Peru is seeking to attract investment, both domestic and foreign, in all sectors of the economy. For such purpose, it has taken the necessary measures to establish a coherent investment policy that eliminates barriers that foreign investors may face. As a result, it has been considered one of the countries with the most open investment regimes in the world.
Foreign investment legislation and trends
Peru has adopted a legal framework that does not require prior authorization for foreign investment. Foreign investments are permitted without restrictions in most economic activities. The activities with restrictions are very specific, such as air transport, maritime transport, public and private security, and manufacturing weapons of war. In addition, Peru has established a legal framework to protect the economic stability of investors and reduce government interference in economic activities.
The Peruvian State may grant legal stability to domestic and foreign investors regarding the statutes in place on income tax and, specifically, on dividend distribution. Those foreign investors who can seek the execution of a legal stability agreement are those willing to invest in Peru, in a period of no less than two 2 years, minimum amounts of US$10 million in the mining and/or hydrocarbon sectors, or US$5 million in any other economic activity.
Peruvian laws, regulations, and practices do not discriminate between domestic companies and foreign companies. Foreign investors receive equal treatment. There are no restrictions on the repatriation of earnings, international capital transfers, or foreign exchange practices. There are also no restrictions on the sending of interest and royalties. Foreign currency may be used to acquire goods or meet financial obligations, provided that the operator complies with the Peruvian tax legislation in force.
Favorable legal framework for foreign investors
Peru offers a legal framework that protects the interest of foreign investors, offering them:
- A non-discriminatory, equal treatment
- Unrestricted access to the majority of economic sectors
- Free transfer of capital
Domestic and foreign investors are offered:
- Right to free competition
- Guarantee of private property (no expropriations or state takeovers)
- Freedom to acquire shares in Peruvian companies
- Freedom to gain access to internal and external credit Freedom to remit royalties and profits from their Investments
- Simplicity of most operations, whether in local currency (Sol) or U.S. Dollars, without exchange rate controls
- Abroad series of international investment agreements and participation in the Investment Committee of the Organization for Economic Cooperation and Development (OECD)
Direct foreign investments must be registered with the Private Investment Promotion Agency (ProInversión). Foreign investors may remit abroad (with no restrictions) the net profits originating from their investments, as well as transferring their shares, ownership rights or interests, perform capital stock reductions, and wind up businesses.