Chile’s Financial Market Commission (CMF) has published “Balance of the CMF’s Mandates”, setting out the Board’s strategic reference framework for implementing the regulator’s three mandates, and how it weighs potential trade-offs to support the overall objective of an adequately functioning financial system for people and businesses. The paper defines the Prudential Mandate as focusing on solvency, liquidity and risk management; the Market Conduct Mandate as protecting investors and financial services users through transparency, integrity and fair treatment; and the Market Development Mandate as improving efficiency, accessibility, depth and resilience. Given there is no statutory hierarchy between mandates in Chile, the CMF describes a case-by-case approach to managing “constructive tension”, grounded in risk analysis and empirical evidence, including the principle that equal activity and equal risk should face a similar regulatory response, and that limits should be set for “critical risks” that threaten systemic solvency, market integrity, customer protection or institutional reputation. The Board also points to the need for internal transparency and accountability on how risks are weighted and when that information should be shared publicly, and calls for periodic reviews of its risk analysis annually or more frequently if material market changes occur.

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