Companies May Face Upgraded Privacy Law in Chile

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By Tom Azzopardi

Companies doing business in Chile would face new privacy compliance standards and stronger enforcement under a proposed law set for introduction in January.

The government bill would seek to protect citizen’s rights and freedoms over their personal data in line with Chile’s global commitments and the privacy standards of the Organization for Economic Cooperation and Development (OECD), which Chile joined in 2010, Deputy Finance Minister Alejandro Micco recently said.

Industry specialists say the lack of adequate data protection legislation is holding back the development of global technological services in Chile. Micco said that the proposed law aims to fix these shortfalls.

“Obviously we are going to have an institution which oversees personal data both in the public and private sectors and ensures personal data is properly handled throughout our economy,” the minister said at a Dec. 14 seminar in Santiago on boosting Chile’s service exports.

Present Law Criticized as Inadequate

Chile’s existing data protection law, the Law on the Protection of the Private Life (Law No 19,628) which was signed into law in 1999, is widely seen as inadequate for the modern web-connected world. Based on Spain’s framework data protection statute, the law failed to create an effective privacy regulator with enforcement authority.

Although details of the new bill haven’t been made public, analysts expect it to modify the existing law, rather than replace it entirely. It will likely opt for a slimmed-down data protection unit reporting to the Finance Ministry similar to Chile’s financial intelligence unit, rather than creating an entirely independent entity, they said.

“We should all get behind this as it is important that Chile gets data protection legislation that it needs as soon as possible,” Raul Arrieta, a data protection specialist who advised the Economy Ministry on the issue, told Bloomberg BNA Dec. 15. The bill may make it through one of the two chambers of Congress but is unlikely to clear both, Arrieta said.

Micco said the legislation would be submitted before lawmakers depart for the annual summer recess in February. However, it unlikely that the bill will become law before a new administration takes office in March 2018. The government has already spent much of its political capital on controversial reforms of the tax code, labor laws and education sector while most legislators are focused on next October’s congressional and presidential elections.

The present Chilean administration took up privacy early in its term, establishing a public-private committee under the auspices of the Economy Ministry to develop draft legislation. However, an earlier proposed bill to replace the existing law was blocked by incoming Finance Minister Rodrigo Valdes over concerns of the cost of establishing an autonomous privacy office amid a squeeze on public finances.

To contact the reporter on this story: Tom Azzopardi in Santiago at correspondents@bna.com

To contact the editor responsible for this story: Donald Aplin at daplin@bna.com

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