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Corporate bonds and commercial paper in Chile: issue deeds, bondholder representatives, ratings, debt lines, stamp tax and the 4 percent tax regime for public debt

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Last verified: 2026-10-26 · Status: Stable

A public offer of debt with a term over one year can only be made through bonds issued under a public deed signed with a bondholders' representative, rated by two independent rating agencies; short term debt of up to 36 months can be issued as commercial paper with one rating, and both can be issued as lines of up to ten years. Bonds that opt into the special tax regime of art. 104 of the income tax law give foreign holders a 4 percent tax on accrued interest and no tax on the capital gain when the conditions are met. Stamp tax on the issue accrues at placement, capped at 0.8 percent.

USD figures use the Central Bank exchange rate of CLP 986.58 per US dollar published in the Diario Oficial for 23 October 2026 (Ley Nº 18.840 art. 44). UF figures use the SII value of CLP 41,221.08 per UF for 26 October 2026 and UTM figures the October 2026 value of CLP 72,151. Conversions are for orientation only; the legal thresholds are set in UF or UTM.

Key facts

Term above which public debt must be issued as bonds	More than one year textLey Nº 18.045 art. 103, as of 2026-10-26 · in force
Risk ratings required for publicly offered bonds	2 agenciesLey Nº 18.045 art. 76, as of 2026-10-26 · in force
Maximum term of commercial paper (efectos de comercio)	36 monthsLey Nº 18.045 art. 131, as of 2026-10-26 · in force
Maximum life of a registered line of commercial paper	10 yearsLey Nº 18.045 art. 131, as of 2026-10-26 · in force
Withholding on interest paid to non residents on bonds issued by Chilean companies (foreign currency or pesos) and art. 104 instruments	4 %DL Nº 824 art. 59 Nº 1 d), g) and h), as of 2026-10-26 · in force
Maximum stamp tax on a bond issue	0.8 %DL Nº 3.475 art. 1 Nº 3, as of 2026-10-26 · in force

The rule

1. A public offering of debt securities with a term over one year may only be made through bonds. When requesting registration of a bond issue, the issuer files the public deed signed with the representative of the future bondholders, whom the issuer appoints in the deed and the bondholders' meeting may replace at any time. The deed sets all terms: issuer information, leverage limits and use of proceeds, amount, series, interest, indexation, amortisation and redemption (early redemption only by lottery or other equal treatment procedure), covenants, the representative's rights and duties, and the type of arbitration for disputes. Bonds can be issued for a fixed amount or as lines, provided placements outstanding do not exceed the amount and term of the registered line. Banks and financial companies are outside this limitation.
Cost to do it: CMF registration: 34 UF plus 0.85 per thousand of the issue up to 340 UF (DL Nº 3.538 art. 33); a UF 3,000,000 issue pays 374 UF, about CLP 15,416,684 or US$15,626. Representative, rating agencies, legal and placement fees are agreed privately.Ley Nº 18.045, Ley de Mercado de Valores, Title XVI, Art. 103 and art. 104, 1981-10-22 official text · verified 2026-10-26

2. Disputes between bondholders or their representative and the issuer go to arbitration under the deed; if the deed is silent, one or more arbitrators deciding in equity (árbitros arbitradores). The claimant may always take the dispute to the ordinary courts instead. Arbitrators may not be named in the deed; they are chosen by agreement of the parties or, failing that, by the courts, and only the recurso de queja lies against their decisions. Bondholders can always remove their representative and each holder can sue individually for payment.Ley Nº 18.045, Ley de Mercado de Valores, Art. 104 letter h) and art. 105, 1981-10-22 official text · verified 2026-10-26

3. When bonds finance new investment projects worth more than 40 percent of the issuer's individual assets before the issue, with funds applied in stages over more than one year, the deed must appoint an extraordinary administrator of the proceeds and a custodian, who release funds only as construction progress, equity contributions or other conditions are met. The bondholders' representative, the extraordinary administrator, custodians and experts are supervised by the CMF and may not be related to the issuer. Bondholder meetings require the absolute majority of the bonds of the issue on first call and those present on second call, deciding by absolute majority of the votes present.Ley Nº 18.045, Ley de Mercado de Valores, Art. 112, art. 116 and art. 124, 1981-10-22 official text · verified 2026-10-26

4. Issuers of publicly offered debt must hire, at their own cost, continuous and uninterrupted ratings from at least two different and independent rating agencies, and file two ratings with the registration application. For short term debt under Title XVII one rating is enough. Ratings are voluntary for shares and investment fund units.
Cost to do it: Two rating agency contracts for bonds, one for commercial paper, kept for the life of the issue; fees are set privately.Ley Nº 18.045, Ley de Mercado de Valores, as amended by Ley Nº 19.301 (Diario Oficial 19 March 1994), Art. 8 bis and art. 76, 1994-03-19 official text · verified 2026-10-26

5. Public offerings of debt with a term of no more than 36 months may also be made through promissory notes or other credit instruments (commercial paper, efectos de comercio), on the terms set by CMF general rules, either for a fixed amount or as a line of debt securities. Each placement in a line may not exceed the 36 month term, and lines may stay in force for up to ten years from registration. The issue terms must be set out in a public deed signed by the issuer's representative, and holders can enforce all obligations in the deed through executive proceedings.Ley Nº 18.045, Ley de Mercado de Valores, Title XVII, as amended by Ley Nº 19.768 (Diario Oficial 7 November 2001), Art. 131, 2001-11-07 official text · verified 2026-10-26

6. Gains on the sale of qualifying public debt instruments are not income when the instruments are registered in the Securities Registry, issued in Chile, and the issue deed opts into art. 104 and sets a fiscal interest rate for each placement, with at least one coupon a year. The seller must have held them at least one year (or a shorter period set by Ministry of Finance decree), or bought and sold them on a Chilean exchange in a continuous auction procedure authorised by the CMF and the SII. Non resident holders must appoint a Chilean representative, custodian or intermediary responsible for their tax obligations. Interest accrued on these instruments is taxed as it accrues.Decreto Ley Nº 824, Ley sobre Impuesto a la Renta, Title VI, Art. 104, 1974-12-31 official text · verified 2026-10-26

7. Interest paid to non residents on bonds issued in foreign currency by companies incorporated in Chile, on the same bonds issued in pesos, and on public debt instruments under art. 104 bears additional tax at 4 percent instead of 35 percent. For art. 104 instruments the issuer withholds 4 percent of the interest accrued at each coupon, prepayment or redemption, and holders that are not taxpayers can ask the SII for a refund for the period they held the bonds by the 5th of the following month; alternatively the issue terms may provide for withholding by the non resident's Chilean representative or custodian.
Example: A coupon of CLP 98,658,000 on peso bonds held by a foreign fund bears CLP 3,946,320 of withholding at 4 percent. / A US$100,000 coupon on dollar bonds issued by a Chilean company bears US$4,000 of Chilean tax, against US$35,000 at the general 35 percent rate.Decreto Ley Nº 824, Ley sobre Impuesto a la Renta, Art. 59 Nº 1 letters d), g) and h); art. 74 Nº 7 and Nº 8, 1974-12-31 official text · verified 2026-10-26

8. Stamp tax applies to the issue of bonds and debentures of any kind at 0.066 percent per month or fraction of term, capped at 0.8 percent. For promissory notes, bonds, debentures and other securities representing fundraising that belong to issues registered in the Securities Registry, the tax accrues when the securities are placed, and the issuer is the taxpayer.
Cost to do it: 0.8 percent of the amount placed for any bond with a term of 13 months or more.
Example: A placement of CLP 49,329,000,000 of seven year bonds pays CLP 394,632,000 of stamp tax at the 0.8 percent cap. / On US$50 million of bonds, that is US$400,000.Decreto Ley Nº 3.475, Ley de Timbres y Estampillas, Art. 1 Nº 3, art. 9 Nº 6 and art. 14, 1980-09-04 official text · verified 2026-10-26

Feature	Bonds (Title XVI)	Commercial paper (Title XVII)
Term	Over one year (mandatory form)	Up to 36 months
Ratings	Two independent agencies (art. 76)	One agency (art. 76)
Issue document	Public deed with the bondholders' representative (art. 104)	Public deed signed by the issuer (art. 131)
Lines	Allowed within amount and term of the line	Allowed; line valid up to 10 years
Holder protections	Representative, meetings, extraordinary administrator for large projects	Rights set in the deed; executive enforcement
Stamp tax	0.066 percent per month, cap 0.8 percent, at placement	Same; a 12 month paper pays 0.792 percent

Bonds versus commercial paper under Ley Nº 18.045

Worked example

A Chilean utility registers a UF 3,000,000 (about CLP 123,663,240,000 or US$125.3 million) ten year bond line, appoints a bank as bondholders' representative in the public deed and files two ratings (Ley Nº 18.045 art. 76 and 104). It pays 374 UF of CMF fees (about US$15,626) and, at placement, stamp tax at the 0.8 percent cap: UF 24,000, about CLP 989,305,920 or US$1.00 million (DL Nº 3.475 art. 1 Nº 3 and art. 14).
The deed opts into art. 104 and sets the fiscal rate. A foreign bond fund that buys UF 100,000 of the bonds bears 4 percent withholding on accrued interest at each coupon instead of 35 percent (DL Nº 824 art. 59 and 74 Nº 7), and if it sells after one year it pays no Chilean tax on the gain (art. 104), through a Chilean custodian that handles its tax obligations.

Step by step

1. Choose the instrument: bonds for terms over one year, commercial paper up to 36 months.
2. Hire two rating agencies (one for commercial paper) and a bondholders' representative not related to the issuer.
3. Draft the public deed with the mandatory terms, covenants and arbitration clause, and decide whether to opt into art. 104 of the income tax law.
4. File with the CMF for registration of the issue or line; pay 34 UF plus 0.85 per thousand up to 340 UF.
5. At each placement, report the fiscal rate to the CMF the same day (art. 104) and pay stamp tax.
6. Withhold 4 percent on interest for art. 104 bonds and pay it by the 12th of the following month; handle refund requests from non taxpayer holders.

Common traps

Offering debt with a term over one year to the public as notes rather than bonds. Only bonds are allowed (Ley Nº 18.045 art. 103).
Naming the arbitrator in the deed. The law forbids it (art. 105).
Assuming art. 104 tax benefits apply automatically. The deed must opt in and set a fiscal rate per placement; the instrument must be issued in Chile with at least one coupon a year.
Selling art. 104 bonds before one year off exchange: the gain exemption may not apply.
Forgetting the extraordinary administrator when proceeds fund new projects above 40 percent of assets (art. 112).
Using a representative related to the issuer; the person must step down and report it as an essential fact (art. 116).

Sources

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