MSE Insolvencies in Chile

This episode features a conversation with Roberto Villaseca, III NextGen Member, Partner of Carey LL.P. and Civil Law professor at Pontificia Universidad Católica de Chile.

In this episode, Roberto offers a detailed and candid analysis of Chile’s 2023 MSME insolvency reform, emphasising that while the new simplified reorganisation and liquidation procedures reduce costs and accelerate timelines, they have not yet shifted the deeper structural barriers that keep small businesses from using restructuring tools effectively. He explains that the elimination of audits, mandatory creditors’ meetings and certain liquidation steps, along with digital‑first processes and a roster of lower‑cost Veedores, has created a more accessible procedural framework, yet uptake for reorganisation remains strikingly low due to the continued absence of workable financing options and the dominance of banks in Chile’s credit market. Roberto discusses the limited scope of discharge, the challenges posed by regulatory gaps, the judiciary’s emerging reluctance to accept asset‑poor cases, and tensions around excluded debts such as state‑guaranteed student loans. Reflecting on lessons for other jurisdictions, Roberto stresses that procedural streamlining alone cannot transform outcomes: policymakers must address the economic realities confronting small businesses by ensuring access to financing and covering unavoidable administrative expenses. As he succinctly puts it, “regimes for struggling entrepreneurs must change the market dynamics — it’s not simply about procedures”.

The podcast is introduced by NextGen’s co-chair, Olya Antle of Cooley, and moderated by ⁠Dr. Eugenio Vaccari⁠ of Royal Holloway, University of London. It was recorded in early March 2026, with information accurate at the time of recording.