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On November 20, 2018, Law 21,121 was published (the “Law”), which introduced various modifications to Chilean criminal law on crimes against corruption, increasing the punishment of certain existing crimes and incorporating new criminal offenses to Chilean legislation.

The Law has the following thrusts:

(i) New criminal sanction

In the first place, the Law incorporated a new criminal sanction to punish certain types of corruption offenses, consisting of the absolute, permanent and temporary disqualification, for holding positions, jobs, trades or professions in companies that contract with bodies or companies of the State or with companies or associations in which the State has a majority participation; or in companies that participate in concessions granted by the State or whose purpose is the provision of public utility services.

The application of said sanction will imply the deprivation of the position or employment
that is being performed, and the impossibility of holding it permanently or for the time of the sentence when the sanction is temporary. For these purposes, the Department of Public
Contracting and Procurement will maintain an updated public record of the persons to whom this penalty has been imposed.

(ii) Provisions relating a corruption in the private field.

Secondly, the Law incorporated new legal figures of corruption offenses in the private
sphere, which, in terms similar to the reality of other European countries and some Latin
American countries, come to fill a legal void existing in Chile in this matter.

First, the Law incorporated bribery among private individuals in the new articles 287 a and
b of the Criminal Code.

The first of these articles punishes with penalties of up to three years of imprisonment to
the employee or agent who requests or accepts to receive an economic benefit or of
another nature, for his or her own or a third party, to favor or have favored in the exercise
of his or her duties the contracting with one bidder over another. Said crime also entails a
fine of both the double of the benefit requested or accepted. In case the benefit is of a
different nature from the economic one, the fine will be from 50 to 500 Monthly Tax Units.
For its part, the second of these articles punishes with penalties of up to 540 days of
imprisonment who consents to give an employee or agent an economic or other benefit, for
his or her own or a third party, to favor or have favored the contracting with one bidder over another; and with penalties of up to 3 years of pressure to those who have given or offered such benefits.

In both cases, the crime also entails a fine of both the double of the benefit requested or
accepted, and 50 to 500 Monthly Tax Units, if the benefit is of a different nature.

Second, the Law incorporated the offense of unfair administration into article 470 of the
Criminal Code.

This new type sanctions with penalty of up to 5 years of imprisonment to the one who is in
charge of the management of all or part of the patrimony of another person caused
prejudice, whether exercising abusively powers to dispose on her account or oblige it, either by executing or omitting any other action in a manner manifestly contrary to the interest of the owner of the affected patrimony. The crime also carries a fine of half the amount of the fraud.

In the event that the entrusted patrimony is that of an open or special corporation, whoever incurs in the act of unfair administration will be sanctioned with prison sentences of up to 10 years, a fine of half of the fraud and temporary special disqualification of up to 5 years to perform as a manager, director, liquidator or administrator in any capacity of a company or entity under the control of a Superintendency or the Commission for the Financial Market.

Third, article 240 of the Criminal Code broadened the incompatible criminal type of
negotiation, joining the directors and managers of a corporation. By virtue of this
modification, the directors or managers of corporations, which, breaching the conditions
established by law, directly or indirectly, are interested in any negotiation, action, contract,
operation or management that involves the company, they may be sanctioned with up to 5
years of imprisonment, a fine of half of the value of the interest they would have taken in the business and absolute disqualification of up to 10 years holding positions, jobs or public
offices. With the same penalty, the directors or managers who give or allow to take interest, shall be sanctioned, having to prevent it, to his or her spouse, civil partner, relatives, third parties associated with him or her, or companies or undertakings in which he or herself or any of the aforementioned persons exercises the administration or has a social interest.

(iii) Bribery

Third, the Law modified the bribery offense by substantially expanding the scope of sanction of said crime.

First, the coverage of the crime of bribery was broadened, encompassing not only the battery with gifts of an economic nature, but with gifts of any kind.

Second, a new situation of bribery was incorporated, in the first paragraph of Article 248 of
the Criminal Code, sanctioning the public employee who requests or accepts, for his or her
own or a third party’s benefit, to which he or she has no right. This new criminal offense is
sanctioned with penalties of up to 3 years of imprisonment, 5 years of disqualification to hold public offices or offices and fine of both benefit requested or accepted.

Third, the Law increased the sanctions of the type of bribery consisting of the official
requesting or accepting greater rights than those indicated by reason of his or her position, or a benefit for his or her own or a third party, to perform or for having performed an act
pertaining to his or her position.

In this regard, the sanctions for this type of bribery reach up to 5 years imprisonment, 7 years of disqualification for holding positions or public offices and fine of both the double of the benefit requested or accepted.

Fourth, the Law also increased the penalties of imprisonment, financial and disqualifications
for the type of bribery consisting of requesting or accepting to receive an economic benefit or of another nature, for his or her own or a third party to omit or for having omitted a proper due act of office, or to perform or for having performed an act in violation of the duties of his or her office. In this regard, the new sanctions increased up to 10 years of imprisonment, up to 10 years of disqualification for positions or public offices and fine of double to four times the benefit requested or accepted. Likewise, if the violation of the duty of the office consists in exercising influence on another public employee in order to obtain from it a decision that may generate a benefit for an interested third party, the penalty of disqualification for public offices or offices shall be permanent.

Fifth, the new law broadens the criminal type with respect to the bribing party, punishing him or her when he or she offers, gives or consents in giving a benefit to the public employee. In addition, the penalties in respect of said private person were increased, reaching up to 10 years of imprisonment, a fine equivalent to the benefit requested or accepted, up to 7 years of disqualification for holding public positions or offices, and temporary or permanent disqualification for holding positions, jobs, trades or professions in companies that contract with bodies or companies of the State or with companies or associations in which this one has a majority participation; or in companies that participate in concessions granted by the State or whose purpose is the provision of public utility services.

Finally, the Law reformulated the criminal offense of bribery to foreign public officials,
established in article 251 bis of the Criminal Code, and increased the penalties of said
crime. According to the new wording, the criminal offense sanctions whoever offers,
promises, gives or consents to give a foreign public official a benefit of any nature for the
purpose of obtaining or maintaining for his or her own or for a third party any business or
advantage in the field of any international transactions or an economic activity performed
abroad. Meanwhile, the penalties for this crime were increased to 10 years of imprisonment, in addition to a fine of double to four times the benefit offered, promised, given or requested, disqualification for up to 10 years for holding public positions or offices, and temporary or permanent disqualification for holding positions, jobs, trades or professions in companies that contract with bodies or companies of the State or with companies or associations in which this one has a majority participation; or in companies that participate in concessions granted by the State or whose purpose is the provision of public utility services.

(iv) Increase of the sanctions of crimes against the public administration

Fourth, the Law included an increase of the imprisonment, financial and / or disqualification sanctions for a series of crimes against the public administration.

First, sanctions of imprisonment, financial and disqualifications of the crime of embezzlement of public funds contemplated in article 233 of the Criminal Code were increased. By virtue of this modification, the maximum penalties for imprisonment for said crime increased to one degree, going on to be sanctioned with imprisonment sentences of up to 5 years, 10 years and 15 years, depending on the amount of the subtracted. Likewise, the penalty of a fine for said crime was standardized to a fine equivalent to twice the amount subtracted. Finally, the minimum penalty of temporary disqualification for holding public positions and offices was increased three to five years.

Second, the financial sanctions for the crime of misuse of public funds contemplated in
article 235 of the Criminal Code were increased, establishing as a minimum fine half the
value of said amounts.

Third, the maximum imprisonment and financial penalties were increased in the case of the
fraud crime against the Treasury contemplated in article 239 of the Criminal Code, passing
to sanction with up to 15 years of imprisonment and a fine of half of what was defrauded.

Fourth, imprisonment and financial penalties were increased in case of incompatible
negotiation by public employees, arbitrators, liquidators, experts, executors, among others,
contemplated in article 240 of the Criminal Code, passing to sanction with up to 5 years of
imprisonment and a fine of half of the value of the interest it would have taken in the
business.

Fifth, the penalty of imprisonment of up to five years was included for the crime of illegal
levies contemplated in article 241 of the Criminal Code, and the minimum penalty of the
inability for holding public offices or offices was increased.

(v) Statute of Limitation

In the fifth place, the Law incorporated a new way of computing the statute of limitations
regarding the offenses of embezzlement of public funds, illegal levies, bribery and bribery of foreign public officials, contemplated in paragraphs 5, 6, 9 and 9 bis of Title IV of the Second Book of the Criminal Code.

In the case of said crimes, the statute of limitation period of the criminal action will begin to run from the moment the public employee who intervened in them ceases in his or her
position or function. However, if the employee, within the six months following the cessation of his / her position or function, assumes a new public office with powers of direction, supervision or control over the previously held, the period of statute of limitation shall begin to run since it ceased in the latter.

(vi) Criminal responsibility of legal persons

Finally, the Law introduced amendments to the criminal liability law of legal persons.

First, it incorporated new criminal offenses for which legal persons may be held responsible, incorporating into the catalog of offenses established in Law No. 20,393 the offenses of incompatible negotiation by directors or managers of a corporation, bribery between private, misappropriation and unfair administration.

Second, the Law extended the prohibition sanction to execute acts and contracts with state
agencies, incorporating this prohibition to State companies and companies or associations in which it has a majority participation, and the prohibition to adjudicate any concession granted by the State.

Third, the fines for tax benefit that can be imposed for the infraction of said law were
increased, whose maximum went from twenty thousand Monthly Tax Units to three hundred thousand Monthly Tax Units

Fourth, the concept of confiscation was extended to encompass all the gains obtained
through the commission of the offence.

Fifth, the Law expanded the possibility of decreeing the dissolution or cancellation of the
infringing company, encompassing not only crimes, but also simple crimes, provided that the company has been convicted, within the previous five years, for the same offense and there is no mitigating circumstance.

Sixth, a cessation of the legal representation of who was formalized in an investigation is
established for the same punishable act by which the criminal liability of the legal person is
investigated. In this case, the court will order a new representative to be appointed within a certain period of time, and if the appointed representative does not make the appointed
nomination, the court will appoint a professional to represent it.

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