Chile’s lower house Finance Committee concluded its detailed review of the capital markets reform known as MK4 on Wednesday, October 21, 2026, after two days of often intense debate on more than 200 indications. The session approved a new startup promotion statute and two Corfo investment measures, while the Executive Branch reserved constitutional objections to the latter provisions. The discussions also exposed tensions over the role of pension fund administrators in managing new voluntary housing savings accounts.
Corfo Venture Capital and Funds of Funds Measures
The committee approved two parliamentary indications that would allow Corfo, Chile’s economic development agency, to subscribe to and pay quotas in venture capital funds that finance startups. The same measures would permit Corfo to create public investment funds, or contribute to them, to invest in funds of funds focused on venture capital. The commission reversed an earlier inadmissibility ruling by seven votes to six, although Finance Minister Jorge Quiroz reserved constitutional review, citing exclusive presidential initiative and fiscal expenditure.
Startup Promotion Statute Approved
The committee also approved the Statute for Promotion of Innovation and Investment in Venture Capital, extending benefits similar to those of the junior stock market segment to unlisted startups. Eligible companies must be certified by Corfo as qualified innovative firms, be less than 10 years old, have net worth up to UF 1 million, and report average annual income up to UF 300,000. The statute aims to open financing channels for early-stage technology companies.
Tax Credit and Capital Gains Exemption
Under the approved statute, investors in eligible startups, directly or through venture capital funds, receive a 35% tax credit against global complementary income tax, with an annual cap of UTA 50. Capital gains are exempt from taxation if the investment is held for at least three years, and the text exempts SAFE agreements and convertible notes from stamp and seal taxes. Supporters said the measure brings Chile closer to international practices for encouraging venture capital investment.
AFP Housing Savings Controversy
A separate point of contention was Article 2 of the reform, which creates voluntary savings for housing and allows pension fund administrators, known as AFPs, to manage those funds. Opposition lawmakers argued that this exceeds the single purpose of AFPs under Decree Law 3,500, while the Executive Branch said the same reform regulates the new function. Communist Party Deputy Irací Hassler called for the provision to be voted on in the Chamber with constitutional rank and a qualified quorum.
Lawmaker Reactions and Next Steps
UDI Deputy Jaime Coloma praised the government for not changing client liability rules in cases of bank fraud and for committing to a future banking law. RN Deputy Diego Schalper, who introduced the Corfo indications, said he respects the Executive Branch’s position and expects progress during the legislative process. The Republican Party also rejected the Corfo provisions and announced it will support constitutional reservations when MK4 reaches the Chamber floor next week.
The MK4 debate now moves to the full Chamber of Deputies, where constitutional reservations and pension-related disagreements are likely to shape the next stage of discussion. The approved startup statute and Corfo investment proposals reflect a shared interest in strengthening Chile’s venture capital ecosystem, even as procedural and fiscal concerns remain unresolved. Lawmakers will need to reconcile those priorities to advance the broader capital markets reform and deliver the regulatory clarity sought by investors and startups.
Source: Df.cl