Opening the Field: Chile’s Push for More Competition in Public Works

Chile is promoting an agenda to attract more competitors to its public works bids, which includes reorganizing its portfolio of concessions, shorter bidding processes, an expanded Contractor Registry, and a new dispute resolution system. For foreign companies, these measures could facilitate access to a market with more than three decades of experience in public-private partnerships and nearly 1,000 public works tenders per year.

Between August and October 2026, the Ministry of Public Works (“MOP”) announced a set of measures after finding that competition in its bidding processes had been declining and that the number of tenders declared void was increasing. The agenda aims to strengthen a system with a proven track record: between 1993 and 2025, approximately US$23.4 billion was invested through concessions, and the Chilean model has served as a benchmark for countries such as Costa Rica, Paraguay, and Peru[1]. Added to this is the “Chile Despega” Plan, launched by the government in September 2026 to revive employment, through which the MOP plans to increase the volume of its tenders by approximately 25%.

With regard to concessions, the MOP postponed seven of the twelve tenders scheduled for 2026 in order to ensure better conditions for carrying out the processes. At the same time, it is working on four lines of action to improve the execution of the project portfolio through stricter monitoring of projects, standardization and simplification of bidding documents, early coordination with sectoral agencies, and ongoing dialogue with the industry.

In traditional public works projects, the MOP aims to reduce the duration of bidding processes from six to four months through ten measures, including the early appointment of evaluators, a combined technical and financial evaluation, and maximum time limits of five days for the approval of bidding documents, the evaluation of proposals, the award of contracts, and the transfer of land. Likewise, the ministry proposes expanding the maximum ranges of the Contractor Registry by 75%, so that second-tier companies would go from competing for contracts worth up to 80,000 Unidad Tributaria Mensual (“UTM”, an inflation-indexed Chilean unit of account) (approximately US$5.8 million) to 140,000 UTM (approximately US$10.2 million). This would make permanent a flexibility measure that has been in effect on a temporary basis since 2023 and is set to expire at the end of 2026.

The most significant change in traditional public works is a new dispute resolution system. Unlike concessions, which have a Technical Panel, contractors today can only seek administrative remedies through the MOP and the Comptroller’s Office—or through the ordinary courts—in the event of disputes over fines, engineering errors, or compensation. The proposal includes an early warning system for all contracts, advisory committees for regional contracts valued at less than US$14 million, and a dispute management panel for larger projects, composed of six specialists.

Some issues remain open. The bill on disputes has not yet been submitted to Congress—a step the MOP hopes to take before the end of the year—and the industry has suggested supplementing it with internationally recognized mechanisms, such as mediation, dispute boards, and arbitration.

All of the above points toward attracting more competitors to public works bids. For foreign contractors, investors, and operators, this agenda could open a window of opportunity in a market seeking more streamlined processes and dispute resolution mechanisms more in line with international standards. Its success will depend, however, on whether the measures translate into projects that are actually launched, whether they are accompanied by an adequate budget, and whether the MOP manages to regain its position as a reliable partner for the private sector.

Author:
Nicolás Yuraszeck, Partner, Projects and Infrastructure, Prieto Abogados 
nyuraszeck@prieto.cl