Chilean law has a framework to regulate the relations between consumers and merchants.
What are the consumer protection laws in Chile? The relationships between consumers and merchants or suppliers in Chile are regulated by law in order to avoid disparities between the parties that violate the rights of consumers.
If you are looking to invest in Chile, you need to know:
What is SERNAC?
The National Consumer Service (SERNAC) is the state entity responsible for mediating between consumers and merchants/suppliers and sanctioning any infringement of their legal obligations by the latter.
Consumer Associations take on the role of representing their members and the general public before both government authorities like the courts of law.
Consumer protection laws
Companies that supply goods and services are legally obliged to comply with a number of rules in this area, including the non-discrimination of consumers, complying with the advertised conditions and respecting the price that is advertised.
The mechanisms designed to protect consumers include:
- Consumer complaints
- The oversight conducted by SERNAC,
- Voluntary collective procedures
- Class action suits
- Collective mediation
What are the sanctions for companies that violate consumer protection regulations in Chile?
Companies that violate consumer protection regulations can be sanctioned with fines of between 300 and 2,250 Monthly Tax Units (UTM), the latter applicable to violations where the quality of the product or service could affect public health, public safety or the environment.
In Chile, there are specific regulations for financial service providers, to ensure that consumers receive “simple” and “transparent” information that does not mislead them when contracting a product or service. If the financial consumer is led into error, the law considers a three-pronged sanction system, based on annulment, fines and compensation for damages caused by violations on the part of the financial service provider.
To learn more in detail about this and other material relevant to starting your business in Chile, download the chapter of our step-by-step guide for Foreign Investors. Other chapters of the guide also contain useful information about Labor Laws, Taxes and Environmental Assessment.