BlogCorfo Certification Why Corfo rejects R&D Law projects (and how to avoid it)
Applying under the R&D Law doesn’t guarantee the benefit. According to a University of Chile study based on Corfo data, the certification rate was 54.4% in 2021, and that year only 37% of the amounts applied for were certified. In other words, a significant share of applications are rejected in full or in part.
The good news: the reasons for rejection are well known and mostly avoidable.
1. “It’s a routine improvement”
This is by far the most common reason. With 2015 data, 64% of rejections happened because Corfo considered the project to consist of “routine, repetitive or minor improvements, adaptations and analyses”, one of the law’s express exclusions.
How to avoid it: explain the scientific or technological uncertainty the project aims to resolve. Don’t describe what you’ll build; describe what you don’t know and how you’ll find out. We cover this in Innovation is not the same as R&D.
2. Capabilities not demonstrated
For projects, Corfo checks that the company has enough equipment and qualified staff. If the team can’t show R&D experience, or the equipment and facilities aren’t relevant, certification becomes difficult.
How to avoid it: include at least one science or engineering professional or technician with demonstrable R&D experience in the last 36 months, backed by a CV, degrees and contract. See How to prove your R&D team’s capabilities.
3. Costs that don’t reflect the market
Corfo checks that spending properly reflects costs and matches market conditions. An inflated budget, expenses unrelated to the activities or items outside the accepted expense categories can lead to partial certification.
How to avoid it: link each budget line to a project activity, use real quotes and stick to the accepted expense categories. See How to build your budget.
4. Incomplete documents or late replies
If documents are missing, Corfo asks for them and the company has 30 days from notification to respond. If it doesn’t, the application is treated as not submitted. It’s avoidable, yet it still happens.
How to avoid it: prepare everything before applying and name one person responsible for answering Corfo on time.
5. It isn’t R&D, however valuable
Market studies, promotion, buying intellectual property as the main goal, or testing a product that is already ready to sell are expressly excluded. A project can be strategic for the company and still not qualify.
What Corfo doesn’t assess
Worth remembering: Corfo doesn’t assess the relevance or commercial value of the project. You won’t be rejected for having a weak business model, but because the project isn’t R&D under the law or because you didn’t demonstrate it well.
If you’re rejected
The resolution can be challenged through administrative appeals. In practice, though, the most useful step is to understand the reason and reshape the project for a new application.
This article is for information only and is not tax advice. Sources: Certification Regulation (Supreme Decree 102/2012), Corfo’s FAQ and Weber (2022), University of Chile.