8 Chile »
Marcelo Armas MFrom: Set-Off Law and Practice: An International Handbook (3rd Edition)
Edited By: William Johnston, Thomas Werlen, Frederick Link
This chapter examines the law of set-off in Chile, both before and after insolvency, as well as the alternatives for contractual set-off structures that may be agreed among two or more parties. In Chile, set-off was created as a legal concept primarily on the basis of practical considerations rather than juridical principles. The right to set-off may arise due to a contractual arrangement between the parties or by the operation of law, including the Chilean Civil Code. The chapter first considers set-off in Chile outside insolvency, focusing on set-off by operation of law and contractual set-off, before discussing set-off in insolvency. In particular, it explains the implications of a declaration of liquidation under Chilean Bankruptcy Law and its possible consequences for set-off rights. It also analyses issues arising in cross-border set-off.