Actually... Some good explanations in this thread, but there's still some confusion. Hope I can clear that up. Spoilers ahead!
There are actually two Charlottes -- the real one -- she dies and is only seen in a flashback towards the end -- and the other one -- a runaway who assumes Charlotte's identity.
Tom's daughter (the redhead), Louise, committed suicide by jumping out of a window a couple of weeks after her disappearance -- why Tom doesn't know, but he keeps looking for places she might have been and people she might have met in order to understand her motivations. At the end of the movie he finds out that she killed herself because she accidentally killed the real Charlotte. She had kept quiet about the incident and couldn't bear the guilt any longer.
The real Charlotte, before she got killed, was fooling around with the mentally handicapped Freddy when Louise showed up unexpectedly. In the ensuing struggle, Charlotte got pushed off a ledge and died. Freddy's father (the gamekeeper/forester) didn't know about Louise being responsible and assumed Freddy had killed Charlotte. Freddy did tell the truth, but his father didn't believe him, thinking he was making things up to shift the blame. (After all, Louise was there on a school trip: she left the village shortly after committing the murder and there was no way of tracing her.) Freddy's father buries Charlotte's corpse underneath the trailer and keeps a tight lid on his son's alleged murder. Not even Charlotte's parents know what happened to their daughter.
So, a month after Charlotte's death, Louise kills herself. Both girls are dead at this point.
Fast-forward 18 months. Tom, still desperately searching for the truth about why his daughter killed herself, chances upon a runaway girl who indicates that she's seen Louise. She's afraid, has just run away from home that very same day, and she tells Tom a lie in order to secure a bed. Tom believes her.
When the girl is discovered in Tom's flat, her picture is sent out. Charlotte's parents arrive and claim that she is their daughter. The girl, who still wants to get away from her own home, complies. This girl's real name is Julie, but throughout the movie she plays the part of Charlotte, and Tom and the viewers are led to believe that she *is* Charlotte.
The reason why the girl goes along with this charade is that she wants to run away from her father, who sexually abuses her. The mother's reason is desperation: she desperately wants to believe that she's got her daughter back. Her husband and her son (the real Charlotte's brother) and the entire village know that the girl isn't really Julie, but this being a tightly-knit community, they keep quiet about the whole mess.
The reveal at the end of the movie establishes that a) "Charlotte" is not the real one but rather an opportunistic runaway; b) Tom's daughter Louise killed the real Charlotte, and c) she killed herself out of guilt for b).
Prior to the reveal at the end of the movie several clues suggest that the girl Tom knows as Charlotte is not the real one: these are noticed by the characters, too. For one, the girl known as Charlotte speaks Dutch natively -- that's very remarkable for a girl in a small Wallonian community. Secondly, Tom's police buddy shows him a report that says that "Charlotte" is several inches taller than the one that disappeared, that she's healthier and more muscular than before she disappeared. And finally, there's one scene where the false Charlotte sits at the dinner table, and asks her "dad" if he wants to pass the salt, "please, daddy?" At that point the "dad" leaves the room in disgust, because he's just keeping up appearances for his wife's sake. Oh, and then there's the whole faux-incestuous relationship between the false Charlotte and her "brother".
There. I hope that's clear enough. If it isn't, do ask for a better explanation!
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