Edgar Filing: CHEMICAL & MINING CO OF CHILE INC

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 6-K

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE

SECURITIES EXCHANGE ACT OF 1934

For the month of June, 2016.

Commission File Number 33-65728

CHEMICAL AND MINING COMPANY OF CHILE INC.

(Translation of registrant’s name into English)

El Trovador 4285, Santiago, Chile (562) 2425-2000

(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F: x Form 40-F ¨

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ___

Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ___

Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant’s “home country”), or under the rules of the home country exchange on which the registrant’s securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant’s security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Santiago, Chile. June 1, 2016.- Sociedad Química y Minera de Chile S.A. (SQM) (NYSE: SQM; Santiago Stock Exchange: SQM-B, SQM-A) reports the translation of its financial statements for the three months ended March 31, 2016, the Spanish version of which was filed with the Chilean Superintendency of Securities and Insurance (Superintendencia de Valores y Seguros or “SVS”) on May 18, 2016.

CONSOLIDATED FINANCIAL STATEMENTS

For the period ended

March 31, 2016

Sociedad Química y Minera de Chile S.A. and Subsidiaries

In Thousands of United States Dollars

This document includes:

Consolidated Classified Statements of Financial Position

Consolidated Statements of Income by Function

Consolidated Statements of Comprehensive Income

Consolidated Statements of Cash Flows

Consolidated Statements of Changes in Equity

Notes to the Consolidated Financial Statements

Sociedad Química y Minera de Chile S.A. and Subsidiaries

Table of Contents –Consolidated Financial Statements

Consolidated Classified Statements of Financial Position		9
Consolidated Statements of Income by Function		11
Consolidated Statements of Comprehensive Income		13
Consolidated Statements of Cash Flows		14
Consolidated Statements of Changes in Equity		16
Note 1	Identification and activities of the Company and Subsidiaries	18
1.1	Historical background	18
1.2	Main domicile where the Company performs its production activities	18
1.3	Codes of main activities	18
1.4	Description of the nature of operations and main activities	18
1.5	Other background	20
Note 2	Basis of presentation for the consolidated financial statements	22
2.1	Accounting period	22
2.2	Financial statements	22
2.3	Basis of measurement	23
2.4	Accounting pronouncements	23
2.5	Basis of consolidation	27
2.6	Significant accounting judgments, estimates and assumptions	29
Note 3	Significant accounting policies	30
3.1	Classification of balances as current and non-current	30
3.2	Functional and presentation currency	30
3.3	Foreign currency translation	30
3.4	Subsidiaries	32
3.5	Consolidated statement of cash flows	32
3.6	Financial assets	32
3.7	Financial liabilities	33
3.8	Financial instruments at fair value through profit or loss	33
3.9	Financial instrument offsetting	33
3.10	Reclassification of financial instruments	33
3.11	Derivative and hedging financial instruments	33
3.12	Derecognition of financial instruments	35
3.13	Derivative financial instruments	35
3.14	Fair value measurements	35
3.15	Leases	35

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Sociedad Química y Minera de Chile S.A. and Subsidiaries

3.16	Deferred acquisition costs from insurance contracts	36
3.17	Trade and other receivables	36
3.18	Inventory measurement	36
3.19	Investments in associates and joint ventures	37
3.20	Transactions with non-controlling interests	38
3.21	Related party transactions	38
3.22	Property, plant and equipment	38
3.23	Depreciation of property, plant and equipment	39
3.24	Goodwill	40
3.25	Intangible assets other than goodwill	40
3.26	Research and development expenses	41
3.27	Prospecting expenses	41
3.28	Impairment of non-financial assets	42
3.29	Minimum dividend	43
3.30	Earnings per share	43
3.31	Trade and other payables	43
3.32	Interest-bearing borrowings	44
3.33	Other provisions	44
3.34	Obligations related to employee termination benefits and pension commitments	45
3.35	Compensation plans	45
3.36	Revenue recognition	45
3.37	Finance income and finance costs	46
3.38	Income tax and deferred taxes	47
3.39	Segment reporting	48
3.40	Environment	49
Note 4	Financial risk management	49
4.1	Financial risk management policy	49
4.2	Risk factors	50
4.3	Risk measurement	53
Note 5	Changes in accounting estimates and policies (consistent presentation)	53
5.1	Changes in accounting estimates	53
5.2	Changes in accounting policies	53
Note 6	Background of companies included in consolidation	54
6.1	Parent’s stand-alone assets and liabilities	54
6.2	Parent entity	54
6.3	Joint arrangements of controlling interest	54

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Sociedad Química y Minera de Chile S.A. and Subsidiaries

6.4	General information on consolidated subsidiaries	55
6.5	Information attributable to non-controlling interests	58
6.6	Information on consolidated subsidiaries	59
6.7	Detail of transactions between consolidated companies	63
Note 7	Cash and cash equivalents	64
7.1	Types of cash and cash equivalents	64
7.2	Short-term investments, classified as cash equivalents	64
7.3	Information on cash and cash equivalents by currency	65
7.4	Amount of significant restricted (unavailable) cash balances	65
7.5	Short-term deposits, classified as cash equivalents	66
Note 8	Inventories	67
Note 9	Related party disclosures	68
9.1	Related party disclosures	68
9.2	Relationships between the parent and the entity	68
9.3	Detailed identification of the link between the Parent and subsidiary	69
9.4	Detail of related parties and related party transactions	71
9.5	Trade receivables due from related parties, current:	72
9.6	Trade payables due to related parties, current:	72
9.7	Board of Directors and Senior Management	73
9.8	Key management personnel compensation	75
Note 10	Financial instruments	76
10.1	Types of other financial assets	76
10.2	Trade and other receivables, current and non-current	77
10.3	Hedging assets and liabilities	79
10.4	Financial liabilities	81
10.5	Trade and other payables	92
10.6	Financial liabilities at fair value through profit or loss	93
10.7	Financial asset and liability categories	94
10.8	Fair value measurement of assets and liabilities	96
10.9	Financial assets pledged as guarantee	97
10.10	Estimated fair value of financial instruments and financial derivatives	97
10.11	Nature and scope of risks arising from financing instruments	99
Note 11	Equity-accounted investees	100
11.1	Investments in associates recognized according to the equity method of accounting	100
11.2	Assets, liabilities, revenue and expenses of associates	101
11.3	Other information	102

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Sociedad Química y Minera de Chile S.A. and Subsidiaries

Note 12	Joint Ventures	102
12.1	Policy for the accounting of equity accounted investment in joint ventures	102
12.2	Disclosures of interest in joint ventures	102
12.3	Investment in joint ventures accounted for under the equity method of accounting	103
12.4	Assets, liabilities, revenue and expenses from joint ventures:	105
12.5	Other Joint Venture disclosures:	106
Note 13	Intangible assets and goodwill	107
13.1	Balances	107
13.2	Disclosures on intangible assets and goodwill	107
Note 14	Property, plant and equipment	113
14.1	Types of property, plant and equipment	113
14.1	Reconciliation of changes in property, plant and equipment by type:	114
14.3	Detail of property, plant and equipment pledged as guarantee	118
14.4	Additional information	118
14.5	Impairment of assets	118
Note 15	Employee benefits	118
15.1	Provisions for employee benefits	118
15.2	Policies on defined benefit plan	119
15.3	Other long-term benefits	120
15.4	Post-employment benefit obligations	121
15.5	Staff severance indemnities	121
Note 16	Executive compensation plan	123
Note 17	Disclosures on equity	125
17.1	Capital management	125
17.2	Disclosures on preferred share capital	126
17.3	Disclosures on reserves in equity	128
17.4	Dividend policies	129
17.5	Provisional dividends	130
Note 18	Provisions and other non-financial liabilities	131
18.1	Types of provisions	131
18.2	Description of other provisions	132
18.3	Other non-financial liabilities, current	132
18.4	Changes in provisions	133
18.5	Detail of main types of provisions	134
Note 19	Contingencies and restrictions	135
19.1	Lawsuits and other relevant events	135

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Sociedad Química y Minera de Chile S.A. and Subsidiaries

19.2	Restrictions to management or financial limits	139
19.3	Commitments	140
19.4	Tax contingency	141
19.5	Restricted or pledged cash	141
19.6	Securities obtained from third parties	143
19.7	Indirect guarantees	144
Note 20	Revenue	146
Note 21	Earnings per share	146
Note 22	Borrowing costs	147
22.1	Costs of capitalized interest, property, plant and equipment	147
Note 23	Effect of fluctuations on foreign currency exchange rates	148
Note 24	Environment	149
24.1	Disclosures of disbursements related to the environment	149
24.2	Detail of information on disbursements related to the environment	150
24.3	Description of each project, indicating whether these are in process or have been finished	154
Note 25	Other current and non-current non-financial assets	161
Note 26	Operating segments	162
26.1	Operating segments	162
26.2	Operating segment disclosures:	164
26.3	Statement of comprehensive income classified by operating segments based on groups of products	166
26.4	Revenue from transactions with other Company’s operating segments	168
26.5	Disclosures on geographical areas	168
26.6	Disclosures on main customers	168
26.7	Segments by geographical areas as of December 31, 2015 and December 31, 2014	169
Investment accounted for under the equity method
Intangible assets other than goodwill
Investment accounted for under the equity method
Intangible assets other than goodwill
26.8	Property, plant and equipment classified by geographical areas	170
Note 27	Gains (losses) from operating activities in the statement of income by function of expenses, included according to their nature	171
27.1	Revenue	171
27.2	Cost of sales	171
27.3	Other income	172

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Sociedad Química y Minera de Chile S.A. and Subsidiaries

27.4	Administrative expenses	172
27.5	Other expenses by function	173
27.6	Other income (expenses)	173
27.7	Summary of expenses by nature	174
27.8	Finance expenses	174
Note 28	Income tax and deferred taxes	175
28.1	Current tax assets	175
28.2	Current tax liabilities	176
28.3	Tax earnings	176
28.4	Income tax and deferred taxes	177
Note 29	Disclosures on the effects of fluctuations in foreign currency exchange rates	188
Note 30	Mineral resource exploration and evaluation expenditure	193
Note 31	Lawsuits and complaints	194
Note 32	Sanction proceedings	196
Note 33	Potential Arbitrage Proceeding for the Settlement Insurance Policy for Heavy Rains in the Atacama Saltpeter Deposit	197
Note 34	Closure of the Pedro de Valdivia Site	197
Note 35	Effects on Premises after the Rain Storms in the Tocopilla Zone	198
Note 36	Events occurred after the reporting date	198
36.1	Authorization of the financial statements	198
36.2	Disclosures on events occurring after the reporting date	198
36.3	Detail of dividends declared after the reporting date	200

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Sociedad Química y Minera de Chile S.A. and Subsidiaries

Consolidated Classified Statements of Financial Position

Assets	Note		As of March 31, 2016 ThUS$		As of December 31, 2015 ThUS$
Current assets
Cash and cash equivalents		7.1		526,687		527,259
Other current financial assets		10.1		690,758		636,325
Other current non-financial assets		25		69,834		62,006
Trade and other receivables, current		10.2		294,790		302,225
Trade receivables due from related parties, current		9.5		85,799		99,907
Current inventories		8		1,039,938		1,003,846
Current tax assets		28.1		45,128		65,277
Total current assets				2,752,934		2,696,845

Non-current assets
Other non-current financial assets		10.1		2,737		486
Other non-current non-financial assets		25		27,786		33,526
Trade receivables, non-current		10.2		1,008		1,050
Investments in associates		11.1		53,457		49,836
Investments in joint ventures		12.3		57,041		29,466
Intangible assets other than goodwill		13.1		109,675		110,428
Goodwill		13.1		38,088		38,388
Property, plant and equipment		14.1		1,645,642		1,683,576
Deferred tax assets		28.4		577		161
Total non-current assets				1,936,011		1,946,918
Total assets				4,688,945		4,643,762

The accompanying notes form an integral part of these consolidated financial statements.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Sociedad Química y Minera de Chile S.A. and Subsidiaries

Consolidated Classified Statements of Financial Position, (continued)

Liabilities and Equity	Note		As of March 31, 2016 ThUS$			As of December 31, 2015 ThUS$
Liabilities
Current liabilities
Other current financial liabilities		10.4		476,607			402,030
Trade and other payables, current		10.5		126,403			136,840
Trade payables due to related parties, current		9.6		165			435
Other current provisions		18.1		28,519			28,141
Current tax liabilities		28.2		46,992			52,070
Provisions for employee benefits, current		15.1		4,514			13,445
Other current non-financial liabilities		18.3		96,457			69,966
Total current liabilities				779,657			702,927

Non-current liabilities
Other non-current financial liabilities		10.4		1,237,200			1,290,203
Other non-current provisions		18.1		8,890			8,890
Deferred tax liabilities		28.4		211,446			219,391
Provisions for employee benefits, non-current		15.1		22,779			21,995
Total non-current liabilities				1,480,315			1,540,479
Total liabilities				2,259,972			2,243,406

Equity		17
Share capital				477,386			477,386
Retained earnings				1,911,459			1,882,196
Other reserves				(20,570	)		(19,797	)
Equity attributable to owners of the Parent				2,368,275			2,339,785
Non-controlling interests				60,698			60,571
Total equity				2,428,973			2,400,356
Total liabilities and equity				4,688,945			4,643,762

The accompanying notes form an integral part of these consolidated financial statements.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Sociedad Química y Minera de Chile S.A. and Subsidiaries

Consolidated Statements of Income by Function

		January to March
	Note	2016 ThUS$			2015 ThUS$

Revenue	20		391,845			387,519
Cost of sales	27.2		(278,285	)		(256,824	)
Gross profit			113,560			130,695

Other income	27.3		4,024			4,877
Administrative expenses	27.4		(18,091	)		(21,165	)
Other expenses by function	27.5		(6,445	)		(14,880	)
Other gains (losses)	27.6		1,188			394
Profit (loss) from operating activities			94,236			99,921
Finance income			4,308			3,350
Finance costs	22		(17,431	)		(16,936	)
Share of profit of associates and joint ventures accounted for using the equity method			5,744			3,559
Foreign currency translation differences	23		(4,173	)		9,710
Profit (loss) before taxes			82,684			99,604
Income tax expense, continuing operations	28.4		(24,036	)		(27,792	)

Profit (loss) from continuing operations			58,648			71,812

Profit for the year			58,648			71,812
Profit attributable to
Owners of the Parent			58,526			71,685
Non-controlling interests			122			127
Profit for the year			58,648			71,812

The accompanying notes form an integral part of these consolidated financial statements.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Sociedad Química y Minera de Chile S.A. and Subsidiaries

Consolidated Statements of Income by Function, (continued)

		January to March
	Note	2016		2015
		US$		US$

Earnings per share
Common shares
Basic earnings per share (US$ per share)	21		0.2224		0.2724

Basic earnings per share (US$ per share) from continuing operations			0.2224		0.2724

Diluted common shares
Diluted earnings per share (US$ per share)	21		0.2224		0.2724

Diluted earnings per share (US$ per share) from continuing operations			0.2224		0.2724

The accompanying notes form an integral part of these consolidated financial statements.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Sociedad Química y Minera de Chile S.A. and Subsidiaries

Consolidated Statements of Comprehensive Income

	January to March
	2016			2015
Statements of comprehensive income	ThUS$			ThUS$

Profit for the year		58,648			71,812
Components of other comprehensive income before taxes and foreign currency translation differences
Gain (loss) from foreign currency translation differences, before taxes		1,462			(3,162	)
Other comprehensive income before taxes and foreign currency translation differences		1,462			(3,162	)
Cash flow hedges
(Gain) loss from cash flow hedges before taxes		(2,994	)		3,596
Other comprehensive income before taxes and cash flow hedges		(2,994	)		3,596
Other comprehensive income before taxes and actuarial gains (losses) from defined benefit plans		(1	)		(18	)
Other components of other comprehensive income before taxes		(1,533	)		416

Income taxes associated with components of other comprehensive income
Income taxes associated with cash flow hedges in other comprehensive income		765			(815	)
Income taxes associated with components of other comprehensive income		765			(815	)

Other comprehensive income		(768	)		(399	)

Total comprehensive income		57,880			71,413

Comprehensive income attributable to
Owners of the Parent		57,753			71,308
Non-controlling interests		127			105
Total comprehensive income		57,880			71,413

The accompanying notes form an integral part of these consolidated financial statements.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Sociedad Química y Minera de Chile S.A. and Subsidiaries

Consolidated Statements of Cash Flows

Consolidated Statements of cash flows	Note	03/31/2016 ThUS$			03/31/2015 ThUS$
Cash flows from (used in) operating activities

Types of receipts from operating activities

Cash receipts from sales of goods and rendering of services			405,708			433,844
Cash receipts from premiums and benefits, annuities and other benefits from policies entered			1,116			259

Types of payments

Cash payments to suppliers for the provision of goods and services			(254,850	)		(249,705	)
Cash payments to and on behalf of employees			(35,042	)		(38,111	)
Other payments related to operating activities			(2,709	)		(8,771	)
Dividends received			2,208			2,592
Interest paid			(2,856	)		(9,925	)
Interest received			4,308			3,350
Reimbursed (paid) income taxes			(2,205	)		(23,471	)
Other incomes (outflows) of cash			(13,332	)		4,273

Net cash generated from (used in) operating activities			102,346			114,335

Cash flows from (used in) investing activities
Other cash payments made to acquire interest in joint ventures			(25,000	)		(59	)
Proceeds from the sale of property, plant and equipment			572			221
Acquisition of property, plant and equipment			(37,323	)		(21,432	)
Proceeds from sales of intangible assets			1,416			2,972
Cash advances and loans granted to third parties			155			425
Other incomes (outflows) of cash (*)			(61,429	)		15,970

Net cash generated from (used in) investing activities			(121,609	)		(1,903	)

(*) Includes other cash receipts (payments), investments and redemptions of time deposits and other financial instruments, which do not qualify as cash and cash equivalents in accordance with IAS 7.7 as they record a maturity date from their date of origin greater than 90 days.

The accompanying notes form an integral part of these consolidated financial statements.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Sociedad Química y Minera de Chile S.A. and Subsidiaries

Consolidated Statements of Cash Flows, (continued)

	Note	03/31/2016 ThUS$			03/31/2015 ThUS$

Cash flows from (used in) financing activities

Proceeds from long-term borrowings			-			-
Proceeds from short-term borrowings			40,000			20,.000
Total proceeds from borrowings			40,000			20,000
Repayment of borrowings			(20,000	)		(20,000	)

Net cash generated from (used in) financing activities			20,000			-

Net increase (decrease) in cash and cash equivalents before the effect of changes in the exchange rate			737			112,432

Effects of exchange rate fluctuations on cash held			(1,309	)		6,819
Net (decrease) increase in cash and cash equivalents			(572	)		119,251

Cash and cash equivalents at beginning of period			527,259			354,566
Cash and cash equivalents at end of period			526,687			473,817

The accompanying notes form an integral part of these consolidated financial statements.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Sociedad Química y Minera de Chile S.A. and Subsidiaries

Consolidated Statements of Changes in Equity

2016	Share capital		Foreign currency translation difference reserves			Cash flow hedge reserves			Actuarial gains (losses) from defined benefit plans			Other miscellaneous reserves			Other reserves			Retained earnings			Equity attributable to owners of the Parent			Non-controlling interests		Total
	ThUS$		ThUS$			ThUS$			ThUS$			ThUS$			ThUS$			ThUS$			ThUS$			ThUS$		ThUS$

Equity at beginning of the year		477,386		(14,035	)		(1,699	)		(2,386	)		(1,677	)		(19,797	)		1,882,196			2,339,785			60,571		2,400,356
Profit for the year		-		-			-			-			-			-			58,526			58,526			122		58,648
Other comprehensive income		-		1,457			(2,229	)		(1	)		-			(773	)		-			(773	)		5		(768	)
Comprehensive income		-		1,457			(2,229	)		(1	)		-			(773	)		58,526			57,753			127		57,880
Dividends		-		-			-			-			-			-			(29,263	)		(29,263	)		-		(29,263	)
Increase (decrease) in equity		-		1,457			(2,229	)		(1	)		-			(773	)		29,263			28,490			127		28,617

Equity as of March 31, 2016		477,386		(12,578	)		(3,928	)		(2,387	)		(1,677	)		(20,570	)		1,911,459			2,368,275			60,698		2,428,973

The accompanying notes form an integral part of these consolidated financial statements.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Sociedad Química y Minera de Chile S.A. and Subsidiaries

Consolidated Statements of Changes in Equity

2015	Share capital		Foreign currency translation difference reserves			Cash flow hedge reserves			Actuarial gains (losses) from defined benefit plans			Other miscellaneous reserves			Other reserves			Retained earnings			Equity attributable to owners of the Parent			Non-controlling interests			Total
	ThUS$		ThUS$			ThUS$			ThUS$			ThUS$			ThUS$			ThUS$			ThUS$			ThUS$			ThUS$

Equity at beginning of the year		477,386		(7,701	)		(1,881	)		(1,903	)		(1,677	)		(13,162	)		1,775,612			2,239,836			59,867			2,299,703
Profit for the year)		-		-			-			-			-			-			71,685			71,685			127			71,812
Other comprehensive income		-		(3,146	)		2,780			(11	)		-			(377	)		-			(377	)		(22	)		(399	)
Comprehensive income		-		(3,146	)		2,780			(11	)		-			(377	)		71,685			71,308			105			71,413
Dividends		-		-			-			-			-			-			(35,843	)		(35,843	)		-			(35,843	)
Increase (decrease) due to changes in interests in subsidiaries		-		-			-			-			-			-			-			-			(54	)		(54	)
Increase (decrease) in equity		-		(3,146	)		2,780			(11	)		-			(377	)		35,842			35,465			51			35,516

Equity as of March 31, 2015		477,386		(10,847	)		899			(1,914	)		(1,677	)		(13,539	)		1,811,454			2,275,301			59,918			2,335,219

The accompanying notes form an integral part of these consolidated financial statements.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Interim Consolidated Financial Statements As of March 31, 2016.

Note 1

Identification and activities of the Company and Subsidiaries

1.1	Historical background

Sociedad Química y Minera de Chile S.A. "SQM" is an open stock corporation organized under the laws of the Republic of Chile, Tax Identification No.93.007.000-9.

The Company was incorporated through a public deed dated June 17, 1968 by the notary public of Santiago MR. Sergio Rodríguez Garcés. Its existence was approved by Decree No. 1,164 of June 22, 1968 of the Ministry of Finance, and it was registered on June 29, 1968 in the Registry of Commerce of Santiago, on page 4,537 No. 1,992. SQM's headquarters are located at El Trovador 4285, Fl. 6, Las Condes, Santiago, Chile. The Company's telephone number is +56 2 2425-2000.

The Company is registered with the Securities Registry of the Chilean Superintendence of Securities and Insurance (SVS) under No. 0184 dated March 18. 1983 and is subject to the inspection of the SVS.

1.2	Main domicile where the Company performs its production activities

The Company’s main domiciles are: Calle Dos Sur plot No. 5 - Antofagasta; Arturo Prat 1060 - Tocopilla; Administración Building w/n - Maria Elena; Administración Building w/n Pedro de Valdivia - María Elena, Anibal Pinto 3228 - Antofagasta, Kilometer 1378 Ruta 5 Norte Highway - Antofagasta, Coya Sur Plant w/n - Maria Elena, kilometer 1760 Ruta 5 Norte Highway - Pozo Almonte, Salar de Atacama (Atacama Saltpeter deposit) potassium chloride plant s/n - San Pedro de Atacama, potassium sulfate plant at Salar de Atacama s/n – San Pedro de Atacama, Minsal Mining Camp s/n CL Plant CL, Potassium– San Pedro de Atacama, formerly the Iris Saltpeter office S/N, Commune of Pozo Almonte, Iquique.

1.3	Codes of main activities

The codes of the main activities as established by the Chilean Superintendence of Securities and Insurance are as follows:

-	1700 (Mining)

-	2200 (Chemical products)

-	1300 (Investment)

1.4	Description of the nature of operations and main activities

Our products are mainly derived from mineral deposits found in northern Chile. We mine and process caliche ore and brine deposits. The ore deposit in northern Chile contains nitrate and iodine deposits. The brine deposits of the Salar de Atacama, in northern Chile, contain high concentrations of lithium and potassium as well as significant concentrations of sulfate.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Interim Consolidated Financial Statements As of March 31, 2016.

Note 1

Identification and Activities of the Company and Subsidiaries (continued)

1.4

Description of the nature of operations and main activities, continued

From our caliche ore deposits located in the north of Chile, we produce a wide range of nitrate-based products used for specialty plant nutrients and industrial applications, as well as iodine and iodine derivatives. At the Salar de Atacama, we extract brines rich in potassium, lithium and sulfate in order to produce potassium chloride, potassium sulfate, lithium solutions, and bischofite (magnesium chloride). We produce lithium carbonate and lithium hydroxide at our plant near the city of Antofagasta, Chile, from the solutions brought from the Salar de Atacama.

We sell our products in over 100 countries worldwide through our global distribution network and generate our revenue mainly from abroad.

Our products are divided into six categories: specialty plant nutrition, iodine and its derivatives, lithium and its derivatives, industrial chemicals, potassium and other products and services, described as follows:

Specialty plant nutrition: SQM produces and sells four types of specialty plant nutrition in this line of business: potassium nitrate, sodium nitrate, sodium potassium nitrate, and specialty mixes. This business is characterized by being closely related to its customers for which it has specialized staff who provide expert advisory in best practices for fertilization according to each type of crop, soil and climate. Within this type of business, potassium derivative products and specially potassium nitrate have had a leading role given the contribution they make to develop crops insuring an improvement in post-crop life in addition to improving quality, flavor and fruit color. The potassium nitrate, which is sold in multiple formats and as a part of other specialty mixtures, is complemented by sodium nitrate, potassium sodium nitrate, and more than 200 fertilizing mixtures.

Iodine: The Company is a major producer of iodine at worldwide level. Iodine is widely used in the pharmaceutical industry, technology and nutrition. Additionally, iodine is used as X ray contrast media and polarizing film for LCD displays.

Lithium: the Company’s lithium is mainly used for manufacturing rechargeable batteries for cell phones, cameras and notebooks. Through the manufacturing of lithium-based products, SQM provides significant materials to face great challenges such as the efficient use of energy and raw materials. Lithium is mainly not used for rechargeable batteries for small electrical appliances such as mobile phones, tablets and laptops. It is also used in industrial applications such as the manufacturing of glass, ceramics and lubricating greases. Other uses include the pharmaceutical and chemical industries.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Interim Consolidated Financial Statements As of March 31, 2016.

Note 1

Identification and Activities of the Company and Subsidiaries (continued)

1.4

Description of the nature of operations and main activities, continued

Industrial Chemicals: Industrial chemicals are products used as supplies for a number of production processes. SQM participates in this line of business producing sodium nitrate, potassium nitrate and potassium chloride. Industrial nitrates have increased their importance over the last few years due to their use as storage means for thermal energy at solar energy plants, which are widely used in countries as Spain and the United States in their search for decreasing CO₂emissions.

Potassium: The potassium is a primary essential macro-nutrient, and even though does not form part of the plant’s structure, has a significant role for the developing of its basic functions, validating the quality of a crop, increasing post-crop life, improving the crop flavor, its amount in vitamins and its physical appearance. Within this business line, SQM has also potassium chlorate and potassium sulfate, both extracted from the salt layer located under the Salar de Atacama (the Atacama Saltpeter Deposit).

Other products and services: This business line includes revenue from commodities, services, interests, royalties and dividends.

1.5

Other background

Staff

As of March 31, 2016 and December 31, 2015, staff was detailed as follows:

	03/31/2016						12/31/2015
Employees	SQM S.A		Other subsidiaries		Total		SQM S.A.		Other subsidiaries		Total
Executives		27		72		99		26		71		97
Professionals		121		870		991		116		838		954
Technicians and operators		271		2,939		3,210		256		2,741		2,997
Foreign employees		-		198		198		-		202		202
Overall total		419		4,079		4,498		398		3,852		4,250

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Interim Consolidated Financial Statements As of March 31, 2016.

Note 1

Identification and Activities of the Company and subsidiaries (continued)

1.5

Other background, continued

Main shareholders

The table below establishes certain information about the beneficial property of Series A and Series B shares of SQM as of March 31, 2016 and December 31, 2015. In respect to each shareholder which has interest of more than 5% of outstanding Series A or B shares. The information below is taken from our records and reports controlled in the Central Securities Depository and reported to the Superintendence of Securities and Insurance (SVS) and the Chilean Stock Exchange, whose main shareholders are as follows:

Shareholder as of March 31, 2016	No. of Series A with ownership		% of Series A shares			No. of Series B with ownership		% of Series B shares			% of total shares
The Bank of New York Mellon, ADRs		-		-			59,705,588		49.60	%		22.68	%
Sociedad de Inversiones Pampa Calichera S.A.(*)		44,889,781		31.43	%		6,887,688		5.72	%		19.67	%
Inversiones El Boldo Limitada		29,330,326		20.54	%		17,963,546		14.92	%		17.97	%
Inversiones RAC Chile Limitada		19,200,242		13.44	%		2,202,773		1.83	%		8.13	%
Potasios de Chile S.A.(*)		18,179,147		12.73	%		-		-			6.91	%
Inversiones PCS Chile Limitada		15,526,000		10.87	%		-		-			5.90	%
Banco de Chile on behalf of non-resident third parties		-		-			8,887,526		7.38	%		3.38	%
Inversiones Global Mining (Chile) Limitada (*)		8,798,539		6.16	%		-		-			3.34	%
Banco Itau on behalf of investors		20,950		0.01	%		6,103,242		5.07	%		2.33	%
Inversiones La Esperanza Limitada		3,711,598		2.60	%		46,500		0.03	%		1.43	%

(*) Total Pampa Group 29.92%

Shareholder as of December 31, 2015	No. of Series A with ownership		% of Series A shares			No. of Series B with ownership		% of Series B shares			% of total shares
The Bank of New York Mellon, ADRs		-		-			59,079,533		49,08	%		22,45	%
Sociedad de Inversiones Pampa Calichera S.A.(*)		44,880,793		31.43	%		7,007,688		5.82	%		19.72	%
Inversiones El Boldo Limitada		29,330,326		20.54	%		17,963,546		14.92	%		17.97	%
Inversiones RAC Chile Limitada		19,200,242		13.44	%		2,202,773		1.83	%		8.13	%
Potasios de Chile S.A.(*)		18,179,147		12.73	%		-		-			6.91	%
Inversiones PCS Chile Limitada		15,526,000		10.87	%		-		-			5.90	%
Inversiones Global Mining (Chile) Limitada (*)		-		-			9,055,272		7,52	%		3.44	%
Banco de Chile on behalf of non-resident third parties		8,798,539		6.16	%		-		-			3.34	%
Banco Itau on behalf of investors		20,950		0.01	%		5,679,753		4.72	%		2.27	%
Inversiones La Esperanza Limitada		3,711,598		2.60	%		46,500		0.04			1.43	%

(*) Total Pampa Group 29.97%

On March 31, 2016 the total number of shareholders had risen to 1,203.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Interim Consolidated Financial Statements As of March 31, 2016.

Note 2

Basis of presentation for the consolidated financial statements

2.1

Accounting period

These consolidated financial statements cover the following periods:

Consolidated Statements of Financial Position for the periods ended March 31, 2016 and December 31, 2015.

Consolidated Statements of Changes in Equity for the periods ended March 31, 2016 and 2015.

Consolidated Statements of Comprehensive Income for the periods between January and March 31, 2016 and 2015.

Statements of Direct-Method Cash Flows for the periods ended March 31, 2016 and 2015.

2.2

Financial statements

The consolidated financial statements of Sociedad Química y Minera de Chile S.A. and its Subsidiaries were prepared in accordance with International Financial Reporting Standards (hereinafter “IFRS”) and represent the full, explicit and unreserved adoption of International Financial Reporting Standards as issued by the International Accounting Standards Board (hereinafter the “IASB”).

These consolidated financial statements fairly reflect the equity and financial position of the Company and the results of its operations, changes in statement of income recognized and cash flows occurring during the periods then ended.

IFRS establish certain alternatives for their application. Those applied by the Company are detailed in this Note.

The accounting policies used for the preparation of the annual consolidated accounts comply with all IFRS in issue at the reporting date.

As explained in Note 28.4, on September 29, 2014, Law No. 20.780 was enacted, which introduces amendments to the income tax system in Chile and addresses other tax matters. On October 17, 2014, the Chilean Superintendence of Securities and Insurance (SVS) issued Circular No. 856, which establishes that the effects of changes in income tax rates on deferred tax assets and liabilities must be recognized directly in “Retained earnings” in equity instead of the statement of income, which is different from that required by IAS 12.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Interim Consolidated Financial Statements As of March 31, 2016.

Note 2

Basis of presentation for the consolidated financial statements (continued)

2.3

Basis of measurement

The consolidated financial statements have been prepared on the historical cost basis except for the following:

Inventories are recorded at the lower of cost and net realizable value.

Other current and non-current asset and financial liabilities at amortized cost.

Financial derivatives at fair value; and

Staff severance indemnities and pension commitments at actuarial value.

2.4

Accounting pronouncements

New accounting pronouncements

a) The following standards, interpretations and amendments are mandatory for the first time for annual periods beginning on January 1, 2016:

Amendments and improvements		Mandatory for annual periods beginning on
Amendment to IFRS 11 “Joint Arrangements” – on the acquisition of interest in a joint operation – Issued in May 2014. This amendment includes guidance related to the method for accounting for an acquisition of an interest in a joint operation in which the activity constitutes a business, specifying the proper treatment for such acquisitions.		01/01/2016

Amendment to IAS 16 “Property, Plant and Equipment” and IAS 38 “Intangible Assets” on depreciation and amortization – Issued in May 2014. The amendments clarify that a depreciation method that is based on revenue that is generated by an activity that includes the use of an asset is not appropriate because revenue generated by such an activity in general reflects other factors other than the use of the economic benefits embedded in the asset or item of property, plant and equipment. Accordingly, a rebuttable presumption exists that a revenue-based depreciation or amortization method is inappropriate.		01/01/2016

Amendment to IAS 27 “Separate Financial Statements” on the equity method – Issued in August 2014. This amendment allows entities to use the equity method of accounting for the recognition of investments in subsidiaries, joint ventures and associates in their separate financial statements.		01/01/2016

Amendment to IFRS 10 “Consolidated Financial Statements” and IAS 28 “Investments in Associates and Joint Ventures”. Issued in September 2014. This amendment addresses an inconsistency between the requirements of IFRS 10 and IAS 28 for the treatment of a sale or contribution of assets between an investor and its associate or joint venture. The main consequence of this amendment is the recognition of a full gain or loss when the transaction involves a business (whether or not in a subsidiary) and a partial gain or loss when the transaction involves assets that are not a business, even if such assets are in a subsidiary.		01/01/2016

Amendment to IAS 1 “Presentation of Financial Statements.” Issued in December 2014. This amendment clarifies the application guidance of IAS 1 on materiality and aggregation, presentation of subtotals, structure of the financial statements and disclosure of accounting policies. The amendments are part of the IASB’s Initiative on Disclosures.		01/01/2016

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Interim Consolidated Financial Statements As of March 31, 2016.

Note 2

Basis of presentation for the consolidated financial statements (continued)

2.4

Accounting Pronouncements, continued

Improvements to International Financial Reporting Standards (2014) issued in September 2014		Mandatory for annual periods beginning on
IFRS 7 "Financial Instruments: Disclosures" It establishes two amendments to IFRS 7: (1) Service contracts: if a Company transfers a financial asset to a third party under conditions that allow the assigner to dispose of the asset, IFRS 7 requires the disclosure of any type of continued involvement that the entity may still have on transferred assets. IFRS 7 provides guidance on what is understood as continued involvement within this context. The amendment is prospective with the option of applying it retrospectively. This also affects IFRS 1 to provide the same option to the first-time adopters of IFRS 1; (2) Interim Financial Statements: The amendment clarifies that the additional disclosure required by amendments to IFRS 7 “Offsetting Financial Assets and Financial Liabilities” is not specifically required for all interim periods, unless required by IAS 34. The amendment is retrospective.		01/01/2016

IAS 19, "Employee Benefits" – This amendment clarifies that in order to determine the discount rate for post-employment benefit obligations, the important aspect is the currency in which liabilities are denominated, not the country where they generate. The evaluation of whether a deep market exists for high-quality corporate bonds is based on corporate bonds in such currency, not in corporate bonds of a particular country. Likewise, where there is no deep market for high-quality corporate bonuses in such currency, government bonds in the related currency have to be used. Such amendment is retrospective but limited at the beginning of the first period presented.		01/01/2016

IAS 34, "Interim Financial Reporting" – This amendment clarifies the meaning of disclosure of information ‘elsewhere in the interim financial report’ and amends IAS 34 to require the inclusion of a cross-reference from the interim financial statements to the location of the information. This amendment is retrospective.		01/01/2016

The adoption of the standards, amendments and interpretations indicated above has no significant impact on the Company’s consolidated financial statements.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Interim Consolidated Financial Statements As of March 31, 2016.

Note 2

Basis of presentation for the consolidated financial statements (continued)

2.4

Accounting Pronouncements, continued

b) Standards, interpretations and amendments issued, not effective for the financial statements beginning on January 1, 2016, which the Company has not adopted early are as follows:

Standards and Interpretations		Mandatory for annual periods beginning on
IFRS 9 “Financial Instruments” – Issued in July 2014. The IASB has issued the full version of IFRS 9, which supersedes the application guidance in IAS 39. This final version includes requirements on the classification and measurement of financial assets and financial liabilities and an expected credit losses model that replaces the incurred loss impairment model used today. The final hedging accounting part of IFRS 9 was issued in November 2013. Early adoption is permitted.		01/01/2018

IFRS 15 “Revenue from Contracts with Customers” – Issued in May 2014. This standard establishes the principles that an entity shall apply to report useful information to users of financial statements about the nature, amount, timing, and uncertainty of revenue and cash flows arising from a contract with a customer. For such purposes, the basic principle is that an entity will recognize revenue representing the transfer of goods or services to customers in an amount that reflects the consideration that the entity expects to receive in exchange for such goods or services. The application of this standard will replace IAS 11 Construction Contracts and IAS 18 Revenue, as well as IFRIC 13 Customer Loyalty Programmes, IFRIC 15 Agreements for the Construction of Real Estate, IFRIC 18 Transfers of Assets from Customers and SIC 31 Revenue-Barter Transactions Involving Advertising Services. Early application is permitted.		01/01/2018

IFRS 16 “Leases” – issued in January 2016 establishes the principle for the recognition, measurement, presentation and disclosure of leases. IFRS 16 supersedes the current IAS 17 and introduces a single model for accounting recognition for lessees and requires a lessee to recognize the assets and liabilities of all lease contracts over a term of more than 12 months, unless the underlying asset has a low value. The objective is ensuring that lessees and lessors provide relevant information that fairly represents transactions conducted. IFRS 16 is effective for annual periods beginning on or after January 1, 2019, early adoption is permitted for entities applying IFRS 15 or prior to the date of initial application of IFRS 16.		01/01/2019

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Interim Consolidated Financial Statements As of March 31, 2016.

Note 2

Basis of presentation for the consolidated financial statements (continued)

2.4

Accounting Pronouncements, continued

Amendments and improvements		Mandatory for annual periods beginning on
Amendment to IAS 7 “Statement of Cash Flows.” – Issued in February 2016. This amendment introduces additional disclosures allowing users of financial statements to assess changes in obligations from financing activities.		01/01/2017

Amendment to IAS 12 “Income Taxes.” - Issued in February 2016. This amendment clarifies how to account for deferred tax assets related to debt securities measured at fair value.		01/01/2017

The Company's management is in the process of assessing the impacts on the consolidated financial statements of the adoption of IFRS 9, IFRS 15 and IFRS 16. However, for the remaining standards, amendments and interpretations described above, it believes they will not have any significant impact for the initial application period.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 2

Basis of presentation for the consolidated financial statements (continued)

2.5

Basis of consolidation

(a)

Subsidiaries

Relate to all the entities on which Sociedad Química y Minera de Chile S.A. has control when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those variable returns through its power over the entity. Subsidiaries apply the same accounting policies of their Parent.

To account for the acquisition, the Company uses the acquisition method. Under this method the acquisition cost is the fair value of assets delivered, equity securities issued and liabilities incurred or assumed at the date of exchange. Identifiable assets acquired and liabilities and contingencies assumed in a business combination are measured initially at fair value at the acquisition date. For each business combination, the Company will measure non-controlling interest of the acquiree either at fair value or as proportional share of net identifiable assets of the acquiree.

Companies included in consolidation:

				Ownership interest
		Country of						03/31/2016		12/31/2015
TAX ID No.	Foreign subsidiaries	origin	Functional currency	Direct		Indirect		Total		Total
Foreign	Nitratos Naturais Do Chile Ltda.	Brazil	US$		0.0000		100.0000		100.0000		100.0000
Foreign	Nitrate Corporation Of Chile Ltd.	United Kingdom	US$		0.0000		100.0000		100.0000		100.0000
Foreign	SQM North America Corp.	USA	US$		40.0000		60.0000		100.0000		100.0000
Foreign	SQM Europe N.V.	Belgium	US$		0.5800		99.4200		100.0000		100.0000
Foreign	Soquimich S.R.L. Argentina	Argentina	US$		0.0000		100.0000		100.0000		100.0000
Foreign	Soquimich European Holding B.V.	Netherlands	US$		0.0000		100.0000		100.0000		100.0000
Foreign	SQM Corporation N.V.	Netherlands	US$		0.0002		99.9998		100.0000		100.0000
Foreign	SQI Corporation N.V.	Netherlands	US$		0.0159		99.9841		100.0000		100.0000
Foreign	SQM Comercial De México S.A. de C.V.	Mexico	US$		0.0013		99.9987		100.0000		100.0000
Foreign	North American Trading Company	USA	US$		0.0000		100.0000		100.0000		100.0000
Foreign	Administración y Servicios Santiago S.A. de C.V.	Mexico	US$		0.0000		100.0000		100.0000		100.0000
Foreign	SQM Peru S.A.	Peru	US$		0.9800		99.0200		100.0000		100.0000
Foreign	SQM Ecuador S.A.	Ecuador	US$		0.0040		99.9960		100.0000		100.0000
Foreign	SQM Nitratos Mexico S.A. de C.V.	Mexico	US$		0.0000		100.0000		100.0000		100.0000
Foreign	SQMC Holding Corporation L.L.P.	USA.	US$		0.1000		99.9000		100.0000		100.0000
Foreign	SQM Investment Corporation N.V.	Netherlands	US$		1.0000		99.0000		100.0000		100.0000
Foreign	SQM Brasil Limitada	Brazil	US$		1.0900		98.9100		100.0000		100.0000
Foreign	SQM France S.A.	France	US$		0.0000		100.0000		100.0000		100.0000
Foreign	SQM Japan Co. Ltd.	Japan	US$		1.0000		99.0000		100.0000		100.0000
Foreign	Royal Seed Trading Corporation A.V.V.	Aruba	US$		1.6700		98.3300		100.0000		100.0000
Foreign	SQM Oceania Pty Limited	Australia	US$		0.0000		100.0000		100.0000		100.0000

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 2

Basis of presentation for the consolidated financial statements (continued)

2.5

Basis of consolidation, continued

				Ownership interest
		Country of						03/31/2016		12/31/2015
TAX ID No.	Foreign subsidiaries	origin	Functional currency	Direct		Indirect		Total		Total
Foreign	Rs Agro-Chemical Trading Corporation A.V.V.	Aruba	US$		98.3333		1.6667		100.0000		100.0000
Foreign	SQM Indonesia S.A.	Indonesia	US$		0.0000		80.0000		80.0000		80.0000
Foreign	SQM Virginia L.L.C.	USA	US$		0.0000		100.0000		100.0000		100.0000
Foreign	SQM Italia SRL	Italy	US$		0.0000		100.0000		100.0000		100.0000
Foreign	Comercial Caimán Internacional S.A.	Panama	US$		0.0000		100.0000		100.0000		100.0000
Foreign	SQM Africa Pty.	South Africa	US$		0.0000		100.0000		100.0000		100.0000
Foreign	SQM Lithium Specialties LLC	USA	US$		0.0000		100.0000		100.0000		100.0000
Foreign	SQM Iberian S.A.	Spain	US$		0.0000		100.0000		100.0000		100.0000
Foreign	SQM Agro India Pvt. Ltd.	India	US$		0.0000		100.0000		100.0000		100.0000
Foreign	SQM Beijing Commercial Co. Ltd.	China	US$		0.0000		100.0000		100.0000		100.0000
Foreign	SQM Thailand Limited	Thailand	US$		0.0000		99.996		99.996		99.996

				Ownership interest
		Country	Functional					03/31/2016		12/31/2015
TAX ID No.	Domestic subsidiaries	of origin	currency	Direct		Indirect		Total		Total
96.801.610-5	Comercial Hydro S.A.	Chile	US$		0.0000		60.6383		60.6383		60.6383
96.651.060-9	SQM Potasio S.A.	Chile	US$		99.9999		0.0000		99.9999		99.9999
96.592.190-7	SQM Nitratos S.A.	Chile	US$		99.9999		0.0001		100.0000		100.0000
96.592.180-K	Ajay SQM Chile S.A.	Chile	US$		51.0000		0.0000		51.0000		51.0000
86.630.200-6	SQMC Internacional Ltda.	Chile	Ch$		0.0000		60.6381		60.6381		60.6381
79.947.100-0	SQM Industrial S.A.	Chile	US$		99.0470		0.9530		100.0000		100.0000
79.906.120-1	Isapre Norte Grande Ltda.	Chile	Ch$		1.0000		99.0000		100.0000		100.0000
79.876.080-7	Almacenes y Depósitos Ltda.	Chile	Ch$		1.0000		99.0000		100.0000		100.0000
79.770.780-5	Servicios Integrales de Tránsitos y Transferencias S.A.	Chile	US$		0.0003		99.9997		100.0000		100.0000
79.768.170-9	Soquimich Comercial S.A.	Chile	US$		0.0000		60.6383		60.6383		60.6383
79.626.800-K	SQM Salar S.A.	Chile	US$		18.1800		81.8200		100.0000		100.0000
78.053.910-0	Proinsa Ltda.	Chile	Ch$		0.0000		60.5800		60.5800		60.5800
76.534.490-5	Sociedad Prestadora de Servicios de Salud Cruz del Norte S.A.	Chile	Ch$		0.0000		100.0000		100.0000		100.0000
76.425.380-9	Exploraciones Mineras S.A.	Chile	US$		0.2691		99.7309		100.0000		100.0000
76.064.419-6	Comercial Agrorama Ltda. (a)	Chile	Ch$		0.0000		42.4468		42.4468		42.4468
76.145.229-0	Agrorama S.A.	Chile	Ch$		0.0000		60.6377		60.6377		60.6377
76.359.919-1	Orcoma Estudios SPA	Chile	US$		51.0000		-		51.0000		100.0000
76.360.575-2	Orcoma SPA	Chile	US$		100.0000		-		100.0000		100.0000

(a)

The Company consolidated Comercial Agrorama Ltda. as it has the control of this company’s relevant activities.

Subsidiaries are consolidated using the line-by-line method, adding the items that represent assets, liabilities, revenues, and expenses of similar content, and eliminating those related to intragroup transactions.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 2

Basis of presentation for the consolidated financial statements (continued)

2.5

Basis of consolidation, continued

Profit or loss of depending companies acquired or disposed of during the year are included in profit or loss accounts consolidated from the date control is transferred to the Group, or up to the date control is lost, as applicable.

Non-controlling interest represents the equity of a subsidiary not directly or indirectly attributable to the Parent.

2.6

Significant accounting judgments, estimates and assumptions

Management of Sociedad Química y Minera de Chile S.A. and its subsidiaries is responsible for the information contained in these consolidated financial statements, which expressly indicate that all the principles and criteria included in IFRSs, as issued by the International Accounting Standards Board (IASB), have been applied in full.

In preparing the consolidated financial statements of Sociedad Química y Minera de Chile S.A. and its subsidiaries, Management has made judgments and estimates to quantify certain assets, liabilities, revenues, expenses and commitments included therein. Basically, these estimates refer to:

The useful lives of property, plant and equipment, and intangible assets and their residual value;

Impairment losses of certain assets, including trade receivables;

Assumptions used in calculating the actuarial amount of pension-related and severance indemnity payment benefit commitments;

Provisions for commitments assumed with third parties and contingent liabilities;

Provisions on the basis of technical studies that cover the different variables affecting products in stock (density and moist, among others), and allowance for slow-moving spare-parts in stock;

Future cost for closure of mining sites;

The determination of the fair value of certain financial assets and derivative instruments;

The determination and assignment of fair values in business combinations.

Despite the fact that these estimates have been made on the basis of the best information available on the date of preparation of these consolidated financial statements, certain events may occur in the future and oblige their amendment (upwards or downwards) over the next few years, which would be made prospectively, recognizing the effects of the change in estimates in the related future consolidated financial statements.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 3

Significant accounting policies

3.1

Classification of balances as current and non-current

In the attached consolidated statement of financial position, balances are classified in consideration of their remaining recovery (maturity) dates; i.e., those maturing on a date equal to or lower than twelve months are classified as current and those with maturity dates exceeding the aforementioned period are classified as non-current.

The exception to the foregoing relates to deferred taxes, which are classified as non-current, regardless of the maturity they have.

3.2

Functional and presentation currency

The Company’s consolidated financial statements are presented in United States dollars (“U.S. dollars” or “US$”), which is the Company’s functional and presentation currency and is the currency of the main economic environment in which it operates.

Consequently, the term foreign currency is defined as any currency other than the U.S. dollar.

The consolidated financial statements are presented in thousands of United States dollars without decimals.

3.3

Foreign currency translation

(a)

Group entities:

The revenue, expenses, assets and liabilities of all entities that have a functional currency other than the presentation currency are converted to the presentation currency as follows:

Assets and liabilities are converted at the closing exchange rate prevailing on the reporting date.

Revenues and expenses of each profit or loss account are converted at monthly average exchange rates.

All resulting foreign currency translation gains and losses are recognized as a separate component in translation reserves.

In consolidation, foreign currency differences arising from the translation of a net investment in foreign entities are recorded in equity (other reserves). At the date of disposal, such foreign currency translation differences are recognized in the statement of income as part of the gain or loss from the sale.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 3

Significant accounting policies (continued)

3.3

Foreign currency translation, continued

The main exchange rates used to translate monetary assets and liabilities, expressed in foreign currency at the end of each period in respect to U.S. dollars, are as follows:

	03/31/2016		12/31/2015
	US$		US$

Brazilian real		3.55		3.90
New Peruvian sol		3.32		3.41
Argentine peso		14.50		12.90
Japanese yen		112.68		120.61
Euro		1.13		0.92
Mexican peso		17.23		17.34
Australian dollar		0.77		0.73
Pound Sterling		1.43		0.67
South African rand		14.84		15.61
Ecuadorian dollar		1.00		1.00
Chilean peso		669.80		710.16
UF		38.54		36.09

(b)

Transactions and balances

Non-monetary transactions in currencies other than the functional currency (U.S. dollar) foreign currencies are translated to the respective functional currencies of Group entities at exchange rates at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the reporting date are retranslated to the functional currency at the exchange rate at that date. All differences are recorded in the statement of income except for all monetary item that provide effective hedge for a net investment in a foreign operation. These items are recognized in other comprehensive income on the disposal of the investment; at the time they are recognized in the statement of income. Charges and credits attributable to foreign currency translation differences on those hedge monetary item are also recognize in other comprehensive income.

Non-monetary assets and liabilities that are measured at historical cost in a foreign currency are retranslated to the functional currency at the historical exchange rate of the transaction. Non-monetary items that are measured based on fair value in a foreign currency are translated using the exchange rate at the date on which the fair value is determined.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 3

Significant accounting policies (continued)

3.4

Subsidiaries

SQM S.A. establishes, as basis, the control exercised in subsidiaries, to determine their share in the consolidated financial statements. Control consists of the Company’s ability to exercise power in the subsidiary, exposure, or right, to variable performance from its share in the investee and the ability to use its power on the investee to have an influence on the amount of the investor’s performance.

The Company prepares the consolidated financial statements using consistent accounting policies for the entire Group, the consolidation of a subsidiary commences when the Company has control over the subsidiary and stops when control ceases.

3.5

Consolidated statement of cash flows

Cash equivalents correspond to highly-liquid short-term investments that are easily convertible in known amounts of cash. They are subject to insignificant risk of changes in their value and mature in less than three months from the date of acquisition of the instrument.

For purposes of the statement of cash flows, cash and cash equivalents comprise cash and cash equivalents as defined above.

The statement of cash flows includes movements in cash performed during the year, determined using the direct method.

3.6

Financial assets

Management determines the classification of its financial assets at the time of initial recognition, on the basis of the business model for the management of financial assets and the characteristics of contractual cash flows from the financial assets. In accordance with IAS 39, financial assets are measured initially at fair value plus transaction costs that may have been incurred and are directly attributable to the acquisition of the financial asset. Subsequently, financial assets are measured at amortized cost or fair value.

The Company assesses, at each reporting date, whether there is objective evidence that an asset or group of assets is impaired. An asset or group of financial assets is impaired if and only if there is evidence of impairment as a result of one or more events occurring after the initial recognition of the asset or group of assets. For the recognition of impairment, the loss event has to have an impact on the estimate of future cash flows from the asset or groups of financial assets.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 3

Significant accounting policies (continued)

3.7

Financial liabilities

Management determines the classification of its financial liabilities at the time of initial recognition. As established in IAS 39, financial liabilities at the time of initial recognition are measured at fair value, less transaction costs that may have been incurred and are directly attributable to the issue of the financial liability. Subsequently, these are measured at amortized cost using the effective interest method. For financial liabilities that have been initially recognized at fair value through profit or loss, these will be measured subsequently at fair value.

3.8

Financial instruments at fair value through profit or loss

Management will irrevocably determine, at the time of initial recognition, the designation of a financial instrument at fair value through profit or loss. By doing so, this eliminates and/or significantly reduces measurement or recognition inconsistency that would otherwise have arisen from the measurement of assets or liabilities or from the recognition of gains and losses from them on different bases.

3.9

Financial instrument offsetting

The Company offsets an asset and liability if and only if it presently has a legally enforceable right of setting off the amounts recognized and has the intent of settling for the net amount of realizing the asset and settling the liability simultaneously.

3.10

Reclassification of financial instruments

At the time when the Company changes its business model for managing financial assets, it will reclassify the financial assets affected by the new business model.

For financial liabilities these could not be reclassified.

3.11

Derivative and hedging financial instruments

Derivatives are recognized initially at fair value as of the date on which the derivatives contract is signed and, subsequently, are assessed at fair value. The method for recognizing the resulting gain or loss depends on whether the derivative has been designated as an accounting hedge instrument and, if so, it depends on the type of hedging, which may be as follows:

(a)

Fair value hedge of assets and liabilities recognized (fair value hedges);

(b)

Hedging of a single risk associated with an asset or liability recognized or a highly possible foreseen transaction (cash flow hedge).

At the beginning of the transaction, the Company documents the relationship existing between hedging instruments and those items hedged, as well as their objectives for risk management purposes and the strategy to conduct different hedging operations.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 3

Significant accounting policies (continued)

3.11

Derivative and hedging financial instruments, continued

The Company also documents its evaluation both at the beginning and at the end of each period if derivatives used in hedging transactions are highly effective to offset changes in the fair value or in cash flows of hedged items.

The fair value of derivative instruments used for hedging purposes is shown in Note 10.3 (hedging assets and liabilities). Changes in the cash flow hedge reserve are classified as a non-current asset or liability if the remaining expiration period of the hedged item is higher than 12 months, and as a current asset or liability if the remaining expiration period of the entry is lower than 12 months.

Derivatives that are not designated or do not qualify as hedging derivatives are classified as current assets or liabilities, and changes in the fair value are directly recognized through profit or loss.

(a)

Fair value hedge

The change in the fair value of a derivative is recognized with a debit or credit to profit or loss, as applicable. The change in the fair value of the hedged entry attributable to hedged risk is recognized as part of the carrying value of the hedged entry and is also recognized with a debit or credit to profit or loss.

For fair value hedges related to items recorded at amortized cost, the adjustment of the fair value is amortized against profit or loss during the period, through maturity. Any adjustment to the carrying value of a hedged financial instrument, for which the effective rate is used, is amortized with a debit or credit to profit or loss at its fair value, attributable to the risk being covered.

If the hedged entry is derecognized, the fair value not amortized is immediately recognized with a debit or credit to profit or loss.

(b)

Cash flow hedges

The effective portion of gains or losses from the hedge instrument is initially recognized with a debit or credit to other comprehensive income, whereas any ineffective portion is immediately recognized with a debit or credit to profit or loss, as applicable.

Amounts taken to equity are transferred to profit or loss when the hedged transaction affects profit or loss, as when the hedged interest income or expense is recognized when a projected sale occurs. When the hedged entry is the cost of a non-financial asset or liability, amounts taken to other reserves are transferred to the initial carrying value of the non-financial asset or liability.

Should the expected firm transaction or commitment no longer be expected to occur, the amounts previously recognized in equity are transferred to profit or loss. If a hedge instrument expires, is sold, finished, or exercised without any replacement, or if a rollover is performed or if its designation as hedging is revoked, the amounts previously recognized in other reserves are maintained in equity until the expected firm transaction or commitment occurs.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 3

Significant accounting policies (continued)

3.12

Derecognition of financial instruments

In accordance with IAS 39, the Company derecognizes a financial asset when the contractual rights to the cash flows from the asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all the risks and rewards of ownership of the financial asset are transferred; and the control of the financial assets has not been retained.

The Company derecognizes a financial liability when its contractual obligations or a part of these are discharged, paying to the creditor or its legally extinguished entity the primary responsibility for the liability.

3.13

Derivative financial instruments

The Company maintains derivative financial instruments to hedge its exposure to foreign currencies. Derivative financial instruments are recognized initially at fair value; attributable transaction costs are recognized when incurred. Subsequent to initial recognition, changes in fair value of such derivatives are recognized in profit or loss as part of gains and losses.

The Company permanently assesses the existence of embedded derivatives, both in its contracts and financial instruments. As of March 31, 2016 and December 31, 2015, there are no embedded derivatives.

3.14

Fair value measurements

From the initial recognition, the Company measures its assets and liabilities at fair value plus or minus transaction costs incurred that are directly attributable to the acquisition of a financial asset or issuance of a financial liability.

3.15

Leases

(a)

Lease - Finance lease

Leases are classified as finance leases when the Company holds substantially all the risks and rewards derived from the ownership of the asset. Finance leases are capitalized at the beginning of the lease, at the lower of the fair value of the leased asset or the present value of minimum lease payments.

Each lease payment is distributed between the liability and the interest expenses to obtain ongoing interest on the pending balance of debt. The respective lease obligations, net of interest expense, are included in other non-current liabilities. The interest element of finance cost is debited in the consolidated statement of income during the lease period so that a regular ongoing interest rate is obtained on the remaining balance of the liability for each year.

(b)

Lease – Operating lease

Leases in which the lesser maintains a significant part of the risks and rewards derived from the ownership are classified as operating leases. Operating lease payments (net of any incentive received from the lesser) are debited to the statement of income or capitalized (as applicable) on a straight-line basis over the lease period.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 3

Significant accounting policies (continued)

3.16

Deferred acquisition costs from insurance contracts

Acquisition costs from insurance contracts are classified as prepayments and correspond to insurance contracts in force, recognized using the straight-line method and on an accrual basis, and are recognized under other non-financial assets.

3.17

Trade and other receivables

Trade and other receivables relate to non-derivative financial assets with fixed and determinable payments and are not quoted in any active market. These arise from sales operations involving the products and/or services, of which the Company commercializes directly to its customers.

These assets are initially recognized at their fair value and subsequently at amortized cost according to the effective interest rate method, less a provision for impairment loss. An allowance for impairment loss is established for trade receivables when there is objective evidence that the Company will not be able to collect all the amounts which are owed to it, according to the original terms of receivables.

Implicit interest in installment sales is recognized as interest income when interest is accrued over the term of the operation.

3.18

Inventory measurement

The Company states inventories for the lower of cost and net realizable value. The cost price of finished products and products in progress includes the direct cost of materials and, when applicable, labor costs, indirect costs incurred to transform raw materials into finished products, and general expenses incurred in carrying inventories to their current location and conditions. The method used to determine the cost of inventories is weighted average cost.

Commercial discounts, rebates obtained, and other similar entries are deducted in the determination of the acquisition price.

The net realizable value represents the estimate of the sales price, less all finishing estimated costs and costs which will be incurred in commercialization, sales, and distribution processes.

The Company conducts an evaluation of the net realizable value of inventories at the end of each year, recording an estimate with a charge to income when these are overstated. When a situation arises whereby the circumstances, which previously caused the rebate to cease to exist, or when there is clear evidence of an increase in the net realizable value due to a change in the economic circumstances or prices of main raw materials, the estimate made previously is modified.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 3

Significant accounting policies (continued)

3.18

Inventory measurement, continued

The valuation of obsolete, impaired or slow-moving products relates to their net estimated, net realizable value.

Provisions on the Company's inventories have been made based on a technical study which covers the different variables which affect products in stock (density and humidity, among others).

Raw materials, supplies and materials are recorded at the lower of acquisition cost or market value. Acquisition cost is calculated according to the average price method.

3.19

Investments in associates and joint ventures

Interests in companies on which joint control is exercised (joint venture) or where an entity has significant influence (associates) are recognized using the equity method of accounting. Significant influence is presumed to exist when interest greater than 20% is held in the capital of an investee.

Under this method, the investment is recognized in the statement of financial position at cost plus changes, subsequent to the acquisition, and considering the proportional share in the equity of the associate. For such purposes, the interest percentage in the ownership of the associate is used. The associated goodwill acquired is included in the carrying amount of the investee and is not amortized. The debit or credit to profit or loss reflects the proportional share in the profit or loss of the associate.

Unrealized gains for transactions with affiliates or associates are eliminated considering the interest percentage the Company has on such entities. Unrealized losses are also eliminated, except if the transaction provides evidence of impairment loss of the transferred asset.

Changes in the equity of associates are recognized considering the proportional amounts with a charge or credit to “Other reserves” and classified considering their origin.

Reporting dates of the associate, the Company and related policies are similar for equivalent transactions and events under similar circumstances.

In the event that the significant influence is lost or the investment is sold or is held as available for sale, the equity method is discontinued, suspending the recognition of proportional share of profit or loss.

If the resulting amount according to the equity method is negative, the share of profit or loss is reflected at zero value in the consolidated financial statements, unless a commitment exists by the Company to reinstate the Company’s equity position, in which case the related provision for risks and expenses is recorded.

Dividends received by these companies are recorded by reducing the equity value, and the proportional share of profit or loss recognized in conformity with the share of equity are included in the consolidated profit or loss accounts in the caption “Equity share of profit (loss) of associates and joint ventures that are accounted for using the equity method of accounting”.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 3

Significant accounting policies (continued)

3.20

Transactions with non-controlling interests

Non-controlling interests are recorded in the consolidated statement of financial position within equity separate from equity attributable to the owners of the Parent.

3.21

Related party transactions

Transactions between the Company and its subsidiaries are part of the Company’s normal operations within its scope of business activities. Conditions for such transactions are those normally effective for those types of operations with regard to terms and market prices. Also, these transactions have been eliminated in consolidation. Expiration conditions for each case vary by virtue of the originating transaction.

3.22

Property, plant and equipment

Tangible property, plant and equipment assets are stated at acquisition cost, net of the related accumulated depreciation, amortization and impairment losses that they might have experienced.

In addition to the price paid for the acquisition of tangible property, plant and equipment, the Company has considered the following concepts as part of the acquisition cost, as applicable:

1. Accrued interest expenses during the construction period which are directly attributable to the acquisition, construction or production of qualifying assets, which are those that require a substantial period prior to being ready for use. The interest rate used is that related to the project’s specific financing or, should this not exist, the average financing rate of the investor company.

2. The future costs that the Company will have to experience, related to the closure of its facilities at the end of their useful life, are included at the present value of disbursements expected to be required to settle the obligation.

Construction-in-progress is transferred to property, plant and equipment in operation once the assets are available for use and the related depreciation and amortization begins on that date.

Extension, modernization or improvement costs that represent an increase in productivity, ability or efficiency or an extension of the useful lives of property, plant and equipment are capitalized as a higher cost of the related assets. All the remaining maintenance, preservation and repair expenses are charged to expense as incurred.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 3

Significant accounting policies (continued)

3.22

Property, plant and equipment, continued

The replacement of full assets, which increase the asset’s useful life or its economic capacity, are recorded as a higher value of property, plant and equipment with the related derecognition of replaced or renewed elements.

Gains or losses which are generated from the sale or disposal of property, plant and equipment are recognized as income (or loss) in the period, and calculated as the difference between the asset’s sales value and its net carrying value.

Costs derived from daily maintenance of property, plant and equipment are recognized when incurred.

3.23

Depreciation of property, plant and equipment

Property, plant and equipment are depreciated through the straight-line distribution of cost over the estimated technical useful life of the asset which is the period in which the Company expects to use the asset. When components of one item of property, plant and equipment have different useful lives, they are recorded as separate assets. Useful lives are reviewed on an annual basis.

In the case of mobile equipment depreciation is performed depending on the hours of operation

The useful lives used for the depreciation and amortization of assets included in property, plant and equipment are presented below.

Types of property, plant and equipment	Minimum life or rate		maximum life or rate
Buildings		2		40
Machinery		2		25
Transport equipment		3		30
Furniture and fixtures		2		18
Office equipment		1		20
Production plants		1		25
Mining assets		2		20
Other property, plant and equipment		1		30

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 3

Significant accounting policies (continued)

3.24

Goodwill

Goodwill acquired represents the excess in acquisition cost on the fair value of the Company's ownership of the net identifiable assets of the subsidiary on the acquisition date. Goodwill acquired related to the acquisition of subsidiaries is included in goodwill, which is subject to impairment tests every time consolidated financial statements are issued, and is stated at cost less accumulated impairment losses. Gains and losses related to the sale of an entity include the carrying value of goodwill related to the entity sold.

This intangible asset is assigned to cash-generating units with the purpose of testing impairment losses. It is allocated based on cash-generating units expected to obtain benefits from the business combination from which the aforementioned goodwill acquired arose.

3.25	Intangible assets other than goodwill

Intangible assets mainly relate to water rights, trademarks, and rights of way related to electric lines, development expenses, and computer software licenses.

(a)

Water rights

Water rights acquired by the Company relate to water from natural sources and are recorded at acquisition cost. Given that these assets represent legal rights granted in perpetuity to the Company, they are not amortized, but are subject to annual impairment tests.

(b)

Right of way for electric lines

As required for the operation of industrial plants, the Company has paid rights of way in order to install wires for the different electric lines in third party land. These rights are presented under intangible assets. Amounts paid are capitalized at the date of the agreement and charged to income, according to the life of the right of way.

(c)

Computer software

Licenses for IT programs acquired are capitalized based on costs that have been incurred to acquire them and prepare them to use the specific program. These costs are amortized over their estimated useful lives.

Expenses related to the development or maintenance of IT programs are recognized as an expense as and when incurred. Costs directly related to the production of unique and identifiable IT programs controlled by the Group, and which will probably generate economic benefits that are higher than costs during more than a year, are recognized as intangible assets. Direct costs include expenses of employees that develop information technology software and general expenses in accordance with corporate charges received.

The costs of development for IT programs recognized as assets are amortized over their estimated useful lives.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 3

Significant accounting policies (continued)

3.25

Intangible assets other than goodwill, continued

(d)

Mining property and concession rights

The Company holds mining property and concession rights from the Chilean Government. Property rights are usually obtained with no initial cost (other than the payment of mining patents and minor recording expenses) and upon obtaining rights on these concessions, these are retained by the Company while annual patents are paid. Such patents, which are paid annually, are recorded as prepaid assets and amortized over the following twelve months. Amounts attributable to mining concessions acquired from third parties that are not from the Chilean Government are recorded at acquisition cost within intangible assets.

No impairment of intangible assets exists as of March 31, 2016 and December 31, 2015.

3.26	Research and development expenses

Research and development expenses are charged to profit or loss in the period in which the disbursement was made.

3.27	Prospecting expenses

The Company has mining property and concession rights from the Chilean Government and acquired from third parties other than the Chilean Government, destined to the exploitation of caliche ore and saltpeter deposits and also the exploration of this type of deposits.

Upon obtaining these rights, the Company initially records disbursements directly associated with the exploration and evaluation of deposits (associated with small deposits with trading feasibility) as asset at cost. Such disbursements include the following concepts:

-	Disbursements for geological reconnaissance evaluation

-	Disbursements for drilling

-	Disbursements for drilling work and sampling

-	Disbursements for activities related to technical assessment and trading feasibility of drilling work

-	And any disbursement directly related to specific projects where its objective is finding mining resources.

Subsequently, the Company distinguishes exploration and evaluation projects according to the economic feasibility of the mineral extracted in the area or exploration, among those that finally will deliver future benefits to the Company (profitable projects) and those projects for which it is not probable that economic benefit will flow to the Company in the future (i.e., when the mine site has low ore grade and its exploitation is not economically profitable).

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 3

Significant accounting policies (continued)

3.27

Prospecting expenses, continued

If technical studies determine that the ore grade is not economically suitable for exploitation, the asset is directly expensed. Otherwise, it is held in the caption “other non-current assets”, reclassifying the portion related to the area to be exploited in the year in the caption inventories and such amount is amortized as production cost on the basis of estimated tons to be extracted.

The technical reasons for this classification correspond to the fact that this is an identifiable non-monetary asset that is owned to be used in the production of our processes as a main raw material. For this reason and because our disbursements correspond to proven reserves with a trading feasibility and used as main raw material in our production processes, these are presented as inventories that will be exploited within the commercial year and the remainder as development expenses for small deposits and prospecting expenses in the caption “other non-current assets”.

3.28	Impairment of non-financial assets

Assets subject to depreciation and amortization are subject to impairment testing, provided that an event or change in the circumstances indicates that the amounts in the accounting records may not be recoverable. An impairment loss is recognized for the excess of the book value of the asset over its recoverable amount.

The recoverable amount of an asset is the higher between the fair value of an asset or cash generating unit (“CGU”) less costs of sales and its value in use, and is determined for an individual asset unless the asset does not generate any cash inflows that are clearly independent from other assets or groups of assets.

When the carrying value of an asset exceeds its recoverable amount, the asset is considered an impaired asset and is reduced to its net recoverable amount.

In evaluating value in use, estimated future cash flows are discounted using a discount rate before taxes which reflects current market evaluation on the time value of money and specific asset risks.

To determine the fair value less costs to sell, an appropriate valuation model is used.

Impairment losses from continuing operations are recognized with a debit to profit or loss in the categories of expenses associated with the impaired asset function, except for properties reevaluated previously where the revaluation was taken to equity.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 3

Significant accounting policies (continued)

3.28

Impairment of non-financial assets, continued

For assets other than acquired goodwill, an annual evaluation is conducted of whether there are impairment loss indicators recognized previously that might have already decreased or ceased to exist. The recoverable amount is estimated if such indicators exist. An impairment loss previously recognized is reversed only if there have been changes in estimates used to determine the asset’s recoverable amount from the last time in which an impairment loss was recognized. If this is the case, the carrying value of the asset is increased to its recoverable amount. This increased amount cannot exceed the carrying value that would have been determined net of depreciation if an asset impairment loss would have not been recognized in prior years. This reversal is recognized with a credit to profit or loss.

3.29	Minimum dividend

As required by the Shareholders’ Corporations Act, unless decided otherwise by the unanimous vote by the shareholders of subscribed and paid shares, a public company must distribute dividends as agreed by the shareholders at the General Shareholders’ Meeting held each year with a minimum of 30% of its profit, except when the Company records unabsorbed losses from prior years. However, the Company defines as policy the distribution of 50% of its profit for the year.

3.30	Earning per share

The net basic earnings per share amounts are calculated by dividing profit for the year attributable to ordinary owners of the parent by the weighted average number of ordinary shares outstanding during the year.

The Company has not conducted any type of operation of potential dilutive effect that assumes diluted earnings per share other than the basic earnings per share.

3.31	Trade and other payables

Trade and other payables are measured at fair value plus all costs associated with the transaction. Subsequently, these are carried at amortized cost using the effective interest rate method.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 3

Significant accounting policies (continued)

3.32	Interest-bearing borrowings

At initial recognition, interest-bearing borrowings are measured at fair value. Subsequently, they are measured at amortized cost using the effective interest rate method. Amortized cost is calculated considering any premium or discount from the acquisition and includes costs of transactions which are an integral part of the effective interest rate.

These are recorded as non-current when their expiration period exceeds twelve months and as current when the term is lower than such term. Interest expense is calculated in the year in which they are accrued following a financial criterion.

3.33	Other provisions

Provisions are recognized when:

-	The Company has a present obligation as the result of a past event.

-	It is more likely than not that certain resources must be used, including benefits, to settle the obligation.

-	A reliable estimate can be made of the amount of the obligation.

In the event that the provision or a portion of it is reimbursed, the reimbursement is recognized as a separate asset solely if there is certainty of income.

In the consolidated statement of income, the expense for any provision is presented net of any reimbursement.

Should the effect of the time value of money be significant, provisions are discounted using a discount rate before tax that reflects the liability’s specific risks. When a discount rate is used, the increase in the provision over time is recognized as a finance cost.

The Company’s policy is maintaining provisions to cover risks and expenses based on a better estimate to deal with possible or certain and quantifiable responsibilities from current litigation, compensations or obligations, pending expenses for which the amount has not yet been determined, collaterals and other similar guarantees for which the Company is responsible. These are recorded at the time the responsibility or the obligation that determines the compensation or payment is generated.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 3

Significant accounting policies (continued)

3.34	Obligations related to employee termination benefits and pension commitments

Obligations with the Company’s employees are in accordance with that established in the collective bargaining agreements in force, formalized through collective employment agreements and individual employment contracts, except for the United States that is regulated in accordance with employment plans in force up to 2002.

These obligations are valued using actuarial calculations, according to the projected unit credit method which considers such assumptions as the mortality rate, employee turnover, interest rates, retirement dates, effects related to increases in employees’ salaries, as well as the effects on variations in services derived from variations in the inflation rate. This, considering criteria in force contained in the revised IAS 19.

Actuarial gains and losses that may be generated by variations in defined, pre-established obligations are directly recorded in other comprehensive income.

Actuarial losses and gains have their origin in departures between the estimate and the actual behavior of actuarial assumptions or in the reformulation of established actuarial assumptions.

The discount rate used by the Company for calculating the obligation was 4.89% for the periods ended March 31, 2016 and December 31, 2015, respectively.

The Company’s subsidiary SQM North America has established pension plans for its retired employees that are calculated by measuring the projected obligation using a net salary progressive rate net of adjustments for inflation, mortality and turnover assumptions, deducting the resulting amounts at present value using a 5.5% interest rate for 2016 and 2015. The net balance of this obligation is presented under the non-current provisions for employee benefits.

3.35	Compensation plans

Compensation plans implemented through benefits in share-based payments settled in cash, which have been provided, are recognized in the financial statements at their fair value, in accordance with International Financial Reporting Standards No. 2 "Share-based Payments.” Changes in the fair value of options granted are recognized with a charge to payroll on a straight-line basis during the period between the date on which these options are granted and the payment date (see Note 16).

3.36	Revenue recognition

Revenue includes the fair value of considerations received or receivable for the sale of goods and services during performance of the Company's activities. Revenue is presented net of value added tax, estimated returns, rebates and discounts and after the elimination of sales among subsidiaries.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 3

Significant accounting policies (continued)

3.36

Revenue recognition, continued

Revenue is recognized when its amount can be stated reliably. It is possible that the future economic rewards will flow to the entity and the specific conditions for each type of activity related revenue are complied with, as follows:

(a)

Sale of goods

The sale of goods is recognized when the Company has delivered products to the customer, and there is no obligation pending compliance that could affect the acceptance of products by the customer. The delivery does not occur until products have been shipped to the customer or confirmed as received by customers. When the related risks of obsolescence and loss have been transferred to the customer and the customer has accepted products in accordance with the conditions established in the sale, when the acceptance period has ended, or when there is objective evidence that those criteria required for acceptance have been met.

Sales are recognized in consideration of the price set in the sales agreement, net of volume discounts and estimated returns at the date of the sale. Volume discounts are evaluated in consideration of annual foreseen purchases and in accordance with the criteria defined in agreements.

(b)

Sale of services

Revenue associated with the rendering of services is recognized considering the degree of completion of the service as of the date of presentation of the consolidated classified statement of financial position, provided that the result from the transaction can be estimated reliably.

(c)

Interest income

Interest income is recognized when interest is accrued in consideration of the principal pending payment using the effective interest rate method.

(d)

Income from dividends

Income from dividends is recognized when the right to receive the payment is established.

3.37	Finance income and finance costs

Finance income is mainly composed of interest income in financial instruments such as term deposits and mutual fund deposits. Interest income is recognized in profit or loss at amortized cost, using the effective interest rate method.

Finance costs are mainly composed of interest on bank borrowing expenses, interest on bonds issued and interest capitalized for borrowing costs for the acquisition, construction or production or qualifying assets.

Borrowing costs and bonds issued are recognized in profit or loss using the effective interest rate method.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 3

Significant accounting policies (continued)

3.37

Finance income and finance costs, continued

For finance costs accrued during the construction period that are directly attributable to the acquisition, construction or production of qualifying assets, the effective interest rate related to the project’s specific financing is used. If none exist, the average financing rate of the subsidiary that makes the investment is utilized. Borrowing and financing costs that are directly attributable to the acquisition, construction or production of an asset are capitalized as part of that asset’s cost.

3.38	Income tax and deferred taxes

Corporate income tax for the year is determined as the sum of current taxes from the different consolidated companies.

Current taxes are based on the application of the various types of taxes attributable to taxable income for the year.

Differences between the book value of assets and liabilities and their tax basis generate the balance of deferred tax assets or liabilities, which are calculated using the tax rates expected to be applicable when the assets and liabilities are realized.

In conformity with current Chilean tax regulations, the provision for corporate income tax and taxes on mining activity is recognized on an accrual basis, presenting the net balances of accumulated monthly tax provisional payments for the fiscal period and associated credits. The balances of these accounts are presented in current income taxes recoverable or current taxes payable, as applicable.

Tax on companies and variations in deferred tax assets or liabilities that are not the result of business combinations are recorded in statement of income accounts or equity accounts in the consolidated statement of financial position, considering the origin of the gains or losses which have generated them.

At each reporting period, the carrying amount of deferred tax assets has been reviewed and reduced to the extent there will not be sufficient taxable income to allow the recovery of all or a portion of the deferred tax assets. Likewise, as of the date of the consolidated financial statements, deferred tax assets that are not recognized were evaluated and not recognized as it was more likely than not that future taxable income will allow for recovery of the deferred tax asset.

With respect to deductible temporary differences associated with investments in subsidiaries, associated companies and interest in joint ventures, deferred tax assets are recognized solely provided that it is more likely than not that the temporary differences will be reversed in the near future and that there will be taxable income with which they may be used.

The deferred income tax related to entries directly recognized in equity is recognized with an effect on equity and not with an effect on profit or loss.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 3

Significant accounting policies (continued)

3.38

Income tax and deferred taxes, continued

Deferred tax assets and liabilities are offset if there is a legally receivable right of offsetting tax assets against tax liabilities and the deferred tax is related to the same tax entity and authority.

3.39	Segment reporting

IFRS 8 requires that companies adopt a “management approach” to disclose information on the operations generated by its operating segments. In general, this is the information that management uses internally for the evaluation of segment performance and making the decision on how to allocate resources for this purpose.

An operating segment is a group of assets and operations responsible for providing products or services subject to risks and performance different from those of other business segments. A geographical segment is responsible for providing products or services in a given economic environment subject to risks and performance different from those of other segments that operate in other economic environments.

For assets and liabilities the allocation to each segment is not possible given that these are associated with more than one segment, except for depreciation, amortization and impairment of assets, which are directly allocated to the applicable segments, in accordance with the criteria established in the costing process for product inventories.

The following operating segments have been identified by the Company:

-	Specialty plant nutrients

-	Industrial chemicals

-	Iodine and derivatives

-	Lithium and derivatives

-	Potassium

-	Other products and services

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 3

Significant accounting policies (continued)

3.40	Environment

In general, the Company follows the criteria of considering amounts used in environmental protection and improvement as environmental expenses. However, the cost of facilities, machinery and equipment used for the same purpose are considered property, plant and equipment, as the case may be.

Note 4

Financial risk management

4.1	Financial risk management policy

The Company’s financial risk management policy is focused on safeguarding the stability and sustainability of Sociedad Química y Minera de Chile S.A. and its subsidiaries with regard to all such relevant financial uncertainty components.

The Company’s operations are subject to certain financial risk factors that may affect its financial position or results. The most significant risk exposures are market risk, liquidity risk, currency risk, doubtful accounts risk, and interest rate risk, among others.

Potentially, additional known or unknown risks may exist, of which we currently deem not to be significant, which could also affect the Company’s business operations, its business, financial position, or profit or loss.

The financial risk management structure includes identifying, determining, analyzing, quantifying, measuring and controlling these events. Management and, in particular, Finance Management, is responsible for constantly assessing the financial risk. The Company uses derivatives to hedge a significant portion of those risks.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 4

Financial risk management, continued

4.2	Risk factors

4.2.1

Market risk

Market risk refers to the uncertainty associated with fluctuations in market variables affecting the Company’s assets and liabilities, including:

Country risk: The economic situation of the countries where the Company operates may affect its financial position. For example, sales conducted in emerging markets expose SQM to risks related to economic conditions and trends in those countries. In addition, inventories may also be affected by the economic scenario in such countries and/or the global economy, among other probable economic impacts.

Price risk: The Company’s product prices are affected by the fluctuations in international prices of fertilizers and chemicals, as well as changes in productive capacities or market demand, all of which might affect the Company’s business, financial position and results of operations.

Commodity price risk: The Company is exposed to changes in commodity prices and energy which may have an impact on its production costs that may cause unstable results.

As of to-date, the SQM Group incurs an annual expenditure of approximately US$100 million associated with fuel, gas, energy and equivalents and approximately US$64 million related to direct electrical supply consumption. A change of 10% in the prices of energy required for the Company’s operations may involve costs of approximately US$10 million in short-term movements.

The markets in which the Company operates are unpredictable, exposed to significant fluctuations in supply and demand, and price high volatility. Additionally, the supply of certain fertilizers or chemicals, including certain products which the Company trades, vary mainly depending on the production of top producers and their related business strategies. Accordingly, the Company cannot forecast with certainty changes in demand, responses from competitors or fluctuations in the final price of its products. These factors can lead to significant impacts on the Company’s product sales volumes, financial position and share price.

Quality standards: In the markets in which we operate, customers might impose quality standards on our products and/or governments could enact more stringent standards for the distribution and/or use of our products. Consequently, we might not be able to sell our products if we are not able to meet those new standards. In addition, our production costs might increase to meet such new standards. Not being able to sell our products in one or more markets or to key customers might significantly affect our business, financial position or the results of our operations.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 4

Financial risk management, continued

4.2.2

Credit risk

A contraction of the global economy and the potentially adverse effects in the financial position of our customers may extend the receivables recovery period for SQM, increasing its exposure to doubtful account risk. While measures have been taken to minimize such risk, the global economic situation may result in losses that might have a material adverse effect on the Company’s business, financial position or results of operations.

To mitigate these risks, SQM actively controls debt collection and has established certain safeguards which include loan insurance, letters of credit, and prepayments for a portion of receivables.

Financial investments correspond to time deposits with maturities exceeding 90 days and less than 360 days from the investment date, so they are not exposed to significant market risks. Derivative financial instruments are measured at fair value and are engaged only in the market in Chile.

4.2.3

Currency risk

As a result of its influence on price level determination as well as its relationship with cost of sales, and since a significant portion of the Company’s business transactions are performed in that foreign currency, the functional currency of SQM is the United States dollar. However, the global business activities of the Company expose it to the foreign exchange fluctuations of several currencies with respect to the value of the U.S. dollar. Accordingly, SQM has entered into hedge contracts to mitigate the exposure generated by its main mismatches (assets, net of liabilities) in currencies other than the U.S. dollar against the foreign exchange fluctuation. These contracts are periodically updated depending on the mismatch amount to be hedged in such currencies. Occasionally, and subject to the Board of Directors’ approval, in the short-term the Company insures cash flows from certain specific items in currencies other than the U.S. dollar.

A significant portion of the Company’s costs, particularly payroll, is denominated in Chilean pesos. Accordingly, an increase or decrease in the exchange rate against the U.S. dollar would affect the Company’s profit for the period. Approximately US$ 316 million of the Company’s costs are denominated in Chilean pesos. A significant portion of the effect of such obligations on the statement of financial position is hedged by derivative instrument transactions on the balance mismatch in such currency.

As of March 31, 2016, the Company recorded derivative instruments classified as currency and interest rate hedges associated with all the bonds payable, denominated in UF, with a fair value of US$58 million against SQM. As of December 31, 2015, this amounts to US$75 million in against SQM.

As of March 31, 2016, the Chilean peso to U.S. dollar exchange rate was Ch$669.80 per US$1.00 (Ch$ 710.16 per US$ 1.00 as of December 31, 2015).

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 4

Financial risk management, continued

4.2.4

Interest rate risk

Interest rate fluctuations, primarily due to the uncertain future behavior of markets, may have a material impact on the financial results of the Company.

The Company has current and non-current debts valued at LIBOR, plus a spread. The Company is partially exposed to fluctuations in such rate, as SQM currently holds hedging derivative instruments to hedge a portion of its liabilities subject to the LIBOR rate fluctuations.

As of March 31, 2016, approximately 13% of the Company’s financial liabilities are measured at LIBOR. Accordingly, any significant increase in this rate may have an impact on the Company’s financial position. A 100 basic point variation in this rate may trigger variations in financial expenses of close to US$ 0.23 million. However, this effect is significantly counterbalanced by the returns of the Company’s investments that are also strongly related to LIBOR.

In addition, as of March 31, 2016, the Company's financial liabilities are mainly concentrated in the long-term and approximately 23% have maturities of less than 12 months, decreasing in the process the exposure to changes in interest rates.

4.2.5

Liquidity risk

Liquidity risk relates to the funds needed to comply with payment obligations. The Company’s objective is to maintain financial flexibility through a comfortable balance between fund requirements and cash flows from regular business operations, bank borrowings, bonds, short term investments, and marketable securities, among others.

The Company has an important capital expense program which is subject to change over time.

On the other hand, world financial markets go through periods of contraction and expansion that are unforeseeable in the long-term and may affect SQM’s access to financial resources. Such factors may have a material adverse impact on the Company’s business, financial position and results of operations.

SQM constantly monitors the matching of its obligations with its investments, taking due care of maturities of both, from a conservative perspective, as part of this financial risk management strategy. As of March 31, 2016, the Company had unused, available revolving credit facilities with banks, for a total of approximately US$388 million.

The position in other cash and cash equivalents generated by the Company are invested in highly liquid mutual funds with an AAA risk rating.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 4

Financial risk management, continued

4.3	Risk measurement

The Company has methods to measure the effectiveness and efficiency of financial risk hedging strategies, both prospectively and retrospectively. These methods are consistent with the risk management profile of the Group.

Note 5

Changes in accounting estimates and policies (consistent presentation)

5.1	Changes in accounting estimates

The Company had no changes in the determination of accounting estimates at the closing date of the consolidated financial statements.

5.2	Changes in accounting policies

As of March 31, 2016, the Company’s consolidated financial statements present no changes in accounting policies or estimates compared to the prior period.

The consolidated statements of financial position as of March 31, 2016 and December 31, 2015 and the statements of comprehensive income, changes in equity and cash flows for the periods ended March 31, 2016 and 2015, have been prepared in accordance with the Standards issued by the Chilean Superintendence of Securities and Insurance (SVS), which consider the International Financial Reporting Standards (IFRS), except for that indicated in Note 2.2, and the accounting principles and criteria have been applied consistently.

The accounting principles and criteria were applied consistently.

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 6

Background of companies included in consolidation

6.1	Parent’s stand-alone assets and liabilities

	03/31/2016			12/31/2015
	ThUS$			ThUS$

Assets		4,081,356			4,012,556
Liabilities		(1,713,081	)		(1,672,771	)
Equity		2,368,275			2,339,785

6.2	Parent entity

As provided in the Company’s by-laws, no shareholder can concentrate more than 32% of the Company’s voting right shares and therefore there is no controlling entity.

6.3	Joint arrangements of controlling interest

Sociedad de Inversiones Pampa Calichera S.A., Potasios de Chile S.A., and Inversiones Global Mining (Chile) Limitada, collectively the Pampa Group, are the owners of a number of shares that are equivalent to 29.92% as of March 31, 2016 of the current total amount of shares issued, subscribed and fully-paid of the Company. In addition, Kowa Company Ltd., Inversiones La Esperanza (Chile) Limitada, Kochi S.A. and La Esperanza Delaware Corporation, collectively the Kowa Group, are the owners of a number of shares equivalent to 2.12% of the total amount of issued, subscribed and fully-paid shares of SQM S.A.

The Pampa Group and the Kowa Group have informed SQM S.A., the Chilean SVS and the relevant stock exchanges in Chile and abroad that they are not and have never been related parties between them. In addition, this is regardless of the fact that both Groups on December 21, 2006 have entered into a Joint Action Agreement (JAA) related to those shares. Consequently, the Pampa Group, by itself, does not concentrate more than 32% of the voting right capital of SQM S.A., and the Kowa Group does not concentrate by itself more than 32% of the voting right capital of SQM S.A.

Likewise, the Joint Action Agreement has not transformed the Pampa and Kowa Groups into related parties between them. The Joint Action Agreement has only transformed the current controller of SQM S.A., composed of the Pampa Group, and the Kowa Group into related parties of SQM S.A.

Detail of effective concentration

Tax ID No.	Name	Ownership interest %
96.511.530-7	Sociedad de Inversiones Pampa Calichera S.A.		19.67
76.165.311-5	Potasios de Chile S.A.		6.91
96.863.960-9	Inversiones Global Mining (Chile) Limitada		3.34
Total Pampa Group			29.92

79.798.650-k	Inversiones la Esperanza (Chile) Ltda.		1.43
59.046.730-8	Kowa Co Ltd.		0.30
96.518.570-4	Kochi S.A.		0.30
59.023.690-k	La Esperanza Delaware Corporation		0.09
Total Kowa Group			2.12

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 6

Background of companies included in consolidation (continued)

6.4	General information on consolidated subsidiaries

As of March 31, 2016 and December 31, 2015, the general information of the companies on which the Company exercises control and significant influence is as follows:

					Ownership interest
Subsidiary	Tax ID	Address	Country of incorporation	Functional currency	Direct		Indirect		Total

SQM Nitratos S.A.	96.592.190-7	El Trovador 4285 Las Condes	Chile	US$		99.9999		0.0001		100.0000
Proinsa Ltda.	78.053.910-0	El Trovador 4285 Las Condes	Chile	Ch$		-		60.5800		60.5800
SQMC Internacional Ltda.	86.630.200-6	El Trovador 4285 Las Condes	Chile	Ch$		-		60.6381		60.6381
SQM Potasio S.A.	96.651.060-9	El Trovador 4285 Las Condes	Chile	US$		99.9999		-		99.9999
Serv. Integrales de Tránsito y Transf. S.A.	79.770.780-5	Arturo Prat 1060, Tocopilla	Chile	US$		0.0003		99.9997		100.0000
Isapre Norte Grande Ltda.	79.906.120-1	Anibal Pinto 3228, Antofagasta	Chile	Ch$		1.0000		99.0000		100.0000
Ajay SQM Chile S.A.	96.592.180-K	Av. Pdte. Eduardo Frei 4900, Santiago	Chile	US$		51.0000		-		51.0000
Almacenes y Depósitos Ltda.	79.876.080-7	El Trovador 4285 Las Condes	Chile	Ch$		1.0000		99.0000		100.0000
SQM Salar S.A.	79.626.800-K	El Trovador 4285 Las Condes	Chile	US$		18.1800		81.8200		100.0000
SQM Industrial S.A.	79.947.100-0	El Trovador 4285 Las Condes	Chile	US$		99.0470		0.9530		100.0000
Exploraciones Mineras S.A.	76.425.380-9	Los Militares 4290 Las Condes	Chile	US$		0.2691		99.7309		100.0000
Sociedad Prestadora de Servicios de Salud Cruz del Norte S.A.	76.534.490-5	Anibal Pinto 3228, Antofagasta	Chile	Ch$		-		100.0000		100.0000
Soquimich Comercial S.A.	79.768.170-9	El Trovador 4285 Las Condes	Chile	US$		-		60.6383		60.6383
Comercial Agrorama Ltda.	76.064.419-6	El Trovador 4285 Las Condes	Chile	Ch$		-		42.4468		42.4468
Comercial Hydro S.A.	96.801.610-5	El Trovador 4285 Las Condes	Chile	Ch$		-		60.6383		60.6383
Agrorama S.A.	76.145.229-0	El Trovador 4285 Las Condes	Chile	Ch$		-		60.6377		60.6377
Orcoma Estudios SPA	76.359.919-1	Apoquindo 3721 Of.131 Las Condes	Chile	US$		51.0000		-		51.0000
Orcoma SPA	76.360.575-2	Apoquindo 3721 Of.131 Las Condes	Chile	US$		100.0000		-		100.0000
SQM North America Corp.	Foreign	2727 Paces Ferry Road, Building Two, Suite 1425, Atlanta, GA	United States	US$		40.0000		60.0000		100.0000
RS Agro Chemical Trading Corporation A.V.V.	Foreign	Caya Ernesto O. Petronia 17, Orangestad	Aruba	US$		98.3333		1.6667		100.0000
Nitratos Naturais do Chile Ltda.	Foreign	Al. Tocantis 75, 6° Andar, Conunto 608 Edif. West Gate, Alphaville Barureri, CEP 06455-020, Sao Paulo	Brazil	US$		-		100.0000		100.0000
Nitrate Corporation of Chile Ltd.	Foreign	1 More London Place London SE1 2AF	United Kingdom	US$		-		100.0000		100.0000
SQM Corporation N.V.	Foreign	Pietermaai 123, P.O. Box 897, Willemstad, Curacao	Netherlands	US$		0.0002		99.9998		100.0000
SQM Peru S.A.	Foreign	Avenida Camino Real N° 348 of. 702, San Isidro, Lima	Peru	US$		0.9800		99.0200		100.0000
SQM Ecuador S.A.	Foreign	Av. José Orrantia y Av. Juan Tanca Marengo Edificio Executive Center Piso 2 Oficina 211	Ecuador	US$		0.0040		99.9960		100.0000
SQM Brasil Ltda.	Foreign	Al. Tocantis 75, 6° Andar, Conunto 608 Edif. West Gate, Alphaville Barureri, CEP 06455-020, Sao Paulo	Brazil	US$		1.0900		98.9100		100.0000

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 6

Background of companies included in consolidation (continued)

6.4

General information on consolidated subsidiaries, continued

Ownership interest

Subsidiary

Tax ID

Address

Country of
incorporation

Functional
currency

Direct

Indirect

Total

SQI Corporation N.V.

Foreign

Pietermaai 123, P.O. Box 897, Willemstad, Curacao

Netherlands

US$

0.0159

99.9841

100.0000

SQMC Holding Corporation L.L.P.

Foreign

2727 Paces Ferry Road, Building Two, Suite 1425, Atlanta

United States

US$

0.1000

99.9000

100.0000

SQM Japan Co. Ltd.

Foreign

From 1^st Bldg 207, 5-3-10 Minami- Aoyama, Minato-ku, Tokyo

Japan

US$

1.0000

99.0000

100.0000

SQM Europe N.V.

Foreign

Houtdok-Noordkaai 25a B-2030 Antwerp, Belgium

Belgium

US$

0.5800

99.4200

100.0000

SQM Italia SRL

Foreign

Via A. Meucci, 5 500 15 Grassina Firenze

Italy

US$

100.0000

SQM Indonesia S.A.

Foreign

Perumahan Bumi Dirgantara Permai, Jl Suryadarma Blok Aw No 15 Rt 01/09 17436 Jatisari Pondok Gede

Indonesia

US$

80.0000

North American Trading Company

Foreign

2727 Paces Ferry Road, Building Two, Suite 1425, Atlanta, GA

United States

US$

100.0000

SQM Virginia LLC

Foreign

2727 Paces Ferry Road, Building Two, Suite 1425, Atlanta, GA

United States

US$

100.0000

SQM Comercial de México S.A. de C.V.

Foreign

Av. Moctezuma 144-4 Ciudad del Sol. CP 45050, Zapopan, Jalisco México

Mexico

US$

0.0010

99.9900

100.0000

SQM Investment Corporation N.V.

Foreign

Pietermaai 123, P.O. Box 897, Willemstad, Curacao

Netherlands

US$

1.0000

99.0000

100.0000

Royal Seed Trading Corporation A.V.V.

Foreign

Caya Ernesto O. Petronia 17, Orangestad

Aruba

US$

1.6700

98.3300

100.0000

SQM Lithium Specialties LLP

Foreign

2727 Paces Ferry Road, Building Two, Suite 1425, Atlanta, GA

United States

US$

100.0000

Soquimich SRL Argentina

Foreign

Espejo 65 Oficina 6 – 5500 Mendoza

Argentina

US$

100.0000

Comercial Caimán Internacional S.A.

Foreign

Edificio Plaza Bancomer Calle 50

Panama

US$

100.0000

SQM France S.A.

Foreign

ZAC des Pommiers 27930 FAUVILLE

France

US$

100.0000

Administración y Servicios Santiago S.A. de C.V.

Foreign

Av. Moctezuma 144-4 Ciudad del Sol. CP 45050, Zapopan, Jalisco México

Mexico

US$

100.0000

SQM Nitratos México S.A. de C.V.

Foreign

Av. Moctezuma 144-4 Ciudad del Sol. CP 45050, Zapopan, Jalisco México

Mexico

US$

100.0000

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 6

Background of companies included in consolidation (continued)

6.4

General information on consolidated subsidiaries, continued

Ownership interest

Subsidiary

Tax ID

Address

Country of
incorporation

Functional
currency

Direct

Indirect

Total

Soquimich European Holding B.V.

Foreign

Loacalellikade 1 Parnassustoren 1076 AZ Amsterdam

Netherlands

US$

100.0000

SQM Iberian S.A

Foreign

Provenza 251 Principal 1a CP 08008, Barcelona

Spain

US$

100.0000

SQM Africa Pty Ltd.

Foreign

Tramore House, 3 Wterford Office Park, Waterford Drive, 2191 Fourways, Johannesburg

South Africa

US$

100.0000

SQM Oceania Pty Ltd.

Foreign

Level 9, 50 Park Street, Sydney NSW 2000, Sydney

Australia

US$

100.0000

SQM Agro India Pvt. Ltd.

Foreign

C 30 Chiragh Enclave New Delhi, 110048

India

US$

100.0000

SQM Beijing Commercial Co. Ltd.

Foreign

Room 1001C, CBD International Mansion N 16 Yong An Dong Li, Jian Wai Ave Beijing 100022, P.R.

China

US$

100.0000

SQM Thailand Limited

Foreign

Unit 2962, Level 29, N° 388, Exchange Tower Sukhumvit Road, Klongtoey Bangkok

Thailand

US$

99.996

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 6

Background of companies included in consolidation (continued)

6.5	Information attributable to non-controlling interests

Subsidiary	% of interests in the ownership held by non- controlling interests.			Profit (loss) attributable to non-controlling interests					Equity, non-controlling interests				Dividends paid to non- controlling interests
				03/31/2016			12/31/2015		03/31/2016		12/31/2015		03/31/2016		12/31/2015
				ThUS$			ThUS$		ThUS$		ThUS$		ThUS$		ThUS$
Proinsa Ltda.		0.1	%		-			-		-		-		-		-
SQM Potasio S.A.		0.0000001	%		-			-		-		-		-		-
Ajay SQM Chile S.A.		49	%		(336	)		1,551		8,443		8,107		-		1,946
SQM Indonesia S.A.		20	%		-			-		1		1		-		-
Soquimich Comercial S.A.		39.3616784	%		174			2,605		49,717		49,897		-		1,303
Comercial Agrorama Ltda.		30	%		39			3		263		292		-		-
Agrorama S.A.		0.001	%		-			-		-		-		-		-
Orcoma Estudios SPA		49	%		1			5		2,274		2,274		-		-
SQM (Thailand) Limited.		0.004	%		-			-		-		-		-		-
Total					(122	)		4,164		60,698		60,571		-		3,249

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 6

Background of companies included in consolidation (continued)

6.6	Information on consolidated subsidiaries

	03/31/2016

Subsidiary	Assets				Liabilities				Revenue		Profit (loss)			Comprehensive income (loss)
	Current		Non-current		Current		Non-current
	ThUS$		ThUS$		ThUS$		ThUS$		ThUS$		ThUS$			ThUS$

SQM Nitratos S.A.		552,542		62,809		555,671		7,153		24,551		1,766			1,766
Proinsa Ltda.		157		1		-		-		-		-			-
SQMC Internacional Ltda.		204		-		-		-		-		(2	)		(2	)
SQM Potasio S.A.		111,302		904,592		33,431		22,191		2,773		57,217			57,387
Serv. Integrales de Tránsito y Transf. S.A.		51,907		63,135		86,822		6,325		5,734		(378	)		(378	)
Isapre Norte Grande Ltda.		485		706		461		144		774		33			48
Ajay SQM Chile S.A.		17,502		977		842		406		8,336		687			687
Almacenes y Depósitos Ltda.		279		44		1		-		-		(3	)		65
SQM Salar S.A.		770,700		850,773		533,716		200,518		211,313		74,026			74,110
SQM Industrial S.A.		1,121,095		666,982		806,472		76,185		167,880		(3,488	)		(2,139	)
Exploraciones Mineras S.A.		527		31,457		5,714		-		-		(95	)		(95	)
Sociedad Prestadora de Servicios de Salud Cruz del Norte S,A.		355		585		478		398		421		2			11
Soquimich Comercial S.A.		145,586		21,695		39,996		977		19,978		(444	)		(405	)
Comercial Agrorama Ltda.		10,167		1,626		10,886		31		2,951		(130	)		(130	)
Comercial Hydro S.A.		8,984		74		3		5		12		71			71
Agrorama S.A.		10,153		709		11,404		35		3,018		(237	)		(237	)
Orcoma SpA		2		2,356		13		-		-		(2	)		(2	)
Orcoma Estudio SpA		1,550		3,188		97		1		-		(2	)		(2	)
SQM North America Corp.		223,257		15,623		230,674		485		62,979		(6,869	)		(8,130	)
RS Agro Chemical Trading Corporation A.V.V.		5,192		-		-		-		-		(2	)		(2	)
Nitratos Naturais do Chile Ltda.		-		240		3,345		-		-		(81	)		(81	)
Nitrate Corporation of Chile Ltd.		5,076		-		-		-		-		-			-
SQM Corporation N.V.		668		105,150		3,539		-		-		(11,483	)		(10,570	)
SQM Peru S.A.		423		1		1,177		-		-		2			2
SQM Ecuador S.A.		15,644		140		14,659		35		6,522		201			201
SQM Brasil Ltda.		140		1		640		2,199		59		(92	)		(92	)
SQI Corporation N.V.		-		21		38		-		-		(2	)		(2	)
SQMC Holding Corporation L.L.P.		22,169		13,867		1,000		-		-		943			943
SQM Japan Co. Ltd.		2,773		226		449		530		719		215			215

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 6

Background of companies included in consolidation (continued)

6.6

Information on consolidated subsidiaries, continued

03/31/2016
	Assets				Liabilities									Comprehensive
Subsidiary	Current		Non-current		Current		Non-current		Revenue		Profit (loss)			income (loss)
	ThUS$		ThUS$		ThUS$		ThUS$		ThUS$		ThUS$			ThUS$

SQM Europe N.V.		374,821		2,257		342,343		-		171,126		(9,910	)		(9,910	)
SQM Italia SRL		1,173		-		15		-		-		-			-
SQM Indonesia S.A.		4		-		1		-		-		-			-
North American Trading Company		158		145		39		-		-		-			-
SQM Virginia LLC		14,814		14,360		14,814		-		-		-			-
SQM Comercial de México S.A. de C.V.		103,601		1,932		79,151		-		50,034		(2,318	)		(2,318	)
SQM Investment Corporation N.V.		82,689		121		37,826		860		-		(7,418	)		(7,418	)
Royal Seed Trading Corporation A.V.V.		73,582		-		93,527		-		-		391			461
SQM Lithium Specialties LLP		15,766		3		1,264		-		-		-			-
Soquimich SRL Argentina		213		-		178		-		-		(9	)		(9	)
Comercial Caimán Internacional S.A.		262		-		1,122		-		-		1			1
SQM France S.A.		345		6		114		-		-		-			-
Administración y Servicios Santiago S.A. de C.V.		259		136		798		99		625		192			192
SQM Nitratos México S.A. de C.V.		31		2		17		7		61		(3	)		(3	)
Soquimich European Holding B.V.		74,478		99,904		81,649		-		-		(11,927	)		(11,014	)
SQM Iberian S.A.		63,005		69		58,798		-		33,383		(1,064	)		(1,064	)
SQM Africa Pty Ltd.		95,860		1,346		85,870		-		12,781		(3,026	)		(3,026	)
SQM Oceania Pty Ltd.		2,873		-		880		-		683		77			77
SQM Agro India Pvt, Ltd.		1		-		1		-		-		(3	)		(3	)
SQM Beijing Commercial Co. Ltd.		3,356		39		550		-		1,772		641			641
SQM Thailand Limited		5,883		7		3,209		-		1,021		54			54
Total		3,992,013		2,867,305		3,143,694		318,584		789,506		77,531			79,900

SQM S.A.
El Trovador 4285,
Las Condes, Santiago, Chile
Tel: (56 2) 2425 2000
www.sqm.com

Notes to the Consolidated Financial Statements as of March 31, 2016.

Note 6

Background of companies included in consolidation (continued)

6.6

Information on consolidated subsidiaries, continued

12/31/2015
	Assets				Liabilities										Comprehensive
Subsidiary	Current		Non-current		Current		Non-current		Revenue			Profit (loss)			income (loss)
	ThUS$		ThUS$		ThUS$		ThUS$		ThUS$			ThUS$			ThUS$

SQM Nitratos S.A.		521,948		69,159		531,903		7,913		146,731			(715	)		(739	)
Proinsa Ltda.		149		-		-		-		-			-			-
SQMC Internacional Ltda.		195		-		-		-		-			(1	)		(1	)
SQM Potasio S.A.		90,230		843,842		7,748		23,438		10,785			184,315			184,533
Serv. Integrales de Tránsito y Transf. S.A.		46,646		63,973		81,703		6,642		44,045			(12,450	)		(12,316	)
Isapre Norte Grande Ltda.		791		540		664		143		3,883			-			6
Ajay SQM Chile S.A.		17,044		942		879		563		38,414			3,165			3,165
Almacenes y Depósitos Ltda.		264		41		-		-		-			(12	)		(77	)
SQM Salar S.A.		639,804		871,339		474,225		201,581		762,058			193,367			193,300
SQM Industrial S.A.		1,030,937		702,192		741,820		83,751		685,634			19,144			11,224
Exploraciones Mineras S.A.		482		31,443		5,560		-		-			(666	)		(666	)
Sociedad Prestadora de Servicios de Salud Cruz del Norte S,A.		296		550		423		364		2,299	<