Class Actions in Chile

Abstract

This study provides an empirical description of how class actions have worked in Chile under the procedure enacted in 2004. The study is the first comprehensive empirical description of consumer class action cases in the country since they were implemented. This study begins with a description of the consumer class action procedure and explains how the consensus regarding the undesirable effects of private enforcement steered by plaintiffs’ attorneys, led to a defendant-friendly procedure that gave little incentives for plaintiffs to litigate them. The study also explains the theoretical barriers in the procedure that prevents settlements, which are a common outcome of class action litigation in other jurisdictions. The second part of the article describes the universe of class action cases, and provides some interpretations on the aggregated data. The latter confirms that the class action procedure has effectively prevented sophisticated plaintiff’s counsels from engaging in class action litigation, has rendered few settlements, and ultimately have been used for political purposes or to draw the attention of the regulatory authorities.