A. LEGISLATION AND RULES
A.1 Legislation
Chile has a dual legal framework in the field of arbitration. Domestic arbitration is ruled by the Organic Code of Courts and the Code of Civil Procedure (CCP), whereas international arbitration is governed by Act No. 19,971 on International Commercial Arbitration (“ICA Act“), which came into force in September 2004 and is mostly a replica of the UNCITRAL Model Law.
Chile is also a signatory to the New York Convention, the Inter-American Convention for Letters Rogatory, the Panama Convention, and the ICSID Convention. Additionally, most of the free trade agreements, as well as the BITs that Chile has entered into, institute specific arbitration mechanisms to settle disputes arising from their application to the benefit of foreign investors. Moreover, the Apostille Convention has greatly reduced costs and time when it comes to documents issued abroad, thus enhancing the advantages of the jurisdiction as an arbitration seat.
Chile has a longstanding tradition of arbitration. Domestic courts firmly protect arbitration tribunals by granting them autonomy and independence to carry out their duties. This judicial support, alongside the well-recognized quality of arbitrators and national arbitral venues, good infrastructure, and the credibility that the judicial branch has earned over decades, has positioned Chile as a reliable seat for arbitration in Latin America.
There are no recent legislative bills introducing amendments to the ICA Act or to the legal regulation of arbitration.
A.2 Institutions, rules and infrastructure
There are two main arbitration institutions in Chile — the Arbitration and Mediation Center of the Santiago Chamber of Commerce (CAM) and the National Center of Arbitration of Chile (CNA). The Center of Mining Arbitration and Mediation (CAMMIN) is devoted to mining disputes. Other minor arbitration institutions are located throughout the country.
A.2.1 CAM
CAM is the leading arbitration institution in the country. It was founded in 1992 as a nonprofit branch of the Chamber of Commerce of Santiago with the support of the Bar Association of Chile.
CAM has its own procedural rules for both international and domestic disputes, unless both parties agree to establish different rules.
CAM also has a dispute boards service, an alternative system of early resolution of disputes, under which a panel of independent experts helps the parties solve their disputes through informal assistance. Additionally, CAM has a special mediation service for small and medium-sized businesses.
CAM’s headquarters are located in the city center of Santiago,[1] and there is also a venue in the borough of Las Condes, which is closer to principal law firms’ offices.[2] Procedural tracing is conducted through E-CAM, its online system.
Recently, the CAM introduced an Emergency Arbitration procedure, which allows for a rapid constitution of the arbitration tribunal and a more expeditious procedure. The arbitrator is even empowered to issue interim measures, which makes it particularly attractive.
A.2.2 CNA
The CNA was created in 2007 by independent professionals to constitute an alternative to institutional arbitration in Chile. CNA Santiago handles arbitration and mediation for solving domestic disputes. It is located in the financial district of Santiago.[3]
A.2.3 Special and regional arbitration institutions
In 2021, the Mining Chamber of Chile created the CAMMIN, providing expert arbitration services in relation to mining, energy and environmental[4] matters. The new National Center of Mediation, Arbitration and Conciliation is committed to settling neighborhood disputes.[5]
A.2.4 Regional arbitration institutions
There are also other regional arbitration institutions, such as the Center for Arbitration and Mediation of the Region of Valparaíso in the port of Valparaíso[6]; the Biobío Arbitration and Mediation Center in the city of Concepción[7]; and the Center of Conciliation and Arbitration in the southern city of Puerto Montt.[8]
Furthermore, the authors notice a growing trend to include arbitration clauses to settle disputes through international arbitration bodies (such as the ICC, the SIAC and the LCIA), and in some cases, with these procedures having seats in Chile. The possibility of holding hearings remotely, the competitiveness of the fees of said bodies, and the rosters of arbitrators have contributed significantly to this phenomenon.
B. CASES
As expressly provided by the ICA Act, the only way to challenge an international arbitral award is by submitting a request for annulment (recurso de nulidad) before a court of appeal. In this regard, the Chilean superior courts (Supreme Court and courts of appeals): (i) have consistently rejected actions other than the request for annulment over arbitral rulings; and (ii) still, to this date, have never granted an annulment of an arbitral award based on the ICA Act. Therefore, the criterion held by the Supreme Court to challenge an arbitral award is still narrow and restrictive, thus protecting the value of the arbitral award.[9]
Moreover, the Supreme Court (which is in charge of recognizing foreign awards) tends to adopt a very protective approach to the ICA Act since it only rejects recognition on specific occasions.
Recent case law developments include the following:
B.1 Albemarle Limitada v. Emaresa[10]
As we reported in last year’s issue, a Chilean branch of Albemarle – constituted and domiciled in Chile – brought an arbitration case against Emaresa, also a Chilean company, and Cipatex, a Brazilian enterprise[11]. Since one of the parties was based in Brazil, the arbitration rules provided that the proceedings were to be governed by the ICA Act. By concluding that Cipatex was not bound by the arbitral clause, the arbitrator excluded it from the proceedings, which resumed with Albemarle and Emaresa, the two Chilean companies, alone.
In January 2024, the arbitrator rendered his award on the case, which partially accepted Albemarle’s claim.
Against the award, Albemarle filed a motion for complaint (in Spanish, recurso de queja) before the Court of Appeals of Santiago. A motion for complaint is a special petition intended to invalidate judicial rulings that do not allow for other remedies, provided that the judge has committed a gross fault or abuse. This motion is admissible in domestic arbitration, when parties waive remedies against the award.
Although the Court decided to process this motion, Emaresa claimed that since the proceedings were governed by the ICA Act, the only possible remedy was the request for annulment provided for by that Act. The Court upheld Emaresa’s argument and dismissed the motion.
Albermarle decided to file a new motion for complaint before the Supreme Court, this time against the Court of Appeals’ justices that decided to reject the first complaint.
In May 2024, the Supreme Court rejected this second complaint, finding that
- The Court of Appeals can interpret the law freely, without considering a “serious fault” or “abuse” when deciding to apply the ICA Act (because even if it is wrong, it is not unreasonable
- The rules of procedure established that the ICA Act would apply, an issue that was not modified during the arbitration
The Supreme Court’s ruling may be confusing as to the role of section 1 of the ICA Act (scope of application) in relation to the will of the parties. Since at the time of constituting the arbitration, there was a party domiciled abroad, the rules of procedure provided for the application were that of the ICA Act. However, it is doubtful whether the ICA Act continues to apply if the foreign party withdraws from the arbitration proceedings and there is no other connecting factor justifying the application of said legal body. This may undermine the principle that the requirements of section 1 of the ICA Act are objective and cannot be set aside by the parties.
[1] Monjitas 392, Floor 11, borough of Santiago, city of Santiago de Chile. Its website is: www.camsantiago.cl
[2] San Sebastián 2812, floor 5, borough of Las Condes.
[3] Apoquindo 3600, Floor 5, borough of Las Condes, city of Santiago de Chile. Its website is http://www.cna.cl/
[5] http://www.cnmac.cl/#about
[6] Plaza Justicia (without number), Floor 1, city of Valparaíso. Its website is http://www.abogados-valparaiso.cl/
[7] Caupolicán 567, Office 201, city of Concepción. Its website is https://www.cpcbiobio.cl/servicios/centro-de-arbitraje-y-mediacion/
[8] O’Higgins 144, City of Puerto Montt. Its website is
https://www.centroarbitrajeconciliacion.com/
[9] We make reference to the following leading cases: D’Arcy Masius Benton & Bowles Inc. v. Arbitrator Mr. Jorquiera [Court of Appeals of Santiago, Docket No. 865-2006]; Huber/Coderch Mitjans Jorge – Sociedad Río Bonito SA – Sociedad Queltehue SA [Court of Appeals of Santiago, Docket No. 1739-2015; Supreme Court, Docket No. 30967-2015]; Ingeniería Proyersa Ltda v. Arbitrator Mr. Figueroa [Court of Appeals of Santiago, Docket No. 2685-2016; Supreme Court, Docket No. 62114-2016]; Publicis Groupe Holdings BV v. Arbitrator Mr. Vial [Court of Appeals of Santiago, Docket No. 9134-2007]; Administradora Río Claro SA v. Arbitrator Mr. Jana [Court of Appeals of Santiago, Docket No. 3390-2017]; Benchmark Genetics Chile SA (formerly Salmones Chaicas SA) v. Atlantium [Court of Appeals of Santiago, Docket No. 14054-2019]; Inversiones VyV SpA v. GyM Chile SpA and GyM SA [Court of Appeals of Santiago, Docket No. 4394-2019 and Supreme Court, docket No. 11139-2020]; Sociedad de Inversiones Cerro Concepción Limitada and others v. Sudamérica SpA and others [Court of Appeals of Santiago, Docket No. 88-2022 and Supreme Court, Docket No. 4105-2024], among others.
[10] Court of Appeals of Santiago, Docket No. 1474-2024; Supreme Court, Docket No. 10854-2024.
[11] See: https://www.globalarbitrationnews.com/2024/01/01/baker-mckenzie-international-arbitration-yearbook-2023-2024-chile/
