What question did this study set out to answer?

This article aims to explore the implications of the first application of Chile’s General Anti-Avoidance Rule in the Forestal Aurora case.

January 25, 2026

The Forestal Aurora Case: Insights from the First Case Application of the Chilean GAAR

Key Points

This article aims to explore the implications of the first application of Chile’s General Anti-Avoidance Rule in the Forestal Aurora case.
Detailed examination of the Forestal Aurora case
Comparison of Chile’s GAAR with EU GAAR under ATAD I
Analysis of court decisions and tax authority challenges
Identification of intent and artificiality issues in tax avoidance
Revelation of economic substance concerns
Highlighting inconsistencies in the application of GAAR in Chile versus EU standards

Abstract

This article examines the first application of Chile’s General Anti-Avoidance Rule (“GAAR”) in the Forestal Aurora case. The tax authority challenged a cross-border financing structure aimed at benefiting from a reduced 4% withholding tax rate on interests. The courts’ decisions mirror the EU GAAR’s subjective test under ATAD I, particularly regarding intent, artificiality and economic substance, revealing doctrinal inconsistencies in the application of Chile’s GAAR.

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Cite This Study

Allen et al. (Wed,) studied this question.

synapsesocial.com/papers/6975b24dfeba4585c2d6dc1a https://doi.org/https://doi.org/10.59403/75vbxm

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