Procurement Risk:
Very High
Score:
24/100
Government Policy
Q57
13/100
Does the country have legislation covering defence and security procurement with clauses specific to corruption risks, and are any items exempt from these laws?
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This indicator is not assigned a score in the GDI. The Chilean legal framework for the system of acquisitions and contracting in the defence…
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The law for acquisitions or “Ley de Compras” establishes a general framework with a flexible normative body and basic rules and procedures for acquisitions…
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The multiplicity and dispersion of the legislation relative to acquisitions and contract in the defence sector have somewhat hindered their effective implementation. In August…
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Q58
NEI/100
Is the defence procurement cycle process, from assessment of needs, through contract implementation and sign-off, all the way to asset disposal, disclosed to the public?
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There is not enough information to score this indicator. The disclosure of the defence procurement cycle is fragmented and dispersed. In conjunction with the…
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The disclosure of the defence procurement cycle is fragmented and dispersed. In conjunction with the institutions of defence, the system of public procurement or…
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There is not enough information to score this indicator. This is due to limited information on the policies and procedures relating to the defence…
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Q59
42/100
Are defence procurement oversight mechanisms in place and are these oversight mechanisms active and transparent?
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There are internal and external procurement oversight mechanisms. Internally, the Ministry of National Defence (MDN) is responsible for oversight of the investment of resources…
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The institutions of defence have been working on the development of an overall framework to rationalise investment and procurement based on the concept of…
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The transparency and publicity of oversight for procurement are highly unequal. There is no transparency relating to the internal oversight mechanisms in the armed…
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In conformity with the 2006 Law of Fiscal Responsibility [1], the last edition of the Book of Defence [2] defined a system of investment…
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The MDN does not publish plans for defence purchases in advance or with sufficient detail. Particular institutions in the defence sector may publish their…
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The acquisitions of goods and services made through public bidding in the web system Chile Compras can be traced and disaggregated by the respective…
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Data released through the Chile Compras is available in an accessible way through a centralised search engine [1, 2]. The information published pertains to…
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Capability Gap and Requirements Definition
Q62
0/100
What procedures and standards are companies required to have – such as compliance programmes and business conduct programmes – in order to be able to bid for work for the Ministry of Defence or armed forces?
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While there are procedures in place for the exclusion of bidders from registries and/or tenders, anti-corruption concerns do not seem to be of any…
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This indicator is scored ‘Not Applicable’. There are no standards relating to anti-corruption compliance required in defence procurement. Furthermore, there is evidence of obstacles…
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Q63
17/100
Are procurement requirements derived from a national defence and security strategy, and are procurement decisions well-audited? Are defence purchases based on clearly identified and quantified requirements?
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According to Article 5 Section g) of Law 20424 (Organic Bylaws of the National Defence Ministry), the Minister of Defence “proposes acquisition and investment…
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Formally, oversight of procurement in the defence sector has been conducted by the Special Commission of Defense in Congress, by the General Comptroller, and…
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As mentioned in 63A, there are no set of rules in force for tying purchases to a national defence strategy; this means that “purchases…
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Tender Solicitation, Assessment and Contract Award
Q64
NEI/100
Is defence procurement generally conducted as open competition or is there a significant element of single-sourcing (that is, without competition)?
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There is no public information on the percentage of acquisitions that belong to open competition (public bidding), private competition (private bidding) and direct contract.…
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There are two mechanisms for procurement in defence other than public bidding: private bidding, when particular tenders are called to formulate proposals according to…
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Q65
0/100
Are tender boards subject to regulations and codes of conduct and are their decisions subject to independent audit to ensure due process and fairness?
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The regulation and oversight of tender boards for procurement and acquisitions in the defence sector are decentralised and fragmented within different agencies and branches…
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There is no evidence of comprehensive audits to tender boards and officials involved in selecting suppliers and designing tender specification. There is some evidence…
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There is very little transparency in the operation and regulation of the bidding boards and their associated members. Tender boards regulations and codes of…
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As outlined in 63A and 63C, the 2017 White Paper referenced in this answer is an aspirational policy document, not a law [1]. There…
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Q66
58/100
Does the country have legislation in place to discourage and punish collusion between bidders for defence and security contracts?
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The country has a general legal framework that penalises collusion between firms that may affect free competition, including the results of bids made by…
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There is legislation that excludes companies and individuals who have been convicted of bribery and corruption for hiring and bidding with state agencies and…
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Academic literature, international reports, and investigative journalism provide a mixed picture on the degree of enforcement of legislation to discourage and punish collusion in…
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An online search – and through interviews – revealed no information on whether training is provided for procurement officials with regards to collusion in…
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Contract Delivery and In-Service Support
Q67
25/100
Are there mechanisms and procedures that ensure that contractors meet their obligations on reporting and delivery?
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There are formal rules to ensure that bidders and contractors that contract with public entities comply with their obligations on reporting and delivery. However,…
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Contracts are available for those acquisitions and procurement that goes through the System of Public Procurement ChileCompra [1, 2, 3, 4]. For each contract,…
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There has been a critical evaluation of the monitoring systems and the extent to which officials in the defence sector regularly oversee contract completion.…
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More specific information is needed on the frequency of enforcement and whether external scrutiny is available if necessary to provide a score for this…
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Q68
75/100
Are there mechanisms in place to allow companies to complain about perceived malpractice in procurement, and are companies protected from discrimination when they use these mechanisms?
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Formal procedures and mechanisms to complain about perceived malpractice in procurement in the defence sector are formally established; however, their functioning and guarantees are…
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Complaint mechanisms are available for procurement and contracting procedures that operate through the public procurement system ChileCompra. In this system, companies and individuals can…
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There is no evidence of companies that have been discriminated against or barred from procurements because of genuine complaints. Complaint mechanisms for procurement and…
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Legislation to exclude companies and senior company officials in the face of bribery and corruption-related offences exists, but procurement officials might have limited authority…
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An online search – and through interviews – revealed insufficient information on the subject of prosecution and undue influence. As such, this indicator is…
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An online search – and through interviews – revealed insufficient information on the subject of prosecution and undue influence. As such, this indicator is…
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Offset Contracts
Q70
0/100
When negotiating offset contracts, does the government specifically address corruption risk by imposing anti-corruption due diligence on contractors and third parties?
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There are no policies for offset contracts in general, and the specific committee that oversaw them disbanded. The government of Chile is aware of…
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There has been a tradition of opacity in offset contracts and acquisitions in the defence sector. Early on, the authors identified the lack of…
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There is no evidence of completion reports with supplier performance appraisals for offset contracts. The lack of monitoring of contracts has been pointed out…
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Article 13 of Law 19.866 grants the government the power to terminate a contract in cases of non-compliance [1]. However, there is not enough…
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There is very little evidence on the degree of competition to which compensation contracts have been subjected. Indirect background information of the use of…
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Agents / Brokers
Q73
25/100
How strongly does the government control the company’s use of agents and intermediaries in the procurement cycle?
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There have been serious concerns for the discretionary and opaque use of intermediaries in cases of alleged corruption in acquisition in the armed forces…
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Given that the government imposes no restrictions on the use of agents and intermediaries, this indicator is marked ‘Not Applicable’.
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Financing Package
Q74
0/100
Are the principal aspects of the financing package surrounding major arms deals, (such as payment timelines, interest rates, commercial loans or export credit agreements) made publicly available prior to the signing of contracts?
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Detailed information on the financing packages surrounding the main arms agreements in the armed forces is rarely available either before or after the signing…
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Seller Influence
Q75
NS/100
How common is it for defence acquisition decisions to be based on political influence by selling nations?
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This indicator is not assigned a score in the GDI. There is some evidence in the post-authoritarian period of corruption due to military acquisition…
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This indicator is not assigned a score in the GDI. There has been some justification of military procurement based on military needs, but this…
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This indicator is not assigned a score in the GDI. The existence of domestic pressures for granting acquisitions has been a concern in the…
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