Investing in Chile: What a Foreign Investor Gets by Law
Chile does not screen foreign investment; it codifies its rights. Law 20.848 guarantees repatriation of capital and profits, access to the formal exchange market and equal treatment, and from 2027 the Reconstruction Law adds a lower corporate rate and long-term tax stability contracts.
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A foreign investor in Chile has four statutory rights under Law 20.848: remit capital and profits abroad after taxes, access the formal exchange market, import capital goods VAT-free for projects of USD 5 million or more, and receive the same treatment as local investors. No general prior approval applies.
The framework: Law 20.848 and who it covers
The definitions matter, because they gate the certificate and the VAT exemption.
Law 20.848 replaced the DL 600 contract system in 2016 as Chile's framework for foreign direct investment. A foreign investor is any person or entity constituted abroad, neither resident nor domiciled in Chile, that transfers capital into the country (Article 3). Foreign direct investment is a transfer of USD 5 million or more, in freely convertible currency, physical assets, reinvested profits, capitalized credits, capitalizable technology or related-party loans tied to the investment (Article 2). Acquiring at least 10% of the voting rights or capital of a Chilean company, within those amounts, also qualifies.
Qualifying investors may request a certificate from InvestChile, the foreign investment promotion agency, which must issue it within 15 days (Article 4). The certificate is voluntary and its only stated purpose is to prove access to the regime. In practice it is the key that opens the VAT exemption below, so most qualifying investors should request it once the investment is materialized.
Four statutory rights
These are rights written into the law, not policies or practice.
- Repatriation (Article 5): the right to remit abroad the transferred capital and the net profits it generates, once applicable taxes are paid.
- Exchange-market access (Article 6): the right to use the formal foreign-exchange market both to bring the investment in and to buy the currency for remittances, at a freely agreed rate. These operations remain subject to the Central Bank's general powers (Article 7).
- VAT-free capital goods (Article 8): exemption from the 19% VAT on imported capital goods destined to qualifying projects, under the conditions explained below.
- Equal treatment (Article 9): foreign investors are subject to the same legal regime as Chilean investors, and no direct or indirect arbitrary discrimination is allowed.
The VAT exemption on capital goods, in practice
A real 19% saving on project capex, with a procedure that rewards preparation.
The exemption covers capital goods imported for projects of USD 5 million or more in mining, industry, forestry, energy, infrastructure, telecommunications, research and technological development, or medical and scientific fields, among others. The project must be one that starts generating revenue at least twelve months after the first capital goods enter the country, which is precisely the profile of a greenfield investment. The application goes to the Ministry of Finance; a foreign investor must attach the InvestChile certificate. The Ministry has 60 days to decide, and silence works in the investor's favor: if no decision issues in time, the application is deemed approved and the resolution must follow within five business days. Staged or expanded projects extend the original exemption with a simplified filing.
What changes in 2027
The Reconstruction Law stacks two new incentives on top of the standing framework.
| Incentive | What it does | Threshold |
|---|---|---|
| Corporate rate cut | First Category tax falls in steps from 27% to 23% between 2027 and 2029 | All companies |
| Tax stability contracts | Freeze of the tax rules for 10, 15 or 20 years, for a 1.5-point surcharge | USD 50M or more |
The two interact: a stability contract freezes the rules in force on the date of signing, and the rate falls during the same window, so timing the signature is a modeling exercise, not a formality. We cover the schedule in the rate-cut analysis and the contract regime in our guide to the new tax stability agreements.
No general screening, but sector gates exist
The friction in a Chilean entry is regulatory, not about nationality.
Chile has no general mechanism that reviews or authorizes foreign investment before entry. The certificate is optional, and incorporation follows ordinary corporate law. The real gates are sectoral and apply to any operator, local or foreign: fintech activities require CMF registration under the Fintec Law, personal data processing falls under the new data protection regime, and essential services carry cybersecurity duties. Which frameworks apply to a given entry is a mapping exercise we walk through in regulatory compliance for companies entering Chile.
How the pieces fit for a market entry
The rights above are the floor; the structure decisions determine the outcome.
A typical sequence: choose the vehicle (SpA, Limitada or branch), model the tax position (corporate rate, Additional Tax and treaty credits), plan the first hires under Chilean employment law, and, if the project reaches USD 50 million, evaluate a stability contract before signing anything. The USD 5 million certificate and the VAT exemption slot into that sequence early, because both depend on how and when the capital enters.
Frequently asked questions
Is there a minimum amount to invest in Chile?
No. Anyone can invest in Chile under the ordinary rules with any amount. USD 5 million is the threshold to qualify as foreign direct investment under Law 20.848, which unlocks the investor certificate and the capital-goods VAT exemption. USD 50 million is the separate threshold for the tax stability contracts starting in 2027.
Does Chile screen or pre-approve foreign investment?
There is no general screening or prior-authorization regime. A foreign investor enters through ordinary corporate law, and the InvestChile certificate is voluntary. What does exist are sector gates: fintech activities need CMF registration, and data, cybersecurity and other regulated frameworks apply by activity, not by nationality.
Can I repatriate capital and profits?
Yes, as a statutory right. Article 5 of Law 20.848 guarantees remittance of the transferred capital and the net profits it generates, once applicable taxes are paid. Article 6 guarantees access to the formal foreign-exchange market to bring the investment in and to buy the currency for remittances, at a freely agreed exchange rate.
What taxes will the investment pay?
The company pays corporate income tax at 27%, falling in steps to 23% between 2027 and 2029 under the Reconstruction Law. Profits remitted abroad bear the 35% Additional Tax, with the corporate tax as a credit, full or partial depending on whether a double-taxation treaty applies. Our guide to taxes for a foreign company covers the mechanics.
What is the InvestChile certificate and do I need it?
It is a certificate issued by InvestChile, the foreign investment promotion agency, within 15 days of application, recognizing that an investment of USD 5 million or more qualifies under Law 20.848. It is voluntary, but in practice you need it: the application for the capital-goods VAT exemption must include it.
What incentives start in 2027?
Two, both from the Reconstruction Law: the corporate rate cut from 27% toward 23%, and tax stability contracts for investments of USD 50 million or more, freezing the tax rules for 10 to 20 years in exchange for a 1.5-point surcharge. The capital-goods VAT exemption is already in force and does not depend on 2027.
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