News On The Bill Regarding The Strengthening Of SERNAC

On June 2, 2014, President Michelle Bachelet presented to Congress a bill to modify Law N° 19,496 on the Protection of the Rights of Consumers ("CPA") -Bulletin N° 9369-03.

Currently, this bill is in its second constitutional stage of processing before the Senate, pending the publication of the second report of the Constitution, Legislation, Justice and Regulation Commission.

The president of the aforementioned commission has stated that there is an agreement with the Executive branch in order to finish the processing of certain bills which are high priority for the Government, before the end of the legislative year (January 2017). The bill for the modification of the CPA is among these bills. According to said agreement, on December 14, 2016, the Government instructed sum urgency for this bill1.

Please find a summary of the main lines and modifications contained in the bill herein:

1. NEW AUTHORITIES OF SERNAC

   The bill aims to significantly increase the authority of the National Consumers Bureau ("SERNAC" for its Spanish acronym) regarding supervision, sanctioning, regulation and interpretion of the law.

   Supervision: The bill confers upon SERNAC the ability to enter into those facilities in which suppliers develop their activities in order to determine if the law is being fulfilled. This ability may be exercised with the assistance of the police in case the supplier does not cooperate with the supervision process. Also, in this context, the Bureau has the authority to require that a company present any document, book or information that is necessary for the supervision process, and to subpoena the legal representatives, administrators, advisors and other dependents of the company regarding the facts subject to these proceedings. Sanctioning: The bill gives SERNAC the authority to directly sanction infringements to the CPA. For this purpose, the bill sets forth a new proceeding before SERNAC. Regulating and interpreting: The exercise of these new authorities will correspond to the National Director of SERNAC, and shall be approved by a new regulatory body, independent from SERNAC, named "Regulatory Counsel". This counsel shall approve or reject the regulation and interpretation proposals made by the National Director of SERNAC. According to these new authorities, SERNAC may: (i) issue rules or general instructions, in order to complement the CPA, and (ii) administratively interpret regulations that protect the rights of consumers. The bill...