1 Mandatory or voluntary

2.1.1 Is filing mandatory or voluntary?

Filing is mandatory, if the thresholds formulated in section 2.3.1 under the Merger Screening Schedule are met.

However, if these thresholds are not met, the parties may lodge a voluntary filing.

2.2 Suspensory effect

2.2.1 Must completion of the transaction await clearance by the relevant authorities?

Yes. The undertakings concerned are forbidden from closing a transaction notified to the Chilean Competition Agency.

1. What type of transactions are caught by the merger control regime?

1.1 Concentrations

1.1.1 Type of transactions that are caught by the merger control rules?

According to the legal definition, a concentration transaction is deemed to be any fact, act or convention, or combination thereof, which results in two or more economic agents that were not part of the same business group and that were previously independent from each other, ceasing such independence in any scope of their activities by one or more of the following ways:

a) by the merging of entities, or the entity resulting from the merger;

b) by acquisition of one or more of the economic agents, whether directly or indirectly, of rights that allow it, whether individually or jointly, to decisively influence the other’s management (the Guidelines of the Chilean Competition Agency equate the concept of “decisive influence” to “control”);

c) by their association, under any structure, to create an independent and different economic agent, that conducts its business in a permanent manner, i.e. a joint venture;

 d) by acquisition, of control over the assets of another economic agent by any title.

In turn, the law understands that an “economic agent” is “Any entity, or part thereof, whichever its legal form or lack thereof, that offers or demands goods and services, as well as the set of tangible or intangible assets, or both, that allows the offer or demand of goods and services”. Hence, even a collection of tangible and/or intangible assets allowing someone to offer or demand goods or services may be considered an economic agent.

1.2 Joint ventures

1.2.1 What types of joint ventures are caught by the merger control rules?

As mentioned in Section 1.1.1, letter c) above, the type of joint ventures that are subject to merger control are those that are usually referred to as “full-function joint ventures”. This is because the law requires that the transaction generates a new independent entity (from the economic agents that participate in the joint venture) that is capable of acting in the market permanently. The corporate organization of the new entity is irrelevant. Since the relevant criteria is the autonomy of the joint venture, the decisive influence or control exerted by the parties over the joint venture or its profit intention (or lack of it) does not affect the nature of a concentration transaction.

If the transaction does not create a new, permanent and independent economic agent, it will not be considered a concentration transaction, but the Chilean Competition Agency may decide to investigate it anyway according to the general rules.

To consider a joint venture a concentration transaction, the following must be considered:

i. The creation of a new economic agent, whether it is entirely new or emerges from preexisting activities or assets. The associating agents may or may not control the joint venture.

ii. Functional autonomy (independence). It must have the possibility of developing full functions and operations in the market. This independence must be analyzed from both a legal and an economic point of view. In order to define its autonomy, the joint venture’s relation to the associating agents is taken into consideration, as well as its behavior in the market. The Chilean Competition Agency considers that a deadline of up to three years to let the joint venture emancipate from the associating agents is reasonable, unless there are specific reasons to extend or shorten that term. 

It is important to remember that any change of control in a joint venture may create a new concentration operation under the other three definitions in Section 1.1.1 above.

1.3 Definition of "control"

1.3.1 How are the concepts of "control" and "change of control" defined?

“Control” is the possibility, de jure or de facto, to determine or veto decisions regarding strategy and competitive behavior of an economic agent. Such control includes administration organization, voting stocks, strategy and business decisions, and, in general, competitive development influence. It is not relevant if that control or influence is actually being exerted, but rather the possibility of it being exerted.

This control or decision-making influence will be analyzed in each case by the Chilean Competition Agency.

The concept of “control” applies not only to change of control of an economic agent but also when it is an essential change in the quality or structure of said control.

In this case we refer to the concept of “change of control”. This happens in the event that the change modifies the way in which one economic agent exercises its decisive influence in the controlled economic agent. This is considered an entire new concentration operation. However, modifications in the amount of shareholdings of the economic agent(s) already having control that do not lead to changes in the privileges that come with this shareholding or in the control structure of the controlled entity do not trigger a change of control.

1.4 Minority shareholdings

1.4.1 Are minority and other interests less than control caught by the merger control rules?

The analysis referred to in Section 1.3.1 above is qualitative and not be limited to analyzing the percentages of shareholding. A transaction may be caught under the control rules if a minority shareholder is considered capable of exerting decisive influence in decision-making when, for example, the participation gives veto rights or there is an existing agreement between shareholders that can block strategy decisions capable of affecting the competitive development of another economic agent and reducing competition.

Acquisition of direct or indirect participation of over 10% of a competitor’s capital must also be notified to the Chilean Competition Agency. Notification must be filed within sixty days of concluding the acquisition. This obligation will only apply if both economic agents, separately, have a turnover over 100,000 UF in the past year.

UF or "Unidad de Fomento" is a Chilean financial variable unit adjustable according to inflation (measured according to the Consumer Price Index or CPI). The UF value is adjusted daily according to the variation of the CPI of the previous month. As a reference, on May 28 2019, the UF had a value equivalent to 27,754 Chilean pesos (app. 39,23 USD).

2. Establishing jurisdiction for notification of mergers

2.1 Merging parties/undertakings concerned

2.1.1 Which undertakings are considered parties to the merger ("undertakings concerned") in the various types of transactions identified under Section 1.1.1 and 1.2.1.

In general terms, the undertakings concerned are the economic agents that cease their independence by any of the means established in Section 1.1.1 above:

- In the case of a merger, the undertakings concerned are the merging entities including their respective corporate groups;

- In the case of an acquisition of decisive influence, the undertakings concerned are the acquiring party (including all the entities in its corporate group), and the target undertaking (not including the seller);

- In the case of a joint venture, the undertaking concerned are the are each of the undertakings jointly acquiring control and their respective corporate group;

- In the case of an acquisition of control of assets, the undertakings concerned are the acquiring party (including all the entities in its corporate group) and the assets that will be acquired.

2.2 Date for establishing jurisdiction

2.2.1 Which date is relevant for concluding whether the transaction is notifiable?

There is no legal provision in this regard.

The only reference in terms of timing is that a transaction shall be notified to the Competition Agency prior to its implementation/completion. As part of the notification documents, the parties shall submit a document that evidences the real and serious intention to carry out the transaction, which can be an SPA, MOU, LOI or any other document that demonstrates the intention of the parties. Thus, the relevant date shall be the one on which such document was executed. Please note that there is no deadline for submitting the notification.  

2.3 General thresholds

2.3.1 Threshold(s) for when a concentration must be notified under the general merger control regime?

The transactions that must be notified are the ones that i) produce effects in Chile and ii) meet the following cumulative thresholds:

i. The combined turnover in Chile of the undertakings concerned reached an amount equal to or over UF 2,500,000 (app. USD 107,600,000) in the financial year prior to the notification; and

ii. The turnover in Chile of each of at least two of the undertakings concerned equalled at least UF 450,000 (app. USD 19,300,000).

As from 2020, the thresholds will be adjusted annually according to the variation of real GDP.

UF or "Unidad de Fomento" is a Chilean financial variable unit adjustable according to inflation (measured according to the Consumer Price Index or CPI). The UF value is adjusted daily according to the variation of the CPI of the previous month. As a reference, on August 9 2019, the UF had a value equivalent to 27,953.42 Chilean pesos (app. 39.37 USD).

2.3.2 For each threshold, can the threshold be triggered by only one party having local turnover?

No. Since both the joint and individual thresholds must be met to trigger the notification, it is required that at least two of the undertakings concerned have local turnover.

2.3.3 For each threshold, can the threshold be triggered without any party having local turnover?

No.

2.3.4 Are there any circumstances where transactions falling below these thresholds may be still investigated?

In the case that the undertakings concerned do not reach the thresholds and do not voluntarily notify the Chilean Competition Agency of the merger (see Section 2.1.1 under the Merger Control Regime Schedule), the Chilean Competition Agency may initiate an investigation within a year after the conclusion of the transaction.

2.4 Other national thresholds for ex ante merger control (e.g. sector-specific rules)

2.4.1 Relevant thresholds for sector-specific or other ex ante merger control rules?

No, there are no relevant thresholds for sector-specific transactions, apart from the general thresholds provided in Section 2.3.1 above.

2.4.2 Are any such schemes mandatory or voluntary?

Not applicable.

2.5 Foreign-to-foreign mergers

2.5.1 Do any exemptions, special thresholds etc. apply to foreign-to-foreign mergers, i.e. where none of the undertakings concerned is domiciled in the jurisdiction?

Transactions must be notified to the Chilean Competition Agency regardless of whether the undertakings concerned are domiciled outside of Chile, as long as their turnover in Chile meet the abovementioned thresholds. For more information, see Sections 2.3.1 above and 3.4.1 above.

3. Calculation and allocation of turnover, asset value, transaction value etc.

3.1 Relevant turnover

3.1.1 How is turnover defined (e.g. is income from other sources than "ordinary activities to be included, and how are rebates, taxes, internal turnover etc. treated)?

As a general definition, turnover is the amount resultant from the sale of goods and services.

As a general rule, the Chilean Competition Agency´s Threshold Guideline establishes that the sales considered shall include:

(i) Sales supplying the Chilean market;

(ii) Sales where the final clients are allocated in Chile;

(iii) If the undertakings concerned supply the Chilean market through a third party, the sales of the latter are the ones counted;

(iv) Taxes, sales between agents of the same business group, and sales that are not a result of the normal course of business shall be deducted.

3.1.2 Identification and link to any official rules, guidance etc. on how to calculate turnover?

Turnover calculation guidance can be found on the Chilean Competition Agency’s website www.fne.gob.cl and, more specifically, on http://www.fne.gob.cl/wp-content/uploads/2017/10/Guia-Interpretacion-Umbrales-1.pdf. This last guidance document can be used for the entire section of merger thresholds.

Another guidance document that might be useful is http://www.fne.gob.cl/wp-content/uploads/2017/10/Guia-de-competencia-.pdf.

3.2 Relevant period for calculation of turnover

3.2.1 Which financial year(s) is relevant for the calculation of turnover?

Turnover must be calculated according to the sales generated during year prior to the one when the parties notify the transaction.

3.2.2 Should adjustments be made for e.g. divestitures, acquisitions, closings and other changes of the economic reality of the undertaking concerned made after or during the relevant financial year?

No. The law does not allow for, nor require, making any adjustments to the turnover.

3.3 Relevant undertakings for the calculation of turnover

3.3.1 The "undertakings concerned", i.e. which parties?

See Section 2.1.1 above.

3.3.2 The undertakings whose turnover is taken into account?

The turnover considered depends on the form of the concentration transaction (see Section 1.1.1 above).

In the case of mergers and joint ventures or other similar commercial partnership, to calculate whether the thresholds have been met, one must calculate the turnover of the parties and those of their corporate groups.

For share acquisitions, and asset acquisitions, to calculate whether the thresholds have been met, one must calculate the turnover of the acquirer, the acquirer’s corporate group and the turnover of the target or that generated with the acquired assets.

3.3.3 Shall the turnover of the existing seller be included in the target's group turnover?

No, only the target’s turnover and the turnover of any entity that the target controls.

3.4 Geographical allocation of turnover

3.4.1 The principles for the geographical allocation of turnover?

The turnover to be considered for the thresholds is that generated in Chile.

As a general rule, the turnover must be allocated according to the location of the client at the moment of the trade, without considering the country where the trade was made. This often coincides with the location where the service or good is provided. Therefore, the contracts concluded in Chile with the final aim to provide goods or services to customers located out of Chile should not be considered for the calculation of turnover. On the contrary, contracts concluded out of Chile with the purpose of providing goods or services to customers located in Chile must be considered for the calculation.

In the case of goods supply, there can be special situations in which the location of the client at the moment of concluding the contract is different from the place where the product will be delivered. In these cases, the final location of the delivery will prevail over the location of the conclusion of the contract. The same rule applies when providing services.

There is a special situation when a multinational company has a centralized purchase strategy and supplies itself in a single localization. In this case, when the products are bought by the central organization, to whom the products are delivered, and afterwards are redistributed internally to different establishments in various countries, the sales are only assigned to the country where the centralized purchase organization is. This is different from the situation where the seller relates directly with an affiliated establishment set up in each country. In these cases, we must include the situation where the central organization has a framework contract and the affiliated stores are in charge of the orders, and the delivery is made to them directly. In these situations, the sales will be assigned to the country of the affiliated store.

In case that one of the undertakings concerned sells its goods or services in Chile through a third entity, the sales that must be considered are the ones made to this third entity.

Regarding international transport, whether passengers or cargo, it is considered that the sales are in Chile if the transport service has Chile as origin or destination.

3.5 Valuation and allocation of assets

3.5.1 The principles for valuation and allocation of assets?

IFRS standards apply.

3.6 Calculation of other thresholds

3.6.1 The principles for calculation of metrics for other thresholds (e.g. transaction value, market share, share of supply etc.)?

Not applicable.

3.7 Special rules

3.7.1 Do any special rules or principles apply to the calculation, allocation etc. of turnover, assets etc. for specific undertakings (e.g. State-owned undertakings, investment funds, credit and financial institutions, insurance companies, financial holding companies, others)?

Special rules apply to the following industries:

1. Financial institutions:

Special rules apply to every entity dedicated to:

(i) granting consumer loans;

(ii) financial leasing;

(iii) payment intermediary;

(iv) mutual warranty;

(v) custody and deposit of values, and

(vi) national and international exchange operations by its own means or through a third entity.

The turnover (applying the corresponding tax deduction) considered consists of the following items (i) interests, (ii) title and company participation profit, (iii) commission, charges, fees, etc., (iv) net profits from financial operations and (vi) other turnover from the development of its regular and ordinary activities. Therefore, the money they receive and use for loans and similar purposes should not be considered.

However, in the case of financial institutions with participation in other companies that allows them to secure the majority of votes in the shareholders’ meeting and appoint the majority of the members of the board of directors in the case of stock corporations (or secure the majority of votes in the meetings of its members and appoint the manager or legal representative or most of them in other kind of companies), or to exert decisive influence (according to the Securities Act), it is necessary to add the turnover of those companies, making sure that the turnover is not being double counted.

2. Insurance and reinsurance companies, pension fund administrators (AFP):

Regarding insurance and reinsurance companies, the sales that must be considered for the thresholds are the value of the issued gross premiums and the return on the investments of the insurance and reinsurance companies. The premiums include those that come from contracts concluded in the relevant year and those from past contracts that are currently (at time of calculation) in force.

Although investments are considered part of the turnover calculation, we must differentiate between purely financial investments that do not implicate control over assets, votes, appointments or undertakings and the ones that do implicate such control. In the latter case, the total turnover of the controlled undertaking must be added to the insurance or reinsurance turnover, applying the same criteria indicated for financial institutions.

Regarding pension fund administrators, the turnover that must be considered for the thresholds is that which comes from fee charges and spread profitability. However, when a pension fund administrator has control or decisive influence over another entity (according to the criteria explained in the above paragraph, the turnover of the latter entity must be included for turnover calculation, making sure that the turnover is not being double counted.

3. Investment funds:

In the case of investment funds, both the fees charged for the administration of the funds and the turnover of the undertakings controlled by the fund’s management company must be included.

4. State-owned undertakings:

The state is not considered an undertaking or investment company. Therefore, to calculate the turnover of state-owned companies, we must consider only those undertakings that belong to the same independent decision-making center. I.e. companies in which the state has shareholdings are only considered part of the same corporate group if they are connected through the same line of administration.

3.7.2 Does any exemptions apply?

Not applicable.

1. Practical information

1.1 Responsibility for filing

1.1.1 The parties responsible for filing?

The undertakings that sign the transaction document that triggers the obligation to notify (SPA, MOU, term sheet, LOI, etc.) are jointly responsible for the filing.

1.2 Deadlines for filing

1.2.1 Are there any mandatory deadlines for filing, and, if so, how these are calculated?

There are no mandatory deadlines for filing but the filing must take place before the closing of the transaction.

1.2.2 Are there any sanctions for not filing within the deadlines?

Not applicable.

1.3 Early filing

1.3.1 Is it possible to file before the signing of merger agreement?

When notifying, the parties shall submit evidence of their real and serious intention to carry out the transaction. This usually corresponds to a conditional SPA, a term sheet, an MOU, LOI or any other document that shows that the parties will carry out the transaction and set forth the general terms of the transaction. The parties cannot notify if they do not have any proof of their intention.

1.4 Filing fees

1.4.1 Are there any fees for filing, and, if so, please describe how such fees are calculated?

There are no filing fees.

1.4.2 When must the filing fee must be paid?

Not applicable.

1.5 Publicity

1.5.1 When and in which format will the authority publish receiving a notification?

Please refer to Section 2.2.1 below for information on the filing procedure and timeline.

When the Chilean Competition Agency considers the notification complete, the decision that initiates its evaluation will be published on its website, excluding confidential information.

This decision, along with the report that supports it, will be communicated to the parties and published on the Chilean Competition Agency’s website. If they contained confidential information, only redacted versions of the documents will be published on the site.

1.5.2 How will the authority in general handle the case publicly, e.g. will it usually comment in the media, send out press releases etc.?

The Chilean Competition Agency publishes the following documents on its website:

a) the decision that declares the opening of the investigation;

b) the decision to extend the investigation into Phase II;

c) the clearance or prohibition decision, and

d) the corresponding report that substantiates such decision.

The Chilean Competition Agency issues a press release on its website when it publishes the clearance or prohibition decision or the decision to extend the investigation into Phase II, which only consists of a brief summary of the case. Other than these publications, the Chilean Competition Agency does not issue any comment to the press or anyone else during the proceedings or afterwards.

1.5.3 Will third parties be able to review the notification?

After the communication described in section 1.5.2 is made, the docket becomes public and third parties have access to it and the notification. However, any confidential information is protected, and only public versions are available to third parties.

2. Procedure and timing

2.1 Normal and simplified procedures

2.1.1. Does the regime allow for a simplified (fast track) procedure, and, if so, what are the criteria for using the simplified procedure?

Yes, the regime allows for a simplified procedure, which allows the parties to file a smaller number of documents compared to the normal procedure. For the notifying parties to follow this simplified procedure, they must fulfil one of the following requirements:

a) There is no horizontal or vertical overlapping between the undertakings concerned or entities in their corporate groups;

b) The undertakings concerned or the entities of their corporate groups’ participation in different markets have such low relevance that they are not able to reduce substantially the competition. This will be the case if, at the same time:

    1. The undertakings concerned and their corresponding corporate groups do not reach, jointly, a share of over 20% in the same significant market; and
    2. The undertakings concerned and their corporate groups do not reach an individual or corporate group share of 30% in a significant market vertically related; or

c) When in the hypothesis of a merger, acquisition of control or acquisition of assets, the following cumulative requirements are met:

    1. The combined market share of the undertakings concerned and entities in their corporate groups that participate in a horizontal relation is less than 50%;
    2. The increase (“delta”) in the Herfindahl – Hirschman Rate in the concentration is less than 150.

To follow this simplified procedure, the undertakings concerned must file with the Chilean Competition Agency information and elements that prove and verify that they, in effect, fulfil one of the above exceptions.

2.2 Procedural stages (cf. timetable below)

2.2.1 The various stages of (i) a simplified procedure and (ii) a normal procedure?

Both simplified and regular notifications have the same procedure. The difference between the two is the number of documents required. 

The procedure before the Chilean Competition Agency consists of two phases: Phase I and Phase II. Additionally, the procedure contemplates a pre-filing stage.

Pre-filing stage: Prior to the notification of the transaction the parties may approach the Mergers Division of the Chilean Competition Agency to prepare the information that must be submitted and resolve any doubts regarding the notification process.

Notification and Phase I: Once the undertakings concerned have notified the transaction, the Chilean Competition Agency has ten working days to declare whether the filing contains all the information required (i.e. if it is complete or not). If the Chilean Competition Agency declares the filing incomplete, the undertakings concerned have ten additional business days to submit the missing information, documents or explanations requested. Then, the Chilean Competition Agency has another ten business days to declare whether the filing is complete or not. This process could be repeated several times.

When the Chilean Competition Agency deems the filing complete, it shall initiate an investigation, communicating its decision to the parties and to the public (keeping confidential any privileged information as necessary). During Phase I, the case docket is confidential, and third parties cannot access it. Over the course of the investigation, the Chilean Competition Agency may request the cooperation of staff at public offices or services, request information from the parties, private individuals and companies, and request depositions from individuals which may have information about the transaction.

Within thirty business days following the start of the investigation, the Chilean Competition Agency shall: 

    1. Approve the transaction simply and unconditionally, if it concludes that the transaction will not substantially lessen competition;
    2. Approve the transaction, conditioning said approval on the fulfillment of mitigation measures offered by the notifying parties, if it concludes that, subject to said measures, the transaction will not substantially lessen competition; or
    3. Extend the investigation for a maximum of ninety additional business days, if it considers that the transaction could substantially lessen competition if it is consummated simply and unconditionally or conditioned to the remedies offered by the notifying parties. In such event, the proceeding moves to Phase II.

The thirty-day term may be suspended once for up to thirty business days if the Chilean Competition Agency and the undertakings concerned agree to do so, and it is suspended by the Chilean Competition Agency for up to ten business days each time the undertakings concerned submit a mitigation proposal.

Phase II: If the Chilean Competition Agency decides to initiate Phase II proceedings, it shall inform all agencies and authorities directly concerned, as well as any economic agents likely to be affected by the transaction. Recipients of this communication – as well as any third party interested in the transaction, including suppliers, competitors, customers or consumers – may submit information to the investigation within twenty business days following the extension’s publication on the Chilean Competition Agency’s website.

Upon the expiration of the ninety-day period, the Chilean Competition Agency shall:

    1. Approve the transaction unconditionally if it concludes that the transaction will not substantially lessen competition;
    2. Approve the transaction, conditioning said approval to the fulfillment of mitigation measures offered by the notifying parties, if it concludes that, subject to said measures, the transaction will not substantially lessen competition; or
    3. Prohibit the transaction, if it concludes that the transaction has the ability to substantially damage competition. 

The ninety-day term may be suspended once for up to sixty business days if the Chilean Competition Agency and the parties agree to do so, and it is suspended by the Chilean Competition Agency for up to fifteen business days each time the parties submit a mitigation proposal.

In case the Chilean Competition Agency rejects the transaction, the parties may appeal the decision before the Chilean Competition Court within ten business days.

2.2.2 Is pre-notification contact with the relevant authorities customary/obligatory/encouraged/etc.?

There is a voluntary pre-notification procedure. The parties may contact the Chilean Competition Agency’s Merger Division before filing the notification officially to prepare the information that must be accompanied and solve any doubts regarding the notification process. Also, the parties may discuss the possibility of not filing certain information under justified cause or filing the notification under the simplified procedure.

The information given by the parties during this phase does not exempt the later revision to determine if the notification is complete, and the Chilean Competition Agency is not required to follow the opinions given in this phase as it is considered informative and prior to the official procedure.

2.2.3 Are there any sanctions for not filing within the deadlines?

Since there is no deadline for filing a merger, there are no sanctions in this matter.

However, the Chilean Competition Court can impose sanctions for the following conduct of the undertakings concerned:

  1. Failure to notify a concentration transaction when mandatory.
  2. Closing the transaction after the notification, but before the Chilean Competition Agency’s approval, since the transaction is suspended in this period.
  3. Failure to comply with the mitigation measures agreed in order to approve the transaction.
  4. Closing a transaction despite the Chilean Competition Agency’s decision forbidding its completion.
  5. Submission of false information within the context of the notification. 

The Competition Court is entitled to adopt, in its final judicial decision, the following sanctions:

  1. Modification or termination of acts, contracts, agreements or systems that infringe the merger control regime.
  2. Modification or liquidation of companies, corporations and other private legal persons that took part in acts, contracts, agreements or systems that infringe the merger control regime.
  3. Application of fines of up to 30% of the turnover of the offender(s) corresponding to the line of goods or services associated with the infringement, or up to double the economic benefit gained by the infringement, or if these amounts cannot be determined, up to 60,000 UTA (app. USD 57,000,000). These fines may be imposed not only on the legal entities but also on the directors, administrators and other individuals who participated in the infraction. The fines imposed on directors, administrators or other individuals cannot be paid by the legal entities within which they provide services (nor by their shareholders or by any other entity of their business groups). The payment of the fines imposed on legal entities may be jointly demanded from the individuals that took part of the infringement and benefited from it.
  4. In case the undertakings responsible for the filing fail to notify the transaction and are brought before the Competition Court, it may issue a fine for up to 20 UTA (app. USD 840) for each day of delay in the filing since the completion of the transaction.

In addition, every individual or legal entity that has suffered a loss because of the infringement of the parties may demand compensation before the Competition Court.

There are also criminal sanctions, arrests, and fines in case of withholding information or handing over false data.

2.3 Timetable (cf. timetable below)

2.3.1 The statutory timetable/deadlines for review of a notification?

See Section 2.2.1 under the Merger Control Regime Schedule.

2.3.2 Can the statutory timetable/deadlines be suspended ("stop-the-clock"), and if so under which conditions?

The parties and the Chilean Competition Agency may agree to suspend the procedure for up to thirty days in Phase I, and for up to sixty days in Phase II. These suspensions must be agreed in written form. 

In addition, the procedure will be suspended every time the parties offer remedies, for up to ten days in Phase I and fifteen days in Phase II.

2.3.3 If pre-notification with the relevant authorities contact is possible/customary, how long will the duration of such contact usually be?

There is no legal timeline for pre-notification, since it is not mandatory. The estimated time will depend on the relevance of the transaction, the information that is handed over to the authorities, etc.

3. Format and content of notification

3.1 Notification forms

3.1.1 Must the notifying parties use any mandatory notification forms, e.g. for simplified and normal procedures, and, if relevant, add a link to the relevant forms?

The form itself is not mandatory.

There are specific forms that state the information that the undertakings concerned must submit, whether under the general or the simplified procedure. They contain the same information as the notification regulation, published in the official gazette, plus a brief explanation about each one of the documents required to do a complete filing.

The links to the forms are, for general notification: http://www.fne.gob.cl/wp-content/uploads/2017/10/notificacion_ordinario-1.pdf;

and for simplified notification: http://www.fne.gob.cl/wp-content/uploads/2017/10/notificacion_simplificada-1.pdf.

For the document that contains relevant annexes (e.g. affidavits, confidence requests, etc.): http://www.fne.gob.cl/wp-content/uploads/2017/10/Anexos-1.pdf.

3.2 Supporting documentation

3.2.1 List of the supporting documentation which must as a minimum be submitted along with the notification?

Cf. checklist below.

The links to the corresponding documentation that shall be submitted are, for ordinary notification: http://www.fne.gob.cl/wp-content/uploads/2017/10/notificacion_ordinario-1.pdf; and for simplified notification: http://www.fne.gob.cl/wp-content/uploads/2017/10/notificacion_simplificada-1.pdf.

The undertakings concerned may request, in written form and stating the reasons, to be exempt from filing certain information, under one of the following circumstances:

  1. The information is not available to the undertakings concerned, in which case they must state the reasons why they do not have such information and hand over estimations as precise as possible, and state where to find the data.
  2. The information is irrelevant for the Chilean Competition Agency’s analysis, case in which the undertakings concerned must file a draft notification to assess their request.

The request will be evaluated by the Chilean Competition Agency, who will communicate its decision.

The following information cannot be exempted:

  1. Necessary information to identify the transaction and the parties involved.
  2. Information that allows the Chilean Competition Agency to evaluate the risks of reduced competition following the transaction.
  3. The signed affidavit from the parties declaring their intention to conclude the transaction.

3.3 Originals, legalization and apostillation (cf. checklist below)

3.3.1 List of all documents which must be submitted in original/legalized versions and whether any documents must be apostilled?

Apart from the technical format detailed in the form listed in Section 3.1.1 above, the documents and information filed in a notification must be original or a compliant copy of its original, including an affidavit from the undertakings concerned regarding the veracity, sufficiency and integrity of the information that was handed over (use the annex listed in Section 3.1.1 above).

3.3.2 If the merger regime has a mandatory filing deadline, must all the documents identified under Section 3.3.1 be submitted within this deadline?

Not applicable.

3.4 Language

3.4.1 Which languages may be used for drafting and filing a notification?

The notification must be filed in Spanish, providing translations in Spanish and the original documents if they are in a different language. Exceptionally, the Chilean Competition Agency may allow the notifying parties to attach documents in English but it may later request Spanish translations of such documents.

3.4.2 Does translations have to be certified/legalized and apostilled?

The translations do not have to be certified, legalized or apostilled, unless expressly required by the Chilean Competition Agency in very exceptional cases.

Statutory timetable

Step Description Time
1

Pre-notification

There is a voluntary pre-notification procedure. The parties may contact the Chilean Competition Agency’s Merger Division before filing the notification officially to prepare the information that must be accompanied and solve any doubts regarding the notification process. Also, the parties may discuss the possibility of not filing certain information under justified cause or filing the notification under the simplified procedure.

The information given by the parties during this phase does not exempt the later revision to determine if the notification is complete, and the Chilean Competition Agency is not required to follow the opinions given in this phase as it is considered informative and prior to the official procedure.

There is no legal timeline for pre-notification, since it is not mandatory. The estimated time will depend on the relevance of the transaction, the information that is handed over to the authorities, etc.

2

Notification and Phase I:

Both simplified and regular notifications have the same procedure. The difference between the two is the number of documents required.

Once the undertakings concerned have notified the transaction, the Chilean Competition Agency has ten working days to declare whether the filing contains all the information required (i.e. if it is complete or not). If the Chilean Competition Agency declares the filing incomplete, the undertakings concerned have ten additional business days to submit the missing information, documents or explanations requested. Then, the Chilean Competition Agency has another ten business days to declare whether the filing is complete or not. This process could be repeated several times.

When the Chilean Competition Agency deems the filing complete, it shall initiate an investigation, communicating its decision to the parties and to the public (keeping confidential any privileged information as necessary). During Phase I, the case docket is confidential, and third parties cannot access it. Over the course of the investigation, the Chilean Competition Agency may request the cooperation of staff at public offices or services, request information from the parties, private individuals and companies, and request depositions from individuals which may have information about the transaction.

Within thirty business days following the start of the investigation, the Chilean Competition Agency shall:

  1. Approve the transaction simply and unconditionally, if it concludes that the transaction will not substantially lessen competition;
  2. Approve the transaction, conditioning said approval on the fulfillment of mitigation measures offered by the notifying parties, if it concludes that, subject to said measures, the transaction will not substantially lessen competition; or
  3. Extend the investigation for a maximum of ninety additional business days, if it considers that the transaction could substantially lessen competition if it is consummated simply and unconditionally or conditioned to the remedies offered by the notifying parties. In such event, the proceeding moves to Phase II.

Notification - 10 business days. If the notification is incomplete the undertakings concerned have 10 additional business days to submit the missing information. Then, the Chilean Competition Agency has another 10 business days to declare whether the filing is complete or not. This process could be repeated several times.

Phase 1 - 30 business days.

Please be aware that "stop-the-clock" is possible (cf. 2.3.2 above).

3

Phase II

If the Chilean Competition Agency decides to initiate Phase II proceedings, it shall inform all agencies and authorities directly concerned, as well as any economic agents likely to be affected by the transaction. Recipients of this communication – as well as any third party interested in the transaction, including suppliers, competitors, customers or consumers – may submit information to the investigation within twenty business days following the extension’s publication on the Chilean Competition Agency’s website.

Upon the expiration of the ninety-day period, the Chilean Competition Agency shall:

  1. Approve the transaction unconditionally if it concludes that the transaction will not substantially lessen competition;
  2. Approve the transaction, conditioning said approval to the fulfillment of mitigation measures offered by the notifying parties, if it concludes that, subject to said measures, the transaction will not substantially lessen competition; or
  3. Prohibit the transaction, if it concludes that the transaction has the ability to substantially damage competition. 

In case the Chilean Competition Agency rejects the transaction, the parties may appeal the decision before the Chilean Competition Court within ten business days.

Phase II - 90 business days.

All agencies and authorities as well as any third party interested in the transaction have 20 business days, following the extension’s publication on the Chilean Competition Agency’s website, to submit information to the investigation.

Please be aware that "stop-the-clock" is possible (cf. 2.3.2 above).

  • Step 1 1
  • Step 2 2
  • Step 3 3
  • Not defined
  • 10 days (+ extensions) + 30 days
  • 90 days

Checklist

List of the supporting documentation which must as a minimum be submitted along with the notification.

Supporting documentation

This content was delivered
and last updated on 09-08-2019 by
Contact Person
Sergio Díez, Partner
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