Mr Andhoy and a companion were travelling across the ice when the support boat sank, and Mr Andhoy has said he was returning to Antarctica to find answers to the sinking.
After the trip he did not return through New Zealand for fear of arrest.
Mr Andhoy's lawyer, Nils Jorgen Vordahl, told Norway's FVN news that a naval vessel arrested the boat on Saturday evening in Chilean waters while it was on its way to Argentina.
Both the crew and boat was now under guard by armed military personnel.
The navy had been given no reason why the boat was placed under arrest but Mr Andhoy had been told it was at the request of the New Zealand Government, Mr Vordahl said.
A spokeswoman for the Ministry of Foreign Affairs said it was aware the Nilaya has been escorted to Puerto Williams and had its sailing permit suspended.
"We understand that the crew are well, our embassy in Chile is on standby to provide consular assistance to the New Zealander on board.
"The Chilean authorities are aware of New Zealand's concerns about the unauthorised expedition to the Ross Sea region,'' she said.