Chile
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Introduction
Chilean competition law is regulated by Decree Law No. 211 of 1973 (the Competition Act).[2] Since 2004, the authorities in charge of the protection and promotion of competition in Chile have been the Chilean Competition Authority (FNE), the Chilean Competition Tribunal (TDLC) and the Chilean Supreme Court (SC).
The FNE is an administrative entity that represents public interest in economic matters. With this aim, the FNE is in charge of investigating and prosecuting competition infringements, overseeing compliance with TDLC rulings and decisions, conducting studies on competitive dynamics in Chilean markets and making policy recommendations to the Executive Power. Furthermore, since 2016, the FNE has overseen the pre-emptive control of mergers.[3]
The TDLC is a special and independent jurisdictional entity in charge of:
- judging, resolving and punishing competition law infringements in contentious proceedings;
- hearing and deciding on non-contentious or public consultation proceedings;
- issuing general binding instructions to economic agents as well as policy recommendations to the Executive Power;
- hearing and judging compensation claims for damages derived from anticompetitive violations;[4] and
- resolving appeals against FNE decisions prohibiting mergers.[5]
Finally, the SC hears appeals to TDLC rulings or decisions, both on contentious and non-contentious cases, and resolves appeals in partial judicial settlements, as discussed below.
Availability of settlements in Chile
This section focuses on the range of settlement alternatives available in the Chilean jurisdiction to resolve investigations carried out by the FNE or to end proceedings initiated before the TDLC by either the FNE or third parties.
Competition settlements for FNE conduct investigations
The FNE is entitled to close an investigation if, inter alia, it can reach an extrajudicial agreement with the investigated party (or parties), or if a change in circumstances takes place during the investigation that makes the threat to competition disappear.[6] The latter may include commitments of the party involved in the investigation that eliminate the competition risks identified.[7] When the FNE chooses one of these alternatives, it then closes the investigation through a reasoned decision that is made available to the public and does not prosecute any infringement before the TDLC.
Extrajudicial agreements
Legal recognition and procedure
Since 2009, according to the Competition Act,[8] the FNE has been entitled to reach an extrajudicial agreement with the undertakings involved in an investigation, to eliminate the threats to competition identified during that investigation. The details of this procedure are neither regulated in the Competition Act nor in FNE’s guidelines. Usually, during an investigation the undertaking under scrutiny is the party that takes the initiative to propose commitments to the FNE to reach an extrajudicial agreement.
The proposal is typically made in writing and includes a reference to the possible threats to competition identified by the FNE − from the undertaking’s perspective – and a proposal with the commitments that would be appropriate to deal with those concerns. If the FNE is willing to close the investigation with an extrajudicial agreement, it evaluates the proposition and, generally, responds with a counterproposal. The counterproposal commonly includes the competition risks that were not identified previously, suggestions to the commitments previously made by the undertaking under investigation and possibly the proposal of new obligations to prevent threats to competition. This unleashes a negotiation process between the prosecutor and the undertaking. During the negotiations, it is possible to find exchanges of proposals, meetings and submissions of information (including economic reports) by the firm to support its proposals.
Considering that it is not a regulated process, there is no strict timeline or deadline for the negotiation process. The only restriction is the statute of limitation of the alleged infringement that restricts the FNE to take action against the offender.[9] If the negotiation is successful, the investigation finishes with an extrajudicial agreement that is submitted for the TDLC’s approval. If the negotiation fails, the FNE’s investigation continues.
Once the FNE and the undertakings reach an extrajudicial agreement, it must be submitted to the TDLC. The TDLC must schedule a hearing to listen to the FNE, the undertakings involved and any other party that may have a legitimate interest in the case.[10] The TDLC must approve or reject the agreement within 15 working days, without the possibility of changing the settlement.[11] Those opposed to the TDLC decision can only proceed through a petition for reconsideration before the TDLC.
Publicity of proceedings
The FNE investigation’s file is not public, and the same principle applies to extrajudicial agreement negotiations between undertakings and the FNE. Only the reasoned final decision of the investigation is made available to the public.[12]
On the contrary, all the procedures handled before the TDLC are public; therefore, once the extrajudicial agreement has been submitted to the TDLC, the information related to the judicial procedure becomes available to the public. Nonetheless, commercially sensitive information may be redacted and kept confidential.
Matters that can be settled
Prior to the merger control regime implemented in 2016, the FNE resorted to extrajudicial agreements to deal with the risks created by future mergers.[13] Today, extrajudicial agreements are mainly used to deal with suspected abuses of dominance but are available to deal with any other anticompetitive conduct. Even though the Competition Act does not prevent the use of extrajudicial agreements to deal with coordinated conduct, the FNE has not yet resorted to extrajudicial agreements to terminate investigations related to collusive agreements or concerted practices.[14]
Content of extrajudicial agreements
There have been 18 extrajudicial agreements submitted to the TDLC, nine of which were related to mergers,[15] and the TDLC rejected only one of those.[16] Five of the non-merger cases concern investigations of abusive behaviour. In all those cases, the FNE accepted behavioural commitments. The commitments encompassed modifications of contracts (and bidding terms and conditions) to prevent harm to competition and to eliminate barriers to entry or exit costs,[17] mechanisms related to limit maximum prices,[18] and commitments of future behaviour to avoid the undertakings from restricting the entrance or expansion of competitors.[19] Also, the FNE required the introduction of monitoring mechanisms and monitoring trustees.[20]
The four remaining cases cover different scenarios. One case arose due to the failure to notify the FNE of the existence of a minority shareholding in a competitor.[21] This extrajudicial agreement is the only one that has ended with the commitment of paying a penalty.[22]
Another case, Tianqi, related to the acquisition of a minority shareholding by Tianqi Lithium Corporation (Tianqi) in a competitor on the lithium market, Sociedad Química y Minera de Chile SA (SQM). In this case, the FNE identified risks associated with potential information exchanges between competitors and potential conflicts of interest on SQM’s board of directors. To prevent those risks, the commitments negotiated between Tianqi and the FNE encompassed restrictions to the former for the nomination of SQM board members, and obligations to refrain from voting on the board when there could be a conflict of interests, as well as measures to prevent the exchange of sensitive commercial information.[23]
Another extrajudicial agreement, Soprole, concerned the breach of a previous decision from the TDLC. The breaching party committed to adopt measures to make the relationship with their clients more transparent and the terms of their offers more precise.[24]
Transbank II, a case related to the payment systems market, is the only non-merger extrajudicial agreement that has been rejected by the TDLC because the TDLC considered that the extrajudicial agreement procedure was not appropriate for ruling on the subject covered by the agreement and that the simplified procedure lacked the phases of a proper trial, which it deemed necessary to reach an adequate decision, due to the complexity of the case. The TDLC rejected the settlement but did not rule on the merits of the subject.[25]
Effects of extrajudicial agreements
When the TDLC approves an extrajudicial agreement, it becomes binding on the undertakings involved and can be enforced by the FNE.
To approve or reject an extrajudicial agreement, the TDLC takes into consideration whether the settlement is aimed at protecting competition. The TDLC evaluates whether the FNE complied with the adequate parameters to assess the conduct during the investigation;[26] whether the commitments are sufficient and proportionate to prevent the identified risks;[27] and whether the agreement will allow the existing competitive conditions on the market to improve.[28]
However, the TDLC always indicates that the ruling does not imply a pronouncement on the legality of the facts that motivated the settlement − in this scenario it never rules on the existence or absence of an infringement of competition law − and that the settlement’s approval does not restrict the rights that third parties may have in that regard. Third parties’ interest then remains protected and their rights are not affected in relation to the facts that motivated the settlement.[29]
Closing a conduct investigation in exchange for behavioural commitments
Possibility of, and procedure for, closing investigations in exchange for behavioural commitments
The FNE has also closed administrative investigations based on commitments offered by the investigated undertakings without reaching an extrajudicial agreement. Although there is no explicit legal recognition of this alternative, the FNE has included these types of commitments − as justification for closing an investigation and dismissing the enforcement activity against investigated undertakings − in its guidelines,[30] based on its discretionary powers.[31]
Generally, the FNE will agree on the commitments only when they eliminate or mitigate all the competition concerns that have been identified during the investigation. The idea behind closing the investigation based on the commitments offered is that the potential anticompetitive facts or conduct were changed or corrected by the investigated undertaking − because of the commitments offered − and the facts or conduct that potentially justify the enforcement have disappeared. There would then be no ground for pursuing further legal action against the investigated undertaking.[32]
The possibility to offer and commence negotiation of these commitments can arise either from the FNE or the investigated undertakings.[33] Negotiations are restricted to the potential obliged undertaking and the FNE. Therefore, in general, this process provides less ground (compared with other alternatives discussed in this chapter) for third parties to intervene or make comments − unless, of course, there is an explicit request made by the FNE.
Once commitments have been offered by the investigated undertaking, the FNE will analyse the proposal. Despite the lack of legal regulation, in practice, after the FNE has finished its analysis, a negotiation period is opened between the investigated undertaking and the FNE to discuss the details of the commitments and their design and final structure.[34] No deadlines are connected to this period of negotiation; the period will depend on the specific circumstances of each investigation[35] and the statute of limitation of the alleged infringement.[36]
If the FNE decides to request third parties’ comments, it will be necessary to disclose part of the information discussed during the negotiations. Nevertheless, the FNE will require the involved undertaking’s authorisation before disclosing any type of information.
Negotiations of these commitments remain confidential. Once the FNE’s final decision has been made, the reasoned decision to close the investigation subject to certain commitments is published.[37]
The FNE will require implementation of the commitments before it closes the investigation. Otherwise, the investigation remains open. Exceptionally, the FNE will close the investigation before implementation of the commitments, but this will require a specific justification.
Matters in which investigations can be closed in exchange for behavioural commitments
These types of agreements are commonly used in abuse of dominant position investigations, and it is not clear whether the FNE has used these agreements for closing cartel investigations.
It has been argued that the FNE can apply its discretionary powers to close investigations and dismiss complaints only in cases where the general interest of the community is not at risk. Based on that assumption, it is more likely that the FNE will be willing to accept commitments by the investigated undertaking only when there is no compromise to the general interest of the community. This could be the reason why cartel investigations are not normally closed based only on commitments offered by the undertakings.[38]
Behavioural commitments
The types of commitments that can be offered are diverse. In Royal Canin,[39] the FNE closed a resale price maintenance investigation after the investigated undertaking clarified its commercial conditions to its clients.[40]
In Tecsa/Salfacorp,[41] the FNE closed its merger investigation[42] once the parties to the transaction − after its completion − offered to reduce the duration of a non-compete clause established in the share purchase agreement from four to three years. The FNE considered that this proposal mitigated the competition concerns identified in connection with the transaction.
Clexane[43] was a case in which the investigation was focused on a potential abusive price discrimination conduct. The investigated undertaking, a pharmaceutical company,[44] offered the FNE a commitment to reduce the list price of Clexane by 50 per cent and to introduce a new product pack size in specific sales channels.[45]
Land port PTLA[46] relates to potential anticompetitive conduct by the concessionaire of a land port bordering Argentina (PTLA) with the purpose of benefiting its subsidiary, a freight depot, by sending freight to this depot and artificially increasing tariffs.[47] During the investigation, PTLA proposed the establishment of an administrative procedure to determine the criteria for diverting freight from the licensed area to the non-licensed area on a non-discriminatory and objective basis.[48] The procedure was designed with the Chilean Customs Agency.
Another case, Electric Appliances-Enel,[49] focused on potential anticompetitive strategies implemented by an electricity distributor (Enel) consisting of giving free-of-charge benefits to property development companies that opted to use only electrical appliances in new buildings, with the objective of creating a captive demand, excluding alternative energy sources for appliances and recouping its investment (and more) in the long term.[50] Enel offered to cease the delivery of electrical appliances and other services free of charge.
Military Hospital Bid[51] concerned requirements included in the bidding rules that limited the number of bidders, and whether these requirements could be considered as entry barriers.[52] The FNE determined that the requirements were not unjustified and they did not impede or limit competition during the bid. Nevertheless, the Military Hospital offered to take several measures during future bids to avoid competition claims.[53]
Finally, in Fishing quota for fishmeal and fish oil,[54] the investigation focused on several supply contracts agreed between artisanal fishers and companies that produce fishmeal and fish oil; the investigated companies bought artisanal fishers’ fishing quota subject to exclusivity. The FNE decided to analyse the contracts in depth, and determined that the exclusivity clauses might have produced anticompetitive effects. The investigated companies offered different measures to increase the fishers’ options to trade with several companies and obtain better commercial conditions.[55] The FNE agreed to those commitments and considered that they were proportional to the competition risks identified.
Competition settlements before the TDLC and the SC
Judicial settlements
Legal recognition and procedure
The possibility to settle in contentious competition or infringement proceedings was introduced in 2003.[56] Article 22 of the Competition Act[57] grants the TDLC the power to call for the parties of a contentious proceeding to settle after the term to answer the complaint[58] has elapsed. However, it is not necessary for the TDLC to convene the parties ex officio to settle. In fact, it is also possible that within the term to answer the claim, the parties of the proceeding − all or some of them − request the TDLC to call for a settlement. The TDLC usually accepts this request and summons the parties to a settlement hearing. Moreover, it is also possible that, during the negotiations and review of the settlement, the TDLC suspends the proceeding.[59]
However, if the TDLC does not consider it appropriate to call the parties for a settlement[60] or if said process fails, the evidentiary period starts, and the proceeding continues.
The FNE is authorised by law to settle.[61] In fact, the execution by the FNE of a settlement agreement does not imply resigning its public powers, but simply exercising them at its discretion, in representation of the interests of the community in the protection of competition.
Publicity of proceedings
Trials held before the TDLC are public, as is the judicial settlement stage, and the documents and proposals submitted to the TDLC in the hearings specially held for such purposes.[62] However, at the request of a party, the TDLC may order the confidentiality of those instruments that contain commercially sensitive information, the disclosure of which could significantly affect the competitive development of the owner of the information.
Limits of judicial settlements
The TDLC must approve the settlement submitted by the parties, unless it violates competition law.[63] Thus, as the SC affirms, the TDLC has limited power of control, aimed at preventing a settlement agreement reached between the parties from contravening competition.[64]
The TDLC’s case law states that settlement agreements must end or limit the matter under dispute, without jeopardising competition. This, as indicated by the TDLC, implies that the defendant assumes behavioural commitments or other obligations in accordance with the legal right protected by the Competition Act, thus preventing or correcting situations that could affect competition in the relevant market.[65]
However, in certain cases, the TDLC has gone beyond that analysis, examining whether the commitments, obligations and measures agreed upon in the settlement improve the existing market conditions[66] or whether the settlement contains mechanisms for the prevention or correction of possible infringements or competition risks.[67] In relation to the latter, the TDLC has also complemented settlement agreements, by adding provisions to these, provided that the parties expressly request or agree to this.[68]
The TDLC has also examined whether the settlement contributes to the development of the procedure, in terms of clarifying the facts or reducing expenses or procedural times, particularly in cases of partial judicial settlements.[69]
Matters that can be settled
The Competition Act does not establish limitations regarding the type of infringement that can be settled, giving the possibility to even settle cartels.[70] However, since the introduction of a leniency programme in 2009, the FNE and the TDLC are less willing to reach or approve settlements in cartel cases, as the incentives are aimed at promoting the use of said programme.[71] The post-2009 cartel cases in which a settlement has been reached and approved are cases in which none of the defendants adhered to a leniency programme, in which the settlement agreements have generally been partial and where the TDLC ultimately issued a condemnatory decision regarding the matters that were not included in the settlement.[72]
Moreover, the possibility of reaching a settlement in hardcore cartels may also be limited due to the reinstatement of criminal sanctions for such offences[73] because the FNE can only prosecute cartels criminally when they have already been established by a condemnatory final judgment issued by the TDLC. Therefore, it is likely that, in these cases, the FNE would not be willing to settle, as this would mean giving up on criminally prosecuting a cartel, bearing in mind that the FNE is the only authority empowered to bring such actions for competition infringements. To date, no criminal action has been filed, but the possibility of criminally prosecuting this type of competition violation is expected to discourage settlements in hardcore cartel cases.
The FNE has shown its willingness to reach settlement agreements, particularly in the following cases:
- those concerning infringements of prior TDLC decisions, resolutions, instructions or extrajudicial agreements;[74]
- those in which the necessary duty to notify the FNE of an acquisition of a minority stake[75] in a competitor has not been made;[76] and
- gun-jumping cases,[77] as occurred in Minerva/JBS.[78]
Total or partial judicial settlements
Settlements can be total or partial, in relation to the parties involved in the case or the matters included in the settlement. As for the parties involved in the case, the Competition Act indirectly recognises this by granting the parties that did not enter into the settlement the right to appeal TDLC’s approval resolution.[79] This has also been confirmed by the TDLC.[80] It is also possible to agree partial judicial settlements on some aspects of the disputed matters and exclude others, as happened in Transbank I.[81]
In both cases, the proceeding must continue with the parties that did not execute the settlement agreement and with respect to the remaining matters that were not included in the settlement.
An issue that has been debated is whether the resolution that approves a subjective partial settlement implies a prejudgment from the TDLC. However, it is relevant to point out that the TDLC is allowed by law to express its opinions about the matters that are subject to a settlement and to facilitate reaching it, without such opinions preventing the TDLC from continuing to hear the case with respect to the parties that did not settle. In addition, as indicated, the TLDC only controls whether the settlement reached between the parties does not violate competition, so its approval or rejection does not imply a prejudgment of the dispute under analysis.[82]
Content of judicial settlements
Settlement agreements approved by the TDLC have included different kinds of commitments and remedies, but in almost all cases have consisted of behavioural remedies.[83]
Commitments in relation to abusive behaviour are mainly aimed at eliminating exclusionary conduct, including limiting or prohibiting exclusivity clauses or incentives,[84] certain types of discounts[85] and tied sales.[86] Some of the commitments are also aimed at eliminating behaviour that might prevent the entrance or expansion of competitors, such as restrictions on publicity and exhibition of products,[87] and commitments in relation to the fair registration of brands in the National Institute of Industrial Property, ensuring the prevention of the registration of brands that belong to competitors before such competitors have registered them, and avoiding hindering the registration of competitors’ brands in the National Institute of Industrial Property through judicial actions or lawsuits.[88] Another objective of remedies has been to ensure transparent, fair and non-abusive contracting conditions such as committing to provide general, objective and non-discriminatory offer terms[89] or ensuring fair contracting conditions.[90] Sometimes commitments also include waiving further actions not extinguished by the settlement[91] and communicating the content of the settlement agreement to the public.[92]
In cases related to collusion and infringements of previous TDLC decisions, settlements also include fines,[93] training in competition law[94] and reporting obligations to the FNE.[95] An interesting case is a settlement between private parties in which they agreed to establish a damages penalty clause in case the defendants infringed the Competition Act.[96] Particularly in partial settlements in cartel cases, it is usual to find the defendants’ declaration of having put an end to the conduct subject to the claim −without recognising the legal qualification given by the FNE − and the commitment not to carry them out in the future; the obligation to collaborate with the FNE during the proceeding to provide relevant information during the trial to clarify the facts under dispute; and waiving certain means of proof, particularly testimonial evidence.[97]
Moreover, for abuses of dominance, as well as for cartel cases, commitments to adopt internal regulations within the corresponding company or trade association[98] have been included, to prevent infringements to competition[99] or to address the competitive risk alleged.[100]
When the settlement contains commitments that need permanent observation or evaluation, the company subject to them might be required to hire a trustee, selected together with the authority, to supervise its compliance and report directly to the FNE, as required in Unilever and Latam.[101]
In consideration of the commitments assumed by the defendants of the case, it is currently common for the FNE to agree to reduce[102] or even eliminate[103] the fines previously requested to the TDLC in its claim.
Effects of judicial settlements
Settlement agreements, once approved by the TDLC, will be considered for all legal purposes as if they were a final judgment issued by the TDLC. Therefore, it will put an end to the trial, totally or partially, producing the effect of res judicata with respect to the parties that have agreed to it and the matters dealt with in the settlement agreement.[104]
One common doubt about settlements in contentious proceedings is whether a settlement entered by the FNE creates the effect of res judicata. The Competition Act does not solve this issue. However, in two settlements, it was expressly stated that, if said agreement were approved by the TDLC, the procedure would end with res judicata effect.[105] Moreover, in Farmacias,[106] when the FNE entered into a settlement with Farmacias Ahumada SA, the possibility that the FNE would subsequently submit a claim against its directors, managers, executives or employees was extinguished, as in fact was recognised by the FNE in the settlement. The foregoing is a consequence of the principle of ne bis in idem, which in these matters prevents the exercise of an action based on the same cause, because the controversy was resolved by the settlement.
Settlements before the SC
The SC has also accepted judicial settlements in competition cases heard by it, such as in D&S/Cencosud,[107] Banco de Chile,[108] John Malone[109] and Cámara de Comercio de Santiago.[110] Additionally, it is interesting to note that the SC required the parties to settle in a non-contentious proceeding, despite the fact this possibility is not expressly recognised in the Competition Act. However, notwithstanding the parties agreeing on a settlement, the SC issued a final decision, ending the trial by its final judgment.[111]
Other cases: evidentiary conventions and extrajudicial settlements
Another possibility of agreements is entering into evidentiary conventions[112] in exchange for a reduction of the penalty required by the FNE. In 2013, in Buses II,[113] the FNE reached some evidentiary conventions within a partial judicial settlement with two of the three parties involved in the collusion. The undertakings acknowledged the facts that sustained the FNE’s allegations and,[114] in exchange, the FNE reduced the maximum penalty required.[115] Since there have been no other cases, there is no clarity on whether the FNE is likely to reach these types of settlements again. The TDLC considers these evidentiary conventions as confessions from the parties that make these agreements and, consequently, as direct evidence of the infringement. Concerning third parties, however, these acknowledgements are only considered pieces of testimonial evidence that must be evaluated within the rest of the body of evidence and are not enough, in themselves, to prove their participation in the agreements.[116]
Finally, the TDLC has accepted the withdrawals of private claims in circumstances where the parties had reached extrajudicial settlements.[117] These are not proper judicial settlements because they are agreements negotiated outside the trial and without the participation of the TDLC, and end with the withdrawal of the claim. The TDLC must, however, approve the withdrawals to make sure that the exit does not contravene the Competition Act.
Recommendations for negotiating settlements
If a company is being investigated by the FNE or has been sued in a competition procedure and estimates that it may offer commitments to the authority to obtain the closing of the investigation, or to reach an extrajudicial agreement or a judicial settlement, it must approach the FNE or the TDLC, as the case may be, with a transparent, credible, technically grounded and sound proposal.
When the case is still under investigation, it is useful to explain in the proposal the functioning of the market, and the operation of the firm in that context. The proposal should include a reference of the concerns and risks to competition stemming from the conduct and should demonstrate how the proposed commitments remove those risks. It is not recommended that parties avoid mentioning any risks because it is likely that the FNE or the TDLC will identify those concerns anyway. The commitments must be sufficient and proportionate to deal with the risks, and, if arguing efficiencies, they must have an economic justification as well as proper evidence of them.
Prior to the submission of any proposal it is highly recommended that the commitments should be evaluated internally by the company, to confirm that each of the commitments is feasible for implementation. Retracting the commitments may show a lack of seriousness, and breaching them could trigger sanctioning procedures before the TDLC.[118]
Notes
1 Nicole Nehme is a partner, Mabel Ahumada is a director, and Raffaela Corte and Beatriz Hidalgo are senior associates, at FerradaNehme.
2 The Competition Act has been subject to various amendments. The main amendments were introduced by: (1) Law No. 19,610 of 1999, which, in summary, strengthened the powers, technical character and independence of the Chilean Competition Authority (FNE); (2) Law No. 19,911 of 2003, in which the major modifications were to replace the Antitrust Commissions (the Central Preventive Commission and the Antitrust Commission) with the establishment of the Chilean Competition Tribunal (TDLC), to eliminate criminal sanctions and to increase fines; (3) Law No. 20,361 of 2009, mainly aimed at improving the tools to fight cartels, granting additional investigative powers to the FNE, creating a leniency programme, increasing fines for this offence and extending the statute of limitations; and (4) Law No. 20,945 of 2016, which introduced important changes regarding collusion, such as the reinstatement of criminal penalties, the punishment per se for hardcore cartels and the inclusion of additional sanctions. This amendment also: established a mandatory and ex-ante control for concentration operations, introduced a new infringement for cases of direct horizontal interlocking, established the obligation to notify the FNE of acquisitions of minority stakes in competitors, increased fines and granted the TDLC the power to hear and resolve compensation actions for damages resulting from antitrust violations.
3 This being the only matter in which the FNE has the power to adopt decisions by prohibiting or approving − unconditionally or subject to remedies − concentration operations subject to its control.
4 Since 2016, by an amendment introduced by Law No. 20,945.
5 Criminal procedures regarding collusive behaviour are the jurisdiction of the Chilean criminal tribunals, but there have been no criminal prosecutions to date.
6 See ‘Instructivo Interno para el Desarrollo de Investigaciones de la Fiscalía Nacional Económica’ (Internal Instructions for the Development of the National Economic Prosecutor’s Office’s Investigations), dated May 2013, pp. 15–16. Available at www.fne.gob.cl/wp-content/uploads/2017/10/Instr._investigaciones_2013-1.pdf, accessed 24 September 2020.
7 ibid.
8 Extrajudicial agreements were introduced to the Competition Act in 2009 by Law No. 20,361. Article 39(ñ) of the Competition Act states that: ‘The National Economic Prosecutor will have the following powers and duties . . . . Enter into extrajudicial agreements with undertakings involved in its investigations, for the purpose of safeguarding competition in the markets. The Tribunal will be informed of the agreement in one sole hearing, without the form of a trial, specially summoned to that effect, within the fifth business day from the receipt of the background, during which it may hear the declarations of the parties to the agreement as well as the opinion of those who have a legitimate interest. It shall be presumed that the National Consumer Service and the consumer associations established by Law No. 19,496 have a legitimate interest. The Tribunal must approve or reject the agreement in a maximum period of fifteen business days counting from the date of the hearing. These decisions, once executed, are binding upon the parties to the agreement and may only be reversed by means of an appeal.’
9 The statute of limitation is three years from the moment of the execution of the conduct. Only in the case of collusive behaviour, the statute of limitation is five years, and the term will not start counting while the effects of the conduct remain on the market.
10 The Competition Act does not define what should be understood by a third party with legitimate interest; it only establishes that the interest of the National Consumer Service and consumer associations is presumed. Some commentators have proposed that a third party with a legitimate interest is someone whose interests (only interests and not necessarily rights) may be reached by the decision, as long as the third party appears before the TDLC prior to the final decision. See Jorge Grunberg, ‘The power of the National Economic Prosecution Office to close its investigations regarding eventual anticompetitive infringements through administrative settlements or commitments’, Revista de Derecho Público 92 (2020); p. 91.
11 Judicial terms include Saturday as a working day.
12 Specifically, the FNE will publish its final and reasoned decisions on its website. However, the parties involved in the inquiry can require copies of individual pieces of the investigation that are provided after being redacted to protect commercially sensitive information from third parties. Additionally, according to the Transparency Act Regarding Access to Public Information (Law No. 20,285), which applies to all public entities, any person can request information from any public entity about the institutions’ actions and decisions. Thus, any person can request information from the FNE about its investigations and can request copies of the investigation files. Once a submission is presented, the FNE will inform all the parties involved in the investigation or that have submitted information, asking if they give or deny their consent to deliver the information or if they agree as long as all commercially sensitive information is protected. Usually, the FNE responds to the request of information made through the Transparency Act by giving copies that redact any confidential, commercially sensitive information.
13 Before the implementation of the merger control regime in 2016, when a third party wanted to challenge a merger or if the merging parties wanted the authority’s approval of the concentration, they could initiate a non-contentious procedure before the TDLC. In this procedure, the TDLC was able to gain knowledge of the operation and could approve or reject it. The decision was binding for the undertakings involved. During those negotiations, the FNE applied the same rules and principles that it currently applies when examining a merger.
14 This tendency will probably be maintained, considering that the FNE has publicly expressed its preference for prosecuting collusive behaviour.
15 These agreements were reached prior to the implementation of the mandatory merger control regime in Chile. Therefore, it is highly unlikely that this type of extrajudicial agreement will be reached in the future. These extrajudicial agreements were the following: Extrajudicial Agreement No. 2-2010, SMU; Extrajudicial Agreement No. 3-2010, LAN; Extrajudicial Agreement No. 7-2013, Pfizer; Extrajudicial Agreement No. 9-2014, Abbott; Extrajudicial Agreement No. 10-2014, Oben; Extrajudicial Agreement No. 11-2015, Contitech and Veyance; Extrajudicial Agreement No. 12-2015, Electrolux; Extrajudicial Agreement No. 13-2016, Canales de Television; and Extrajudicial Agreement No. 14-2017, Holchile and Inversiones Caburga.
16 Extrajudicial Agreement No. 3-2010, LAN, is the only one that was rejected. The reason was that a non-contentious procedure concerning the same operation was initiated prior to the submission of the extrajudicial agreement to the TDLC (the non-contentious procedure was initiated by a consumer association the day before the FNE and the undertakings submitted the extrajudicial agreement to the TDLC).
17 Extrajudicial Agreement No. 1-2010, Soc. Concesionaria Aerotas, included commitments related to terminating some contracts and changing the bidding rules to facilitate new entry; Extrajudicial Agreement No. 4-2011, Terminal Aéreo de Santiago, included the restructuring of the parking segments to give better options to consumers; Extrajudicial Agreement No. 6-2012, Storbox and Iron Mountain, included commitments related to eliminating some clients’ obligations at the end of the contracts, facilitating the possibility of switching providers. That agreement also incorporated obligations to the undertaking to facilitate the termination of the relationship for the client; for example, in relation to the duration and the renewal of the conditions of the contracts and the return of the stored boxes.
18 Extrajudicial Agreement No. 4-2011, Terminal Aéreo de Santiago, included restructuring of, and adjustments to, parking fees; Extrajudicial Agreement No. 6-2012, Storbox and Iron Mountain, included commitments that limited contract termination fees.
19 Extrajudicial Agreement No. 5-2012, Torre, Fábrica Internacional de Lápices, included the commitment of not engaging in practices impeding or hindering the entrance or expansion of competitors and the obligation of auditing the practice by an external consultant that had to report the findings directly to the FNE. The practices in which the undertakings had engaged were paying the schools so they would include their brand in the lists of required school supplies given to parents. Extrajudicial Agreement No. 8-14, Polifusión, included the commitment of behaving in the future in good faith in all conduct related to brand registration at the National Institute of Industrial Property.
20 For example, this obligation was included in Extrajudicial Agreement No. 10-2014, Oben.
21 The obligation to notify a minority shareholding acquisition on a competitor was introduced by the 2016 amendment to the Competition Act (Article 4-bis of the Competition Act for future acquisitions, and Fourth Transitory Article of Law No. 20,945 for materialised transactions before the 2016 amendment).
22 Approximately €23,500. Extrajudicial Agreement No. 15-2018, International Mainstream Renewable Power.
23 Extrajudicial Agreement No. 16-2018, Tianqi.
24 Extrajudicial Agreement No. 18-2020, Soprole.
25 Extrajudicial Agreement No. 17-2020, Transbank II. There are no pending decisions from the TDLC regarding extrajudicial agreements.
26 Extrajudicial Agreement No. 14-2017, Holchile and Inversiones Caburga, approval decision, 29 June 2019, recital 14.
27 Extrajudicial Agreement No. 16-2018, Tianqi, approval decision, 30 October 2019, recital 9; Extrajudicial Agreement No. 13-2016, Canales de Television, approval decision, 28 January 2016, recital 14; Extrajudicial Agreement No. 12-2015, Electrolux, approval decision, 16 September 2015, recital 19.
28 Extrajudicial Agreement No. 8-2014, approval decision, 5 August 2014, recital 7; Extrajudicial Agreement No. 6-2013, approval decision, 9 April 2013, recital 4.
29 Therefore, even after the TDLC’s agreement approval, third parties could file a complaint before the FNE or present a claim before the TDLC in relation to the facts that motivated the agreement. However, it is unlikely that a complaint before the FNE would succeed since the FNE would have agreed to the settlement on the certainty that competition concerns would be resolved. A claim before the TDLC will probably follow the same outcome, since the TDLC would already have analysed the competition concerns and commitments of the specific agreement, and concluded that there were sufficient and adequate commitments to overcome or outweigh the competition concerns identified in the case.
30 Instructivo Interno para el Desarrollo de Investigaciones de la Fiscalía Nacional Económica, dated May 2013, p. 16. Available at www.fne.gob.cl/wp-content/uploads/2017/10/Instr._investigaciones_2013-1.pdf, accessed 24 September 2020.
31 These discretionary powers are established in Article 39, Paragraph 1 of the Competition Act. Regarding the possibility for the FNE to close investigations or dismiss complaints at the administrative stage (i.e., discharging judicial prosecution before the TDLC), see Jaime Arancibia, ‘Potestad del Fiscal Nacional Económico para desestimar previamente o archivar una investigación respecto de posibles infracciones al DL 211 de 1973, y para celebrar acuerdos extrajudiciales en materia de fusiones y adquisiciones’, in: Reflexiones sobre el Derecho de la Libre Competencia: Informes en Derecho Solicitados por la Fiscalía Nacional Económica (2010–2017), p. 165. Available at www.fne.gob.cl/wp-content/uploads/2017/11/FNE-Libro.pdf, accessed 24 September 2020.
32 id., p. 172.
33 Nevertheless, as the ongoing investigation is confidential, the only option for the investigated undertaking to find out more details on the competition concerns identified by the FNE is to communicate with the FNE.
34 The negotiation process is similar to the remedy negotiation process in mergers. However, as previously stated, there is no legal recognition of the right of the undertakings to offer these commitments, so the investigated undertakings will depend on the discretionary powers of the FNE to finally decide whether the commitments justify the closing of the investigation.
35 Among other circumstances, the duration of the negotiation period and its final outcome will depend on (1) the starting date of the investigation: the longer the duration of the investigation, the more likely that the FNE has precisely identified the competition risks and the greater the possibility of agreeing on the commitments; (2) the type of anticompetitive conduct investigated: this is normally abuse of dominant position investigations, but within the range of possible infringements some are easier to assess than others; and (3) the method of implementing and monitoring the commitments: the easier they are to implement and monitor, the more likely it is that an agreement on the commitments can be reached.
36 See footnote 9.
37 It is always possible to agree on a redacted version of the commitments with the FNE. The FNE’s decision must be reasoned and well-founded and will probably explain how the commitments deal with the competition risks identified.
38 See Arancibia (footnote 31), p. 169.
39 See FNE Case No. 1481-2009, available at www.fne.gob.cl/wp-content/uploads/2012/01/arch_031_2011.pdf, accessed 24 September 2020.
40 In this case, the company modified its price list by explicitly adding that the indicated prices were suggested and informed its clients that commercial conditions (as discounts and incentives) did not depend on the implementation of those suggested prices. The FNE considered that these commitments were appropriate to eliminate the risks identified and decided to close the investigation in December 2011.
41 See FNE Case No. 1810-2011, available at www.fne.gob.cl/wp-content/uploads/2012/08/inpu_1810_11.pdf (closing report), accessed 24 September 2020.
42 This is a merger case in which the FNE, after the completion of the transaction, decided to open an investigation to analyse the effects of the merger on the market. The investigation was launched in 2011 when no merger control regime existed in Chile, and the analysis of mergers was usually carried out after their completion, following the general rules for administrative investigations of conduct.
43 See FNE Case No. 1931-2011, available at www.fne.gob.cl/wp-content/uploads/2015/06/inpu_017_2015.pdf (closing report) and www.fne.gob.cl/wp-content/uploads/2015/06/arch_11_2015.pdf (closing decision), accessed 24 September 2020. As the FNE identified, Clexane had a high market share in the retail channel.
44 Sanofi-Aventis de Chile SA.
45 The medicine was being sold in pharmacies (retail sales channel) in two pack sizes (of two and 10 syringes), and the investigated undertaking offered to make the two sizes available to foundations (non-profit organisations that distribute Clexane to certain patients). The investigated undertaking also offered to improve the information available in the places where the medicine could be found at a convenient price with the purpose that physicians would inform patients about these alternatives to the retail sales channels.
46 See FNE Case No. 2368-2015, available at www.fne.gob.cl/wp-content/uploads/2016/09/inad_009_2016.pdf, accessed 24 September 2020.
47 PTLA had received permission from the Chilean Customs Agency to divert freight to depots that were next to its licensed area once the licensed area had reached capacity. The FNE received a complaint in which the complaining party argued that PTLA, rather than storing freight within its licensed area, was diverting freight to a related depot (based in the administrative authorisation) prior to capacity being reached, which allowed PTLA to charge higher prices because the rates in this depot were not regulated, whereas the rates in its licensed depot had been fixed in the bidding process.
48 The procedure established: an exhaustive list of justifications to deliver freight to depots outside the land port licence area; the need for intervention from the Customs Authority to confirm that the requirements for the delivery were met in every case; the implementation of efficient systems to customer queries, claims and questions; and the obligation to actively inform customers of the new procedure.
49 See FNE Case No. 2350-2015, available at www.fne.gob.cl/wp-content/uploads/2016/12/arch_xx_2016.pdf (closing report), accessed 24 September 2020.
50 In particular, within these ‘benefits’, the FNE considered that Enel not only gave free electrical appliances to the property developers, but also provided other services free of charge; for example, connections to Enel’s outside facilities and other electrical installations.
51 See FNE Case No. 2385-2016, available at www.fne.gob.cl/wp-content/uploads/2017/07/arch_05_2017.pdf (closing decision), accessed 24 September 2020.
52 In this case, the Military Hospital had launched a bid to buy cancer drugs for its patients. The complaint presented before the FNE argued that several requirements included in the bidding rules (i.e., plant certifications, certification of origin and bio-equivalence studies) had the effect of preventing several bidders from submitting an offer to the bidding process.
53 In particular, the Military Hospital committed to, inter alia: (1) limit the certification requirements to cases in which these are strictly necessary, to avoid unjustly limiting the number of bidders; and (2) organise bids for each type of drug that the hospital requires, unless bids for a group of drugs is necessary, particularly in terms of efficiency (i.e., to obtain lower prices or secure supply).
54 See FNE Case No. 2375-2016, available at www.fne.gob.cl/wp-content/uploads/2018/12/inpu_021_2018.pdf (closing report) and www.fne.gob.cl/wp-content/uploads/2018/12/arch_14_2018.pdf (closing decision), accessed 24 September 2020.
55 The investigated companies committed to: (1) reduce the period of exclusivity to two years (the exclusivity period was initially linked to the duration of the contract which was, on average, eight years); (2) introduce the possibility to renovate the contracts, linked to the possibility to end the commercial relationship each time (which was not clear previously); (3) publish the prices that the investigated companies would pay to the fishers per tonne of fish (which was not transparent previously); (4) avoid the establishment of clauses limiting the possibility of the artisanal fishers to change commercial partner; and (5) give permanent and clear information to the artisanal fishers regarding all aspects of the agreement.
56 Law No. 19,911, published in the Official Gazette on 14 November 2003.
57 The first and second paragraph of Article 22 of the Competition Act state that: ‘Once the period established in article 20 has expired, whether the interested parties responded or otherwise, the Tribunal may call the parties to a conciliation. If it is not considered pertinent or if said procedure failed, the Tribunal will receive the evidence during a non-extendable and common period of twenty business days. Concerning the conciliation, the Tribunal will resolve and approve the same, provided that the agreement is not anti-competitive. A complaint recourse referred to in article 27 may be filed against the resolution that approves a conciliation, by persons admitted to litigate that were not party thereto.’
58 The complaint could have been filed by the FNE or by an interested party.
59 See, for example, Cases C No. 153-2008, Requerimiento de la FNE en contra de Cervecera CCU Chile Limitada and C No. 244-2012, Requerimiento de la FNE contra Sociedad de Transportes Línea Uno Collico S.A. y otros. In practice, once the TDLC calls the parties to negotiate a settlement, the parties submit their proposals to one or more TDLC judges in hearings specially held for such purposes. Generally, after these hearings, the parties submit documents that reflect the progress on negotiations or the adjustments made to said proposals to the TDLC judges. Between hearings, the parties continue to directly negotiate the settlement agreement.
60 This can occur when the parties request the TDLC to call for a settlement but the TDLC rejects it; for example, because there is a public interest involved that justifies continuing with the proceeding.
61 In fact, Article 39, Paragraph 1, of the Competition Act establishes that: ‘The National Economic Prosecutor . . . will be able to defend the interests entrusted to him/her in the manner that he/she deems legally arranged, according to his/her own assessment.’
62 On the contrary, negotiations between the parties conducted outside those hearings are private.
63 See Transvip, where the parties of the proceeding reached a settlement agreement but the TDLC rejected it on the grounds that it was not sufficient to protect competition; Case C No. 302-2015, Demanda de Transporte Transvip S.p.A. en contra de SCL Terminal Aéreo de Santiago S.A. y otro. Moreover, in Sociedad de Transportes Línea Uno Collico, the TDLC rejected a partial settlement agreement because, among other arguments, it considered that the proposed commitments – not to participate in or encourage the conclusion of price agreements between operators of the urban transport services market, the implementation of an internal code aimed at discouraging conduct contrary to competition and the amendment of the by-laws of the trade union association – would not be sufficient to protect competition and would not justify the reduction of the penalty proposed by the FNE in the agreement; Case C No. 244-2012, Requerimiento de la FNE contra Sociedad de Transportes Línea Uno Collico S.A. y otros.
64 SC ruling dated 30 August 2009, Case No. 3344-2009, Requerimiento de la FNE contra Farmacia Ahumada y otros.
65 See Cases C No. 295-15, Requerimiento de la FNE contra LATAM Airlines Group S.A.; C No. 248-13, Requerimiento de la FNE contra Casther y otros; and C No. 177-08, Requerimiento de la FNE contra ACHAP A.G y Otros.
66 See Farmacias, where the TDLC considered that the commitments assumed by Farmacias Ahumada SA were pro-competitive and that they could also contribute to establish the existence of the collusive agreement; Case C No. 184-2008, Requerimiento de la FNE en contra de Farmacias Ahumada S.A. y otros. See also LATAM, where the TDLC considered that the settlement agreement contained obligations that would tend to promote and improve competition with respect to existing market conditions; Case C No. 295-2015, Requerimiento de la FNE contra LATAM Airlines Group S.A.
67 See Cases C No. 181-08, Demanda de Telmex Servicios Empresariales S.A. contra Compañía de Telecomunicaciones de Chile S.A.; and C No. 249-13, Requerimiento de la FNE contra Unilever Chile S.A.
68 By means of Ruling No. 36/2006, recitals 1, 2, 3 and 4, the TDLC, at the request of the parties, complemented a settlement agreement, thus resolving a point not yet agreed on by them. This was given that the TDLC considered that the rest of the settlement agreement would not violate competition and that it would be efficient and beneficial for the parties to end the trial by approving the agreement; Case C No. 66-2005, Demanda de AES Gener S.A. y Norgener S.A. en contra de Electroandina S.A.
69 See Cases C No. 184-2008, Requerimiento de la FNE en contra de Farmacias Ahumada S.A. y otros; C No. 244-2012, Requerimiento de la FNE contra Sociedad de Transportes Línea Uno Collico S.A. y otros; and C No. 248-13, Requerimiento de la FNE contra Casther y otros.
70 In fact, in Farmacias, the FNE reached a settlement with Farmacias Ahumada SA, one of the pharmacy chains accused of collusion, and in Radio Valparaíso, the FNE settled with nine of 10 defendants; Case C No. 194-2009, Requerimiento de la FNE contra Radio Valparaíso Ltda. y otros. Furthermore, in Trabajadores del Mar Independiente de la Caleta Punta de Choros A.G., a collusion case where the FNE accused the association of deciding and adopting a series of conducts that constituted express agreements between competitors, the TDLC approved a settlement agreement between the FNE and the trade association, ending the procedure by this mechanism; Case C No. 198-2009, Requerimiento de la FNE contra Asociación Gremial de Trabajadores del Mar Independiente de Caleta Punta de Choros A.G.
71 In fact, in cases Tecumseh Do Brasil, Asfaltos, Navieras, Laboratorios and Papeles, in all of which one or two of the defendants adhered to a leniency programme, there is no evidence in the proceeding that followed that the TDLC called the parties to a settlement or that the parties requested it; Cases C No. 207-2010, Requerimiento de la Fiscalía Nacional Económica contra Tecumseh Do Brasil Ltda. y otro; C No. 280-2014, Requerimiento de la FNE contra Asfaltos Chilenos S.A. y otros; C No. 292-2015, Requerimiento de la FNE contra CCNI S.A. y otras; C No. 312-2016, Requerimiento de la Fiscalía Nacional Económica en contra de Fresenius y otros; and C No. 299-2015, Requerimiento de la FNE contra CMPC Tissue S.A. y otra. In Pullman Bus, a cartel case brought to the TDLC in 2011, in which the defendants were accused of adopting and implementing coordinated practices aimed at fixing prices and determining frequencies for the provision of public passenger transport services on certain routes, one of the defendants − not the defendant that adhered to the leniency programme − requested the TDLC to call for a settlement. However, the TDLC rejected that option without providing any further arguments and declaring in its final decision the existence of the cartel; Case C No. 224-2011, Requerimiento de la FNE contra Servicios Pullman Bus Costa Central S.A. y otros.
72 See, for example, Cases C No. 217-2011, Requerimiento de la FNE contra Sociedad Agrícola Comercial y Ganadera Palo Santo Ltda. y otros; C No. 223-2011, Requerimiento de la FNE contra Empresa de Transportes Rurales Ltda. y otros; and C No. 248-2013, Requerimiento de la FNE contra Casther y otros. In all these cases, the FNE reached and the TDLC approved a partial settlement agreement, which in some cases involved all the parties of the proceeding but in none of them involved all the matters in dispute. However, Asociación Gremial de Cirujanos is an exception to this trend. In this case, the FNE accused certain surgeons that were part of a trade association of acting collectively to determine the prices of their medical consultations and surgical procedures, an agreement that would have been reached and facilitated through the trade association. Notwithstanding the above, in 2019 the FNE agreed and the TDLC approved a total settlement agreement with the trade association as well as with 111 surgeons associated to the same, ending the proceeding by this means; Case C No. 353-2018, Requerimiento de la FNE en contra de la Asociación Gremial de Cirujanos de V Región y otros.
73 Law No. 20,945, published in the Official Gazette on 30 August 2016, amended the Competition Act to, among other things, reinstate criminal sanctions for hardcore cartels.
74 See Cases C No. 235-2011, Requerimiento de la FNE contra la Dirección General de Aguas; C No. 273-2014, Requerimiento de la FNE contra Claro Chile S.A.; C No. 281-2014, Requerimiento de la FNE contra Telefónica Móviles Chile S.A.; C No. 282-2014, Requerimiento de la FNE contra Telefónica Chile S.A.; C No. 295-2015, Requerimiento de la FNE contra LATAM Airlines Group S.A.; C No. 314-2016, Requerimiento de la FNE contra ATI y otras; and C No. 328-2017, Requerimiento de la FNE contra Storbox S.A. y otro.
75 This is a stake equal to or higher than 10 per cent of the social capital of a competitor, provided that such acquisition does not grant the acquirer control over its competitor. Although it exceeds the scope of this chapter, according to Article 97 of the Securities Market Law (Law No. 18,045), the controller of a company is the one that: (1) holds the majority of votes at the shareholders’ meetings and is able to appoint the majority of directors, which is known as legal control or de jure control; or (2) can decisively influence the administration of the company, which is known as factual control or de facto control.
76 Case C No.389-2020, Requerimiento de FNE en contra de Sociedad de Inversiones Los Orientales Limitada.
77 This is failing to notify a merger to the FNE prior to its conclusion, or to conclude the transaction before its approval by the competition authorities (either the FNE or the TDLC) once the notification form is submitted to the FNE (Article 49 of the Competition Act).
78 On 6 April 2018, the FNE filed a claim against Minerva SA and JBS SA for having infringed the legal prohibition of concluding a concentration notified to the FNE before receiving the corresponding approval. The FNE considered that the existence of a carve-out agreement did not modify the fact that the concentration had been concluded; Case C No. 346-2018, Requerimiento de la FNE en contra de Minerva S.A. y otra.
79 Article 22, Paragraph 1 of the Competition Act.
80 See Radio Valparaíso, where the FNE settled with nine of 10 defendants, continuing the proceeding with respect to Bío Bío Comunicaciones S.A; Case C No. 194-2009, Requerimiento de la FNE contra Radio Valparaíso Ltda. y otros. Moreover, in Farmacias, the FNE settled with Farmacias Ahumada SA, continuing the trial with respect to the other two defendants, Farmacias Cruz Verde SA and Farmacias Salcobrand S.A; Case C No. 184-2008, Requerimiento de la FNE en contra de Farmacias Ahumada S.A. y otros.
81 Case C No. 16-04, Avocación en recurso de reclamación de Transbank S.A. en contra del Dictamen No. 1270 de la CPC y requerimiento del Sr. Fiscal Nacional Económico.
82 In fact, in the Farmacias settlement agreement, one of the defendants, Farmacias Ahumada SA, acknowledged the existence of some facts relevant to the case but did not recognise responsibility for any infringement, nor acknowledged responsibility of the other companies involved in the case. Furthermore, particularly in cartel cases, conduct or facts recognised by one party (in this case, Farmacias Ahumada S.A.) are not sufficient or suitable by themselves to constitute an infringement, which can only be established at the end of the contentious procedure that will follow its course with the parties that did not enter into the settlement agreement.
83 Prior to the introduction of the pre-emptive merger control regime in Chile (in June 2017), in Hoyts Cinemas, the merging parties agreed to sell some of the cinema complexes that were part of the operation; Case C No. 240-2012, Requerimiento de la FNE contra Hoyts Cinemas Chile y otros.
84 See Cases C No. 221-2011, Requerimiento de la FNE contra Embotelladora Andina y Coca Cola Embonor; C No. 230-2011, Demanda de Industria de Alimentos Trendy S.A. contra Nestlé Chile S.A.; and C No. 249-2013, Requerimiento de la FNE contra Unilever Chile S.A.
85 See Case C No. 249-2013, Requerimiento de la FNE contra Unilever Chile S.A. In this case, Unilever Chile SA agreed not to give retroactive discounts or discounts that could amount to exclusivity or have exclusionary effects.
86 See Case C No. 221-2011, Requerimiento de la FNE contra Embotelladora Andina y Coca Cola Embonor.
87 See Cases C No. 221-2011, Requerimiento de la FNE contra Embotelladora Andina y Coca Cola Embonor; C No. 230-2011, Demanda de Industria de Alimentos Trendy S.A. contra Nestlé Chile S.A.; and C No. 249-2013, Requerimiento de la FNE contra Unilever Chile S.A. In Unilever, the company undertook the commitment not to agree, make payments or offer discounts for the display of their products on their distributors’ shelves that would utilise exhibition space greater than 90 per cent of Unilever’s market share for a period of three years after the settlement was approved. At the end of that term, the same obligation applied but in relation to 100 per cent of Unilever’s market share.
88 See Cases C No. 263-2013 P, Requerimiento de la FNE contra Compañía Cervecerías Unidas S.A. y otra; and C No. 310-2016, Requerimiento de la FNE en contra de G.D Searle LLC.
89 See Case C No. 328-2017, Requerimiento de la FNE contra Storbox S.A. y otro. This case included, inter alia, the commitment to reduce the rate for the termination of the contract, thus adjusting this rate to the same level as the charge for the permanent removal or destruction of boxes, and the commitment to deliver, at the end of each contract, a minimum volume of boxes within a limited period of time. See also Cases C No. 230-2011, Demanda de Industria de Alimentos Trendy S.A. contra Nestlé Chile S.A.; C No. 258-2013, Requerimiento de le FNE contra EFE; and C No. 274-2014, Demanda de la Plaza S.A. contra Servicios de Televisión Canal del Fútbol Ltda.
90 See Case C No. 101-2006, Requerimiento de la FNE contra D&S S.A. y Cencosud S.A. This case ended with each of the supermarkets committing to a binding public document that ensured fair, general, objective and non-discriminatory conditions to all their providers in terms of some of the typical aspects of the relationship between vendors and supermarkets, such as the repositioning and display of products, and discounts, payments and services. D&S SA. settled before the TDLC. Cencosud SA did not settle, appealed the TDLC’s decision and settled before the SC (SC ruling dated 24 July 2008, Case No. 2998-2008).
91 See Cases C No. 220-2011, Demanda de Aerolínea Principal Chile S.A. contra Lan Airlines S.A.; C No. 187-2009, Demanda de Codelco Chile contra Terquim S.A.; and C No. 310-2016, Requerimiento de la FNE en contra de G.D Searle LLC. In the first case, the settlement included waivers from both parties to exercise judicial actions in the future related to the facts discussed in the proceeding, such as claims for damages and collection of procedural expenses. In Codelco/Terquim, a case in which the parties mutually alleged abuse of a dominant position by the other in relation to a concession of sulphuric acid, the parties committed, inter alia, to waive any civil, criminal, administrative or other action with respect to the facts of the proceeding and others that have occurred up to that date. In the third case, G D Searle undertook the commitment to refrain from exercising any future administrative or judicial action based on certain industrial property rights and to desist from a lawsuit filed against Synthon Chile Ltda, for unfair competition and patent infringement.
92 See Cases C No. 249-2013, Requerimiento de la FNE contra Unilever Chile S.A.; C No. 310-2016, Requerimiento de la FNE en contra de G.D Searle LLC; and No. C-389-2020, Requerimiento de FNE en contra de Sociedad de Inversiones Los Orientales Limitada. This last case, however, was not a case of abuse of dominance, but rather a case of not notifying the FNE about a minority stake in a competing company.
93 See Cases C No. 184-2008, Requerimiento de la FNE en contra de Farmacias Ahumada S.A. y otros; C No. 314-2016, Requerimiento de la FNE contra ATI y otras; C No. 328-2017, Requerimiento de la FNE contra Storbox S.A. y otro; C No. 353-2018, Requerimiento de la FNE en contra de la Asociación Gremial de Cirujanos de V Región y otros; and C No. 389-2020, Requerimiento de FNE en contra de Sociedad de Inversiones Los Orientales Limitada.
94 See Cases C No. 194-2009, Requerimiento de la FNE contra Radio Valparaíso Ltda. y otros; C No. 273-2014, Requerimiento de la FNE contra Claro Chile S.A.; C No. 282-2014, Requerimiento de la FNE contra Telefónica Chile S.A.; and C No. 288-2014, Demanda de Beatriz Mella Calderón contra Sindicato de Trabajadores Independientes y Pescadores Artesanales de Pichilemu y otros.
95 See Case C No. 198-2009, Requerimiento de la FNE contra Asociación Gremial de Trabajadores del Mar Independiente de Caleta Punta de Choros A.G. and C No.223-2011, Requerimiento de la FNE contra Empresa de Transportes Rurales Ltda. y otros.
96 See Case C No. 288-2014, Demanda de Beatriz Mella Calderón contra Sindicato de Trabajadores Independientes y Pescadores Artesanales de Pichilemu y otros. The settlement included a penalty clause according to which, if the defendants infringed competition law, they would have to pay approximately €32,700 to the plaintiff in damages.
97 See Cases C No. 184-2008, Requerimiento de la FNE en contra de Farmacias Ahumada S.A. y otros; C No. 194-2009, Requerimiento de la FNE contra Radio Valparaíso Ltda. y otros; C No. 217-2011, Requerimiento de la FNE contra Sociedad Agrícola Comercial y Ganadera Palo Santa Ltda. y otros; C No.223-2011, Requerimiento de la FNE contra Empresa de Transportes Rurales Ltda. y otros; and C No. 248-2013, Requerimiento de la FNE contra Casther y otros.
98 See Case C No. 198-2009, Requerimiento de la FNE contra Asociación Gremial de Trabajadores del Mar Independiente de Caleta Punta de Choros A.G. In this case, the adoption of an internal code was agreed to regulate and organise tourist trips by boat, including the obligation of the trade association to safeguard and maintain freedom in the determination of rates, a system for ordering the departure of vessels that would allow all agents to freely negotiate and provide their services and to guarantee in the future a competitive use of the dock and other facilities of the creeks administered by it.
99 See Cases C No. 184-2008, Requerimiento de la FNE en contra de Farmacias Ahumada S.A. y otros; C No. 194-2009, Requerimiento de la FNE contra Radio Valparaíso Ltda. y otros; C No. 217-2011, Requerimiento de la FNE contra Sociedad Agrícola Comercial y Ganadera Palo Santa Ltda. y otros; C No. 221-2011, Requerimiento de la FNE contra Embotelladora Andina y Coca Cola Embonor; C No. 223-2011, Requerimiento de la FNE contra Empresa de Transportes Rurales Ltda. y otros; and C No. 248-2013, Requerimiento de la FNE contra Casther y otros.
100 See Case C No. 258-2013, Requerimiento de le FNE contra EFE. In this case, the FNE accused Empresa de los Ferrocarriles del Estado, a state railway company, of having abused its dominant position by applying a pricing scheme that was not objective or transparent and that was arbitrarily discriminatory. Therefore, one of the commitments was to establish an internal regulation with a new tariffs scheme that could not be modified within three years.
101 See Cases C No. 249-2013, Requerimiento de la FNE contra Unilever Chile S.A. and C No. 295-2015, Requerimiento de la FNE contra LATAM Airlines Group S.A.
102 This was based on the fact that the defendants acknowledged the conduct alleged in the claim, the collaboration and the behavioural commitments assumed. See Cases C No. 194-2009, Requerimiento de la FNE contra Radio Valparaíso Ltda. y otros; C No. 217-2011, Requerimiento de la FNE contra Sociedad Agrícola Comercial y Ganadera Palo Santa Ltda. y otros; and C No. 248-2013, Requerimiento de la FNE contra Casther y otros.
103 See Case C No. 198-2009, Requerimiento de la FNE contra Asociación Gremial de Trabajadores del Mar Independiente de Caleta Punta de Choros A.G. In this case, the FNE eliminated the fine requested to the TDLC, considering the declarations and commitments assumed by the trade association.
104 One demonstration of the fact that the resolution approving a settlement produces the same effects as a final judgment issued by the TDLC is that said approval can be appealed to the SC by the parties of the proceeding that have not been part of the settlement, an action that typically proceeds against final judgments issued by the TDLC. The effect of res judicata does not and cannot affect the rights of the parties of the proceeding that have not entered into the settlement agreement.
105 Case C No. 153-2008, Requerimiento de la FNE en contra de Cervecera CCU Chile Limitada, settlement agreement approved by the TDLC in 2008 and Case C No. 263-2013 P, Requerimiento de la FNE contra Compañía Cervecerías Unidas S.A. y otra, settlement agreement approved by the TDLC in 2014. In fact, in a subsequent case (C No. 169-08, Demanda de Cervecería Artesanal Artiagoitía Hermanos Ltda. contra Cervecera CCU Chile Ltda), the TDLC accepted CCU’s objection against a new claim, recognising that the action filed by the plaintiff against CCU was extinguished as a result of the res judicata effect produced by the settlement approved by the TDLC in Case C No. 153-2008.
106 Case C No. 184-2008, Requerimiento de la FNE en contra de Farmacias Ahumada S.A. y otros.
107 SC ruling dated 24 July 2008, Case No. 2998-2008, Requerimiento de la FNE contra D&S S.A. y Cencosud S.A.
108 SC ruling dated 13 January 2014, Case No. 3700-2013, Demanda de Afex Transferencias y Cambios Ltda. y otro contra Banco de Chile.
109 SC ruling dated 10 June 2013, Case No. 982-2012, Requerimiento de la FNE contra el Sr. John C. Malone.
110 SC ruling dated 5 December 2012, Case No. 6922-2012, Requerimiento de la FNE contra Cámara de Comercio de Santiago A.G.
111 SC ruling dated 27 December 2019, Case No. 2428-2018, Consulta de Farmacia Cruz Verde S.A. sobre Merchant Discount de Transbank.
112 Evidentiary conventions are understood to be agreements between the parties of a trial where they agree on some or all the facts on which the accusation relies, therefore lifting from the FNE (or eventually another claimant) the burden of proof of those facts.
113 Case C No. 248-2013, Requerimiento de la FNE contra Casther y otros.
114 In addition, the parties committed to not engage in anticompetitive conduct in the future and to adopt an ethics code to prevent anticompetitive behaviour in the companies.
115 The penalty originally requested was approximately €158,500, which was reduced to approximately €23,700. In the end, the parties were each sanctioned approximately €7,900 because the TDLC rejected one of the alleged infringements from the FNE’s claim. TDLC Judgment No. 137/2014, 19 June 2014.
116 id., recitals 30–36.
117 Case C No. 305-2016, Demanda de Alimentos Bio Bio Ltda. y Otros. contra Alimentos y Frutos S.A. y Otros. This case involved several defendants. During the trial, the claimants reached different extrajudicial settlements with all the defendants and withdrew the claims against all of them.
118 On 10 September 2020, the FNE filed a complaint against The Walt Disney Company, requiring a penalty of approximately €3.5 million. The FNE argued that the company breached the commitments agreed with it during the merger control procedure, which were the basis on which the transaction between Disney and Fox was approved. Moreover, the FNE argued that during the merger investigation, the parties submitted false information and avoided submitting some documents required by the merger regulation; the penalty also took this infringement into consideration. Even though this case relates to a merger control procedure, it reveals the FNE’s willingness to pursue and request the imposition of sanctions on undertakings that have breached the commitments assumed; Case C No. 404-2020, Requerimiento de la FNE contra the Walt Disney Company y otra.