Laws and Regulations Affecting Negotiating Practices in Chile

In order to analyze what laws and regulations affect business negotiations in Chile, it must first be determined in what form an American company can be operating in that country. As the Chilean corporate law stands now, a non-resident company or individual can operate in Chile either by appointing a representative; by forming an agency or branch of a foreign corporation; or by forming a partnership or corporation under Chilean law (Deloitt & Touche, 1996).

A representative acts on the basis of a mandate, contained in his or her contract, that the non-resident principal confers to a Chilean resident individual or company. The representative acts on behalf and at the risk of the foreign principal to carry out one or more business transactions.

If a foreign company wants to open a Chilean branch, it must first appoint an agent. The agent must notarize the following documents that must be written in the official language of the foreign country and accompanied by a translation into Spanish:

• Proof that the corporation is legally incorporated abroad
• Certification that the corporation is still in existence
• Authenticated copy of the corporation's current policies
• General power of attorney issued by the corporation to the agent that will represent it in Chile; the power of attorney must state clearly that the agent acts in Chile in the corporation's name.

At the same time, the agent, on behalf of the corporation, must notarize a deed that indicates that:

• The corporation will maintain in Chile realizable assets to cover the liabilities that must be served in Chile
• The effective capital assigned to the Chilean branch or agency and the way and dates that such capital will be brought into the country
• The location of the principal agency or branch in Chile.

Within 60 days, a summary of the notarized documents must be filed with the Chilean Register of Commerce. Within the same time period, the summary must also be published once in the Official Gazette, or Diario Oficial. Branches of foreign limited-liability partnerships require only the granting of a power of attorney (Deloitt & Touche, 1996).