Incorporating in Chile (Old System)

In this post we will revise the process of incorporation of the most common types of companies used in Chile, before the entry to force of the Law 20.659 of 2013, that simplifies the process of incorporation for companies. This process is yet relevant because is still in force, and is preferred by many lawyers, for reasons of habit and flexibility.

Incorporation II - Samuel Zeller

The first step is the drafting of the public deed of incorporation of the company or partnership (for the SpA is it possible to do it by means of a legalized private instrument). This document must be drafted by a lawyer and once reviewed by the partners or entrepreneur, must be signed at any Public Notary.

Later on is necessary to generate an abstract of the deed, which also must be authorized by a Notary. Is worth to mention that both the deed of incorporation and the corresponding abstract must refer to the statements required by law, so the company may exist without vices of nullity.

Once the abstract is authorized, it has to be registered in the Commerce Index of the Real State Register (Conservador de Bienes Raíces) and published once on the Official Journey, before 60 days from the date of the incorporation deed (In the case of the SpA the term is reduced to 30 days).

Is advisable to require a legalization of the abstract, registration and publication for the purposes of having everything in a single document when needed in the future.

The vices occurred during this process, as the omission of any essential mention in the abstract or the publication outside the legal term, can be amended through the procedure established for this purpose in the Law 19.499.

After this process is finished, the company will have legal existence and would be able to start its operations. Nevertheless is necessary to make the solicitation of a Tax Id Number (Rol Unico Tributario, RUT) and the declaration of Beginning of Activities at the Tax Authority (Servicio de Impuestos Internos, SII) to complete the birth process of the company.

The associated costs for the complete process of incorporation are around $100.000 CLP between Notary and Register fees, and the fees from the law Firm can go from $300.000 CLP up to a $1.000.000 CLP.

Santiago Henríquez C. Lawyer.

Picture: Samuel Zeller (CC0)