Investment Treaty Arbitration: Chile

Argentina (1 January 1995)

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

Australia (18 November 1999)

Yes

Yes

Yes

Yes

No

3 months

Yes

Yes

Austria (22 October 2000)

Yes

Yes

Yes

Yes

Yes

3 months

Yes

Yes

Belgium and Luxembourg (5 August 1999)

Yes

Yes

Yes

Yes

No

6 months

Yes

Yes

Bolivia (21 July 1999)

Yes

Yes

Yes

Yes

No

6 months

Yes

Yes

Brazil (not in force)

Yes

Yes

Yes

Yes

No

6 months

Yes

Yes

China (1 August 1995)

Yes

Yes

Yes

Yes

No

6 months

Yes

Yes

Colombia (not in force)

Yes

Yes

Yes

Yes

No

3 months

Yes

Yes

Costa Rica (23 June 2000)

Yes

Yes

Yes

Yes

No

5 months

Yes

Yes

Croatia (15 June 1996)

Yes

Yes

Yes

Yes

No

3 months

Yes

Yes

Cuba (30 September 2000)

Yes

Yes

Yes

Yes

No

3 months

Yes

Yes

Czech Republic (5 October 1996)

Yes

Yes

Yes

Yes

No

3 months

Yes

Yes

Denmark (3 November 1995)

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

Dominican Republic (8 May 2002)

Yes

Yes

Yes

Yes

No

4 months

Yes

Yes

Ecuador (21 February 1996)

Yes

Yes

Yes

Yes

No

6 months

Yes

Yes

Egypt (not in force)

Yes

Yes

Yes

Yes

No

3 months

Yes

Yes

El Salvador (18 November 1999)

Yes

Yes

Yes

Yes

No

3 months

Yes

Yes

Finland (1 May 1996)

Yes

Yes

Yes

Yes

No

6 months

Yes

Yes

France (24 June 1994)

Yes

Yes

Yes

Yes

No

6 months

Yes

Yes

Germany (8 May 1999)

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

Greece (27 October 2002)

Yes

Yes

Yes

Yes

Yes

3 months

Yes

Yes

Guatemala (10 December 2001)

Yes

Yes

Yes

Yes

No

3 months

Yes

Yes

Honduras (10 January 2002)

Yes

Yes

Yes

Yes

No

3 months

Yes

Yes

Hungary (not in force)

Yes

Yes

Yes

Yes

No

5 months

Yes

Yes

Iceland (12 August 2006)

Yes

Yes

Yes

Yes

No

6 months

Yes

Yes

Indonesia (not in force)

Yes

Yes

Yes

Yes

No

4 months

Yes

Yes

Italy (8 February 1995)

Yes

Yes

Yes

Yes

No

6 months

Yes

Yes

Korea (16 September 1999)

Yes

Yes

Yes

No

3 months

Yes

Yes

Lebanon (not in force)

Yes

Yes

Yes

Yes

No

5 months

Yes

Yes

Malaysia (4 August 1995)

Yes

Yes

Yes

Yes

No

3 months

Yes

Yes

Netherlands (not in force)

Yes

Yes

Yes

Yes

Yes

3 months

Yes

Yes

New Zealand (not in force)

Yes

Yes

Yes

Yes

Yes

6 months

Yes

Yes

Nicaragua (10 January 2001)

Yes

Yes

Yes

Yes

No

3 months

Yes

Yes

Norway (7 September 1994)

Yes

Yes

Yes

Yes

No

6 months

Yes

Yes

Panama (21 December 1999)

Yes

Yes

Yes

Yes

No

3 months

Yes

Yes

Paraguay (17 December 1997)

Yes

Yes

Yes

Yes

No

3 months

Yes

Yes

Peru (11 August 2001)

Yes

Yes

Yes

Yes

No

6 months

No

Yes

Philippines (6 August 1997)

Yes

Yes

Yes

Yes

No

3 months

Yes

Yes

Poland (17 January 2000)

Yes

Yes

Yes

Yes

No

3 months

Yes

Yes

Portugal (24 February 1998)

Yes

Yes

Yes

Yes

No

6 months

Yes

Yes

Romania (27 July 1997)

Yes

Yes

Yes

Yes

No

3 months

Yes

Yes

South Africa (not in force)

Yes

Yes

Yes

Yes

No

3 months

Yes

Yes

Spain (28 March 1994)

Yes

Yes

Yes

Yes

No

6 months

Yes

Yes

Sweden (30 December 1995)

Yes

Yes

Yes

Yes

No

6 months

Yes

Yes

Switzerland (2 May 2002)

Yes

Yes

Yes

Yes

No

6 months

Yes

Yes

Tunisia (not in force)

Yes

Yes

Yes

No

4 months

Yes

Yes

Turkey (not in force)

Yes

Yes

No

Yes

No

3 months

Yes

Yes

Ukraine (29 August 1997)

Yes

Yes

Yes

Yes

No

6 months

No

Yes

United Kingdom (21 April 1997)

Yes

Yes

Yes

Yes

Yes

3 months

No

Yes

Uruguay (not in force)

Yes

Yes

Yes

Yes

No

3 months

Yes

Yes

Venezuela (25 May 1995)

Yes

Yes

Yes

Yes

No

No

Yes

Yes

Vietnam (not in force)

Yes

Yes

Yes

Yes

No

4 months

Yes

Yes

Australia (6 March 2009)

Yes

Yes

Yes

Yes

No

6 months

No

Yes

Canada (5 July 1997)

Yes

Yes

Yes

Yes

No

6 months

No

Yes

Colombia (8 May 2009)

Yes

Yes

Yes

Yes

No

6 months

No

Yes

Japan (3 September 2007)

Yes

Yes

Yes

Yes

No

6 months

No

Yes

Korea (1 April 2004)

Yes

Yes

Yes

Yes

No

6 months

No

Yes

MERCOSUR (1 October 1996)

Yes

Yes

Yes

Yes

No

‘reasonable time’

Yes

Yes

Mexico (1 August 1999)

Yes

Yes

Yes

Yes

No

6 months

No

Yes

Peru (1 March 2009)

Yes

Yes

Yes

Yes

No

6 months

No

Yes

United States of America (1 January 2004)

Yes

Yes

Yes

Yes

No

6 months

No

Yes

Other treaties

Substantive protections

Procedural rights

Trans-Pacific Partnership, TPP (signed on 4 February 2016; not yet in force)

Yes

Yes

Yes

Yes

No

6 months

No

Yes

Additional Protocol to the Framework Agreement of the Pacific Alliance (signed on 10 February 2014; not yet in force)

Yes

Yes

Yes

Yes

No

6 months

No

Yes

Agreement on the Cooperation and Facilitation of Investments between the Federal Republic of Brazil and the Republic of Chile (signed on 23 November 2015; not yet in force)

No

Yes

No

Yes

No

At least 150 days (with the option to extend)

No

Yes

Definition of ‘nationality’

To determine the nationality of a Chilean investor, the treaties make reference to the Constitution of the Republic of Chile (eg, Argentina, Germany BITs). Some only refer to Chilean law in general (eg, China, Belgium–Luxembourg, Iceland BITs).

Seat of the investor/place of business

While most Chilean investment treaties provide that a juridical person incorporated or duly organised according to the laws of a contracting party is an ‘investor’, several treaties also require that such entities have their ‘registered office, central administration or principal place of business in that territory’ (eg, United Kingdom BIT) or, even beyond, that their ‘seat together with their effective economic activities’ (eg, Egypt, Hungary, Vietnam BITs), sede, así como sus actividades económicas sustanciales (eg, Bolivia BIT and almost identical language in Dominican Republic BIT) or domicilio, conjuntamente con actividades económicas reales (eg, Iceland BIT) are within the territory of a contracting party.

Control by a non-national

Only a few treaties address the constellation in which an investment is owned or effectively controlled by a non-party national. The Australia BIT provides for this case that the contracting parties may decide jointly in consultation and in accordance with international law, not to extend the rights and benefits of this agreement to such a legal entity. The protocol of the Korea BIT stipulates that the advantages of the treaty shall be denied to any juridical persons if they have no effective economic activities in the territory of the host state and are controlled by nationals of any third country (see also language in most FTAs).

Permanent residents

Only some Chilean investment treaties expressly address the protection of permanent residents. Typically, persons with permanent resident status in the investor home country are not recognised as investors in the host country (eg, Austria, Croatia BITs). Only nationals (natural or juridical persons) of either contracting party are recognised as investors in these treaties. The Australia BIT takes a more differentiated approach: the treaty does not apply to a permanent resident of one contracting party: (i) where the provisions of an investment treaty between the other contracting party and the country of which that person is a citizen have already been invoked or that third country invokes diplomatic protection by a formal request in respect of the same matter; or (ii) the permanent resident is also a citizen of the other contracting party. Otherwise, permanent residents do enjoy protection under the treaty. The Argentina BIT distinguishes between permanent residents as to the time that they are domiciled in the host state and only grants protection to nationals of a contracting party who are domiciled for not more than two years in the territory of the host state and prove that the investments are from abroad. The Malaysia BIT again refers to the origin of the capital of the investment. Permanent residents in the host state who are nationals of the home state can claim protection under the investment treaty, provided that the investment constituted a capital transfer from outside the host state (similar language in the Netherlands BIT) .

Dual nationals

Only the Switzerland BIT addresses dual nationals, natural persons who are nationals of both contracting parties, and provides that the treaty is not applicable to them unless these persons were at the time of investment domiciled outside the host state, and stayed domiciled outside of this territory.

Interplay with other investment treaties

The Australia BIT is not applicable, inter alia, where the provisions of another investment treaty have already been invoked by an investor who is a legal entity organised under the law of a third country and who is also recognised as an investor for the purposes of this treaty. The Austria BIT contains a clause that underscores that the parties are not obliged to accord advantages of a multilateral agreement on investments to which they presently belong or may belong in the future to investors under the present treaty.

Assets which qualify for protection

Chilean investment treaties typically define a broad scope of the covered investments and list as examples for ‘any kind of assets’: ownership of movable and immovable property, including property rights such as mortgages and pledges, shares in companies, loans and other claims to money, intellectual property rights (in particular copyrights, patents, industrial and commercial designs and goodwill), as well as concessions under public law, including concessions for exploration and exploitation.

Indirect control of assets

Some Chilean investment treaties also expressly protect assets controlled indirectly by a protected investor (eg, Australia, Bolivia, Dominican Republic, Ukraine BITs). The Venezuela BIT provides for the protection of legal entities that are incorporated under the laws of any country but ‘effectively controlled’ by investors of one of the contracting parties. In contrast, the Netherlands BIT stipulates that Dutch citizens who are holding an investment in Chile through a legal person located in a third state shall not be entitled to submit a dispute to international arbitration, unless they have at the time their investment was made and ever since been domiciled in the Netherlands.

Commencement of treaty protection

Generally, Chilean investment treaties provide for protection of investments that have been made not only after, but also before the entry into force of the treaty. In some cases investments that have been made prior to the entry into force are only covered if they have been registered as foreign investments (eg, Argentina BIT). The treaties never find application on disputes that have arisen prior to their entry into force or disputes directly related to events which occurred prior to its entry into force. Rarely, the treaties indicate the exact date of the commencement of the treaty protection (eg, Hungary BIT: 1 January 1973).

Admission of investments

Some treaties require formal admission of the investments before they can fall under the scope of protection of the investment treaty. For example, the Indonesia BIT provides that it shall only apply to investments by Chilean investors in Indonesia which have been previously granted admission in accordance with the Law No. 1 of 1967 concerning Foreign Investment. Similarly, the Malaysia BIT limits the meaning of the term ‘investment’ to investments that have been approved by the relevant ministries or authorities of the contracting parties in accordance with their national laws and policies.

Exclusion of certain assets

Very few Chilean investment treaties expressly mention assets that should be excluded from the scope of the investment definition. The Colombia BIT, for example, stipulates in its additional protocol that loans shall not be considered as an investment.

Special formalities

None of the BITs but some of the FTAs allow the contracting parties to impose special formalities in connection with the establishment of the investment, such as that the investor be a resident of the host state or that the investment be legally constituted under the laws or regulations of the host state, provided that such formalities do not materially impair the protections guaranteed under the treaty (eg, Canada, Colombia, Japan FTAs). A contracting party may also require an investor to provide routine information concerning its investment solely for informational or statistical purposes.

Illustrations of the FET standard

Most Chilean investment treaties (eg, Argentina, Australia, Czech Republic BITs) simply provide that each contracting party shall ensure fair and equitable treatment to investments and sometimes also expressly to the activities associated with investments. The Italy BIT uses in distinction to the general phrase of ‘tratamiento justo y equitativo’ the expression ‘trato justo y ecuánime’ (fair and balanced treatment). Nothing in the text of the treaty gives reason to interpret this phrase differently from the standard language.

International law / customary international law

The Belgium-Luxembourg BIT provides that the treatment under the FET standard must not be less favourable than that recognised under international law. The Venezuela BIT stipulates that ‘un tratamiento justo y equitativo conforme al derecho internacional’ shall be ensured (similar language in the Brazil and France BITs and Canada FTA). The Australia FTA connects the FET standard to the international minimum standard of treatment recognised under international customary law by providing that ‘[e] ach Party shall accord to covered investments treatment in accordance with customary international law, including fair and equitable treatment […] ’. It specifies that this treatment corresponds to ‘the customary international law minimum standard of treatment of aliens as the minimum standard of treatment to be afforded to covered investments. The concept[] of ‘fair and equitable treatment’ […] do[es] not require treatment in addition to or beyond that which is required by that standard, and do[es] not create additional substantive rights.’ The treaty text also provides examples for a breach of the FET standard and it adopts the language of the Note of Interpretation of the NAFTA Free Trade Commission when specifying that a ‘determination that there has been a breach of another provision of this Agreement, or of a separate international agreement, does not establish that there has been a breach of [the FET standard]’ (similar language in Colombia, Japan, USA FTAs).

Right to regulate for a public purpose

All Chilean investment treaties provide protection against expropriation without adequate compensation. Expropriation is only permitted for a public purpose. The compensation shall correspond to the value of the expropriated investment immediately before the date that the expropriation was made public.

Indirect expropriation

Many Chilean investment treaties also expressly protect against indirect expropriation (eg, Czech Republic, Belgium–Luxembourg, Dominican Republic, Finland, Uruguay BITs).

Hull Formula

Most treaties use the wording of the Hull Formula to provide that the compensation shall be prompt, adequate and effective (freely transferable).

Scope of MFN treatment

Generally, the MFN protection contained in Chile’s BITs applies to ‘investments’ and ‘investors in regard to their investment-related activities’ (eg, Argentina BIT). The Korea BIT is one of the very few Chilean BITs that limit the MFN treatment to the management, maintenance, use, enjoyment or disposal of protected investments. It thereby indirectly excludes its application to procedural rights, in particular to the right to commence investor-state arbitration.

Common Exceptions to MFN treatment

All Chilean BITs expressly provide that the MFN and national treatment provisions do not extend to the benefits of membership of a customs or economic union and a common market or free trade area. The treatment guarantees also do not extend to investments made under concessional financing agreements between the host and home country of the investor (eg, Argentina BIT). Further, the treatment does not extend to the advantages granted under double taxation agreements and other agreements on tax matters (eg, Australia, Austria, China, Turkey BITs).

Scope of national treatment

Generally, the national treatment protection applies to ‘investments’ and ‘investors’.

Limitation on national treatment

In very few treaties the obligation to provide national treatment is limited and made subject to special conditions. In the Indonesia BIT the Indonesian Government reserves its right to maintain limited exceptions to national treatment of such investments in view of the fact that there are two different laws governing investments in Indonesia (Law No. 1 of 1967 concerning Foreign Investment and Law No. 6 of 1968 concerning Domestic Investment).

MFN only

The Vietnam BIT does not include a national treatment provision but provides for MFN treatment only.

Scope

The formulation of this standard varies in Chile’s investment treaties. Some provide for ‘full protection and security’ (eg, Argentina, Denmark, Greece, Tunisia, United Kingdom BITs) or ‘adequate protection and security’ (eg, Indonesia BIT). Others simply require ‘protection and security’ (eg, Belgium-Luxembourg BITs), ‘full protection’ (eg, Ecuador, Sweden BITs) or merely an obligation to ‘protect’ (eg, Australia, Austria, Bolivia, Croatia, Czech Republic, Finland, Lebanon BITs). The New Zealand BIT combines the FET with the protection and security standard by guaranteeing ‘fair and equitable protection’. There is only one treaty that does not provide for an express provision on the protection of foreign investments (Turkey BIT).

Scope

Only a few Chilean investment treaties contain an umbrella clause (see table above). Those that do contain such a clause, do not contain noteworthy qualifications that restrict its application.

Free transfer of payments

All Chilean investment treaties contain a provision, which requires the contracting parties to permit investors to transfer investments and investment returns freely. But for a few treaties (eg, Argentina BIT), the protection is typically subject to the laws and policies of the host state, including those concerning bankruptcy. In a few treaties, a provision is included that allows the contracting parties to adopt measures that restrict transfers where the country experiences serious difficulties in its balance of payments, and such restrictions are consistent with the articles of agreement of the International Monetary Fund (eg, Colombia BIT). Some treaties specify that transfers concerning investments made under the Chilean Special Programme of Foreign Debt Equity Swaps and Equity Capital are subject to special regulations (eg, Finland, Poland, Portugal BITs).

Free movement of people

Some treaties also include stipulations on the free movement of people who work for the investor or are members of his household. These people shall be permitted to enter, remain in and leave the territory of the other contracting party (eg, Australia BIT). Weaker versions of this provision will only promise assistance in obtaining visa and working permits to nationals of the other contracting party (eg, China BIT) or to endeavour to issue the necessary authorisations concerning the activities of consultants and other qualified persons (eg, Croatia BIT).

Non-impairment

Chile’s BITs impose upon contracting parties an obligation not to impair the management, maintenance, use or enjoyment of investments through arbitrary or discriminatory measures (eg, Argentina, Australia BITs). Some BITs specify that in addition to these activities also the operation, sale and liquidation of the investments shall not be impaired (eg, Austria, Croatia, Czech Republic, Lebanon, Vietnam BITs).

War / armed conflict

If investors suffer damages or losses due to a war, an armed conflict, a state of national emergency, a civil commotion or other similar events in the territory of the host state, Chilean investment treaties typically provide for compensation no less favourable than that accorded to domestic investors or investors of any third State, whichever is more favourable (eg, Austria, Belgium-Luxembourg, Croatia, Germany, Lebanon BITs). Some treaties only provide for compensation that would also be paid to domestic investors (eg, Argentina BIT) and others again only for compensation that is paid to other foreign investors (eg, China, Finland, Iceland, Malaysia BITs).

Environmental protection clause

Specific clauses that preserve the freedom of the contracting parties to adopt, maintain or enforce measures to ensure that investment activity in its territory is undertaken in a manner sensitive to environmental concerns can be found in FTAs and is sometimes accompanied by a mutual recognition that it is inappropriate to encourage investment by relaxing domestic health, safety or environmental measures (eg, Canada, Colombia, Japan FTAs).

Performance requirements

Very few Chilean investment treaties contain a provision on the prohibition of performance requirements. The Dominican Republic BIT, for example, provides that neither party may require (a) a certain export volume or percentage of goods or services, (b) a certain volume or percentage of domestic content, (c) the purchase or use of goods produced or services provided in its territory; or (d) a relationship between the volume or value of imports and the volume and value of exports or the volume of foreign exchange inflows to these investments.

Transparency

While no Chilean BIT contains provisions on transparency the Australia FTA does specify in great detail rules on transparency of the arbitral proceedings. The respondent state shall make the following documents available to the public at its cost: the notice of intent to submit the claim to arbitration, the notice of arbitration, pleadings, memorials, and briefs submitted to the tribunal by the disputing parties, minutes or transcripts of hearings of the tribunal, and orders, awards, and decisions of the tribunal. The tribunal shall conduct hearings open to the public and make appropriate arrangements to protect confidential information from disclosure (similar language in Colombia FTA).

Fork-in-the-road

Fork-in-the-road provisions are common in Chilean investment treaties. The choice of the investor to pursue his rights either before a competent national tribunal or before an international arbitration tribunal is final (eg, China, Croatia, Czech Republic, Denmark, Lebanon BITs). In a few treaties the investor may despite a fork-in-the road clause resort to international arbitration after commencing proceedings in a local court if the local court has not rendered a decision after a certain time frame (eg, Austria BIT: 36 months; Belgium-Luxembourg, Germany, Netherlands BITs: 18 months).

Exhaustion of local remedies

The Austrian BIT expressly stipulates that none of the contracting parties shall request the exhaustion of internal administrative or juridical remedies as a condition for reverting to international arbitration.

ICSID or ad-hoc arbitration

Most Chilean BITs offer the options to submit the dispute to a competent tribunal of the contracting party in whose territory the investment was made or to seek recourse to ICSID arbitration. In addition to that they typically also provide for arbitration in accordance with the UNCITRAL arbitration rules (eg, Austria, Czech Republic, Greece, Vietnam BITs), while some are not offering the additional option of UNCITRAL ad-hoc arbitration (eg, Bolivia, Denmark, Ecudor BITs) and others again are only offering UNCITRAL ad hoc proceedings (eg, Ukraine BIT). Like many investment treaties with China also the Chile-China BIT does provide for ICSID arbitration only for disputes involving the amount of compensation for expropriation. Disputes concerning other matters between an investor and his host state may be submitted only by mutual agreement to an ad hoc arbitral tribunal if the investor has not yet submitted the dispute to the competent court in the host state. The Cuba BIT provides next to the option of domestic court proceedings for UNCITRAL arbitration and ad hoc arbitration according to terms specified in the treaty only.

Time limits

The Germany BIT provides that a dispute that has initially been submitted to a local court can be submitted to an international arbitration tribunal, where there is already a decision on the merits by the local court if one of the parties understands this decision to violate the provisions of the treaty. Such arbitral proceedings shall be instituted within one year from the date of the notification of the decision in writing. Most FTAs require that an arbitration be commenced within three years of the investor having first acquired knowledge of the facts giving rise to the alleged breach (eg, Australia, Japan, USA FTAs).

Applicable law

In rare instances Chilean investment treaties expressly indicate the applicable rules of law in case the dispute is submitted to international arbitration. For example, the Greece BIT indicates that the arbitral tribunal shall decide the dispute in accordance with the provisions of the treaty and the applicable rules and principles of international law (similar language in Ukraine BIT). The Germany BIT stipulates that, additionally, where appropriate, also other treaties in force between the parties and the domestic law of the host state , including its rules of private international law, shall be considered by the arbitral tribunal. The Dominican Republic BIT again requests the tribunal to decide the dispute in accordance with the rules of law agreed by the parties and without such agreement to apply the law of the state party, including its rules of private international law and such rules of international law that may be applicable (similar language in Turkey, Uruguay, Venezuela BITs).

Government entity to which claim notices are sent

Dirección de Asuntos Jurídicos

Ministerio de Relaciones Exteriores de la República de Chile

Teatinos 180

piso 16

Santiago

Chile

Government department which manages investment treaty arbitrations

In the past the Ministry of Economics, Development and Tourism of the Republic of Chile has managed investment treaty arbitrations on behalf of the country.

Internal/external counsel

External counsel has been used in some cases in the past in cooperation with government lawyers.

Public Procurement Process

The government conducted a public procurement process to hire local and international firm in some cases in the past, but it appears that there is no established practice.

Washington Convention implementing legislation

Chile is party to the Washington Convention. The Convention was incorporated into domestic law through Decree1304 of the Ministry of Foreign Relations, and published in the Official Gazette on 9 January 1992.

New York Convention implementing legislation

Chile ratified the New York Convention in 1975 with no reservations. The New York Convention was incorporated into domestic law through Decree 664 of the Ministry of Foreign Relations, and published in the Official Gazette on 30 October 1975.

Legislation governing non-ICSID arbitrations

There is no special law that regulates domestic arbitrations in Chile. The Code of Civil Procedure (articles 242–251, 628–644) and the Judiciary Code (articles 222–243) contain provisions applicable to arbitration, which can be modified by the parties’ agreement. All international commercial disputes arising after September 2004 (irrespective of the date of signature of the arbitration clause) are governed by the International Commercial Arbitration Law (Law No. 19.971), which follows the UNCITRAL Model Law on International Commercial Arbitration.

Compliance with adverse awards

Chile has lost only one investment arbitration case (MTD Equity Sdn. Bhd. Et al . v. Chile) and has complied with it fully.

Attitude of government towards investment treaty arbitration

The Chilean government did not issue a specific policy statement regarding investment treaty arbitration but is very interested in attracting foreign investors. On 13 January 2015, President Bachelet announced the presentation of a bill on a new institutional framework for foreign investment. The new foreign investment law creates a foreign investment attraction agency, which shall actively seek foreign investment and strengthen the government’s policy of stimulating several business sectors with the help of foreign capital.

Attitude of local courts towards investment treaty arbitration

There are no known instances in which local Chilean courts played a role in investment treaty arbitrations. However, Chile is a very arbitration-friendly country, which is expressed through its adoption of the New York Convention without making neither the reciprocity reservation nor the commercial reservation. Enforcement of foreign arbitral awards is easier in Chile than in other Latin American countries. The country is also a party to other international conventions on arbitration, eg, the Panama and Montevideo Conventions.

Foreign Investment Statute Decree Law 600

No

No

1. Transfer of capital and net profits

2. Non-discrimination clause

3. Entitlement of investors to stipulate stabilization clauses on taxation in state contracts

No

No

Multilateral Investment Guarantee Agency

Chile has ratified the Convention establishing the Multilateral Investment Guarantee Agency (MIGA). Under the treaty, Chilean nationals and corporations are eligible to acquire, for the payment of a premium, political risk insurance from MIGA in respect of investments made in certain developing states provided that certain conditions are met. To be eligible for assistance, the investment must be medium to long term in nature, support the host country’s development goals, comply with MIGA’s Policy on Social and Environmental Sustainability and anti-corruption and fraud standards, and also be financially viable.

Awards

MTD Equity Sdn. Bhd. and MTD Chile S.A. v. Republic of Chile, ICSID Case No. ARB /01/7, Chile–Malaysia BIT

Sociedad Anónima Eduardo Vieira v. Republic of Chile, ICSID Case No. ARB /04/7, Chile–Spain BIT

Flughafen Zürich A.G. and Gestión e Ingenería IDC S.A. v. Bolivarian Republic of Venezuela, ICSID Case No. ARB/10/19, Chile–Venezuela BIT and Switzerland–Venezuela BIT

Compañía General de Electricidad S.A. and CGE Argentina S.A. v. Argentine Republic, ICSID Case No. ARB/05/2, Chile–Argentina BIT

Metalpar S.A. and Buen Aire S.A. v. Argentine Republic, ICSID Case No. ARB/03/5, Chile-Argentina BIT

Industria Nacional de Alimentos, S.A. and Indalsa Perú, S.A. (formerly Empresas Lucchetti, S.A. and Lucchetti Perú, S.A.) v. Republic of Peru, ICSID Case No. ARB/03/4, Chile–Peru BIT

Empresa Nacional de Electricidad S.A. v. Argentine Republic, ICSID Case No. ARB/99/4, Chile–Argentina BIT.

Pending proceedings

Victor Pey Casado and President Allende Foundation v. Republic of Chile, ICSID Case No. ARB /98/2, Chile–Spain BIT

Quiborax S.A. and Non-Metallic Minerals S.A. v. Plurinational State of Bolivia, ICSID Case No. ARB/06/2, Chile–Bolivia BIT

Enersis S.A. and others v. Argentine Republic, ICSID Case No. ARB/03/21, Chile-Argentina BIT.