1. Bribery in the home (private to public)
1.1 The Legal Environment
Bribery of public officials (cohecho) is prohibited under Articles 248 to 251 of the Chilean Criminal Code.
1.2 What does bribery mean?
Any public official who: requests or agrees to receive fees greater than those applicable to the office he holds, or an economic benefit in his or her or a third party’s benefit, in exchange for performing or having performed an act within the scope of his or her office is subject to the Chilean Criminal Code; demands or accepts an economic benefit for himself or a third party in exchange for not executing or not having performed an act pertaining to his or her position, or for carrying out an activity in violation of his or her statutory duties; or asks or accepts a monetary reward for himself or a third party in order to commit certain other exceptional public official offences (e.g., embezzlement, violations of persons’ constitutional rights, etc.).
Anyone who offers or promises to offer a pecuniary benefit to a public official who engages in any of the above-mentioned conduct is subject to criminal prosecution.
1.3 What does it mean to be a public official?
Under Chile, the term “public official” is defined as follows in Article 260 of the Criminal Code:
Anyone who holds a position or performs a public function, whether in the Central Administration or in semi-fiscal, municipal, autonomous institutions or companies, or in state-created or state-dependent organisms, qualifies as a public official, even if they are not appointed by the Chilean president (Presidente de la Republica) and do not receive a state salary.
A functional notion of public official is formed (as recognized by the Supreme Court in its 1958 ruling and more recently in 2008) that encompasses a wide range of scenarios not covered by the Administrative Statute’s rigid application.
1.4 Bribery and its Consequences
Domestic bribery carries a maximum sentence of three years in prison and a fine of half to three times the amount of the benefit requested or accepted.
It is also possible to be disqualified from holding public office for a period of time or permanently.
The legal entity is dissolved or its legal authority is revoked.
Prohibition of executing acts and agreements with governmental institutions, either temporarily or permanently.
Loss of some or all fiscal benefits, as well as a total prohibition on receiving those benefits for a set length of time
Fines for the benefit of the Treasury
Penalties Associated with Ancillary Penalties
The law stipulates that, in addition to the previously mentioned fines, the following additional fines may be imposed: confiscation of any products derived from the crime, as well as confiscation of other assets, objects, documents, and instruments pertaining to the same; and, in cases where the felony involves making an investment that exceeds the legal entity’s income, the deposit of a suo motu.
1.5 Contributions from politics
The law governs political contributions. There are thresholds in an open election process depending on the authority being elected.
Foreign individuals or corporations are not permitted to make political contributions.
1.6 Hospitality expenses are subject to a limit (gifts, travel, meals, entertainment, among others)
Neither the law nor the rules specify a monetary limit.
Actions that consist of “requesting,” “making someone promise,” or “accepting” gifts, advantages, or privileges of any kind, whether for the public official or for third parties, specifically infringe the Public Integrity Principle, according to Article 64 N°5 Law 18575.
It further adds that official and etiquette presents are free from the prohibition, as are gifts recognized by custom as civility and indications of civility.
The law does not specify the kind of gifts that are considered courtesy and politeness according to custom. Some regulations, however, do specify their reach to some extent. For example, the Guide of State Administration Transparency and Honesty (the “Guide”), published by the General Secretariat Ministry of the Presidency in January 2008 (the “Guide”), explains the prohibition of Article 64 N°5, stating that it is a broad prohibition that covers not only the material dispense of a gift but also any kind of benefit, such as discounts to obtain a professional license (e.g., discounts more beneficial than those granted to the general public). The Guide explains the notion by stating that it encompasses anything that could jeopardize a public official’s integrity in order to benefit the person who is promised or giving the gift or favor. The Guide further states that getting or demanding economic benefits such as those listed may be considered a bribery criminal violation in addition to an administrative infraction.
2. Bribery in the home (private to private)
In contrast to other jurisdictions, Chilean criminal law does not provide a description of a criminal offense involving benefits offered to private sector business associates during contractual talks. As a result, we argue that, in principle, such conduct is currently unpunished in Chile under rigorous criminal legislation. (The United Nations Convention Against Corruption was published in the Official Gazette on January 30, 2007.) Bribery in the private sector could be dealt with in the future, according to Article 21.)
Nonetheless, such conduct could be considered an unlawful competition practice, as defined in Article 3 of Law N° 20.169, published in the Official Gazette on February 16, 2007, which broadly defines an unlawful competition act as any conduct contrary to bona fide or fair customs that aims to divert customers from a market agent through illicit means (see Article 3 of Law 20,169). If a third party is harmed by an illegal competitive act, it can initiate a civil lawsuit in order to have the act terminated or prohibited, as well as to have the consequences caused by the act ended, and possibly to obtain compensatory damages. A fine may also be imposed in some instances.
Another option is for a party who is found to have been harmed by the action to seek compensation under the Chilean Civil Code’s general rules on extracontractual liability.
3. Foreign public officials’ corruption
3.1 The Legal Environment
Article 251 bis of the Chilean Criminal Code regulates foreign public officers’ corruption.
3.2 Definition of foreign public officials’ corruption
It is against the law to:
offer, promise, or provide an economic or other benefit to a foreign public official, for the benefit of the foreign public official or a third party, in order for the foreign public official to act or refrain from acting in order to obtain or retain any business or unfair advantage in the course of international business transactions for himself or another party;
propose, promise, or deliver a foreign public official such a benefit in exchange for past performance of such an action or omission; and
giving or providing such a benefit consenting or agreeing to give or provide such a benefit
3.3 Explanation of the term “foreign public official”
A foreign public official is defined as a person who: holds a parliamentary, administrative, or judicial position in a foreign state, whether appointed or elected; performs public duties or functions for a foreign state, whether in a public entity or a state-owned company; or is an official or agent of a public international organization, according to Chile’s Criminal Code, Article 251 ter.
3.4 Consequences of foreign public officials’ corruption
The maximum penalty is five years in prison and a fine of one to two times the value of the benefit requested or accepted; if the benefit is not of a financial nature, a fine of up to 1,000 UTM is possible (approximately USD 70,700 at the current exchange rate).
3.5 Hospitality expenses are subject to a limit (gifts, travel, meals, entertainment, among others)
There are no legal restrictions in place.