Use the Lexology Getting the Deal Through tool to compare the answers in this article with those from other jurisdictions.
Describe the agriculture and food supply chain in your jurisdiction.
In Chile, agricultural land is mostly used for fruit production, horticulture, vineyards (including pisco), industrial crops, dry fruits and forest plantations. Agricultural holdings are mainly situated in the Araucanía, Bío Bío and Maule regions.
Agriculture, along with livestock and forestry activity, is one of the industries that generating the most employment in the country.
The food supply chain in Chile consists of several stages where different parties are involved:
- production (producer and plants nurseries);
- processing (refrigerated warehouses and packing);
- national transportation;
- sale of food (retail and food service); and
- export (including logistics and international transportation).
In order to meet international standards of food safety, the food supply chain is regulated by the Sanitary Code and Food Health Regulations. Chile has made continuous and permanent efforts to present itself as an innocuous supplier of Agriculture products. There are a number of collaboration agreements and protocols between Chile’s Food Safety departments and those of other countries that result in an expeditious process of export and delivery to Asia, America and Europe.
What is the regulatory environment for primary agriculture and primary food processors in your jurisdiction?
There are more than 400 legal instruments that apply to the agriculture sector and food processors. Such regulation dispositions apply to a wide range of aspects of the industry ranging from food safety regulations to labour law. Many of these regulations are not left to congress (in the form of statutes) but to administrations, such as customs authorities and the Agriculture and Livestock Service (SAG).
The main sources of regulation for primary agriculture and primary food processors in Chile are:
- the Sanitary Code;
- the Food Health Regulations;
- Decree No. 118/2015 on hazard analysis and critical control points in food establishments;
- Pesticides for Sanitary and Domestic Use Regulation;
- Resolution 33, which sets maximum permitted levels of pesticide residues in food;
- Law No. 20,606, on the Nutritional Composition of Food and on Food Advertising;
- Law No. 18,755, on the organisation and authority of the Agriculture and Livestock Service; and
- Decree-law No. 3,557 on Agriculture Protection.
What are the main non-governmental organisations and non-profit organisations in the agribusiness sector in your jurisdiction?
The main non-governmental organisations and non-profit organisations in the agribusiness sector in Chile are:
- the National Wood Corporation;
- the Chilean Exporters Association;
- the Chilean Wine Corporation;
- Fundación Chile;
- the National Agriculture Society;
- the National Confederation of Smallholders’ Associations; and
- National Fruit Producers’ Association.
There are no rules that obligate any company or entity to belong to any specific organisation.
Land acquisition and use
Identify and summarise the legislation addressing agricultural property transactions in your jurisdiction. Outline how farmland is typically held.
The main domestic status that applies to ownership of agricultural land are:
- the Constitution, which sets the basis for business, free commerce and non-discrimination;
- the Civil Code, which sets the basis of Chilean civil law and applies to all commercial dealings;
- the Code of Commerce;
- Decree No. 993 on the lease of land; and
- Law No. 20,797.
Farmland that is any other type of real estate is subject to public registration in the public Real Estate Registrar. Transfer of property is subject both to a public deed and to the aforementioned registration. Although heavily regulated, the system for real estate registration is somewhat outdated and a study of titles over the land before purchase is strongly advised.
Some specific issues that need to be addressed when buying farm property that should be taken into account during the study of titles to the land are the following:
- easements that may hinder the functioning or development of the farm;
- county provisions regarding the ‘use of soil’ or land use;
- mining concessions that may affect the functioning or development of the farm; and
- payment of social security of the farm’s previous workers and employees.
Non-agricultural land rules
Outline any rules related to use of farmland for non-agricultural uses.
Chile lacks regulation regarding the use of farmland, which is why the spatial location of activities for purposes other than agriculture and forestry that should sit on rural territory (a term that is defined by law, but which is specified by each county council) is determined by the method of land-use change. Although this concept is not specifically defined in a legal body, article 55 of Supreme Decree No. 458 of 1975 implies that the change in the use of land is applied in rural properties located outside of the city limits established in the regulatory plans of the city, where part or all of the surface of the land in question is intended for non-agricultural purposes (eg, industrial, housing, tourism or community facilities).
The legal framework for the land-use change is made up of:
- article 4 of Supreme Decree No. 718/77;
- the Ministry of Housing and Urban Development, which creates the Joint Commission of Agriculture and Urban Development; and
- article 46 of the Law No. 18,755/89 on the organisation and authority of the Agriculture and Livestock Service, as amended by Law No. 19,283/94.
Also, the Ministry of Agriculture and its institutions are historically responsible for agricultural and forestry developments in Chile. In this aspect, it is important to mention two of its institutions that are in charge of the change of use of forests for agricultural or any other purpose. The National Forestry Corporation (CONAF) and the Forest Institute (INFOR).
CONAF’s offices are well represented all over the country in all regions. The organisation controls land use, prohibiting the replacement of native forests for agriculture and promoting afforestation on degraded soils. INFOR delivers technological and market management knowledge, which allows a territorial land approach integrated forest and agricultural use.
Other institutions related to agriculture and livestock area are:
- SAG - Agriculture and Livestock Service;
- INDAP - National Institute for Agricultural Development;
- CNR - National Irrigation Commission;
- ODEPA - Office for Agricultural Planning;
- FIA - Foundation for Agrarian Innovation;
- INIA - National Institute of Agricultural Research;
- CIREN - Information Centre for Natural Resources;
- FUCOA - Foundation of Communications, Training and Agro Culture;
- ACHIPIA - Chilean Agency for food safety and quality; and
- AGROSEGUROS - insurance for agriculture with state subsidy.
How is lending secured by farmland addressed in your jurisdiction? Do special rules apply for farm lending?
Lending is secured by two main types of security interests.
A mortgage is created by a contract between the parties that must be executed before a notary public. The mortgage must then be registered in the public real estate registry managed by the Real Estate Registrar. The mortgage must also be noted in the registration book where the land is registered.
Pledges and liens
By means of a lien, the grower may obtain the financing of its production by pledging its equipment, plants or the farm production.
Currently there are no special rules that apply for farm lending.
Are there provisions relating to creditors’ rights on default by farmers that apply in your jurisdiction?
Both liens and mortgages will afford the secured creditor a privilege of first payment on the collateral. However, these are not granted for farmer’s default cases.
The priority of credits is established in article 2,472 of the Civil Code, while the special rules for granting credits to small agricultural entrepreneurs and agricultural loans are established in the Decree-law No. 2,974.
Law No. 20.797 establishes a relevant change regarding securities and payments on default by farmers or growers. According to the provision of this new act, should parties in a farming contract decide to register their agreement in a public registrar, the product sold and registered is afforded special protection: a joint liability between the farmer breaching the agreement and a third-party purchaser that takes the registered product. The public policy behind this new law aims to formalise the farming contract to reinforce know-how transfer and financing to farmers, by protecting the registered purchaser.
Publicly controlled property
Describe any rules relating to public control of farm property in your jurisdiction. What legislation governs them?
There are no specific rules for public control of farm property.
Foreign ownership restrictions
Are there any restrictions on foreign ownership of farm property in your jurisdiction? What legislation governs them?
There are no special requirements for a foreign company to acquire domestic agricultural companies. Chilean law does not discriminate between Chilean and foreign persons, although there are some limited exceptions such as acquiring property on Chilean borders. However, foreign investors may need to go through some registration procedure and, depending on this, may need to appoint a Chilean representative or a foreign person with a permanent residence in Chile.
Foreign investment - including agriculture - is governed by Chapter XIV of the Compendium of Foreign Exchange Regulations and by Law No. 20,848, which establishes the framework for direct foreign investment (IED) in Chile and creates its respective institutions. The former dictates the regulations that apply for any and all foreign exchange operations related to credits, deposits, investments and capital contributions that originate externally. However, these regulations shall only apply in cases in which the amount of the transaction is over US$10,000, or its equivalent in other currencies. This legislation does not differentiate between Chilean and foreign investors, only that the transaction be made with funds originating overseas.
Regarding the latter, IED only applies for investments of US$5million or more, or its equivalent in other currencies, and this legislation expressly states that the investor must be a natural person or a company incorporated abroad, with neither residence or domiciled in Chile. This foreign investor, to be able to have access to a specific investment regime, must obtain a special certificate that validates their status of being a foreign investor, obtained by having accredited the materialisation of such investment in Chile.
Global real estate management company Colliers International has defined the market as ‘very attractive as a means of investment’ and, according to requests they have received in the past five years, the interest of investors in agricultural land in Chile has risen 70 per cent.
Does the government provide agriculture support programmes to producers, processors or agriculture-related businesses and organisations? Outline the programmes and how they are generally accessed.
There are support programmes for producers, processors and companies and organisations related to agriculture. These programmes were designed by the Ministry of Agriculture and are classified according to different topics:
- external markets and management;
- human capital;
- social support;
- production management and risk;
- technology and research; and
- innovation and entrepreneurship.
To access to each programme, the farmer can visit the website Awww.agroatiende.cl that the Ministry of Agriculture has set up for all types of support depending on the size of the producer (which is measured by the level of annual sales) or depending on the type of assistance required.
Also, the Chilean Economic Development Agency (Corfo), the agency of the Chilean State in charge of boosting the national productive activity, is under the Ministry of Economy, Development and Tourism. Through intermediary agents, Corfo has several programmes aimed at the promotion of agriculture, for example: PROFO Associative Development Project, PROFO EXPORT Associative Development Projects for export, FOCAL Promotion of Quality, among other programmes designed for agricultural activity. Including in these, there are two programmes, namely FOGAIN and COBEX, specifically aimed at helping farmers (or other types of companies) obtain financing from banks or other financial institutions, by which the state of Chile can serve as guarantor for money borrowed.
More information can be found at www.corfo.cl
Are there any programmes addressing assistance or government incentives for investment by foreign ownership in agribusiness?
In early 2016, the Chilean government created a foreign investment promotion agency called InvestChile. The purpose of this agency is to encourage foreign direct investment (FDI) into the country.
InvestChile (www.investchile.gob.cl) provides a wide range of information about Chile, from its economic and social environment to its legal framework and policies on foreign investment.
A foreign investor can find specific information about how to start a business as well as the procedures and regulations with which all investors must comply in order to bring FDI into the country.
Before the creation of this agency, the Chilean Economic Development Agency (Corfo) was in charge of the promotion of foreign investment. There are three types of programmes created by Corfo to promote and attract investment:
- the Todo Chile programme, which promotes regional investments in Chile. The minimum investment for a new project shall be 260.66 million Chilean pesos and 162.91 million Chilean pesos for the extension of a previous project;
- the Alta Tecnología programme, which promotes technological investments; and
- the Zonas Especiales programme, which promotes investments in extreme regions of the country and regions with outdated production. Subsidies are given to studies of pre-investment or facilitation on the commissioning of a project. The minimum investment is 16,291,250 Chilean pesos.
Food safety, certification programmes, animal safety and disease
Outline the applicable legislation for primary processors of live animals. Is any distinction made between meat for domestic consumption and meat for export?
The applicable legislation for primary processors of live animals in Chile are as follows:
- The Meat Act (Law No. 19,162) sets the mandatory classification system of cattle, classification and nomenclature of their meats and regulates the operation of slaughterhouses, cold storage and establishments of the meat industry.
- Subsequently, in June 2009, an amendment to Law No. 19.162, Law No. 20,358 also establishes a system of traceability of cattle and meat.
- General Technical Standard No. 62 regulates medical veterinary inspection of slaughter animals and their meat, and qualification criteria for eligibility for human consumption.
- General Technical Standard No. 117 regulates the veterinary health inspection of poultry and meat.
- Additionally, Supreme Decree No. 977 approves the Food Health Regulations, which sets out the health conditions that all production, import, processing, packaging, warehousing, distribution and sale of food products for human use shall observe, to protect the health and nutrition of the population and ensure the supply of healthy and safe food products.
- Law No. 18.755 creates the Agriculture and Cattle Services, which aims to contribute to the country’s agricultural development through the protection and maintenance of animal and plant health, and establish the norms for achieving it.
- The Sanitary Code regulates all matters related to the promotion and protection of sanitary health.
SAG should ensure that all livestock products for export (products for human and animal consumption and inedible use) comply with the national regulation and animal health requirements of importing countries for products of animal origin in accordance with the degree of protection required by their own health status as for the guidelines of international organisations related to animal health and food safety.
Exporters require official certification to trade products of animal origin, which corresponds to an official document, entitled Export Animal Health Certificate, in which the official veterinarian attests that what is being exported meets the requirements of the importing country.
For issuing and signing this certificate, the official veterinarian has the necessary endorsements of instruments and programmes applied by SAG, along with the relevant documentation.
Food safety regime
Describe the food safety regime in your jurisdiction, including applicable legislation and regulations.
There are a great number of provisions that regulate food safety in Chile. They include basic provisions on the means of transportation of agricultural commodities to criminal provisions regarding the protection of human health.
The main regulations regarding food safety in Chile are:
- Supreme Decree No. 977/96: Food Sanitary Regulations;
- Supreme Decree No. 594/99: Regulations on basic sanitary conditions in the workplace;
- the Sanitary Code;
- Decree No. 157/07: Regulation of pesticides for sanitary and domestic use;
- Decree No. 118/2015 on hazard analysis and critical control points in food establishments;
- Law No. 18,164: Customs, Admission and Import of Goods Act; and
- Decree (DFL) No. 1/89 on sanitary authorisations.
SAG is responsible for enforcing Chile’s import regulations concerning:
- alcoholic beverages;
- organic food;
- animal and plant quarantine; and
- the grading and labelling of beef and some processed food products, both for human and animal consumption, including pet food, feed and feed supplements.
The Ministry of Health is responsible for food sanitation, including meat and poultry and the approval of food ingredients, labels and packaging of processed foods. The regional secretaries of the Ministry of Health are in charge of monitoring compliance with the food safety regulations.
What enforcement can take place in relation to food supply chain safety? What penalties may apply?
To verify compliance with health regulations - including resolutions that have been issued to this effect - the health authority is legally entitled to carry out a preventive inspection of any site, either publicly or privately owned, and its products. A record of the proceedings will be made.
In the event of non-compliance with the current legislation, the health authority may issue a resolution admonishing the offender and establishing compliance of some conditions. If the offender fails to comply, a summary procedure will be initiated against him or her.
The possible penalties include:
- fines ranging from 0.10-1,000 UTM (an indexed monthly unit; as of September 2018 1 UTM is equal to 48,016 Chilean pesos);
- closure of the establishment where the offence was committed;
- withdrawing of the sanitary authorisation that enables the establishment to be in operation;
- stoppage of works;
- confiscation of goods, facilities or work items; or
- destruction of products or goods by any method or procedure, if there is grave risk of harm to health.
Describe any certification programmes and rules for genetically modified foods, organic foods or other differentiated products.
SAG is responsible for establishing the standards and procedures for the import and release of genetically modified organisms (GMOs) under biosafety measures (regulated through Resolution No. 1,523/2001). Within the extent of its functions, SAG has implemented a system of risk analysis for controlled release into the environment of GMOs. SAG monitors all transgenic products in the country to maintain full traceability of the material.
Regarding organic foods, Law No. 20,089 created the National Certification System of Agricultural Organic Products, which establishes the marketing conditions of organic products or their equivalent. One of these conditions is that all organic, biological or ecological products must be duly certified by an entity registered in the Register of the National Organic Certification System.
Food labelling requirements
What are the food labelling requirements, including the applicable legislation, enforcement and penalties?
Food labelling is regulated in Chilean legislation through Supreme Decree No. 977 approving the Food Health Regulations, specifically in Title II ‘Foods’, paragraph two ‘Of the labelling and advertising’. All food products that are stored, transported or dispensed in packages must bear a tag or label containing the following information:
- the name of the food;
- net content;
- country of origin;
- number and date of the resolution and the name of the health service authorising the establishment that produced or packaged the product;
- date of the product’s processing or packaging;
- expiration date or duration of the product;
- nutritional information;
- instructions for storage;
- instructions for use; and
- in the case of imported products, the name and address of the importer will be required.
In relation to genetically modified foods, organic foods or other differentiated products, this shall be mentioned on the label. Any breach of these rules will be sanctioned by the health services in that territory, provided such breach has been proven in accordance with the provisions of the Health Code (see question 14).
On this point, it is important to mention Law No. 20,606 regarding the nutritional composition of food and its advertising, as well as Law 20,869 relating to food advertising and Decree No. 33 amending the Food Sanitary Regulations, although they do not directly affect primary agricultural products, they could have an impact on their derived products and the conditions for labelling and advertising them.
Food animal legislation
Outline any applicable legislation regarding health of food animals, including transportation and disease outbreak and management.
The health of animals intended for human consumption, including means of transport and handling of disease outbreaks, is regulated by:
- Supreme Decree No. 977 approving the Food Health Regulations. Specifically Title I, paragraph X ‘on requirements for the inspection of animals and their meats’ and paragraph XII ‘on hygienic requirements for the transportation and sale of raw milk’.
- General technical Rule No. 54, approved by exempted Resolution No. 2319/2000, on veterinary medical inspection of poultry and its meat.
- Decree No. 29, which approves the regulation on protection of animal welfare during industrial production, commercialisation and other animal storage facilities.
- Chapter 7.6, article 7.6.5 of the Terrestrial Animal Health Code of the World Organisation for Animal Health (OIE).
- Resolution No. 2,153 (1997) on the transit of livestock products and inputs.
- Exempted Decree No. 53 (2007) of the Ministry of Agriculture, which mandates that animals may only enter the country through the approved ports and airports.
Animal movement restrictions
What are the restrictions on the movement of animals within your country?
Some restrictions regarding the movement of animals are established in General Technical Standard No. 54 approved by Exempt Resolution No. 2319/2000 on veterinary health inspection of poultry and meat during industrial production, marketing and other animal maintenance enclosures.
Article 5 states that:
The movement of animals should be done calmly and without harassment, respecting the natural rhythm of the animals and avoiding handling that could cause injury or unnecessary suffering.
The use of instruments is authorised, such as mechanisms of compressed air, flags, dusters, plastic bags and rattles, among others, to encourage and direct the movement of the animals.
Animals’ eye contact with each other should be prevented. This condition shall not apply where animals are mobilised by a sleeve or when the animals are in pens, isolated and/or under observation.
In case of using electric fences, they should only cause discomfort, avoiding pain and unnecessary suffering.
Describe any restrictions on import of food animals.
Specific authorisation must be obtained from SAG (as set out in Resolution No. 3,138/1999 modified by Resolutions 2,567/2003 and 1,995/2000, Ministry of Agriculture) for:
- livestock production facilities;
- slaughtering; and
- processing animals or animal products for export or import into Chile.
Authorisation is based on verification and analysis of technical and scientific information and compliance with specific health requirements, relating to the sanitary quality of animals and product safety.
There are different sanitary requirements depending on the animal, whether domestic or non-domestic, for semen (from cattle, camelids, dogs, horses, goats, sheep and pigs) and other animal products, which can be found at www.sag.gob.cl/ambitos-de-accion/informacion-por-productos-exigencias-sanitarias-especificas (English version link is currently broken as checked on September 2018).
SAG can suspend the import of a species and prevent the introduction into Chile of contagious infectious disease-causing agents that affect animals. For instance, Resolution No. 5,093/2014 suspends the importation of live pigs and blood derivatives from countries infected with the new variants of the porcine epidemic diarrhoea (PED) virus.
What are the regulations related to livestock slaughtering?
Decree No. 28 of 5 June 2012 establishes the regulation for protection of animals that are used for meat, fur, feathers and other products processed in industrial facilities.
According to the aforementioned regulation, the acceptable methods of slaughter are those set out in chapter 7 (specifically 7.6) of the Terrestrial Animal Health Code of OIE.
Pest control requirements
Outline the regulatory regime relating pest control and pesticides, and other management regimes in relation to disease and pests in plants and animals.
The main regulation regarding pest control and pesticides, and other management in relation to disease and pest in plants and animals in Chile are:
- Resolution 33, which sets maximum residue levels on pesticides;
- Law No. 18,755;
- Decree No. 3,557; and
- Decree No. 157.
Most of the provisions on pest control and pesticides will grant authority to SAG to establish all necessary measures on this subject.
With regard to pest control, SAG will have the authority to verify the existence of a pest, and the necessary measures to control it, such as quarantine or destruction. The affected party may dispute SAG’s resolutions before a court of law.
With regard to pesticides, the aforementioned Decree No. 3,557 gives SAG the necessary authority to oversee manufacturing, import, distribution, sale and application of pesticides.
Decree No. 3,557 establishes an objective type of liability for any and all damages provoked by the application of pesticides, which used to be an exception under Chilean law.
A modification to the Sanitary Code has established an objective type of liability as the general rule for defective sanitary products, which includes food and food products for human consumption, pharmaceutical products, and others.
Article 111 J of the Sanitary Code states that the victim of damages stemming from a defective sanitary product will only need to prove the damages that they have sustained, the defect of the product and the link between the two.
Article 111 K of the Sanitary Code states that the respondent cannot avail itself as defence to the claim for damages regarding a defective sanitary product, those damages stemming from circumstances or facts that could not be anticipated in reason of the current state of the art at the time in which the product was place on the stream of commerce.
How are agricultural operations typically organised in your jurisdiction?
Commonly, the type of legal entity and the manner in which deals are carried out will depend on the chain of supply, the volume of supply and the product that is being commercialised. In this regard it is typical to see at least three types of entities that play a part in the growth and commercialisation of agricultural products (this may vary depending on the product that is being sold): exporter, grower and nurseries.
The exporter is the entity that has the distribution network outside of the country (most Chilean agriculture products are grown for export purposes) that handles the export operation of the product. Typically this is a business set up as a type of company (see below). The exporter will purchase fruit from a grower either on a consignment basis or for a fixed price.
The grower is the entity that grows and harvests the produce. The grower usually receives financing from the exporters. Commonly, this is a type of company, but there are many growers that still work as natural persons, especially where production is on a smaller scale.
Nurseries provide the plants for future production. Usually they play an important role when the operation involves protected varieties of plants.
The legal entities used in agribusiness are the same types of companies used for business in Chile, which are:
- limited liability companies;
- companies divided by shares: stock corporations and the shareholders’ companies; and
- cooperatives, which are used by groups of small-scale farmers.
Regarding the incorporation of cooperatives, the Decree with Force of Law (DLF) No. 5 establishes the General Law of Cooperatives, and its article 65 deals with agricultural and peasant cooperatives, which are those engaged in the sale, distribution, production and processing of goods, products and services related to agriculture and forestry, and preferentially act in a rural environment and tend to provide social, economic and cultural development for its partners.
The Ministry of Economy, Development and Tourism estimates that 28.1 per cent of the cooperatives constituted in Chile are agricultural cooperatives (data is available at www.economia.gob.cl).
Outline any restrictions on foreign ownership of agricultural operations or businesses other than farming operations.
The general rule is that there is no difference between Chilean and foreign persons. A constitutional mandate prevents the state from acts of discrimination. The law does not recognise any difference between local and foreign persons in the acquisition and exercise of civil rights (article 57, Civil Code).
There are limited exceptions, some of them based on positive discrimination in favour of foreign investors. In addition, there are certain restrictions on foreign ownership of land near the Chilean border.
Agricultural workers, immigration, and health and safety
Describe any specific rules or laws governing the rights of workers or employees for agricultural operations.
The Labour Code regulates two kinds of agricultural workers: permanent farmworkers and seasonal agricultural workers or seasonal workers.
Permanent agricultural workers are defined as ‘workers who work in soil cultivation of land and all who perform agricultural activities under the orders of an employee’ (article 87). Although agricultural workers are protected by the general rules concerning the workday, they are subject to one of the exceptions that allows their employer to distribute working hours including Sundays and holidays. Their salary may be paid in cash or royalties. The contract of permanent agricultural workers will always include the obligation of the employer to provide the worker and his or her family with hygienic and adequate housing.
The special contract of employment of seasonal agricultural workers includes ‘all those who perform temporary tasks or seasonal farming, commercial or industrial activities derived from agriculture and sawmills and plants of wood exploitation and related industries’ (article 93).
In the event that the worker has any contact with toxic pesticides, the employer must provide sufficient information:
- on the pesticides’ proper use, handling, waste and empty container disposal;
- the risks arising from exposure and any symptoms that may arise from pesticide misuse; and
- the necessary instruments and security measures workers require to protect themselves.
How is farmworker immigration regulated in your jurisdiction?
Immigrant workers have the same rights as every other worker. Their rights do not depend on their nationality or immigration status. This principle is recognised in domestic legislation and in many labour court judgments, as well as in the Labour Bureau’s criteria and opinions.
The Labour Code establishes in article 19 that at least 85 per cent of workers serving the same employer will be Chileans. This normative limits the recruitment of immigrants to 15 per cent in any type of job. Currently, the new Law of Immigration is under study in the congress, this new law would modify the Labour Code, increasing the percentage of foreigners who may be employed by a Chilean employer from 15-25 per cent. This modification has been celebrated in the agricultural sector where foreign labour has supplied the shortage of local workers in the agricultural field.
The permanence of foreigners in Chile and the requirements for their employability is regulated by Immigration Law No. 1,094. as well as Law No. 20,507, which criminalises illicit trafficking of migrants, and establishes rules for it prevention and effective criminal prosecution.
Until 2015, in the system of visas issued by the Immigration Department, a ‘visa subject to contract’ existed. A migrant who had signed an employment contract could get temporary residence upon the expiration of the contract. The employer also had the obligation to pay the return ticket for migrants and their families. Currently, a new type of visa may apply, the ‘temporary by labour motive’ visa. These have durations of one year and do not depend on a single employer. However, it may not apply in the agricultural sector as jobs have terms of less than a year.
Work health and safety regulation
Outline the health and safety regulations relating to farmworkers in your jurisdiction.
The main regulations regarding farmworkers in Chile are:
- Decree No. 594 of the Ministry of Health, Title VII ‘Special rules for primary agriculture, livestock and forestry in open field’.
- Law No. 16,744 on Accident Insurance and Occupational Diseases. Article 67 states:
Companies or entities shall be required to keep up with the internal regulations of health and safety at work and workers to meet the demands these regulations imposed on them. The regulations should refer to the application of fines on workers who do not use the personal protection that was provided for them or do not meet the obligations imposed on them by the rules, regulations or instructions on health and safety at work. The application of such fines shall be governed by the provisions of paragraph I of title III of Book I of the Labour Code.
- Supreme Decree No. 40, article 14 states: ‘All companies or entities are required to establish and maintain internal regulations on safety and health at work, its compliance is mandatory for workers. The company or entity must provide a free copy of the rules to each worker.’
- Decree No. 655 of the Labour Ministry, which approves the regulation on industrial hygiene and safety.
Import and export regulation
How are the export and import of agricultural products (animal and non-animal) regulated in your jurisdiction?
All agricultural products imported into the country must meet all phytosanitary requirements established by the law and governmental regulations for that specific product, which will be verified by SAG to enter Chile. This is also required for export of agricultural products, where each product must meet all phytosanitary requirements established by the importing country.
There is an online application created by the Ministry of Agriculture where each importer or exporter may check the phytosanitary import and export requirements established by SAG (available online at defensa.sag.gob.cl/reqmercado).
Products, by-products and agricultural and livestock inputs may enter the country only through an authorised port, as defined in Decree No. 156 of 1998 and its subsequent amendments. Also, wooden types of packaging need to comply with Nimf No. 15, which establishes the international standard for such.
Another law that indirectly affects the export and import of agricultural products is new Law No. 20,997, which modernises customs legislation and contains concrete measures aimed at improving customs work in the areas of inspection; updating international agreements; upgrading customs standards; and regulating the work of customs agents, among other similar measures.
Tariffs and quotas
May tariffs, quotas or similar measures be put in place?
Such measures may only be put in place when protecting a specific industry and for very specific reasons. Procedures for establishing such measures are heavily regulated and established according to a procedure that is in line with article XIX of the General Agreement on Tariffs and Trade 1994, and the agreement for safeguard measures.
These contingency measures have been applied for agriculture products in the past. Chile was sued by Argentina before the World Trade Organization with regard to wheat and wheat flour.
Import and export treaties
What treaties apply to the import and export of agricultural products in your jurisdiction?
Chile is part of international organisations such as the World Trade Organization (WTO), Food and Agriculture Organisation of the United Nations, International Plant Protection Convention and the OIE.
As a member of the WTO and the General Agreement on Tariffs and Trade, Chile is part of the WTO Agreements that were concluded in 1994 and entered into force on 1 January 1995, which apply to agriculture. However, within the WTO system, the agricultural sector has a specific agreement, the Agreement on Agriculture, whose provisions prevail.
In addition, provisions of the Agreement on Sanitary and Phytosanitary Measures also affect agricultural production and trade, in the same way the Agreement on Trade-Related Aspects of Intellectual Property Rights, the Agreement on Technical Barriers to Trade and the Agreement on Rules of Origin have a particular effect on the agricultural products, and have been important instruments used by Chile in the international field.
Chile has 28 free trade agreements (FTAs). Each FTA has provisions on agriculture such as subsidies, sanitary and phytosanitary measures and technical barriers to trade.
Plant breeder rights
How are plant breeders’ property rights protected in your jurisdiction?
As a member of the Agreement on Trade-Related Aspects of Intellectual Property Rights and the International Union for the Protection of New Varieties of Plants (UPOV) Convention (currently the 1978 Act), Chile protects plant breeders’ rights (PBR) through a sui generis system of registration that follows UPOV guidelines. Specifically, PBR are protected by Law No. 19,342 of 1994 and its Decree No. 373, which transforms the older Registry of Property of Varieties into the Registry of Protected Varieties, overseen by the Department of Seeds of SAG.
Access to plant varieties
How is farmers’ access to crop varieties and plant technologies addressed in your jurisdiction?
In Chile, a PBR incumbent may grant any type of licence he or she considers convenient so that third parties may exploit the protected variety. However, the law specifically dictates that any limitation imposed on the licensee that is not derived from the PBR shall be null and void.
Furthermore, Chile’s legislation states that the monopoly abuse of PBR, which is determined by the Resolution Commission (a Commission of the National Economic Attorney’s Office) will result in the bestowal of an involuntary licence given by the Department of Seeds of SAG to determined licensees. Additionally, the law states that the sentence dictated by the Resolution Commission, which sanctions the aforementioned abuse, will determine the quantity and method of payment that the licensor shall receive as compensation.
Other intellectual property
What other intellectual property considerations apply to agribusiness in your jurisdiction?
Chile maintains a pending obligation to ratify the 1991 Act of the UPOV Convention, which is expected to be fulfilled in the near future. Among other changes to current legislation, this Act will increase the minimum scope of protection from 18 to 25 years for trees and vines, and from 15 to 20 years for all other species; and extends PBR to harvested material in two specific situations: ‘if the material is obtained through the unauthorised use of propagating material’ and ‘if the breeder has not had reasonable opportunity to exercise his right in relation to the propagating material’, therefore granting breeders an effective measure against illegitimate use of their protected variety.
Describe the regulatory agencies that have a role in managing the environmental impact of agricultural production in your jurisdiction.
Regarding the environmental impact assessment there are no special regulatory bodies for agricultural production. The bodies involved in the environmental assessment of any project are:
- the Ministry of the Environment (regulatory matters);
- the Environmental Assessment Service (evaluation matters);
- sectorial agencies with environmental competence (eg, the Health Authority, SAG, the General Water Department);
- different agencies of the state administration, such as governors and municipalities;
- the Superintendency for the Environment (inspectional and punitive function); and
- citizen participation that allows the community to make complaints about actions that may constitute violations of environmental regulations.
Water and air pollution regulation
Describe how water and air pollution is regulated in relation to primary agriculture in your jurisdiction.
There are no comprehensive regulations concerning water and air pollution on agriculture. However, there are certain provisions relating to water pollution in the following regulatory bodies:
- the Water Code of 1981 (Decree (DFL) No. 1,122, Ministry of Justice);
- the Sanitary Code (Decree (DFL) No. 725, Ministry of Public Health). This code establishes a set of provisions related to irrigation water, including:
- that the National Health Service will be in charge of sanitary protection of safe drinking water and water treatment that will be used for irrigation; and
- prohibiting the discharge of sewage, industrial waste or mining in rivers, lakes or any other source or body of water that serves to provide water for irrigation (among other purposes) without prior purification in the manner determined by the regulations.
- In the event of an epidemic or irrigation, the National Health Service will be in charge of the sanitary protection of safe drinking water and water treatment that will be used for irrigation.
- Decree No. 3557/1980, which establishes provisions on agricultural protection (SAG); and
- Chilean Standard No. 1,333 of 1978 as amended in 1987, which establishes water quality requirements for different uses, including irrigation. The rule sets criteria for water quality according to scientific requirements relating to physical, chemical and biological aspects, depending on the particular use.
A growing demand for water to comply with the thriving agricultural development of the country, which is hindered by the tendency of the lesser rainfall (climate change) has put a focus on improving irrigation conditions, with some specific regulations on this matter:
- Law 18,450, whose last version dates on 2013. It approves norms for the encouragement of private investment in irrigation and draining works.
- Law 20,284, modifies Law 18,450, allowing tenant farmers to apply for irrigation projects.
- Law 20,705, modifies Law 18,450, with the objective of encouragement of private investment in irrigation or draining works, including integrated projects and those of multi-use, whose cost exceeds 30,000 unidad de fomento (currently 880,088,543 pesos).
Describe how liquid and other waste is regulated in relation to primary agriculture in your jurisdiction.
Law No. 19,300 on General Bases of the Environment, provides that the state has the obligation to regulate the presence of contaminants in the environment in order to prevent them from become a risk to human health. Although there is no legislation directly concerning agriculture in this respect, there is general legislation regarding liquid waste and sewage sludge. The main pieces of legislation are:
- Supreme Decree No. 609/1998, which establishes emission standards for the regulation of contaminants associated to liquid industrial waste that are discharged into sewage systems;
- Supreme Decree No. 90/2000, which establishes emission standards for the regulation of contaminants, associated with liquid waste discharges to marine and inland surface waters;
- Decree No. 143/2012 on surface waters;
- Decree No. 3/2012, which approves the regulation for handling of sludge from treatment plant effluents of the processing industry of fruits and vegetables; and
- Decree No. 4/ 2009, which regulates the handling of sludge from wastewater treatment plants.