Chapter 2: Political and Economic Environment

http://www.proinversion.gob.pe/english/orientacion/empresas/cont_3.htm=

Chapter 3: Selling U.S. Products and Services

Using an Agent or= Distributor &= nbsp; &nbs= p; &= nbsp; &nbs= p; Return to top

Peruvi= an law does not require the use of local distributors for private sector commercial sales. However, for sales to = the government, U.S. companies should contract and register a local agent. (See "Selling to the Government" later in this chapter.)&n= bsp; It is also advisable to have a representative "on the ground&qu= ot; to stay abreast of the latest opportunities and developments in your company’s area of interest.

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Be diligent when selecting an ag= ent or a representative in Peru. To maximize efficiency and minimize cost, U.S. companies may wish to take advantage of relevant U.S. Department= of Commerce services by contacting the local Commercial Service Export Assista= nce Center (EAC) located in major cities throughout the United States, including Alaska and Hawaii. Services i= nclude the International Partner Search (IPS), which helps to pinpoint interested agents and distributors, the Gold Key Service (GKS), which arranges meetings in-country with potential company representatives (agents or distributors),= and the International Company Profile (ICP), which reports on the credit and business history of individual local companies. For detailed information, refer to Chapter 10: Guide to Our Services.

Establishing an Office = ; &n= bsp; = ; &n= bsp; = ; &n= bsp; Return to top

It is essential for companies planning to operate in Peru to r= etain reputable legal counsel. Law firms are referred to as “estudios” and attorneys as “Doctor” or “Doctora” followed by their last name. An attorney should be aware of mat= ters concerning taxes on corporate and branch income, which have an identical regime, corporate residence, value added taxes, income determination, capit= al gains, inter-company dividends, stock dividends, depreciation and depletion, net operating losses (tax losses) and payments to foreign affiliates. Other significant issues to consid= er include workers’ benefits, payroll and withholding taxes, municipal operating permits and general labor laws that will affect the business when= it starts operating. Most U.S. companies retain the local representative of their U.S.-based auditor. The Commercial Service in Lima can provide a list of local lawyers and/or tax and audit firms.

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Foreign corporations interested in doing business in Peru on a permanent basis must= be formally incorporated and registered in the Peruvian Mercantile Registry. Real estate may be acquired by any foreign entity without the need to establish an office. It is only necessary to vest a loc= al individual with sufficient powers to conduct and close the sale.

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There are two main forms of business organization that can be used for these purposes: branch offices or incorporated subsidiaries.

Establ= ishing a Branch

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To est= ablish a branch the following documents will be required:

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-Copy = of the articles of incorporation of the parent company.

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-Certi= ficate of incorporation and good standing or other official document certifying the existence and continuous operation of the parent company. This certificate must state that t= he parent company is not prohibited, either by law or by its own by-laws, from establishing branches abroad. If such statement cannot be included in the certificate, then a Notary Public = may do so in a separate document.

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-Copy = of the minutes of the board of directors' meeting where the resolution to establis= h a branch in Peru appears. This resolution should specify:

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-The d= omicile in Peru.

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-Durat= ion of the branch (may be indefinite) and the commencement of operations.

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-The p= urpose of the branch, clearly specifying the business and operations that will be conducted in Peru, stating that said purpose is comprised in the parent company’s purpose.

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-Name = of person(s) authorized to act in the registration of the branch and in its representation, and powers vested in him/her, which must include powers to resolve any issue related to the branch activities; to hold the corporation liable for its operations; to appear in court; and to respond to suits brou= ght against it. The holder of the parent corporation’s power of attorney, duly registered, directs the branch. The parent corporatio= n can revoke such power anytime. Th= ere is no requirement for the parent company to submit its financial statements to Peruvian authorities.

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A Nota= ry Public or appropriate government official in the country of incorporation must legalize all documents granted abroad.&nbs= p; A local Peruvian Consul must then authenticate the signatures of the Notary or the government official. The documents should be in Spanish, and if not, must be translated b= y an official Peruvian translator. Upon receipt, the signature of the Peruvian consul must be legalized in the Mini= stry of Foreign Affairs.

Regist= ration fees are as follows:

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-Regis= tration fee: approximately 3/1000 of the assigned capital with a maximum of approximately U.S. $1,060 (one tax unit: 3,450 soles for 2007.)

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-Trans= lation fees: between U.S. $10 and U.S. $12 per page.

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-Legal= ization at the Ministry of Foreign Affairs: U.S. $6 per document.

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-Notar= y and legal fees: widely variable rates.

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Once a= residence or a domicile can be demonstrated, the foreign company must obtain the Regi= stro Unico del Contribuyente (“RUC” or tax payer number.) The taxpayer will use his RUC numb= er in all commercial transactions, similar to the federal tax identification numb= er (EIN) in the United States.

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Incorp= orating a Subsidiary

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The co= rporation is the most common form of establishing a business entity in Peru. A minimum of two shareholders is required. One hundred percent foreign investment is allowed without restrictions, (except for a limited number of restricted activities; see “Chapter 6: Investment Climate, Openness to Foreign Investment”.)

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To com= ply with the rules of incorporation of a subsidiary, the following documents will be required:

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If par= ticipating shareholders are foreign individuals they need only present valid identification (passport), but for corporations participating as shareholde= rs the following documents must be filed:

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-Certi= ficate of Good Standing; and

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-Copy = of the minutes of the board of directors' meeting where the resolution to particip= ate in the incorporation of a Peruvian company appears. This resolution should indicate th= e name of the person appointed as representative to act on behalf of the sharehold= ers in all the incorporation procedures.

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-No mi= nimum capital is required.

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The Bu= siness Corporation Law regulates two forms of corporation: closed corporation (SAC: Sociedad Anonima Cerrada), similar to the private company, and open corpora= tion (SAA: Sociedad Anonima Abierta), similar to the public company.

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Closed Corporation

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The cl= osed corporation (SAC) must have a minimum of two and a maximum of twenty shareholders. The shareholders meetings, and Chief Executive Officer, manage the SAC. A board of directors is optional.<= span style=3D'mso-spacerun:yes'> In case of transfer of shares the = law stipulates a right of first refusal for the existing shareholders. The by-laws may eliminate this rig= ht.

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Open Corporation

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The op= en corporation (SAA) does not limit the maximum number of shareholders and is intended for companies making public offerings. No limitations are allowed for the transfer of shares. The Natio= nal Supervisory Committee of Corporations and Securities (CONASEV) supervise op= en corporations.

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Limited Liability Companies (Sociedad Comercial de Responsabilidad Limitada) is ano= ther form of business organization that is a legal entity different from its own= ers, who can be either individuals or corporations. The liability of the partners is l= imited to the amount of their contribution. The minimum number of partners is two and the maximum is twenty. The name of the company must inclu= de the abbreviation "S.R. Ltda.".

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For more information on setting up a company in Peru visit the following web pages of ProInversion and the Minis= try of Foreign Affairs.

http://www.rree.go= b.pe/portal/economia2.nsf/91d93e7ca259fb4405256c0e0005a30f/af7552948b447752= 05256c0d006f8979?OpenDocument

All po= tential investors should contact an attorney to understand the legal framework for investments found in the Foreign Investment Promotion Law, the Framework Law for Private Investment, the Law for the Promotion of Private Investment in State-Owned Companies, and the Law for the Promotion of Private Investment = in Public Utility Facilities.

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In the event of a dispute, national= or international arbitration may be used, but only if agreed to by the parties= in an agreement or contract, before the dispute arises. Arbitration cannot be imposed unilaterally after the fact as a means to resolve controversies or disputes. Please contact CS L= ima to discuss arbitration venue options, as one of the leading centers has had so= me complaints. The American Cham= ber of Commerce in Peru (AmCham) maintains a fully staffed arbitration center open= to members and non-members.

Franchising = &nb= sp; = &nb= sp; = &nb= sp; Return to top

As the franchise leader in a $500 million indus= try comprised of 120 Peruvian and foreign franchise businesses in Peru, the Uni= ted States holds 70% of the franchise market share (mostly in food services.)

There is no special legislation for franchising. Franchises in Pe= ru are subject to general commercial law, Decision 486, Decision 608, Decision 291= of the Andean Community, and the general antitrust law. According to articles 162 through = 164 of Decision 486 a written license agreement must be registered at the patents = and trademarks office (INDECOPI – www.indecopi.gob.pe). Prospective franchisers need to be= aware of a 30% income tax on royalties, 19% value added tax (paid by the local company) and an average 8.3% import tariffs. Countries that have signed d= ouble taxation agreements with Peru have a different regime on royalties withhold= ing income tax (the U.S. is not included.)

Franchises with promising potential include fam= ily style restaurants, Internet cafes, pre-school educational training and secu= rity systems and services.

Direct Marketing &nbs= p; &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; <= span lang=3DEN style=3D'font-weight:normal'>Return to top

Direct marketing is well establ= ished in Peru in the service sector, especially among financial institutions and sem= inar organizers. One common practi= ce is to hire personnel for telemarketing and mailing campaigns or to contract th= ese services from specialized firms. Databases for direct marketing are zealously guarded and thus are not freely available. Nevertheles= s, commercial information can be obtained through Peru’s chambers of commerce and trade associations (See Chapter 10: Contacts, Market Research = and Trade Events.) Call centers (outsourcing from the U.S. or other Latin countries) are operating in Peru.=

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Catalog sales for consumer goods in= Peru are limited because of the high degree of mistrust in the quality of the product, difficulty in obtaining warranty support, and less than universal acceptance of credit card orders.

Joint Ventures/Licensing &n= bsp; = ; &n= bsp; = ; &n= bsp; Return to top

Peruvi= an law allows for joint ventures and licensing agreements with a legally establish= ed local partner who will be accountable for all legal matters. Peru has largely integrated itself= into the global commercial network, making it an attractive destination for joint ventures and licensing agreements. This is especially true in activities where there is local manufactu= ring or finishing assembly capacity and the U.S. product's market price is stron= gly affected by shipping costs.

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The textile manufacturing industry = in Peru has attracted a great deal of licensing and joint venture activity. Productivity has increased through modern technology, resulting in significant production in exports for well known clothing brands. Peru o= ffers excellent quality raw materials (e.g. high-grade cotton), skilled labor and competitive production costs.

Sellin= g to the Government &nb= sp; = &nb= sp; = &nb= sp; Return to top

To sel= l to the Peruvian government, U.S. companies may participate in a bid process, for which they must register with the National Register of Suppliers (RNP by its Spanish acronym.) The RNP has the fol= lowing chapters: constructors, construction consultants, suppliers of goods, suppl= iers of services, and unqualified to contract with the government. An individual or company can regis= ter in any of the four first chapters and can choose to register jointly as goods = and services provider.

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To reg= ister a company must:

1. Pay a fee at CONSUCODE according t= o its gross annual sales during the previous year.

2. Pre= sent the official form (available at http://www.consucode.gob.pe/) signed by the legal representative.

3. The= legal representative must have its powers registered with the Peruvian Public Registry. If the powers of the legal representative are not registered, this can be done within the follow= ing 15 working days.

4. Cop= y of the municipal license, notarized by the Peruvian Consulate in the United States, and registered with the Peruvian Ministry of Foreign Affairs, translated by= an official interpreter. If ther= e is no municipal license or similar document in the country of origin, the legal representative may present an affidavit stating this fact, also within 15 working days after paying the fee.

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Caution should be exercised when respo= nding to a Peruvian government bid for products or services to ensure it is a val= id bid that conforms to the prevailing regulations. Bidders also need to ensure it is a formal bid called by an authorized agency.=

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In ord= er to ensure that conflicts of interest do not occur, Peruvian law excludes all currently employed government officials from negotiating contracts for bidd= er firms with the government. Th= ere is no post-employment waiting period, however, for former government officials= .

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Peruvi= an law permits an independent distributor to pay commissions or fees to third part= ies in connection with sales to the government. For example, a company in Peru can purchase products from a company in the United States and then pay a third party a fee to resell them to the Peruvian government. There are no Peruvian restrictions= on commissions or mark-ups on sales to the government by either agents or dist= ributors, and the rates vary widely depending on product, client and competition.

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Government agencies usually publish= tender notices in the main newspapers. The government, in an effort to ensure transparency for all government tenders,= is currently using the United Nations Office for Project Service (UNOPS) to no= tify potential suppliers. Peru is = not a signatory to the World Trade Organization (WTO) Plurilateral Agreement on Government Procurement.

Distribution and Sales Channels &= nbsp; &nbs= p; &= nbsp; &nbs= p; Return to top

The po= pulation of Peru is extremely centralized, with 30% of all inhabitants living in the capital city of Lima. Therefo= re, most sales occur in Lima. Sales opportunities do exist in other major population centers such as Arequipa, Chiclayo, and Trujillo. This should be a consideration for= a U.S. company’s overall marketing strategy. Representatives in Lima typically = have sales agents in these cities, covering sales opportunities in the provinces= .

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The mo= st common method of distribution is the appointment of a qualified representative. Appointing an agent or distributor= is advisable if your company is serious about developing the market on a susta= ined basis. At present, U.S. compa= nies are successfully locating qualified local agents.

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The decentralization of budgets, de= legation of decision making to regional governments, the use of “canon” = or tax imposed on extractive industries are important considerations when considering a local representative outside of Lima. It can also make completing the sa= le more challenging especially for municipal or provincial procurements due to= the relative lack of financial and procurement expertise. The Ministry of Finance and Pro-Inversion have plans to provide more hands-on support to regional gover= nments in 2007.

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An alternative approach to distribu= tion is to establish a local subsidiary or branch office. Companies with a complicated produ= ct or service use this method because it allows for effective after sales service= and more aggressive promotion of your product.= Expenses for commercial and industrial space are relatively high in = the Lima area, however, making this an expensive option.

Selli= ng Factors/Techniques &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; &nbs= p; Return to top

Product pricing is a key selling fa= ctor in the Peruvian market. Inexp= ensive products from Asian countries such as Taiwan and Korea outsell more expensi= ve European or North American consumer products in the realm of consumer electronics, appliances and automobiles.&n= bsp; Seconds, knockoffs and pirated goods are problematic as well. However, with investment in sales promotion and service infrastructure, U.S. goods can be competitive. = The strengthening of the Nuevo Sol versus the U.S. dollar has increased the attractiveness of U.S. product imports.

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Equipm= ent performance and efficiency influence the decision maker when purchasing cap= ital goods, notably advanced electronics and construction machinery. The customer often prefers more expensive U.S. or European products, which are highly rated for quality, du= rability, technology, customer support, and regional service.

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Many o= f the larger representatives have small regional offices in a few additional citi= es outside of Lima. The rest of = Peru is largely under populated, underdeveloped and does not offer an attractive market for technical equipment, with certain exceptions, such as the large-scale mining operations located along Peru’s sierra (central mountain range).

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Payment for major purchases is gene= rally on a net 30-day basis. For new m= arket entrants, or when dealing with new customers, it is advisable to request up front payment or work on a confirmed, irrevocable letter of credit basis. Over the counter purchases are don= e in cash (U.S. dollars are widely accepted), check or credit card. Most retailers use credit terms as= a sale technique and major department stores issue their own credit cards.

Electronic Commerce = ; &n= bsp; = ; &n= bsp; = ; &n= bsp; Return to top

The Peruvian E-commer= ce market is developing slowly. = It is small by international standards. B2B type commerce is conducted between large enterprises and the percentage of transactions is growing modestly. These companies use B2B as a comme= rcial practice that will cut operational costs and thus increase their revenues.<= span style=3D'mso-spacerun:yes'> Most large and medium size firms d= o not clearly understand the real importance of B2B and B2C solutions. They focus mostly on cost reduction rather than using this new distribution channel and developing products/services to enhance their reach.

Following is a list of successful firms considered to be local benchmarks in Peruvian E-commerce solutions:

a)&n= bsp; http://www.peru.com<= /span>

<= /p>

b) http://www.rosatel.com.pe

c) All banks (of which the B= anco de Credito deserves a special mention since their site http://www.viabcp.com is by far the most advanced) and most financial services’ institutions have websites to assist clients with virtual services like paying utility bills, getting ins= urance coverage, Internet shopping and information. Transactions are made with ATM or = Credit Cards such as Visa, Mastercard and Amex.

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d) http://www.ewong.com. E.Wong is the largest local superm= arket chain. This website allows the company to receive and pay for orders via the Internet from local and foreign-based consumers for local delivery.

<= /p>

e) Most services firms withi= n the telecommunications industry have websites and portals to interact with mark= et in a variety of services, ranging from refilling pre-paid telephone cards to sending direct marketing SMS messages to target market segments.=

There have been interesting advances in several Peruvian government institutions = as the tax collecting agency (http://www.= sunat.gob.pe), the public registry (http://www.sunar= p.gob.pe), and the Peruvian state owned bank that handles the Treasury accounts (http://www.bn.com.pe.) The National Elections Bureau (http://www.onpe.gob.pe) is testing with electronic voting to implement it progressively.

The Peruvian government has established a special task group under the name of E-Gob Peru. This office is developing Gov2Citizens solutions for payment of taxes, customs and foreign trade information as well as Gov2Gov transactions as a means to reduce expe= nses within the different agencies. It expects to have operating soon several products like a citizens’ serv= ices portal (Jan. 2006) and an entrepreneurial services one (mid-2006). The Peru= vian government is also implementing an Electronic System for Acquisitions and Contracting (SEACE: Sistema Electrónico de Adquisiciones y Contrataciones del Estado). The principal objectives of this electronic sys= tem are to improve the transparency and the management capacity of the governme= nt purchases through the implementation of an electronic mechanism of acquisitions, to promote the decentralization and to create more efficient mechanisms for the mentioned processes.

There is no Public Key Infrastructure (PKI) in Peru yet and digital certification is not widely used. Transactions are made t= hrough electronic funds transfer. IN= DECOPI (National Institute for the Defense of Competition and Protection of Intellectual Property) is working to implement a PKI under the E-Gob Peru project. Peru will probably u= se the U.S. PKI business model.

The legal framework is as follows:

a)&n= bsp; Protection of Personal Information: Yes.

b)&n= bsp; Electronic Signature: Under development.

c)&n= bsp; Electronic Commerce: No.

d)&n= bsp; Validity for Procedures related to E-Gob Peru: Under development.

e)&n= bsp; Electronic Governmental Hiring Process: Under development

Trade Promotion and Advertising &= nbsp; &nbs= p; &= nbsp; &nbs= p; Return to top

Lima b= oasts 30 daily newspapers, a few of which strive for national coverage. Locally oriented newspapers can be= found in most provincial capitals. = First in terms of influence and national readership is "El Comercio," w= hich is also the nation's oldest paper with more than 160 years of continuous publication. Other serious major dailies include "La Republica," “Peru.21,” the independent business daily "Gestion", tabloids “Correo” and “Ojo”, daily “Expreso,” and the official gazette “El Peruano.”

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Radio = enjoys the largest audience of all communications media, reaching even the most isolat= ed populations in Peru. It is of= ten the first source of current news, and is the principal vehicle for transmit= ting information about local issues and events outside of Lima. However, it has little power to sh= ape opinions, particularly among Peru's decision-makers.

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In all= , there are over 1,000 radio stations in Peru, broadcasting on AM, FM, and short wa= ve frequencies. Many of these st= ations are small storefront operations that serve relatively limited audiences. Radio's most influential source of= news and information is "Radio Programas del Peru" (RPP), one of the m= any electronic media holdings of the Delgado Parker family. With transmitters and corresponden= ts in virtually every important city in Peru, RPP constitutes Peru’s only t= rue national radio network. In mo= st major cities, including Lima, RPP leads most AM ratings and is second in FM audience to music-oriented "Radio Panamericana."

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Televi= sion permeates the urban environment in Peru and has become increasingly available to rural audiences as well. As in the = United States, television is often the primary source of news for a majority of th= ose who have access to it.

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The mo= st important players in TV are the six Lima-based television networks, along w= ith a government-owned service, which for years was the only station available = in many parts of Peru. These sev= en broadcasters use affiliates in the provinces much like their counterparts in the United States. In addition there are several independent stations that serve particular cities and regions.

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Cable = television has also begun to make inroads into the Peruvian market with over 100 cable= TV and MMDS (Multichannel Multipoint Distribution Service) companies serving approximately 600,000 homes in different areas of Peru. The main cable service companies a= re Telefonica del Peru offering “Cable Magico”, with 490,000 subscribers; Corporacion Vicmar S.A. (Panama) with its product “Cable Express” former ”Telecable”, acquired from BellSouth/Tele 2000), with less than 5,000 subscribers; Star Global Com (part of the US company Liberty Media) serving Arequipa and Tacna with about 11,000 subscribers; and The DirecTV Group, Inc. (Great Britain), offering its new cable service "DirecTV" with less than 5,000 subscribers. Their packages include CNN and programming from other Latin American, Asian and European countries. The remaining cable companies are = small firms offering their service in concentrated areas surrounding Lima or in t= he provinces.

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Peruvian advertising expenditures e= xceeded $1 billion in 2006.

Pricing &nb= sp; = &nb= sp; = &nb= sp; = &nb= sp; Return to top

In general, Peru is a very open market, with min= imal trade restrictions. The weigh= ted average tariff is 5.6%. Distr= ibutor mark-up varies according to type of product, but usually ranges between 12%= and 25%. All imports are subject = to a 19% value-added local sales tax, which can be used as a tax credit by the importer. There are some exceptions: enterprises established in the industrial free zones and special treatment zones; and companies that have their operations in the jungle reg= ions of Loreto, Ucayali, Madre de Dios, Amazonas, and San Martin, in accordance = with the Peruvian-Colombian Amazon Cooperation Treaty. Some luxury items have higher tari= ffs and some specific goods such as cigarettes, beer, wine, liquors and automobiles, pay an excise tax according to the lists and rates included in Appendixes III and IV of Legislative Decree No. 821 (passed on April 23, 1996). In July 2000 the excis= e tax for new automobiles was reduced to 10%, while that applied to used ones was left at 30%. Imports from cou= ntries with which Peru has bilateral or regional agreements are covered by differe= nt, preferential tariff schedules.

Sales Service/Customer Suppo= rt &= nbsp; &nbs= p; &= nbsp; &nbs= p; Return to top

Peruvians consider service and support a critical factor in making the final purchasing decision, especially for products that require periodic servicing. I= t is important for the product to be sold through a reliable distributor that of= fers the quality and services that the client requires. For example, servicing and availab= ility are currently the two perceived advantages that new Asian autos enjoy over their U.S. competitors in the Peruvian market. Another example would be mining equipment, where the U.S. equipment after-sale service enjoys a superior reputation to that of third country competitors.

Protecting Your Intellectual Property = ; &n= bsp; = ; <= /span>Return to top

Protection of intellectual property rights (IPR) in Peru has improved over the past decade, but still falls short of U.S. and international standards in several areas. After = two years on the United States government's "Priority Watch List" und= er the Special 301 provisions of the 1988 Trade Act, Peru was lowered to the “Watch List” in 2001 following steps on the part of the governm= ent of Peru to address IPR piracy. Peru remains on USTR's Section 301 ~~the~~ "Watch List"= due to concerns about continued high rates of copyright piracy, a lack= of protection for confidential test data submitted for the marketing approval = of pharmaceutical and agrochemical products, and inadequate enforcement of IPR laws, particularly with respect to the relatively weak penalties that have been imposed on IPR violators. Other factors contributing to cont= inued placement on the “Watch List” include Peru’s revocation of second-use patent protection for pharmaceuticals and a lack of protection f= or confidential test data submitted for the marketing approval of pharmaceutic= al and agrochemical products

The Peruvian government ag= ency charged with promoting and defending intellectual property rights is the Institute for the Defense of Competition and Protection of Intellectual Property (INDECOPI, http://www.inde= copi.gob.pe), established in 1992. Legislat= ive Decree 822 of 1996 and by Andean Community Decisions 34= 4 and 486 protects patents, trademarks, and indus= trial designs. Copyrights are prote= cted by Legislative Decree No. 822 of 1996 and by Andean Community Decision 351.= There has been a dispute within the Andean Community over whether national law or Community decisions on IPR prevail in the case of conflict between them. The Andean Community Secretariat i= ssued rulings in 2001 that Peru violated Decision 486 by granting "second use" patents. These ruli= ngs (Andean Community resolutions 358 and 406) threaten to undermine the abilit= y of member states to implement national laws that are stronger than Andean Community norms. Although the government of Peru appealed the Secretariat’s decisions to the Andean Tribunal, the Tribunal ruled in December 2001 that the decisions would stan= d. In late 2002, the government of Pe= ru succumbed to Andean Community pressure (in the form of trade sanctions), and rescinded its protection of second-use patents.

Peru belongs to the World Trade Organi= zation (WTO) and the World Intellectual Property Organization (WIPO). It is also a signatory to the Paris Convention on Industrial Property, Geneva Convention for the Protection of Sound Recordings, Bern Convention for the Protection of Literary and Artist= ic Works, Brussels Convention on the Distribution of Satellite Signals, Phonog= rams Convention, Satellites Convention, Universal Copyright Convention, the World Copyright Treaty, and the World Performances and Phonographs Treaty and the Film Register Treaty. In December 1994, the Peruvian Congress ratified the = World Trade Organization's Agreement on Trade-Related Aspects of Intellectual Property (TRIPs). Although Peru was obligated by this agreement to bring its laws into compliance with TRIPs, the Andean Community’s Decision 486 leaves some issues, like second use patents and data protection, sufficiently vague as = to question the completeness of the decision’s TRIPs compliance.

Peru’s legal framework provides for easy registration of trademarks and inventors have been able to patent their inventions since 1994. Peru’s 1996 Industrial Property = Rights Law provides an effective term of protection for patents and prohibits devi= ces that decode encrypted satellite signals, along with other improvements. Peruvian law does not provide pipe= line protection for patents or protection from parallel imports. Although Peruvian law provides for effective trademark protection, counterfeiting of trademarks, copyrighted products, and imports of pirated merchandise are widespread. = The International Intellectual Property Alliance estimates that the piracy leve= l in Peru for recorded music was 98 percent in 2004-2005, with damage to U.S. industry estimated at $100 million. IIPA estimates motion picture piracy accounts for 60 percent of the market for a loss of $5.5 million. Indecopi considers that software piracy levels remained the same as = 2004 levels, at 56 percent.=

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Peru&#= 8217;s Copyright Law is generally consistent with the TRIPs Agreement. However, textbooks, books on technical subjects, audiocassettes, motion picture videos and soft= ware are widely pirated. While the government, in coordination with the private sector, has conducted numerous raids over the last few years on large-scale distributors and users of pira= ted goods, and h= as increased other types of enforcement, piracy continues to be a significant problem for legitimate owners of copyrights in Peru.

Despite incre= ased enforcement actions by INDECOPI, the judicial branch has failed to impose sentences that adequately deter future IPR violations. The Peru= vian government in July 2004 increased the minimum penalty for piracy to four year’s imprisonment, although there have yet to be any convictions un= der the new law. Peru now has six prose= cutors (two fiscal= ias) dedic= ated full-time to intellectual property cases<= ins cite=3D"mailto:Marcos%20C%20Mandojana" datetime=3D"2007-01-08T11:09">. In November 2006, five courts in L= ima were assigned IPR duties.

As a practical matter, exporters and distributors should hire local counsel who specializess in IPR issues if they are conc= erned about piracy of their products in Peru.&nb= sp; The Commercial Service has prepared the Ambassador’s IPR Toolkit which can be downloaded by clicking the following link: http://www.buyusa.gov/peru/= en/166.html

A list of att= orneys specializing in intellectual property is available from the Commercial Serv= ice office. Law firms that handle= IPR matters can also assist in launching anti-piracy enforcement actions in collaboration with the government of Peru.=

Due Diligence = &nb= sp; = &nb= sp; = &nb= sp; Return to top

U.S. businesses considering exporting to or inve= sting in Peru should perform due diligence on their potential clients, associates= , or partners. As a first step, the International Company Profile (ICP) program of the U.S. Commercial Service = can provide a background check on the reliability of potential clients or partners. The ICP report incl= udes information on a company’s owners, year established, size, sales, financial information and reputation in the market. The Commercial Service and the Eco= nomic Section of the U.S. Embassy in Peru are also available to provide commercial and economic briefings to U.S. businesspersons traveling to Peru.

Local Professio= nal Services = ; &n= bsp; = ; &n= bsp; = ; Return to top

Banks<= /span>

Banco de Comercio: https://www.bancomercio.com/

Banco de Credito: http://www.viabcp.com/<= /span><= /o:p>

Banco del Trabajo: http://www.bantra.com.pe

Banco Financiero: http://www.financiero.com.pe/

Banco Interamericano de Finanzas: http://www.bif.com.pe/

BBVA Banco Continental: http://www.bbvabancocontinental.com/

Citibank: http://www.citibank.com.pe

Interbank: http://www.interbank.com.pe/

Mibanco: http://www.mibanco.com.pe/

Scotiabank: http://www.scotiabank.com.pe

Standard Chartered: http://www.standard= chartered.com/pe/index.html

Accounting/Business Consultants

Apoyo S.A., economic studies, business consulting, market research studies, opini= on studies, multi-customer studies, strategic communication: http= ://www.apoyo.com/default_eng.asp

Atenea Consultores Asociados, business intelligence and counterintelligence: http://www= .ateneaconsult.com/english/atenea_english.htm<= /p>

ConsultAndes, executive advisory, business development, public realtion= s, community relations and public responsibility, crisis management, corporate communications, security: http://www.consultandes.com.pe=

DBM, outplacement consultant and career transition services: http://www.dbmperu.com<= /o:p>

ERM, environmental consulting services: http://www.erm.com

Ernst & Young, accounting, auditing and tax advisory: http://www.ey.com/global/content.nsf/South_America_S/America_del_Su= r_Home

KPMG Caipo y Asociados, auditing, tax and financial advisory: http://www.pe.kpmg= .com/

LB&C Logistics Business & Consulting, supply chain security: http://www.lbcperu= .com

Malaga - Webb & Asociados, business restructuring, continuous improvement, corpo= rate finance: http://www.malaga-webb.com

Organizacion Cuanto, economic studies, social studies, polls, market research: htt= p://www.cuanto.org

Pricewaterhouse Coopers SCRL, auditing, accounting, t= ax and legal services: http://www.pwc.com/

Credit Rating Agencies

Dun & Bradstreet S.A.C.: http://www.dnbperu.com.pe/eng_default.asp

Credit Report S.A.: http://= www.creditreportgroup.com/HomeI.htm

Coface Peru: (= http://www.coface.com.pe<= o:p>

Informa Peru S.A.: http://www.informadelperu.com/engl= ish/index.html

Credit Reporting Agencies

Infocorp/Equifax: www.infocorp.com.pe<= /span>

CERTICOM: www.certicom.com.pe<= /span>

Executive Search

Amrop International: http://www.amrop.com

Boyden International: http://www.boyden.com.pe<= /p>

Heidrick & Struggles: http://www.heidrick.com/Offices/OfficeDetail.aspx?OfficeCode=3DLIM

Korn/Ferry International: http://www.kornferry.com

Tasa Worldwide: http://www.t= asaworldwide.com/english/homepage_00.html

Law Firms

Barreda Moller: http://www.barreda.com.pe/= index_eng.htm

Barrios, Fuentes, Urquiaga Abogados: http://www.bafur.com.pe/index_en.html

Estudio Aurelio Garcia Sayan Abogados: http://www.garciasayan.com.pe/english/defaul= t.htm

Estudio Echecopar: http://www.echecopar.com.pe/enmain= .htm

Estudio Ferrero Abogados: <= span lang=3DES style=3D'mso-ansi-language:ES'>http://www.ferrero.com.pe/ingles/i= ndex.html

Estudio Grau Abogados: http://www.egrau.com/ingles/estudi= o.htm

Estudio Olaechea: http://www.esola.com.pe/

Muniz, Ramirez, Perez-Taiman & Luna Victoria Abogados: = http://www.munizlaw.com/english/in= dex_en.asp

Payet, Rey, Cauvi Abogados: http://www.prc.com.pe/eng/de= fault.htm

Rey & de los Rios Abogados: http://www.reyrios.com/iindex.htm=

Logistics

Maersk Sealand, ocean carrier: http://www.maersksealand.com/link/?page=3Dlhp&path=3D/south_= america/peru

Corporacion de Logistica Integral – CLI, logistic operator: http://www.cli.com.pe/english/inde= x.htm

Ransa, logistics operator: http://www.ransa.net/pe/i= ng/homepage.htm

Moving<= /h4>

Security International Moving S.A.C., national and international moving: http://www.si= moving.com.pe

World Shipping & Storage S.A., = national and international moving: http://www.worldshipping.= com.pe/main.htm

Risk-Rating= Agencies

=

Apoyo & Asociados Internacionales S.A.C. Clasificadora de Riesgo: http://www.aai.com.pe/

Clasificadora de Riesgo Pacific Credit Rating SAC: http://www.ratingspcr.com

Class & Asociados S.A. Clasificadora de Riesgo: http://www.classrating.com

Equilibrium Clasificadora de Riesgo S.A.: http://www.equilibrium.com.pe

=

Telecommunications

America Movil Peru S.A.C., mobile phone service: http://www.claro.com.pe

Nextel del Peru S.A., mobile phone service: http://www.nextel.com.pe=

Telefonica S.A., telecommunication services: http://www.= telefonica.com.pe

Telmex Peru S.A., telecommunication services: http://www.telmex.com/pe/

Web Resources = &nb= sp; = &nb= sp; = &nb= sp; Return to top

Banco de la Nacion: = http://www.bn.com.pe

CONSUCODE: http://w= ww.consucode.gob.pe/

INDECOPI: http://www.indecopi.gob.pe<= o:p>

Ministry of Foreign Affairs: http://www.rree.go= b.pe/portal/economia2.nsf/91d93e7ca259fb4405256c0e0005a30f/af7552948b447752= 05256c0d006f8979?OpenDocument

Oficina Nacional = de Procesos Electorales: http://www.onpe.gob.pe

ProInversion: = http://www.proinversion.gob.pe/eng= lish/orientacion/empresas/cont_3.htm

Superintendencia Nacional de Administracion Tributaria: http://www.sunat.gob.pe

Superintendencia = Nacional de los Registros Publicos: http://www.sunarp.gob.pe

ProExplo 2007 (5th Int’l Congress of Prospectors and Explorers, IIMP, May 22-2= 5, 2007, http://www= .proexplo.com.pe/2007/index_eng.html)

Chapter 4: Leading Sectors for U.S. Export and Inves= tment

&= nbsp;

Com= mercial Sectors

Air Conditioning and Refrigeration Equipment

(Figures in US$ millions except whe= re noted.)

Agricultural Sectors

&= nbsp;

Mining Industry Equipment

&= nbsp;

Overview = &nb= sp; = &nb= sp; = &nb= sp; = Return to top

	2004	2005	2006 (estimated)
Total Market Size	368.4	486.7	806.9
Total Local Production	N/A	N/A	N/A
Total Exports	21.0	28.8	25.2
Total Imports	389.4	515.5	832.1
Imports from the U.S.	190.1	180.9	301.5

(Statistics are unofficial estimates)

2006 Import Market Share (percent for US and Major Competitors): U.S. 36.2%; Bra= zil 21.4%; Germany 6.5%; Japan 5.8%; Sweden 4.9%; Canada 3.6%; Chile 3.0%; Mexi= co 2.7%.

The mining industry leads and will continue to drive Peruvian economic growth.<= span style=3D'mso-spacerun:yes'> In 2005, mining activity represent= ed 6% of GDP and over 60% (US$ 9.8 billion) of total exports. Products include copper, gold, iro= n, lead, silver, tin, and zinc. = Currently, Peru is the fifth destination for exploration after Canada, Australia, the = U.S. and Russia.<= o:p>

&nb= sp;

Industry experts project an annual average grow= th rate of 8-10% for the mining equipment sector during 2007-2008. Current market prices have sparked= an increase in exploration activity, with many mining companies exploring for = new reserves. International metal prices have been rising over the last few years, and the poly-metallic natu= re of Peruvian mining has proven to be an advantage. Official sources estimate that investment in prospecting, exploration and extraction will reach US$ 5 bill= ion by 2010.

Best Products/Services &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; Return to top

HTS Code	Description	%
847490	Pa= rts for machinery for sorting, screening, separating, washing, crushing, grinding, mixing or kneading earth, stone, ores or other mineral substanc= es, in solid form	9.6
870423	G.V.W. exceeding 20 metric tons	8.6
842951	Front-end shovel loaders	8.4
870410	Dumpers designed for off-highway use	7.4
870120	Road tractors for semi-trailers	6.8

Hi-tech equipment and spare parts are imported, while local production and exports = are centered in basic metalworking products.&n= bsp; Equipment related to the transport and storage of concentrates and services in bulk handling facilities are being modernized. The Peruvian market is very compet= itive and highly price sensitive. T= he increase in government and social claims for the implementation and improve= ment of Environmental Impact Assessment studies (PAMAs) will have positive impact upon U.S. equipment suppliers.

Best prospects include: Underground winding gear: lifting, loading and unloading machinery (conveyors, excavato= rs); underground cars, bulldozers, loader shovels; tunnel boring and rock breaki= ng machinery; pneumatic compactors, trucks < 5 tons., tractors for lifting, blasting equipment.; safety and communications equipment.; ventilation, drainage and pumping, roof supporting equipment.; crushing, milling, flotat= ion, leaching, tailings disposal equipment., tires, explosives, mill balls, reactives; and spare parts. <= /span>Imported new and refurbished equipment are in high demand. The US-Peru Trade Promotion Agreem= ent, when implemented, has a provision for remanufactured products, a new area o= f opportunity.

Opportunities &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; &nbs= p; = Return to top

Only 10% of Peru’s reserves have been explored and only 0.6% are in operation.&n= bsp; The National Mining, Petroleum and Energy Society (SNMPE) lists 276 projects:

· 87 in the prospecting stage

· 171 in exploration phase

· 13 developing feasibility studies

· 5 expansions or reactivations

During the last years the key factors driving the increase in demand for mining equipment have been the economic stability of the country and the internati= onal prices that have sparked an increase in exploration activity, and expansion= of current operations.

Upcoming mining-related trade shows in Peru are:

FIBCA 2007 (International Fair for Capital Goods, Fexpe, April 18-20, 2007, h= ttps://www.allianceforbiz.com/events/specific_event.php?id=3D86, http://www.buyusa.gov/pe= ru/en/151.html, http://www.fexpe.com/fibca.php)

29th Mining Convention & 6^th Extemin (IIMP, September 10-14, 2007= , http://www.conve= ncionminera.com/content/index.php)

The U.S. Commercial Service in Lima will run a catalog exhibition for U.S. companies= at Extemin (http://www.buyu= sa.gov/peru/en/106.html).

Resources = &nb= sp; = &nb= sp; = &nb= sp; = Return to top

Ministry of Energy and Mines: http://www.minem.gob.pe

National Mining, Petroleum and Ener= gy Society: http://www.snmpe.org.pe

Peruvian Mining Engineers’ Institute: http://www.iimp.org.pe

Construction Equipment

&= nbsp;

Overview = &nb= sp; = &nb= sp; = &nb= sp; = Return to top

	2004	2005	2006 (estimated)
Total Market Size	264.2	310.5	517.5
Total Local Production	13.2	15.5	25.9
Total Exports	10.0	13.8	11.5
Total Imports	260.9	308.8	503.1
Imports from the U.S.	138.2	113.4	207.9

(Statistics are unofficial estimates)

2006 Import Market Share (percent for US and Major Competitors): U.S. 41.3%; Bra= zil 27.3%; Japan 5.1%; Sweden 4.5%; Canada 2.8%; Germany 2.7%; Australia 1.9%; Republic of Korea 1.8%; Chile 1.8%; France 1.7%; Argentina 1.5%; Italy 1.5%= .

The construction equipment sector in Peru totaled US$ 310.5 million in 2005. The market is mainly comprised by imports, representing 99% of the market share in 2005. An 18% increase in total imports is anticipated in the coming years (2007-2008). This sector is strongly related to Peru’s economic growth and is highly dependent on imports of earth mo= ving machinery, equipment, and parts.

Best Prospects/Services= &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; Return to top

HTS Code	Description	%
870423	Truck, diesel engine gvw>20 metric tons	15.2
842951	Shovel loaders, rear engine, front end	14.5
870410	Cab Chassis, dumpers designed for off-highway= use	13.0
843149	Parts of machinery	7.2
842952	Excavators, new	7.1
843050	Move, grade, level, scrap, excavator self-propelled, nesoi	6.7
842911	Bulldozers & angledozers, self-propelled, track lay new	6.2

Most products considered in this sector are imported, and sell locally. Products such as machinery, mini-f= ront loaders, move, grade and excavator equipment, and other small construction equipment and parts are among the best prospects.

Opportunities &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; &nbs= p; = Return to top

The government is promoting many public infrastructure development and road maintenance projects. The Interamerican Development Bank is offering a S/. 50 million financing progr= am for such projects. These infrastructure projects, as well as the housing construction projects such as Mi Vivienda and Techo Prop= io will steadily increase the demand for construction equipment.

Since 2002 the housing and building sectors have been growing steadily, reaching an annual growth rate of 17%. The projects are developed mainly = in Lima, the capital city, but those related to roads maintenance and infrastructure take place throughout the country. Private partnership is encouraged = by ProInversion in public infrastructure such as roads and sanitation. For 2006-2007 ProInversion is prom= oting investment opportunities in infrastructure that will exceed US$ 4 billion, especially construction of roads, and operation of ports and airports. Another sector that is growing fas= t is the stores and mall construction. Finally, the mining sector is another key driver of the demand for construction equipment.

The decentralization of budgets and decision making to regional governments, the use of “canon” or tax impos= ed on extractive industries are important considerations in choosing a local representative.

Resources = &nb= sp; = &nb= sp; = &nb= sp; = Return to top

Ministry of Production: http://www.produce.go= b.pe

Private Investment Promotion Agency (ProInversion): http://www.proi= nversion.gob.pe/english/default.asp

Oil and Gas Field Machine= ry

&= nbsp;

Overview = &nb= sp; = &nb= sp; = &nb= sp; = Return to top

	2004	2005	2006 (estimated)
Total Market Size	115.0	121.6	301.5
Total Local Production	21.8	26.4	28.2
Total Exports	6.6	9.6	8.4
Total Imports	99.7	104.8	281.7
Imports from the U.S.	43.9	30.0	92.5

(Statistics are unofficial estimates)

2006 Import Market Share (percent for US and Major Competitors): U.S. 32.8%; Bra= zil 10.9%; China 9.4%; Argentina 8.7%; Canada 5.5%; Italy 5.0%; Sweden 3.9%; Colombia 2.6%.

The recent decision to commercialize hydrocarbon reserves in t= he jungle region of Peru has kindled interest in prospecting and exploration.<= span style=3D'mso-spacerun:yes'> Foreign firms are already active surveying sedimentary basins nationwide.&n= bsp; Investment for this project is estimated at US$ 1 billion. Official sources indicate that this finding, and other developments, will transform Peru in a net oil exporter = by 2010. In September 2006, Peru= vian state-owned refining and distribution oil company PetroPeru signed a strate= gic alliance with PetroBras (Brazil’s state-run oil company). This alliance aims to boost hydroc= arbon exploration activity in South America and reduce the high reliance on fuel imports.

The Camisea natural gas mega project came on-stream in August = 2004 and its pipelines have already reached Lima. The recently elected Garcia administration is passing legislation that will prompt an energy matrix migration from oil/diesel-powered technologies to natural gas-powered ones.=

Perupetro, the state oil contracting agency, signed 15 new oil= and gas exploration contracts during 2005 and 16 during 2006. There were three reported oil find= ings during 2005. The market for o= il and gas equipment, accessories, and spare parts is almost comprised by imports, representing 86% of the market in 2005.&nb= sp; The U.S. was the # 1 supplier of this type of equipment with 32.8% of all imports in 2006. There ar= e no import restrictions for oil and gas field equipment in Peru. Local production is focused on interme= diate and low-tech metalworking equipment, spare parts and accessories, and polyethylene tubing, accessories and fittings.

Best Prospects/Services= &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; Return to top

HTS Code	Description	%
843041	Self-propelled boring or sinking machinery	11.0=
730410	Line pipe of a kind used for oil or gas pipelines	9.4<= /span>
730429	Other pipelines, casing and tubing	9.0<= /span>
7305	Other tubes and pipes, having circular cross sections, the external diameter of which exceeds 406.4 mm, of iron or steel	7.2<= /span>
843049	Offshore oil & natural gas drilling & production platforms; rotary boring & sinking machinery for oil well & gas field drilling	5.9<= /span>
843143	Parts of offshore oil & natural gas drilling & production platforms	5.6<= /span>
842139	Gas separation equipment	3.6<= /span>

Best prospects include: steel, copper and polyethylene pipes; gas valves and filters, flow meters, gas burners, gas powered engines and pumps. In Peru, there is a strong demand = for advanced monitoring and remediation equipment in order to meet international and local environmental standards primarily in the mining, and oil and gas extraction activities. The sustained increase in government and social claims for the implementation a= nd improvement of Environmental Impact Assessment studies (PAMAs), which will = have positive impact upon U.S. equipment suppliers.

Drilling wells and transportation pipelines are upgrading their safety standards wor= king under international environmentally conscious practices. There is a small, but growing mark= et niche for U.S. wireless monitoring equipment and services.

Opportunities &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; &nbs= p; = Return to top

In 2005, Peru’s local demand for fuels grew around 10% and the state-run oil company, Petroperu, purchased more than US$ 230 million worth of oil derivatives. Natural gas represented 3% of country’s local fuel deman= d in 2005, with demand for this pollution-free fuel estimated to increase significantly in the coming years. There is great potential for new oil and= gas projects in Peru and good opportunities for suppliers to fulfill needs for equipment and services. New o= n-site oil discoveries may stem from the increased attractiveness in Peru’s sedimentary basins. In 2006, Peru’s oil contracting agency, PeruPetro, signed 16 exploration contr= acts with foreign firms. Additiona= lly, there are five exploration contracts under negotiation. In 2007, investment in exploration= will reach US$ 150 million, and US$ 350 million in oilfield development projects. PeruPetro offered t= enders on 18 oil blocks on January 23 and plans to award them on July 12, 2007

Natural gas supply contracts have already been signed with the most important industrial companies in Lima. It is expected that this fuel will gradually substitute other fuels as the main energy source in Peru in the upcoming years. This represents a good business opportunity, as Peruvian companies will need to migrate from diesel and residual fuel oil driven power to gas driven power. = Main opportunities exist for equipment supply in the Hunt Oil US$ 3.3 billion LNG export project known as Camisea II, in the Petrotech’s offshore block= Z33 exploration project, in Repsol’s block 39, and in other exploration projects as well as in maintenance of current operations.=

FIGAS 2008 is the most comprehensive oil and gas equipment, supplies and accessor= ies tradeshow in the Andean region. The U.S. Foreign Commercial Service in Lima (FCS Lima) will run a catalog exhibition promoting U.S. suppliers during this show.

Resources = &nb= sp; = &nb= sp; = &nb= sp; = Return to top

Ministry of Energy and Mines: http://www.minem.gob.pe

National Mining, Petroleum and Ener= gy Society: http://www.snmpe.org.pe

Perupetro S.A.: http= ://www.perupetro.com.pe/home-e.asp

Pumps, Valves, and Compress= ors

Overview = &nb= sp; = &nb= sp; = &nb= sp; = Return to top

	2004	2005	2006 (estimated)
Total Market Size	124.4	149.0	210.7
Total Local Production	21.7	24.9	29.9
Total Exports	6.5	9.2	6.3
Total Imports	109.2	133.3	187.1
Imports from the U.S.	48.2	60.6	90.7

(Statistics are unofficial estimates)

2006 Import Market Share (percent for US and Major Competitors): U.S. 48.5%; Italy 7.1%; China 6.2%; Brazil 4.6%; Germany 4.6%; Japan 3.1%; Belgium 3.1%.

The total market for pumps, valves, and compressors total= ed US$ 149.0 million in 2005; of which US$ 133.3 million were imports. The market is very competitive; aggressive Asian inroads and highly regarded European suppliers constitute tough competition for U.S. products. Despite these facts, the U.S. remains the main supplier of pumps, va= lves and compressors in Peru providing almost 50% of all imports during 2004-2006. The U.S. share is especially significant in the oil and mining sectors, where many U.S. firms working in those sectors prefer U.S.-made products.

The country’s geographical diversity requires the u= se of almost all types of pumps, valves and compressors, making Peru a very go= od market for such equipment. Mi= ning, soil and water treatment, oil, and industrial sectors drive the local deman= d. Local production is focused on pum= ps and household water valves, representing 16% of the total market size during 2004-2006. Local production of compressors is negligible.

Although U.S.-made products have a good reputation, price is the key-decision factor= . Headquarters marketing and technic= al support to local representatives, and equipment specifications and technical manuals in Spanish, will provide strong competitive advantages.<= /span>

It is highly recommended that U.S. equipment, parts, spare parts and accessories suppliers locate a qualified agent or distributor in Peru to effectively ma= rket their products and timely track local market trends. Appropriate stocking distributors = allow just-in-time responses to large-sized orders.

Best Prospects/Services= = &nb= sp; = &nb= sp; Return to top

HTS Code	Description	%
841391	Pa= rts of pumps	12.0
841381	Se= lf-contained household water systems and windmill pumps	8.1
841490	Pa= rts of compressors	6.1
841480	St= ationary and rotary compressors, exceeding 74.6 kW	5.7
848190	Pa= rts of valves	5.6

Opportunities &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; &nbs= p; = Return to top

The market for pumps, valves and compressors is very promising for U.S. exporters. New mining, oil an= d gas, soil and water remediation, energy, and construction projects in the public= and private sectors will create a significant increase in demand for these products. <= /p>

Experts estimate a 15-20% increase in demand for pumps, valves and compressors, and their parts, in the foreseeable future (2007-2008). This trend will be reinforced by t= he implementation of the U.S.-Peru Trade Promotion Agreement (US-PTPA), which = was signed on April 12, 2006. As a result of this agreement, the U.S. will have greater access to the Peruvian market for products such as machinery, mineral fuel, electrical machinery a= nd plastics, along with a wide variety of agricultural products. Most products will enjoy duty free access immediately.

On December 27, 2006, the Government of Peru eliminated the tariffs on 2,894 product subcategories; most of which are capital goods. This unilateral initiative is inte= nded to encourage Peruvian firms to upgrade their machinery and equipment, resul= ting in the reduction of production costs.

Resources = &nb= sp; = &nb= sp; = &nb= sp; = Return to top

Manufacturers’ Society: http://www.sni.org.pe<= /o:p>

Industrial Chemicals

Overview = &nb= sp; = &nb= sp; = &nb= sp; = Return to top

	2004	2005	2006 (estimated)
Total Market Size	320.1	480.4	525.3
Total Local Production	223.7	241.8	260.0
Total Exports	104.3	145.6	189.2
Total Imports	200.9	384.2	454.5
Imports from the U.S.	71.7	112.2	123.3

(Statistics are unofficial estimates)

2006 Import Market Share (percent for US and Major Competitors): U.S. 27.1%; Chi= na 12.6%; Germany 7.3%; Brazil 5.7%; Korea 4.9%; Venezuela 4.2%; Spain 3.7%; Mexico 3.6%.

Best Prospects/Services= &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; Return to top

HTS Code	Description	%
381710	Mi= xed alkyl benzenes	5.0=
283531	Sodium triphosphates	2.9=
320416	Reactive dyes & preparations based there = on	2.8
292910	Toluenediisocyanates (unmixed)	2.7=
320610	Pigments & preparations based on titanium dioxide<= o:p>	2.5
283711	Cyanides and cyanide oxides of sodium<= span lang=3DEN-US style=3D'mso-bidi-font-size:10.0pt;mso-fareast-font-family:"= Arial Unicode MS"; mso-bidi-font-family:Arial'>	2.3=

Opportunities &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; &nbs= p; = Return to top

The chemical industry in Peru total= ed US$ 480.38 million in 2005. T= he market is primarily comprised by imports, representing 80% of the market sh= are in 2005. An 18% increase in t= otal imports is anticipated for the coming years (2007-2008). Peru’s high reliance on impo= rts of chemical raw materials will continue in the medium term due to the limited local production, which is not able to efficiently support the increased internal demand.

According to the Private Investment Promotion Agency (ProInversion), more than US$ 300 million are required to invest in chemical industry technology upgrades by the year 2008 to meet Peru’s domestic demand for chemicals. Future growth of the sector will be driven largely by foreign investment in the following product lines: solven= ts, detergents, and softeners (i.e., alkyl benzenes and sodium triphosphates), mining chemical raw material (i.e., sodium cyanide, and flocculants for sedimentation, clarification, thickening, and filtration), specific textile dyeing inputs, toluenediisocyanates for manufacturing polyurethane resins, high-tenacity nylon for the fishing industry, nylon monofilaments for the p= aint sector, and aluminum sulfate for water treatment, among others.<= /span>

Many factors affect the demand and consumption level in the Peruvian market including new industrial trends, h= igh credit barriers, and economic growth and marketing techniques. Price is still the major purchasing variable. U.S. subsidiaries o= perating in Peru have shown great adaptability changing their products according to specific industrial use. U.S. exporters should be aware of Peru’s current controls and regulations related to chemical inputs related to drug production.

For more information, contact the National Directorate of Industry (Direccion Nacional de Industria – D= NI) of the Ministry of Production and/or the Chemical Industry Committee at the Manufacturers’ Society.

Resources = &nb= sp; = &nb= sp; = &nb= sp; = Return to top

Manufacturers’ Society, Chemical Industry Committee: http://www.s= ni.org.pe/comites/comite013/quimicos.html

Ministry of Production: http://www.produce.go= b.pe/

Building Products
&= nbsp;

Overview = &nb= sp; = &nb= sp; = &nb= sp; = Return to top

	2004	2005	2006 (estimated)
Total Market Size	315.4=	424.4=	540.4=
Total Local Production	327.6=	423.1=	535.3=
Total Exports	131.0=	169.2=	214.1=
Total Imports	118.8=	170.5=	219.2=
Imports from the U.S.	24.0	40.5	50.2

(Statistics are unofficial estimates)

2006 Import Market Share (percent for US and Major Competitors): U= .S. 22.9%; Chile 19.1%; China 16.1%; Ecuador 7.2%; Spain 7.1%; Brazil 5.9%; Argentina 2.7%; Canada 2.5%; Colombia 2.5%; Italy 2.4%; Bolivia 2.0%; Germa= ny 2.0%; Mexico 1.3%.

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HTS Code	Description	%
730890<= /o:p>	Structures and parts of iron or steel=	8.6
441032<= /o:p>	Particle board surface-covered with melamine-impregnated paper	8.0
730890<= /o:p>	Columns pillars posts beams griders and similar structures, iron or steel	7.7
690890<= /o:p>	Other glazed ceramic flags and paving, hearth and wall tiles fitting square 30 cm or more	6.3
730840<= /o:p>	Equipment scaffolding shuttering propping or pit propping	4.5
391729<= /o:p>	Tubes, pipes & hoses, rigid of plastic<= /o:p>	4.2
700521<= /o:p>	Nonwired glass, colored, opacified, flashed, or surface ground	3.8
441111<= /o:p>	Fiberboard ligneous materials not surface covere= d	3.3

Best prospects in the building sector include: self-propelled machinery, tubes a= nd pipes, structures of iron and steel, tiles and fiberboard materials. Drilling wells and transportation pipelines also have an important demand, and are upgrading their safety standards to operate under international environmentally conscious practices. There is a small b= ut growing market niche for U.S. building products for prime offices (Class A = and A+ buildings).

Opportunities &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; &= nbsp; &nbs= p; Return to top

The building products sector in Peru totaled US$ 424.4 million in 2005. The market is comprised approximat= ely by 60% locally made products and 40% of imported ones. An 18% increase in total market si= ze is projected for the coming years (2007-2008).

Since 2002 the housing and building const= ruction projects have increased. In t= he housing sector alone there is a demand of half a million houses for the following two years, around 49% in Lima and mostly oriented to low and medium-income sectors where the demand is for houses valued around US$ 25,000. Thus, in this sub- se= ctor price is still the major purchasing variable.

The building products sector reached a growth rate of 15 to 20% during the last= two years. This trend is expected= to continue indefinitely. The government low-income housing projects such as Mi Vivienda and Techo Propio= and the private investment in malls, department stores, offices and hotels are driving demand in this sector. Many products are locally produced using imported raw materials. Another fact that will help the bu= ilding sector to grow is the increase of housing loans, mainly when the “Empresas Administradoras Hipotecarias” (mortgage management companies) start operating by mid-2007, the government is also promoting ma= ny public infrastructure development and road maintenance projects. There is a financing program with = the Interamerican Development Bank for S/. 50 million.

Housing projects are developed mainly in Lima, the capital city, however demand is building in Arequipa, Chiclayo, Ica, and Trujillo as a result of economic growth. The construction of premium offices, mall and department stores, distribution centers and large warehouses is developing fast with the participation of foreign large store chains and the increase in retail activity. Projects related to= road maintenance and infrastructure are being developed throughout the country.<= /span>

Resources = &nb= sp; = &nb= sp; = &nb= sp; = Return to top

Ministry of Housing, Construction and Sanitation: http://www.vivienda.gob.pe

Mi Vivienda Fund: http://www.mivivienda.com.pe/p= ortal

Food Processing and Packag= ing Equipment

&= nbsp;

Overview = &nb= sp; = &nb= sp; = &nb= sp; = Return to top

	2004	2005	2006 (estimated)
Total Market Size	67.0	84.3	84.1
Total Local Production	13.5	15.2	16.3
Total Exports	15.2	1.9	3.2
Total Imports	68.7	71.0	71.1
Imports from the U.S.	14.8	14.9	20.6

(Statistics are unofficial estimates)

2006 Import Market Share (percent for US and Major Competitors): U.S. 28.9%; Ger= many 15.2%; Brazil 7.5%; Spain 7.15.8%; The Netherlands 6.1%; Italy 5.4%; Sweden 5.1%; Argentina 3.7%.

The to= tal market for food processing and packaging equipment totaled US$ 84.28 million in 20= 05; of which US$ 71.0 million were imports.&nb= sp; High quality European suppliers constitute a tough competition for U.S.-made equipment. In order= to obtain a larger share of the Peruvian market, U.S. manufacturers need to ke= ep in mind that: (1) Peru is a developing country that is beginning to moderni= ze its food processing industry; (2) the Peruvian labor force is young, unskil= led, sizeable, and available at low cost; (3) small and mid-sized (by Peruvian, = not U.S., standards) companies have difficulty obtaining good financing terms; = and (4) English is commonly spoken among executives, but not within the ranks of intermediate level employees, and maintenance personnel.<= /p>

The local industrial food sector is very diverse and includes many important segments such as beverage, fish/seafood, fruit, vegetables, edible oils, grain, dairy products, meat and sausages, poultry, biscuits, chocolate and confectionery, and sugar. Therefore, the type of equipment i= n high demand for the next years (2007-2008) is also very diverse. U.S. companies should be aware of the needs of new equipment required by local food produc= ers. The Commercial Service strongly recommends U.S. exporters to hire a local representative that can track tre= nds and advise them about the requirements for new equipment.

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HTS Code	Description	%
842199	Other parts or machinery or apparatus for filtering or purifying water	20.4
841989	Ma= chinery designed for cooling food and beverages	10.5
842230	Machinery for filling, closing, sealing, and labeling bottles; cans, bags or other containers; machinery for encapsula= ting bottles, jars, tubes and similar containers; machinery for aerating bever= ages	10.3
843840	Br= ewery machinery	7.7
842290	Parts of machinery of Sub Heading 8422.30	6.5
841950	He= at exchange units	5.7
843890	Parts of machinery of Sub Heading 8438=	4.2

Best prospects include parts for filtering and purifying water equipment, cooling equipment, fully integrated hi-tech equipment for processing and packaging purposes (i.e., machinery for filling, closing, sealing, and labeling bottl= es; cans, bags or other containers; machinery for encapsulating bottles, jars, tubes and similar containers; machinery for aerating beverages); dairy machinery; heat exchange units; other packing or wrapping machinery. Closing, sealing, and labeling equipment are mainly purchased from U.S. suppliers. It is also important to mention th= at Peruvians prefer U.S. technology for rigid containers manufacturing.

Package and container recycling have driven technology not only to provide a more striking appearance and a secondary use, but also to ensure that discarded containers and packages will not pollute the environment. It is also important to mention th= at Peruvian prepared packed meals, targeted towards ethnic groups worldwide, w= ill constitute a growing market niche that U.S. equipment and packing material suppliers can capitalize upon.

Opportunities &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; &nbs= p; = Return to top

The food and beverage processing and packaging industry is one of the most dynamic in Peru. In 2005, this industry = grew 9.4%, boosted by 25% growth in the thriving agribusiness sector. Currently, Peru is ranked worldwid= e as the number one fishmeal and asparagus exporter. Peru’s fruit and vegetable industry comprise the bulk of the country’s agribusiness export sector. The top six products exported during 2004-2005 were: asparagus, mangoes, grapes, paprika, piquil= lo pepper, artichokes, and jalapenos.

Despite these positive trends, the food processing and packaging equipment industry= in Peru is still small, but emerging. It is essentially composed of small- to medium-sized companies, which creates an opportunity for U.S. investors.

Value-added food and beverage products (e.g. garlic-flavored margarine and lemon-flavor= ed bottled water) are emerging product lines within the industry. Intermediate technology processing equipment will be required for the short and medium terms. Every segment of the sector needs = to replace their lines of production. <= /span>

ENVASE/ALIMENTEK PERU 2007 is a trade fair scheduled for July 11-14, 2007 that will feature = the packing industry, bottling, processed foods, ingredients and related products. This fair is organi= zed by the IPENBAL, the SNI and the Argentine Packing Institute (Instituto Argenti= no del Envase). The U.S. and For= eign Commercial Service in Lima (FCS Lima) will run a catalog exhibition promoti= ng U.S. suppliers (http://ww= w.buyusa.gov/peru/en/94.html).

Resources = &nb= sp; = &nb= sp; = &nb= sp; = Return to top

Envase/Alimentek Peru 2007 (July 2007): www.envaseperu.com

Manufacturers’ Society: http://www.sni.org.pe

Pollution Control Equipmen= t

&= nbsp;

Overview = &nb= sp; = &nb= sp; = &nb= sp; = Return to top

	2004	2005	2006 (estimated)
Total Market Size	95.0	89.9	94.7
Total Local Production	9.5	9.0=	9.5
Total Exports	3.5	1.8	2.4
Total Imports	89.0	82.8	87.7
Imports from the U.S.	28.3	24.2	28.9

(Statistics are unofficial estimates)

2006 Import Market Share (percent for US and Major Competitors): U.S. 33.0%; Ger= many 8.7%; Finland 7.6%; Brazil 7.0%; Italy 6.6%; China 6.6%; Spain 6.5%; Netherlands 4= .0%; Canada 3.1%; Argentina 3.0%.

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HTS Code	Description	%
847989	Machines and mechanical appliances=	16.5
842129	Other filtering and purifying equipment for liquids	10.8
842139	Dust collection and air purification equipmen= t	9.7
842199	Parts of filtering and purifying apparatus	9.4
730900	Tanks and other iron or steel containers=	8.0
847420	Portable crushing or grinding machines	6.5
847990	Parts of machinery for treatment <= /span>	6.2

Best prospects include: filtering and purifying equipment for liquids and dust collection and air purification equipment.&nbs= p; These products are mainly demanded for subsidiaries of foreign firms= in order to meet international environmental standards.

Opportunities &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; &nbs= p; = Return to top

The Pollution Control Equipment sec= tor in Peru totaled US$ 89.9 million in 2005.&= nbsp; The market is primarily comprised by imports, representing 92% of the market share in 2005. A 10% increase in total imports is anticipated for the coming years 2007-2008. U.S. products are preferre= d and ranked among main suppliers.

In Peru, both the government and the private se= ctor have operated without an adequate consideration of the pollution repercussi= ons and the future risk for the population.&nb= sp; Most = Peruvian firms do not apply pollution control and related regulations, that explains= why the Pollution Control Equipment sector is not growing as it should. Currently the foreign companies st= arting operations in Peru must follow their corporate pollution control policies a= nd also demand their contractors to do so.&nb= sp; The total market would be larger if the government enforced firms to follow the pollution control rules and develop strategic anti-pollution pla= ns.

Most firms operating in the mining, oil and gas sectors as well as industrial fi= rms must implement pollution control programs&= nbsp; (PAMAs). New projects = must submit Environmental Impact Assessment studies (EIAs). Additi= onally, the Manufacturer’s Society, through the chemicals committee, following the Canadian initiative “Responsible Care”, is developing= and implementing the program “Responsible Conduct with the Environment= 221; with the guidance and approval of the International Council of Chemical Associations. Details availab= le at: http://www.sni= .org.pe/comites/comite013/e-p4.htm.

Resources = &nb= sp; = &nb= sp; = &nb= sp; = Return to top

Manufacturers’ Society: http://www.sni.org.pe<= /o:p>

Security and Safety Equipm= ent

&= nbsp;

Overview = &nb= sp; = &nb= sp; = &nb= sp; = Return to top

	2004	2005	2006 (estimated)
Total Market Size	35.9	41.8	65.0
Total Local Production	5.2	15.1	6.3
Total Exports	5.0	14.0	5.9
Total Imports	35.7	40.7	64.6
Imports from the U.S.	12.1	12.4	17.1

(Statistics are unofficial estimates)

2006 Import Market Share (percent for US and Major Competitors): U.S. 26.4%; Chi= na 17.1%; Canada 8.2%; Brazil 7.5%; Germany 6.3%; Taiwan 4.4%.

The Peruvia= n market for safety and security equipment totaled US$ 41.8 million in 2005. Imports totaled US$ 40.7 million in 2005. Imports are highly disp= ersed, but the U.S. remained as the main supplier of equipment, representing around 30% of all imports during 2004-2006. Local production is mainly comprised of low-tech manufactures and services. Small security devi= ces, such as keys and shotgun cartridges, among others, are produced locally. Among the main services provided a= re guard service (personal protection, bodyguards and private guards), security assessment, values custody and transport, systems installations, equipment assembling, maintenance and repair, and insurance.

The Peruvian General Directorate for the Contro= l of Security Services, Guns, Ammunitions and Explosives for Civil Use (DICSCAME= C) has implemented a rigorous procedure for licensing protection and security equipment. This license cover= s all protection services and security equipment as well as small arms. Local firms must register with the DICSCAMEC office to be certified. U.S. exporters are urged to utilize a local agent/vendor that compli= es with this regulation.

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HTS Code	Description	%
902219	X-ray apparatus for other uses	10.7
847190	ID= and remote control access systems	9.9
830140	Ot= her reinforced safe locks	7.8
853110	Sm= oke detectors and burglar alarms	6.4
902000	Ot= her breathing apparatus and gas masks	6.2
853190	Pa= rts for electric or visual signaling apparatus	4.6

Best prospects for the security equipment sub sector includes: X-ray apparatus for security purpo= ses (destined primarily for airports, prisons, large-sized hotels, and intellig= ent buildings), card key and magnetic entry devices, ID and remote control acce= ss systems, safe locks, padlocks, battery-powered smoke detectors, electric burglar and fire alarms, electric and visual signaling apparatus, and shotg= un cartridges, among others. Best prospects for the safety sub sector includes: earplugs and earmuffs, breathing apparatus and gas masks, bulletproof vests, safety glass (ballistic glass),= and sprinkler systems (fire extinguishing equipment), among others.

Opportunities &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; &nbs= p; = Return to top

Steady growth of mining, energy and construction activities has heightened the demand for personal safety equipment during 2004-2006. An overall increas= e in demand for safety and security equipment from national security agencies (i= .e., Army, Navy, Aviation, and National Police) and local production sectors has made Peru a small but interesting market for U.S. suppliers.

In Peru, urban and rural dwellers, businesses and tourists face street crime, kidnappings and armed robbery everyday. These threats have led into Nation= al Police and Municipal Security equipment upgrading and improvement, by procu= ring small arms and several deterrent devices.

U.S. safety and security products in Peru enjoy an excellent receptivity, not on= ly because of the quality of the goods but also the after-sale service agreeme= nts they entail. Price is the key competitive factor in Peru. U= .S. suppliers should provide access to financing along with aggressive promotio= nal support for their representatives. Presently, the safety and security import market is very competitive, and is open to any brand or technology.

In Peru, the most relevant industry= -related multiplier is the National Society of Security (SNS). Established in 2000, the SNS group= s the 70 major local security firms. Another key association is the Firefighting Equipment and Supplies M= anufacturers’ Committee of the Manufacturers’ Society (COFESTCI).

Resources = &nb= sp; = &nb= sp; = &nb= sp; = Return to top

National Society of Security: http://www.seguridad-la.com/instit/pe/sns.htm

Firefighting Equipment and Supplies Committee – Manufacturers’ Society: http://www.= sni.org.pe/comites/comite054/comite054.html

Drugs and Pharmaceuticals=

Overview = &nb= sp; = &nb= sp; = &nb= sp; = Return to top

	2004	2005	2006 (estimated)
Total Market Size	265.2=	278.6=	349.4=
Total Local Production	39.8<= /o:p>	41.8<= /o:p>	52.4<= /o:p>
Total Exports	14.9<= /o:p>	17.3<= /o:p>	14.0<= /o:p>
Total Imports	240.3=	254.1=	311.1=
Imports from the U.S.	32.6<= /o:p>	30.0<= /o:p>	33.0<= /o:p>

(Statistics are unofficial estimates)

2006 Import Market Share (percent for US and Major Competitors): U.S. 10.6%; Ind= ia 8.8%; Colombia 8.5%; Argentina 7.7%; Germany 6.6%; Brazil 6.2%; Mexico 6.1%; France 5.6%; China 4.9%; Chile 4.1%; Switzerland 4.1%; Belgium 3.8%; Spain 2.9%; Italy 2.4%; United Kingdom 2.3%; Uruguay 1.8%.

Best Products/Services<= span style=3D'mso-tab-count:6'> &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; Return to top

HTS Code	Description	%
300490	Medicaments for human u= se in measuring doses for retail sale	43.4
300220	Vaccines for human medi= cine	7.2
300420	Erythromycin, tetracycl= ine, and other antibiotics for human use	6.8
300239	Other vaccines for vete= rinary medicine	2.9
300450	Other medicaments conta= ining vitamins	2.8
300210	Other blood fractions <= o:p>	2.6

Best prospects include: diuretics, cardiovascular, cough and cold preparations, antihistamines, antacids, analgesics, antipyretics, non-hormonal anti-inflammatory agents, anticonvulsants, hypnotics & sedatives, among= other medicaments for human use in measuring doses for retail sale. There is a quite small market nich= e for vitamins and slim products.

Opportunities &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; &nbs= p; = Return to top

Despite the rapid growth = of the Peruvian economy, the pharmaceutical market has increased its production only slightly and related to local demand.= Lack of adecuate IPR enforcement has affected the market’s growth. The pharmaceutical ma= rket in Peru is not significant compared with other countries, thus, products are very expensive. Most products= in this sector are imported. Loc= al production is mainly comprised of branded generics, the "original" brand-name medicines are targeted for consumption by those with mid- or high-level purchasing power and eventually for ESSALUD (Peruvian public health insurance system). Price is st= ill the major purchasing variable.

The Peruvian government c= onducts different health programs including vaccination campaigns, and other preven= tive measures. The market is highly concentrated and around 80% of firms operating in Peru are foreign firms. The most important firm currently operating in Peru is Bristol-Myers Squibb with a market share over 9%, followed by Pfizer with 7% market share. Major producers include Farmindustria, Medifarma, Magma, and Hersil in the pharmacy sector; and Infarmasa, Institu= to Quimioterpico, Hersil, and SJR in the hospital sector.

Pharmaceutical producers and importers have strong distribution systems, directly distribu= ting around 25% of the market value. Major distributors include Quimica Suiza, Albis, and Drokasa; major pharmacy chai= ns include Boticas Fasa, BTL, Boticas Tassara, and Superfarma. However, independent pharmacies are forming alliances.

Peruvian government buys annually around US$ 176 million through military hospitals, ESSALUD and the Ministry of Health.

Resources = &nb= sp; = &nb= sp; = &nb= sp; = Return to top

Ministry of Health: http://www.m= insa.gob.pe/portal/

= Air Conditioning and Refrigeration Equipment

Overview = &nb= sp; = &nb= sp; = &nb= sp; = &nb= sp; Return to top

	2004	2005	2006 (estimated)
Total Market Size	54.5	74.6	82.4
Total Local Production	2.0	2.3	2.4
Total Exports	0.7	0.7	0.8
Total Imports	53.2	73.0	80.8
Imports from the U.S.	22.8	24.3	26.9

(Statistics are unofficial estimates)

2006 Import Market Share (percent for US and Major Competitors): U.S. 33.3%; Chi= le 12.7%; Brazil 12.0%; China 9.1%; Italy 3.5%; Japan 2.6%.<= /p>

The market for air conditioning and refrigeration equipment totaled US$ 74.6 million in 2005; of which US$ 73.0 million were imports. The U.S. is the main supplier of t= his type of equipment. Asian firm= s are rapidly gaining market share at the expense of U.S. exporters by supplying equipment priced 50-60% cheaper than American equipment.

Despite this fact, U.S. suppliers can regain an advantage by exporting refurbished refrigeration equipment. U.S. equipment has a well-known reputation and Peruvians appreciate its high qua= lity and long lifespan. These are = two key competitive advantages.

The industrial refrigeration equipment is linked to the Peruvian food and bever= age industry, one of the most dynamic and stable industrial sectors of the coun= try. Peru’s total agribusiness ex= ports grew 25% in 2005 and are expected to increase 40% during 2006-2007. This increase in exports will incr= ease the local demand for cold storage equipment.

The Commercial Service strongly recommends that U.S. exporters hire a local representative that can track trends and advise them about the requirements= for new or refurbished equipment. U.S. manufacturers and distributors of air conditioning and refrigeration equipm= ent should be open to adapting their equipment and marketing and sales policies= to local market conditions.

Peruvian businesspeople respond to a more personal approach. Equipment manufacturers that maint= ain direct contact with their clients, provide good prices and flexible payment terms, reliable after-sale technical assistance and training, and ensure availability of spare parts for maintenance and repair services, will achie= ve a higher rate of success. Cost effective refrigeration system and plant design, updating and upgrading of existing systems, state-of-the-art turnkey operations are value-added servi= ces within this industry sector.

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HTS Code	Description	%
841490	Pa= rts of fans, ventilating or recycling hoods	20.9
841899	Re= frigeration condensing units and parts thereof	18.0
841850	Fr= eezing and refrigerating display counters, cabinets and showcases	16.5
841480	Re= frigerant recovery units	10.9
841861	He= at pumps, compressor type units whose condensers are heat exchangers	6.1

Best prospects for the foreseeable future (2007-2008) include: parts of ventilat= ing, refrigerating and freezing equipment, electric or other; refrigeration units and their parts; cooling and freezing cabinets and showcases; cold storage rooms; refrigerant recovery units; heat pumps; among others.

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Peru is a very promising market for air conditioning and refrigeration equipment. The market for cold chain equipment (mainly comprised of refrigeration equipment imports) is expected to increa= se 20-25% due to the estimated 40% increase in exports of perishable products. One-time projects (= i.e., building and upgrading of processing facilities) are also boosting the sect= or’s growth primarily in the fisheries and agribusiness sectors. U.S. firms should consider exporti= ng refurbished refrigeration equipment to Peru as the most effective way to rapidly gain market share. Al= so, new commercial and business building developments will drive the demand for= air conditioning and refrigeration equipment in the foreseeable future (2007-20= 08).

The development of agribusiness, food processing, and preservation in Peru has created an increase in demand for specialized refrigeration equipment and systems. In addition, the new= trend of close interaction between the corporate sector engaged in agribusiness a= nd the farming community will result in the application of modern farming techniques and establishment of technologically superior quality cold stora= ge facilities to accelerate the growth of agricultural exports. Also, the fast food retail industr= y in Peru is expanding at a very rapid pace in Lima, Peru’s capital.

Resources = ; &n= bsp; = ; &n= bsp; = ; &n= bsp; = ; = Return to top

Manufacturer’s Society: http://www.sni.org.pe<= /o:p>

Agricultural Sectors = &nb= sp; = &nb= sp; = &nb= sp; Return to top

Product Stati= stics & Data (PS&D) Code: Hard Wheat (1000 MT--not $ value)

=	2004	2005	2006 (estimated)
Total Marke= t Size	1,580	1,672	1,691
Total Local Production	180	172	175
Total Expor= ts	0	0	0
Total Impor= ts	1,400	1,500	1,516
Total Impor= ts from U.S.	885	510	167

Comments: Peru produces about 175,000 MT of = soft wheat, which is used locally for traditional foods, and is not sold into processing channels. Most whe= at is processed into flour for bread and pasta.&= nbsp; Canada led the wheat market in Peru in 2006. U.S. wheat exports fell significan= tly in 2006 due to less competitive prices. Wheat imports are assessed 17 perce= nt duties plus 19 percent value-added tax.

e)&n= bsp; SG Nortek: (metrology services) (511) 572-2630, sgnortek@terra.com.pe.=

Chapter 5: Trade Regulations and Standards

Import Tariffs

Trade Barriers

Import Requirements and Documentat= ion

U.S. Export Controls

Temporary Entry

Labeling and Marking Requirements<= /a>

Prohibited and Restricted Import= s

Customs Regulations and Contact I= nformation

Standards

Trade Agreements<= /li>
Web Resources

Import Tariffs = &nb= sp; = &nb= sp; = &nb= sp; = Return to top

Peru i= mposes no duties on 43.3% of the items in its tariff schedule (3,028 codes covering s= ome agricultural and intermediate goods, parts, capital goods not produced loca= lly, drip irrigation systems, some vehicles, some information technology items, liquefied petroleum gas, and some fuels); 12% duties on 40.6% of the items (2843 codes mainly consumer goods, some locally produced capital and intermediate goods); 17% duties on 0.7% of the items (48 codes some pork me= at, some corn, wheat, barley, and malt products, preparations for child feed, b= eer, and liquor; 20% duties on 10.8% of importable items (759 codes covering mos= tly textiles, footwear, household electrical products, coffee, and some other agricultural products); and 25% duties on 4.5% of the items (316 codes mainly agricultural products)= . The non-weighted average tariff is= 8.3% (including surcharge), down from over 60% in mid-1990.

&= nbsp;

Most imports (97% of codes) are also subject to a 19% value added tax, as are domestically produced goods. In addition, an excise tax (ISC) is applied to certain products such as automobiles. There are no quantitative import restrictions.

Trade Barriers = &nb= sp; = &nb= sp; = &nb= sp; Return to top

In March 19= 91, Peru introduced an import surcharge (variable levy) on some basic agricultural commodities of which rice, corn, sugar and dairy products remain taxed. The government argued that the surcharges were necessary to offset subsidies by exporting countries. The surcharges are calculated on a weekly basis, according to prevailing international prices for each commodity. As a condition for disbursement of a trade-sector loan from the Inter-American Development Ban= k, the government agreed to phase out the surcharges over a three-year period ending in 1997. The government began reducing the surcharges in increments in April 1994, and in July 2001 this system was replaced by a "price band system" similar to one used by the Andean Community.

&= nbsp;

SUNAT has implemented new systems of collecting taxes in advance (VAT and income)= as means to assure tax collection throughout the distribution channels and increase revenues. The system= may work for some sectors but others are being hurt because their margins are smaller than the advanced payments.

Import Requirements and Documen= tation &= nbsp; &nbs= p; &= nbsp; Return to top

For imports, Customs (SUNAT) requir= es a Unique Customs Declaration (DUA), a commercial invoice, an airway bill or b= ill of lading, a packing list, and an insurance letter. If the product is imported from the Andean Community (Colombia, Venezuela, Ecuador and Bolivia), a certificate = of origin is required to qualify for tariff preferences. A food sanitary registry is requir= ed for food processed products (issued by the Food and Environmental Health Bureau DIGESA, http://www.digesa.sld.pe/) or a Sanitary Certificate for animal, plants or their by-products (issued by the Ministry of Agriculture’s National SPS Service SENASA, http://www.senasa.gob.pe/.)

Goods can be brought into the country and kept in a bonded warehouse without payi= ng import duties for up to six months. During that period the importer can pay the duties on the goods kept= in the warehouse and clear customs upon the importer’s schedule. This can be done for the whole shi= pment or it can be broken down according to the importer needs.=

Sanitary and Phytosanitary Regulations are drafted, implemented and enforced by SENASA. We encourage exporters to = request from SENASA an updated list of SPS requirements through the importer, if an= y, before shipping any products to Peru.

For food and beverages the importer needs to submit a sworn application to DIGESA (available= at http://www.digesa.sld.pe) accompanie= d with a Certificate of Free Trade and Use issued by the health authority of the country of origin, the future label and the registration receipt ($69 approximately). If the certif= icate is not available, the importer should present a document issued by the Peru= vian Consulate in the country of origin. The sworn application includes the contact information of the importer’s company and the manufacturer, his tax payer’s identification (R.U.C.), the list of products requested and per each product its content, the results of physical-chemical and microbiological analysis,= lot code system, expiration date, packaging material and storage conditions.

For exports, a Unique Customs Declaration (DUA), a commercial invoice and an ai= rway bill or bill of lading are required. Export licenses are required for cultural relics and antiques. In addition, end-user certificates= are required for the export or re-export of items on the international munitions list, the international chemical/biological warfare (CBW) list and the miss= ile technology control regime (MTCR) list.&nbs= p; Such licenses cover an extremely small portion of total Peruvian exp= orts -- less than 1%.

U.S. Export Controls &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; &nbs= p; = Return to top

The U.S. government controls the ex= port of weapons, ammunition, high technology machinery and equipment (e.g. certain = high performance computers, precision industrial machinery, latest generation ni= ght vision equipment, polygraphs) and some chemicals (e.g. sodium cyanide.)

Temporary Entry = &nb= sp; = &nb= sp; = &nb= sp; Return to top

= Goods can be admitted into Peru tem= porarily for re-export within a year with a bond that guarantees the duties and taxes. Other documentation requirements are the same as those listed above.

Labeling and Marking Requiremen= ts &= nbsp; &nbs= p; &= nbsp; Return to top

<= span lang=3DEN-US style=3D'color:windowtext'>Before reaching the point of sale, = imported packaged foods must carry a separate adhesive label with a Spanish translat= ion of it including the importer/distributor’s contact information and R.U.C. Law 28405 of November = 30, 2004 requires labeling for value-added products other than foods, which cou= ld be included in the future. If im= ported products do not comply with these requirements for customs clearance, impor= ters are allowed to properly label them in private warehouses.=

For food products, labeling requirements are relatively simple. Products normally retain their original labels and the name and tax payer’s identification (RUC) of the manufacturer, importer or distributor must be a= dded to the packaging. The Ministry of Health is in charge of issuing the sanita= ry registration numbers for food products (DIGESA). The Consumer Protection Office wit= hin INDECOPI is responsible for food and beverage labeling inspection and advertising.

Food label contents must include the name of the product and country of manufacture. For perishable products the following information must be included: expiration date, conservation instructions and observations, ingredients, n= et content of the product (weight or volume).= The label must also include information on dangerous ingredients. It is mandatory to include the nam= e, address in Peru of the manufacturer, importer or distributor as well as the taxpayer number (RUC), and sanitary registration number obtained from DIGES= A, risk warning, emergency treatment, when applicable. Perishable products must have the information clearly and visibly detailed in Spanish.

Food packaging must be made of harmless material, free from substances that could affect f= ood safety. Likewise, packages mu= st be manufactured so as to preserve the product’s sanitary quality and composition throughout its useful life according to the Ministry of Health’s sanitary standards. Packages manufactured from previously used recycled paper, cardboard= , or plastic, are forbidden.

Inputs and food additives for food and beverage manufacturing must meet the health quality requirements established in the sanitary standards issued by DIGESA. The use of food addit= ives not included within the list of additives permitted by the Codex Alimentari= us is forbidden. Flavorings acce= pted by the United States Food and Drug Administration (FDA), and the Flavor and Extractive Manufacturing Association (FEMA) are allowed.

Prohibited and Restricted Imports = &nb= sp; = <= /span>Return to top

Very few items have been prohibited= from importation in recent years. = The importation of used clothing and shoes is prohibited; although imports of donated used clothing and shoes are exempt from the prohibition. Importation of some insecticides, fireworks, and toxic waste is also restricted. Imports of used cars more than five years old and used buses and trucks more than two years old are prohibited. Used tires are al= so prohibited. Imports of goat, sheep, and venison, and their products from the Uni= ted States are banned due to scrapie disease.&= nbsp; Imports of remanufactured goods will be permitted once the U.S.-Peru Trade Promotion Agreement is ratified and implemented. See www.export.gov for a list of Market Access provisions under the agreement.

Customs Regulations and Contact Information &n= bsp; = ; Return to top

The P= eruvian Customs Authority has been reformed and modernized over recent years, with help from the World Bank and the UN Development Program. As a result, Customs procedures are almost completely automated. Collections have more than tripled since 1991, despite dramatically lower tariff rates. A Customs= Law was promulgated in April 1996 to consolidate these reforms.

Imports with an FOB value over 3 UIT (taxable reference u= nit by its Spanish acronym) pay a fee of 2.35% of one UIT for valuation service. For 2007 one UIT is = 3,450 Nuevos Soles (approx. US$ 1,000.) In practice Customs is applying a US$ 24 flat valuation fee.

Despite having signed the WTO customs valuation Peruvian customs use= s a referential price verification system (SIVEP by its Spanish acronym.) Customs checks the prices of the Un= ique Customs Declaration (DUA, see “Import Requirements and Documentation” earlier in this chapter) that go through a documentary= or physical inspection, comparing them to those in SIVEP database. If prices in SIVEP are higher, Cus= toms notifies the importer to support the price or to deposit a cash guarantee to clear the goods. There are se= veral complaints from local importers, and verified by the U.S. Commercial Service office, that Customs is assigning values above the real ones. One U.S. exporter has complained that Customs does not accept their invoices but val= ues imports using price lists that do not consider distributor discounts. For Customs to accept the invoice = value it must go with a price list, and the discount must be described and detail= ed in the invoice. Payment terms= must also be detailed. The Customs chapter of the US-PTPA address the referential pricing issue and is consist= ent with Peru’s WTO obligations.

Superi= ntendencia Nacional de Administracion Tributaria

Av. Ga= rcilaso de la Vega 1472, Lima, Peru

(511) = 315-3300, Fax (511) 315-3318

Websit= e: http://www.sunat.gob.pe

Ms. Laura Calderon – National Superintendent

Mr. Enrique Vejarano – National Deputy Superintendent of Internal Taxes

Av. Ga= marra 680, Chucuito, Callao, Peru

(511) = 465-5885, 469-0058, fax (511) 465-3221

Website: http://w= ww.sunat.gob.pe/aduanas/version_ingles/index.html

Mr. Jose Armando Arteaga – National Deputy Superintendent of Customs

Standards = &nb= sp; = &nb= sp; = &nb= sp; = Return to top

&= nbsp;

Overview &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; &nbs= p; Return to top

INDECOPI (the National Institute for the defense of Competition and the Protection of Intellectual Property, http://www.i= ndecopi.gob.pe) is the Peruvian standards development organization, among its other responsibilities. Its Comissi= on of Technical Regulations (CTR), created in 1992, looks after standards matters. The Commission has t= hree functions:

a) Approve technical standar= ds and metrology norms.

b) Qualify the public or pri= vate institutions that will provide conformity assessments.

c) Defend Free Trade under W= TO-TBT commitments.

Standards Organizations = &nb= sp; = &nb= sp; Return to top

Following the list of the different committees a= nd directories inside the CTR working with standards issues:=

a)&n= bsp; Committee for Testing Methodology

b)&n= bsp; Committee for Water Meters Testing

c)&n= bsp; Committee for Testing Laboratories

d)&n= bsp; Committee for Product Certifying Organizations

e)&n= bsp; Committee for Metrology Services

f)&n= bsp; Committee for Quality Management Accreditation

g)&n= bsp; Committee for International Standards Norms.

NIST Notify U.S. Servic= e

Member countries of the World Trade Organization (WTO= ) are required under the Agreement on Technical Barriers to Trade (TBT Agreement)= to report to the WTO all proposed technical regulations that could affect trade with other Member countries. Notify U.S. is a free, web-based e-mail subscription service that offers an opportunity to review and comment on proposed foreign technical regulations that can affect your access to international markets. Register online at Internet URL: http://www.nist.gov/notifyus/=

&= nbsp;

&= nbsp; Conformity Assessment &nb= sp; = &nb= sp; = Return to top

The following firms are certified by CTR to provide Conformity Assessment servi= ces:

a)&n= bsp; INASA- Phone: (511) 578-2624, http://www.inassagroup.com.pe

b)&n= bsp; SGS del Peru: (511) 575-2020, htt= p://www.pe.sgs.com, marisol.rosemberg@sgs.com.=

c)&n= bsp; BSI Inspectorate Peru: (511) 613-8080, echumpitazi@inspectorate.com.= pe, rcayllahua@inspectorate.com.= pe.

d)&n= bsp; EQUAS S.A.: (511) 548-0180, 348-1230, equas@infonegocio.net.pe, equas_lab@infonegocio.net.pe.

&= nbsp; Product Certification = &nb= sp; = &nb= sp; = Return to top

Products coming from the U.S. will not have problems if suppliers receive in advance= all information regarding the products composition and components. The Peruvian standards body (CTR) = works according to a regulatory framework similar to that of the U.S. It is common to have seminars spon= sored by: ANSI, ASTM, NEMA and others to encourage greater conformity with global norms.

Accreditation &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; &nbs= p; Return to top

&nb= sp;

The= re are accreditation bodies for different industries. The laboratories that can provide assistance to U.S exporters are:

a) INTERTEK Testing Services= Peru: (511) 562-0022,

b) CESMEC Peru: (511) 452-12= 23, 464-0248, cesmec@cesmecperu.com.

c) CIMM Peru: (511) 457-5284= , 457-5321, cimmperu@millicom.com.pe.

d) Instituto La Molina Calid= ad Total Labs: (511) 349-2192, = http://www.lamolina.edu.pe/calidadtotal/, calitot@lamolina.edu.pe.

e) EcoLab: (511) 337-5414, http://www.ecolab.com.pe, ecolab@terra.com.pe.

&= nbsp; Publication of Technical Regulations &= nbsp; &nbs= p; &= nbsp; Return to top

The office responsible for publishing and notifying private and public organizations is the National Information Service (SNI-CRT) under CTR. This office is also responsible for notifying the WTO-TBT Committee about changes related to standards issues in Peru. It is under that scheme= that the U.S. and other countries may comment on modifications and propose new standards.

&= nbsp; Labeling and Marking &n= bsp; = ; &n= bsp; = ; &n= bsp; Return to top

In November 2004 Peru issued a new regulation to facilitate trade regarding labeling and marking referred to as (Ley del Rotulado) Law 28405. This new law establishes that products exported to Peru should have a label with the following informatio= n: name of product, country of origin, address of exporter or importer or distributor, expiration date, conservation method, weight in metric system = and risks if any to use it. International quality marks should be visible and easy to identify. =

Contacts &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; &nbs= p; Return to top

The contact information at INDECOPI and CTR in Lima is (511) 224-7800 ext.1261,= fax (511) 224-7800 ext. 1296.

The points of contact at the U.S. Foreign Commercial Service in the Embassy Lima are:

Margaret Hanson-Muse, Commercial Counselor

Gustavo Romero, Commercial Specialist

Phone: (511) 618-2671, 434-3040, fax 434-3041.

Trade Agreements &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; &nbs= p; Return to top

Peru has been a member of = the Andean Community (and its predecessor, the Andean Pact) since 1969. The Andean Community is currently comprised of Peru, ~~Venezuela,~~ Ecuador, Colombia, and Bolivia. In January 2002, the ~~five~~ member countries of the And= ean Community agreed to establish an Andean free trade zone, a common external tariff (CET), and a customs harmonization policy by January 2004. Howeve= r, implementation has been postponed three times, and the target date may be postponed further as CET agreement established a unified tariff sc= hedule that was to come into effect at the end of 2003. Peru and the other Andean Community members have agreed to postpone, once again, until January 1, 2006 the implementation of the CET. Peruvian trade officials concurred with industry representatives and economists who raised concerns that the implementation of the CET as initially agreed would lead to increased tariffs on several consumer products and lower Peru’= ;s competitiveness.

~~&= nbsp;~~

As par= t of the Andean Community, Peru has participated in lengthy negotiations to establis= h a free trade area with Mercosur (Argentina, Brazil, Paraguay and Uruguay econ= omic integration process). On Apri= l 16, 1998, the Andean Community signed a framework agreement with Mercosur as the first step toward building a South American free trade zone. The Andean Community committed to = a goods-based free trade agreement with Mercosur in October 2004. In August 2003, Peru negotiated a separate free trade agreement with Mercosur, which was signed in November 2= 005. The Agreement has yet to go into e= ffect, as the GOP continues negotiations with the Mercosur countries on sensitive agricultural products.

Within the framework of the Latin American Integration Association (ALADI), Peru has signed bilateral t= rade agreements with Argentina, Brazil, Chile, Cuba, Mexico, Paraguay, and Uruguay. Although tariff concessions under most of these agreements are relatively limited, Peru's 1= 998 agreement with Chile calls for the elimination of all trade barriers by the year 2016. In 2006~~August 2005~~, Peru and Chile signed an agreement ~~began negotiations to accelerate and~~ broadening the reduction of tariffs~~, possibly leading to a FTA~~.

Peru is a member of the WT= O and became a full member of the Asia Pacific Economic Cooperation (APEC) forum = in November 1998. Peru signed a partial free trade agreement with Thailand, in November 2005, but. Tthe two governments continue negotiations on sensitive agricultural products. The Peruvian Government has also plans = to beguin free trade<= del cite=3D"mailto:Marcos%20C%20Mandojana" datetime=3D"2006-12-06T09:35">FTA negotiations with Singapore and several other Asian countries. The And= ean Community is sch= eduled to begin negotiations with t= he European Union as well in th= e first quarter of 2007 ~~as wi= th the European Union after the conclusion of the U.S.-Peruvian FTA~~. =

In 2002, the United States renewed and expanded preferential d= uty rates granted to Peru under the Andean Trade Preference Act (ATPA) of 1991.= The expanded agreement, the Andean Trade Promotion and Drug Eradication Act (ATPDEA), has been extended through June 2007 to allow = time for approval of the U.S.-Peru Trade Promotion Agreement (PTPA) by the U.S. Congress. ATPDEA for Peru can be extended for an additional six month period to allow for implementation of the PTPA. ATPDEA ~~expire= s in December 2006 and~~ allows unilateral duty free access to the U.= S. market for 6,300 products (including ~~many n= ew~~ items such as textiles, handicrafts and tuna).&n= bsp; In December 2005, the United States and Peru finalized negotiations = for a bilateral trade agreement. = The agreement was~~has ye= t to be~~ approved and ratified by the Pe= ruvian Congress in June 2006, but has yet to be approved by the ~~both the~~ U.S. ~~and Pe= ruvian~~ Congress~~es but is scheduled to go into effect on Janu= ary 1, 2007, to prevent any lapse in preferential benefits~~. Peru is currently the 43rd~~5th~~ largest export market for U.= S. goods, with U.S. exports exceeding $2.3~~1.5~~ billion in 20064. The st= ock of U.S. foreign direct investment in Peru totaled ~~nearly=~~ $3.9 billion = at the= end ofin 20045.

Web Resources = &nb= sp; = &nb= sp; = &nb= sp; Return to top

Central Reserve Bank of Peru: http://www.bcrp.gob.pe

CETICOS: http://www.conafran.gob.pe<= /p>

CONASEV: http://www.conasev.gob.pe

Customs:= http://w= ww.sunat.gob.pe/aduanas/version_ingles/index.html

EcoLab: http://www.ecola= b.com.pe

DIGESA: http://www.dige= sa.sld.pe/

INASA: www.i= nassagroup.com.pe

INDECOPI: http://www.indecopi.gob.pe<= /p>

INTERTEK Testing Services Peru: http://www.itscb.com

Instituto La Molina Calidad Total Labs: http://www.lamolina.edu.p= e/calidadtotal/

Nation= al Superintendency of Taxation: http://www.sunat.gob.pe=

OPIC: http://www.opic.gov/

OSINERGMIN: http://www.osinerg.= gob.pe/osinerg/homepage.jsp

OSIPTEL: http://www.osiptel.gob.pe/

OSITRAN: http://www.ositran.gob.pe/

ProInversion: http://www.proi= nversion.gob.pe/english/default.asp

SENASA: http://www.senas= a.gob.pe/

SGS del Peru: htt= p://www.pe.sgs.com

SUNASS: http://www.sunass.gob.pe

Superintendency of Banking and Insurance: http://www.sbs.gob.pe= /PortalSBS/Homepage.htm

Chapter 6: Investment Climate

Openness to Foreign Investment

Conversion and Transfer Policies

Expropriation and Compensation

Openness to Foreign Investmen= t &= nbsp; &nbs= p; &= nbsp; &nbs= p; Return to top

The Peruvian government seeks to attract investment -- both foreign = and domestic -- in nearly all sectors of the economy. The U.S.-Peru Trade Promotion Agre= ement (PTPA), pending approval by the U.S. Congress, would enable Peru to attract additional investment by clarifying rules for investors, increasing transparency, reducing barriers to trade, establishing faster customs procedures, and improving the dispute settlement process. Peru does not have a bilateral investment treaty (BIT) or tax treaty with the United States, but these provisions are contained in the PTPA. The U.S. Congress extended unilateral trade preferences under the An= dean Trade Preferences Act (modified by the Andean Trade Preferences and Drug Eradication Act, or ATPDEA) to Peru, Colombia, Bolivia and Ecuador through = June 2007. The U.S. Government recognized Peru's progress in economic policy and other issues by selecting Peru for the Millennium Challenge Account's Threshold Program for fiscal ye= ar 2007.

During the early 1990s, the Peruvian government promoted economic stabilization and liberalization policies by lowering trade barriers, lifting restrictions on capital flows and opening the economy to foreign investors. Peru experienced marked growth in = foreign investment from 1993-1998. Ec= onomic reform and privatization slowed in the late 1990s however, leading to a discernible drop in direct and indirect foreign investment flows. Investment remained stagnant follo= wing the collapse of President Alberto Fujimori's government in November 2000, a= nd through the period of an interim government and the election of President Alejandro Toledo in 2001.

During his tenure, President Toledo implemented several pro-investment policies. In April 2002, the government established ProInversion, building on the foundation of COPRI, the privatization agency created in 1991. ProInversion seeks to be a "one-stop shop" for current and potential investors, and has successfully completed both concessions and privatizations of state-owned enterprises and natural resources. In 2004, Las Bambas, a copper depo= sit, was concessioned to Xstrata TLC, a Swiss company, for USD 121 million plus = 19 percent VAT. In 2005, Bayovar= , a state-owned phosphate rock deposit, was concessioned to a Brazilian company= for a 3 percent royalty, and ProInversion granted British-owned Rio Tinto a concession for the La Granja copper deposit for USD 22 million. Additionally, from January-November 2006, the oil and gas leasing agency Petroperu granted 15 exploration concessions to foreign oil companies, including 8 to 5 U.S. companies, along the northern coast and in the jungle.

In addition to the 1993 Constitution (enacted January 1, 1994), major laws concerning foreign direct investment in Peru include the Foreign Investment Promotion Law (Legislative Decree (DL) 662 of September 1991) and the Frame= work Law for Private Investment Growth (DL 757 of November 1991). The two 1991 laws were implemented= by Supreme Decree 162-92-EF (October 1992).&n= bsp; Two other important laws are the Private Investment in State-Owned Enterprises Promotion Law (DL 674) and the Private Investment in Public Services Infrastructure Promotion Law (DL 758).

The 1993 Constitution guarantees national treatment for foreign investors and permits foreign investment in almost all economic sectors. Prior approval is only required in= the banking (for regulatory reasons, also applies to domestic investment) and defense-related sectors. Fore= ign investors are advised to register with ProInversion to obtain the guarantee that they will be able to repatriate capital, profits and royalties. Foreigners are legally forbidden f= rom owning a majority interest in radio and television stations in Peru; nevert= heless, foreigners have in practice owned controlling interests in such companies.<= span style=3D'mso-spacerun:yes'> Under the Constitution, foreign interests cannot "acquire or possess under any title, mines, lands, forests, waters, or fuel or energy sources" within 50 kilometers of Pe= ru's international borders. Howeve= r, foreigners can obtain concessions and rights within the restricted areas wi= th the authorization of a supreme resolution approved by the Cabinet and the J= oint Command of the Armed Forces. = All investors -- domestic and foreign -- need prior approval before investing in weapons manufacturing industries.

In 1991, the Peruvian government began an extensive privatization program, encouragi= ng foreign investors to participate. From 1991 through September 2005, privatization revenues totaled USD= 9.4 billion, of which foreign investors were responsible for the vast majority. Over three-quarters= of these transactions took place from 1994 to 1997. Through September 2005, privatizat= ion and concessions proceeds totaled USD 35.1 million, and generated investment commitments of USD 1.3 billion. The government has made only limited progress on privatizations since then, and prospects for future direct privatizations are not encouraging. The government has consequently sh= ifted to a strategy of promoting multi-year concessions as a means of attracting investment into major projects. In 2000, the Lima airport was concessioned to a private group (Lima Airport Partners), and in August 2006, nine of Peru's northern airports were concessioned for 25 years to Swissport.&nb= sp; Peru's other airports, as well as various electricity, water, sewage, and oil (Petroperu) companies remain state-owned and operated. In June 2006, the Container Terminal-South Pier of the important seaport of Callao was concessioned for= 30 years to a consortium of P and O Dover (U.K.) and Uniport (Spain).

In June 2004, the Congress passed a law to exclude the state-owned oil company Petroperu from privatization and authorized Petroperu to conduct exploration and production activities. Th= is modified the government's policy since the early 1990s, when it sold all of Petroperu's exploration and production units and a major oil refinery. Under this new law, the government= still has an option of granting concessions on remaining Petroperu assets, includ= ing one pipeline and several refineries. In July 2006, Congress defeated an executive veto of a bill to "strengthen and modernize" Petroperu. Under the new law, Petroperu can r= esume exploration, production and related activities, including petrochemicals; is freed from contracting approval by CONSUCODE, the state procurement supervi= sion agency; is exempted from the approval of its investment projects by the Government Projects Office (SNIP); and will have a worker on its board of directors. Petroperu has a strategic alliance with Brazil's Petrobras.

Under the 1993 Constitution, foreign investors have the same rights as national investors to benefit from any investment incentives, such as tax exemptions= .

Conversion and Transfer Policie= s &= nbsp; &nbs= p; &= nbsp; &nbs= p; Return to top

Under Article 64 of the 1993 Constitution, the Peruvian government guarantees the freedom to hold and dispose of foreign currency; hence, there are no foreign exchange controls in Peru. All restrictions on remittances of profits, dividends, royalties, and capital h= ave been eliminated, although foreign investors are advised to register their investments with ProInversion (as noted above) to ensure these guarantees.<= span style=3D'mso-spacerun:yes'> Exporters and importers are not re= quired to channel foreign exchange transactions through the Central Reserve Bank of Peru, and can conduct transactions freely on the open market. Anyone may open and maintain forei= gn currency accounts in Peruvian commercial banks. U.S. firms have reported no proble= ms or delays in transferring funds or remitting capital, earnings, loan repayment= s or lease payments since Peru's economic reforms of the early 1990s.=

The 1993 Constitution guarantees free convertibility of currency. There is, however, a legal limit o= n the amount that private pension fund managers can invest in foreign securities. In May 2004, the Central Reserve Bank of Peru (BCR) increased this limit from 9 percent to 1= 0.5 percent. The low limit has cr= eated local market distortions, trapping liquidity in Peru that is diverted into local equities and bonds, driving up their prices to artificially high levels. The BCR's new board, appointed by the Garcia Administration, intends to gradually raise this lim= it, beginning with an increase to 12 percent.

The BCR is an independent institution, free to manage monetary policy to maintain financial stability. The BCR's primary goal is to maintain price stability, via inflation targeting. Inflation in Peru was 1.6 percent = in 2005 and 2 percent in 2006. T= he government has also implemented policies to de-dollarize the economy, and deposits in the local currency (nuevo sol) now account for about 36 percent= .

Expropriation and Compensatio= n &= nbsp; &nbs= p; &= nbsp; &nbs= p; Return to top

According to the Constitution, the Peruvian government can only expropriate private property on public interest grounds (such as for public works projects) or = for national security. Any expropriation requires the Congress to pass a specific act. The Government of Peru has express= ed its intention to comply with international standards concerning expropriations.=

Dispute Settlement &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; &nbs= p; Return to top

Dispute settlement continues to be problematic in Peru, although the GOP took steps= in 2005 to improve the dispute settlement process. From December 2004 through 2006, t= he GOP established 24 commercial courts to rule on investment disputes, including = two courts of appeal. All of these courts are located in Lima. T= he commercial courts have substantially improved the process for commercial disputes. Prior to the existe= nce of the commercial courts, it took an average of two years to resolve a commerc= ial case through the civil court system. These new courts, which have specialized judges, have reduced the am= ount of time to resolve a case to two months.&n= bsp; Additionally, the enforcement of court decisions has been reduced fr= om 36 months to 3-6 months. While about 40 percent of decisions are appealed, most of these are resolved at t= he appeals level; very few are appealed to the Supreme Court.

The criminal and civil courts of first instance and appeal are located in the provinces and in Lima. The Su= preme Court is located in Lima. In principle, secured interests in property, both chattel and real, are recognized. However, the judi= cial system is often extremely slow to hear cases and to issue decisions. In addition, court rulings and the degree of enforcement have been difficult to predict. The capabilities of individual jud= ges vary substantially, and allegations of corruption and outside interference = in the judicial system are common. The Peruvian appeals process also tends to delay final decisions. As a result, foreign investors, am= ong others, have found that contracts are often difficult to enforce in Peru. The exposure in 2000 of a network = of corrupt judges controlled by Fujimori advisor Vladimiro Montesinos led to promises by subsequent governments to address corruption and reform the judiciary, but progress has been slow.

Under the 1997 Law of Conciliation (DL 26872), which went into effect on January = 1, 2000, disputants in many types of civil and commercial matters are required= to consider conciliation before a judge can accept a dispute to be litigated.<= span style=3D'mso-spacerun:yes'> Private parties often stipulate arbitration to resolve business disputes, as a way to avoid involvement in = judicial processes.

Peru's commercial and bankruptcy laws have proven difficult to enforce through the courts. There is an administr= ative bankruptcy procedure under INDECOPI (the National Institute for the Defense= of Free Competition and the Protection of Intellectual Property), but it has proven to be slow and subject to judicial intervention. The creditor hierarchy is similar = to that established under U.S. bankruptcy law, and monetary judgments are usua= lly made in the currency stipulated in the contract.

International arbitration of disputes between foreign investors and the government or state-controlled firms is included in the 1993 Constitution. Although Peru theoretically accepts binding arbitration, on a few occasions over the past three years, parastat= al companies and Government Ministries disregarded unfavorable judgments. Previously, the Government of Peru turned these arbitration cases over to the judiciary, where they were bureaucratically delayed until the companies conceded the cases. However, effective July 2005, the Supreme Court ruled that all arbitration findings and awards are final and = not subject to appeal.

Peru is a party to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the New York Convention of 1958), and to the International Center for the Settlement of Investment Disputes (the Washington Convention= of 1965). Disputes between forei= gn investors and the Government of Peru regarding pre-existing contracts must still be submitted to national courts.&nbs= p; However, investors who conclude a juridical stability agreement for additional investments may submit disputes with the government to national = or international arbitration if stipulated in the agreement. In 2005, the government resolved a high-level dispute by upholding the decision of an arbitration panel and ma= king payment.

Several private organizations -- including the Universidad Catolica, the Lima Chamb= er of Commerce and the American Chamber of Commerce -- operate private arbitra= tion centers. The quality of these centers varies, however, and investors should choose a venue for arbitration carefully.

The U.S.-Peru Trade Promotion Agreement, currently pending approval by the U.S. Congress, includes a chapter on dispute settlement and, upon implementation, should further clarify the resolution process in Peru.

= Performance Requirements and Incentives &nbs= p; &= nbsp; &nbs= p; Return to top

Peru offers both foreign and national investors legal and tax stability agreemen= ts to stimulate private investment. These agreements guarantee that the statutes on income taxes, remittances, export promotion regimes (such as drawback), administrative procedures, and labor hiring regimes in effect at the time of the investment contract will remain unchanged for that investment for 10 years. To qualify, an investment must exc= eed USD 10 million in the mining and hydrocarbons sectors or USD 5 million in o= ther sectors within two years. An agreement to acquire more than 50 percent of a company's shares in the privatization process may also qualify an investor for a juridical stability agreement, provided that the infusion will expand the installed capacity of= the company or enhance its technological development.

There are no performance requirements that apply exclusively to foreign investors. Legal stability agreements are subject to Peruvian civil law, which means they cannot be altered unilaterally by the government.&nb= sp; Investors are also offered protection from liability for acquiring state-owned enterprises.

Laws specific to the petroleum and mining sectors also provide assurances to investors. However, in 2000, = the government modified the General Mining Law, substantially reducing benefits= to investors in that sector. Amo= ng the changes were: a reduction in = the term concessionaires are granted to achieve the minimum annual production; = an increase in fees for holding non-productive concessions; an increase in fin= es for not achieving minimum production within the allotted time; a reduction = in the maximum allowable annual accelerated depreciation; and revocation of the income tax exemption for reinvested profits. In 2004, Congress approved a bill charging a 1 to 3 percent royalty on mining companies' sales. The changes do not affect those investors who have signed legal stability agreements with the government.

In December 2006, after increased social demands for a share of mining profits, the Garcia Administration and mining companies agreed to a "voluntary contribution" system whereby mining companies will invest in community infrastructure projects. This agreement averted adoption of a more restrictive mining law, allows mining companies to control where they invest their contributions, and ceases to a= pply if the prices of mined products drop.

Parties may freely negotiate contractual conditions related to licensing arrangemen= ts and other aspects of technology transfer without prior authorization. Registry of a technology transfer agreement is required for a payment of royalties to be counted against taxes. Such registration is automatic upon submission to ProInversion.

Current laws limit foreign employees to no more than 20 percent of the total number= of employees in a local company (whether owned by foreign or national interest= s), and restricts their combined salaries to no more than 30 percent of the tot= al company payroll. However, DL = 689 (November 1991) provides a variety of exceptions to these limits. For example, a foreigner is not co= unted against a company's total if he or she holds an immigrant visa, has a certa= in amount invested in the company (currently about USD 4,000) or is a national= of a country that has a reciprocal labor or dual nationality agreement with Peru. Foreign banks and servi= ce companies, and international transportation companies are also exempt from these hiring limits, as are all firms located in free trade zones. Furthermore, companies may apply f= or exemption from the limitations for managerial or technical personnel.

Right to Private Ownership and Establishment = &nb= sp; Return to top

Foreign and domestic entities are generally permitted the right to establish and own business enterprises and to engage in most forms of remunerative activity.<= span style=3D'mso-spacerun:yes'> Subject to the restrictions listed earlier in this document, both foreign and domestic entities may invest in = any legal economic activity -- including foreign direct investment, portfolio investment, and investment in real property. Private entities may generally fre= ely establish, acquire, and dispose of interests in business enterprises. In the case of some privatized com= panies deemed important by the government, privatization agency ProInversion has included a so-called "golden share" clause in the sales contract, which allows the government to veto a potential future purchaser of the privatized assets.

Protection of Property Rights &= nbsp; &nbs= p; &= nbsp; &nbs= p; Return to top

As noted in the Dispute Settlement section, in principle, secured interests in prope= rty (both chattel and real) are recognized.&nb= sp; However, the Peruvian judicial system is often very slow to hear cas= es and to issue decisions, outcomes have been difficult to predict and enforce, and corruption is frequently alleged. The Peruvian appeals process also delays final outcomes of cases. Thus, foreign investors, among oth= ers, have found that contracts are often difficult to enforce in Peru. Improving the judicial system is a stated priority of the Peruvian Government.

Protection of intellectual property rights (IPR) in Peru has improved over the past decade, but still falls short of U.S. and international standards in several areas. Peru remains on USTR's Special 301 "Watch List" due to concerns about continued high rat= es of copyright piracy, a lack of protection for confidential test data submit= ted for the marketing approval of pharmaceutical and agrochemical products, and inadequate enforcement of IPR laws, particularly with respect to the relati= vely weak penalties that have been imposed on IPR violators.

The Peruvian government agency charged with promoting and defending intellectual property rights is the Institute for the Defense of Competition and Protect= ion of Intellectual Property (INDECOPI, http://www.indecopi.gob.pe), established in 1992. Legislat= ive Decree 822 of 1996 and Andean Community Decisions 344 and 486 protect paten= ts, trademarks, and industrial designs. Copyrights are protected by Legislative Decree No. 822 of 1996 and by Andean Community Decision 351.

Peru belongs to the World Trade Organization (WTO) and the World Intellectual Property Organization (WIPO). It is also a signatory to the Paris Convention on Industrial Property, Geneva Convention for the Protection of Sound Recordings, Bern Convention for the = Protection of Literary and Artistic Works, Brussels Convention on the Distribution of Satellite Signals, Phonograms Convention, Satellites Convention, Universal Copyright Convention, the World Copyright Treaty, and the World Performances and Phonographs Treaty and the Film Register Treaty. In December 1994, the Peruvian Con= gress ratified the World Trade Organization's Agreement on Trade-Related Aspects = of Intellectual Property (TRIPs).

Peru's legal framework provides for easy registration of trademarks, and inventors have been able to patent their inventions since 1994. Peru's 1996 Industrial Property Ri= ghts Law provides an effective term of protection for patents and prohibits devi= ces that decode encrypted satellite signals, along with other improvements. Peruvian law does not provide pipe= line protection for patents or protection from parallel imports. Although Peruvian law provides for effective trademark protection, counterfeiting of trademarks, copyrighted products, and imports of pirated merchandise are widespread. The International Intellectual Pro= perty Alliance estimates that the piracy level in Peru for recorded music was 98 percent in 2004-2005, with damage to U.S. industry estimated at USD 100 million. IIPA estimates motion picture piracy accounts for 60 percent of the market for a loss of USD 5.5 million. Indecopi considers t= hat software piracy levels remained the same as 2004 levels, at 56 percent.

Peru's Copyright Law is generally consistent with the TRIPs Agreement. However, textbooks, books on techn= ical subjects, audiocassettes, motion picture videos and software are widely pirated. While the government= , in coordination with the private sector, has conducted numerous raids over the last few years on large-scale distributors and users of pirated goods, and = has increased other types of enforcement, piracy continues to be a significant problem for legitimate owners of copyrights in Peru.

Despite increased enforcement actions by INDECOPI, the judicial branch has failed to impose sentences that adequately deter future IPR violations. The Peruvian government in July 20= 04 increased the minimum penalty for piracy to four years imprisonment, althou= gh there have yet to be any convictions under the new law. Peru now has six prosecutors (two fiscalias) dedicated full-time to intellectual property cases. In a major breakthrough, in Novemb= er 2006, four special courts of first instance and one special appeals court in Lima were assigned IPR duties, effective 2007.

An IPR Toolkit for Peru can be found on the Embassy and Commercial Service Lima's = websites. Besides being a guide to registeri= ng and protecting IP, it contains a list of lawyers and other organizations that c= an provide support on an on-going basis.

Transparency of Regulatory Syste= m &= nbsp; &nbs= p; &= nbsp; Return to top

The transparency and independence of regulatory processes have become central issues for foreign investors in Peru. Many of the central government entities with which foreign firms must deal -- including the entities that maintain the company registry and super= vise securities and exchanges (CONASEV), handle privatization and investment iss= ues (ProInversion), and handle competition policy and intellectual property mat= ters (INDECOPI) -- have procedures that are relatively transparent and predictab= le. Banks, insurance companies and pri= vate pension funds are regulated primarily by the Superintendency of Banking and Insurance (SBS), which is charged with determining the qualifications of potential market entrants and regulating firms once they have begun operati= ons. SBS regulations are also seen as b= eing transparent.

When the GOP privatized state-owned monopolies in the areas of telecommunications, electrical generation and distribution, and the hydrocarbons sector in the = late 1990s, the GOP established regulatory institutions to oversee the newly pri= vate sectors. Delays and lack of predictability in the rulings of these institutions, including OSIPTEL (telecom) and OSINERG (energy), have at times in the past been notable impe= diments to doing business in Peru.

In December 2005, OSIPTEL published a new law that lowers Peru's high mobile termination rates to levels comparable to international rates over a 3-year period. Several U.S. companie= s have encountered problems with the energy sector regulator (OSINERG) over its he= sitancy to provide clear regulation for the energy sector. Some regulatory agencies have in t= he past been subject to politically motivated government intervention in their technical operations.

U.S. firms have complained that SUNAT's aggressive behavior and interpretation of law are often contrary to the spirit of the law and intent of government policies, complicating normal business operations. The remuneration of SUNAT employee= s is determined, in part, by the theoretical tax liability they uncover in audit= s.

Businesses point out that SUNAT's retroactive reinterpretation of regulations and laws, its levying of disproportionate fines, and initiation of full company audits when companies request a refund or legal revaluation of assets for deprecia= tion purposes, create additional investment and trade barriers. In one case, a U.S. firm requested= an improper drawback of USD 1,345, only to face SUNAT fines of USD 645,000. Although the case was resolved, new legislation was needed to correct the problem. In instances involving airline fue= ls, certain minerals, and other products, SUNAT declared that these goods sold abroad, which under Peruvian government policy are exempted from taxes, were not considered exports and were therefore subject to VAT. Two recent laws were necessary to correct this practice for airline fuels and services. SUNAT often does not follow standa= rd international practice in the way it taxes new activities. To correct these problems, the independent tax tribunals act to check any abuses by SUNAT. In 2004, the GOP established a tax ombudsman who must approve SUNAT's request to appeal adverse tax tribunal decisions. In the past two ye= ars, the tax ombudsman has acted in several cases to end unwarranted litigation = of disputed assessments. In 2005= , a U.S. company won long-standing tax cases against SUNAT as a result of these improvements.

A 2006 World Bank study found that Peru has significantly lowered the average amou= nt of days it takes to start a business from 98 (2005 study) to 72. Various procedures -- such as obta= ining building licenses or certificates of occupancy -- require many steps. Municipal authorities issue most licenses and requirements vary widely by locality. As a result, information on necess= ary procedures is often difficult to obtain.&n= bsp; Business people often complain of excessive red tape; one major fore= ign investor found that starting project construction and a business required several hundred permits, many of which the responsible government entities = were unaware they had to issue. Ot= her investors argue that local governments and municipalities, which are seeking new revenue sources, sometimes withhold licenses or create regulations, thus hindering the ability to do business or making it costlier. Even though import tariffs are substantially lower than previously (the simple average tariff is 8.3 perce= nt ad valorem plus surcharges as of January 2007; the trade-weighted average u= sing 2005 import figures is 5.6 percent), import duties, together with the 19 percent value added tax on goods, high social security tax rates, and certa= in labor laws, increase investment costs significantly and hinder the efficient mobilization and allocation of investment capital. Businesses can apply for VAT reimbursement.

Efficient Capital Markets and Po= rtfolio Investment &nb= sp; = Return to top

Credit is allocated on market terms and the banking industry in Peru is generally considered to be competitive in offering services to business customers. Private pension funds have compete= d in recent years with financial companies for bonds issued by companies, as dem= and for securities greatly exceeds supply.&nbs= p; Foreign investors can obtain credit on the local market and several = of them have done so in the last few years as terms were more competitive than those of the usual international centers.&= nbsp; The private sector has access to a variety of credit instruments. From January through early Decembe= r 2006, firms placed USD 1.55 billion on the local bond market (compared with USD 1= .47 billion in CY 2005), which has been propelled in recent years by demand for investment instruments by private pension fund companies. By October 2006, pension funds man= aged a total of USD 13.4 billion, a 43 percent surge over the October 2005 level (= USD 9.4 billion), thus creating a huge and growing appetite for financial instruments by pension funds. The low 12 percent cap placed by the Central Bank on what the pension funds can invest abroad provides local bond issuers (including the government) and lo= an seekers with a captive capital market.

All firms listed on the Lima Stock Exchange (Bolsa de Valores de Lima) or the Public Registry of Securities must be vetted by CONASEV, the National Commission for the Supervision of Companies, Securities and Exchanges, which maintains the Public Registry of Securities and Stock Brokers. CONASEV is the Peruvian government entity charged with the study, promotion, and regulation of the securities = and commodities markets, the control of market participants, the maintenance of= a transparent and orderly market, the setting of accounting standards and the publication of financial information about covered companies. As part of CONASEV's goal to promo= te market transparency, to prevent monopolies, and to prevent fraud, issuers of stock are required to inform CONASEV and the relevant stock exchange or bod= y in charge of supervising the centralized trading mechanism, of events that aff= ect or might affect the stock, the company, or any public offerings. Although trading on insider inform= ation is technically a crime, no one has been charged and punished under the law.=

Total assets of the commercial banks were USD 24.1 billion at the end of October 2006, 16 percent above the same period of 2005. The banking system is considered g= enerally sound, as it weathered rather well a severe El Nino and global financial turmoil in 1997-98. Sound supervision, combined with competition, led to a significant consolidation = in the sector, which still continues. Consequently, 12 commercial banks comprise the system, of which 3 ba= nks account for just over three-fourths of loans and almost four-fifths of deposits. Banks have revamped operations, increased capitalization, and reduced costs in recent years. As of November 2006, foreigners had significant shares in nine banks, of which they were majority owners of four commercial banks (including two of the country's largest). Under the SBS's conservative crite= ria, 1.9 percent of total loans were assessed as non-performing as of October 20= 06, down from a high of 11 percent in early 2001. The system also has 3 specialized institutions ("financieras") and 39 thriving micro-lenders and savings banks.

Larger private firms often use "cross-shareholding" and "stable shareholder" arrangements to restrict investment by outsiders -- not necessarily foreigners -- in their firms.&= nbsp; As close families or associates generally control ownership of Peruv= ian corporations, hostile takeovers are practically non-existent. Peruvian law and regulations do not authorize or encourage private firms to adopt articles of incorporation or association to limit or restrict foreign participation; nor are there any private or public sector efforts to restrict foreign participation in indus= try standards-setting organizations.

In 2006, SBS approved a license for the first U.S. company to provide retail credit services, thus increasing competition for incumbent banks and Chilean finan= ce companies.

Foreign direct investment registered with ProInversion as of the end of 2005 was USD 14.3 billion, compared with USD 13.9 billion a year earlier. Foreign portfolio investment (dematerialized holdings of securities only) totaled USD 9.6 billion in Oct= ober 2006, up from USD 7.7 billion at the end of December 2005.

Political Violence &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; &nbs= p; Return to top

Although political violence against investors is not a common practice, the mining a= nd petroleum communities witnessed an increase in protests, some violent, in 2005. These leveled off in 20= 06. These protests caused several fore= ign companies to significantly delay or abandon plans to establish operations.<= span style=3D'mso-spacerun:yes'> Protests against the mining indust= ry occurred for various reasons. Although environmental concerns were often the cited pretext, in many cases protestors were seeking social infrastructure investments not provide= d by the government. Often times, well-organized groups, such as the Ronderos (local self-defense groups established during the Shining Path terrorist attacks) or NGOs, exaggerated= a local community's concerns, bringing in protestors from outside the local community to foment protests against the companies. In at least two incidents in 2005 = and 2006, the local mayor and other local authorities led strikes against two l= arge foreign mining companies in an effort to secure additional funds or develop= ment promises from the companies. = During 2005 and 2006, there were road blockages and acts of vandalism by groups protesting mining operations, coca growers protesting the Government's eradication policies, and farmers seeking increased government tariff protections and financial support. Some indigenous communities in an oil production area used river and road blockages as a way to press for their demands on a long-standing pollu= tion case. A common thread for many protests is the lack of government provision of basic services such as heal= th and education. Another compla= int that can underlie what appear to be environmental protests is a lack of acc= ess by local communities to the various "canons," the funds set aside= by the government out of the taxes or royalties paid by the oil, gas and mining firms for local community development.&nbs= p; In some mining areas, firms and local leaders have alleged that narcotraffickers are fomenting protests as a way to keep prying eyes away f= rom their activities.

When significant conflicts developed in the first few months of the Garcia Administration, cabinet ministers and often the Prime Minister became personally involved in successfully resolving the protests. The government established a commi= ssion in late 2006 to prevent and resolve social conflicts in the extractive industries. In addition, vari= ous NGOs have become involved in conflict resolution activities. At the same time, the National Soc= iety of Mining and Petroleum (SNMPE), as well as the government, have become involved in assisting local communities to access the extractive industry canons as a way to both stimulate local development and head off social conflicts. It is reasonable t= o posit that many of these efforts should pay off to reduce social conflicts for investors in 2007.

Political violence remains a concern in the coca-growing regions. The Shining Path (Sendero Luminoso) terrorist organization has become increasingly aggressive and involved in narcotrafficking in these areas. The Shining Path killed eight civilians and five police officers in 2006, and were responsible for 92 serious terrorist incidents that year. In December 2005, the Shining Path killed 13 police officers in several ambushes in coca-going areas of Huanuco and Apurimac. President Garcia continues to reauthorize 60-day states of emergency in parts of Peru's five departments where the Shining Path operates, suspending some civil liberties and giving the armed forces authority to maintain public order.<= /span>

There is little government presence in the remote coca-growing zones of the Monzon a= nd the Apurimac-Ene River valleys. The U.S. Embassy in Lima restricts visits by official personnel to these areas because of the threat of violence by narcotics traffickers and remaining columns of the Shining Path. Information about insecure areas and recommended personal security practices can be found at http://www.ds= -osac.org/.

Corruption = &nb= sp; = &nb= sp; = &nb= sp; = Return to top

It is illegal in Peru for a public official or employee to accept any type of out= side remuneration for the performance of his or her official duties. Peru has ratified both the UN Conv= ention Against Corruption and the Organization of American States' Inter-American Convention Against Corruption. Peru is not a member of the Organization of Economic Cooperation and Development, and has not signed the OECD Convention on Combating Bribery.

Peru is one of four nations worldwide participating as a pilot country in the G8 anti-corruption and transparency initiative. The U.S., other G8 partners and NG= Os helped the Peruvian government develop an action plan that includes activit= ies in six areas: a) citizen information/internet connectivity; b) improving central government fiscal transparency; c) development of GOP procurement systems; d) improving regional/local government transparency and management; e) improvement of transparency of extractive industry revenues; and f) development of asset forfeiture systems and legislation.

The G8 initiative has already shown some positive results. A hemisphere-wide state procurement organization – the Inter-American Organization of Government Procurem= ent Institutions – was created under the leadership of Peru's State Procu= rement Council (CONSUCODE). As of Ja= nuary 2007, eight countries are in the process of adopting the network agreement, prior to its signature (Bolivia, Colombia, Ecuador, Honduras, Mexico, Parag= uay, Peru and Paraguay). Also, eff= orts are underway to provide Internet connections to approximately 90 municipal governments located in areas most affected by terrorism and poverty. The rural connectivity project will allow these governments access to national systems, part of the GOP's E-government initiatives, aimed at creating greater transparency and citizen access to public information.

U.S. firms have reported only a small number of problems directly resulting from corruption, usually in government procurement processes and in the judicial sector, but the revelation in late 2000 of a broad and deep corruption ring organized by former presidential advisor Vladimiro Montesinos heightened awareness of the problem. Transparency International ranked Peru number 70 (out of 163 countri= es) in its 2006 Corruption Perception Index.&n= bsp; While anti-corruption efforts have been a stated priority of both the Toledo and Garcia Governments, in practice most resources are directed at investigating Fujimori-era corruption.&nbs= p; In 2001, President Toledo appointed an anti-corruption "czar&qu= ot; to lead government efforts, but this official resigned in 2002 and has yet = to be replaced. Private sector g= roups have increased efforts to combat corruption through an NGO called "Pro= Etica," which represents Transparency International in Peru.

Bilateral Investment Agreements= &= nbsp; &nbs= p; &= nbsp; &nbs= p; Return to top

Peru has signed bilateral investment agreements with 29 countries (listed below), but not with the United States. T= he U.S.-Peru Trade Promotion Agreement (PTPA), pending approval by the U.S. Congress, would eliminate the need for a bilateral investment agreement.

Peru's Current Bilateral Investment Agreements:

Argentina (1994)	El Salvador (1997)	Portugal (1994)
Australia (1995)	Finland (1995)	Rumania (1994)
Bolivia (1993)	France (1993)	Singapore (2003)
Chile (2000)	Germany (1995)	Spain (1994)
China (1994)	Italy (1994)	Sweden (1994)
Colombia (1994)	Korea (1993)	Switzerland (1991)
Cuba (2000)	Malaysia (1995)	Thailand (1991)
Czech Rep (1994)	Netherlands (1994)	United Kingdom (1993)
Denmark (1994)	Norway (1995)	Venezuela (1996)
Ecuador (1999)	Paraguay (1994)

OPIC and Other Investment Insura= nce Programs = ; &n= bsp; Return to top

The Overseas Private Investment Corporation (OPIC), an independent U.S. Governm= ent agency, offers medium- to long-term financing and political risk insurance. OPIC signed agreem= ents with Peru in December 1992, and in July 1994, OPIC began approving requests= for political risk insurance (including for inconvertibility of currency). In 2001, OPIC provided project fin= ance loans of USD 108.4 million. In 2005, OPIC provided USD 800 million worth of insurance coverage for a copper mine and a startup finance company received USD 27 million worth of OPIC insurance coverage. Because o= f the free convertibility of currency, the U.S. Embassy purchases Peruvian curren= cy for expenses on an as-needed basis, at the market exchange rate. The risk of significant depreciati= on of the exchange rate over the next year is negligible. Peru is a member of the Multilater= al Investment Guarantee Agency.

Labor &n= bsp; = ; &n= bsp; = ; &n= bsp; = ; &n= bsp; Return to top

Labor is abundant and trainable, although there are shortages of highly skilled work= ers in some fields and wages for professional staff are high (sometimes higher = than U.S. wages in the mining sector for positions in the managerial and consult= ing fields). The presence of orga= nized labor in the Peruvian economy has declined; in 2005, 8.6 percent of the lab= or force was organized. Unemploy= ment in Lima officially stood at 7.2 percent in October 2006, compared with 7.9 percent a year earlier. Surve= ys show that 53.5 percent of Lima's economically active population was underemployed in the third quarter of 2006, mostly working in the informal sector for below subsistence wages. The statutory monthly minimum wage was raised in January 2006 to 500 soles (about USD 155). Some workers, like miners, are highly paid and also (per statute) receive a shar= e of company profits.

In 1991-1992, a new labor law and other related statutes replaced extremely inflexible old statutes and regulations.&n= bsp; The new laws allow for multiple forms of unions across company or occupational lines, thus permitting multiple unions in the same company. Workers in probation status or on short-term contracts are not eligible for union membership. Bargaining agreements are consider= ed contractual agreements, valid only for the life of the contract. Productivity provisions must be in= cluded in any collective bargaining agreement.&nb= sp; The number of officials and the amount of time union officials may devote to union work with pay is limited to 30 days per year. Unless there is a pre-existing lab= or contract covering an occupation or industry as a whole, unions must negotia= te with each company individually. A labor law passed in July 1995 liberalized hiring. Business leaders lauded the above changes, saying they led to greater efficiency. Labor leaders disagreed, arguing t= hat the new labor laws eroded labor protections and encouraged outsourcing in a= way that undercut union activity.

With Peru's return to democracy in 2000, Peruvian organized labor regained some,= but by no means all, of the protections enjoyed in the pre-Fujimori era. A decision by the Constitutional Tribunal in 2004, for example, legitimized collective industry-wide bargain= ing in the civil construction industry. Labor leaders saw this as a potential precedent to be applied to oth= er activities, but that has not yet happened.= Furthermore, new laws added to labor inflexibility because the restr= ictions for termination and downsizing have made businesses reluctant to hire new employees and have created incentives to outsource.

Either unions or management can request binding arbitration in contract negotiations. Strikes can be = called only after approval by a majority of all workers (union and non-union) voti= ng by secret ballot and only in defense of labor rights. Unions in essential public service= s, as determined by the government, must provide a sufficient number of workers during a strike to maintain operations.

The 1993 Constitution provides for a maximum workday of eight hours, with 48 hours as the maximum week. The labor c= ode also sets 24 hours rest per week and 30 days paid annual vacation for all workers. Workers readily sacr= ifice these and other benefits in exchange for regular employment. Strike activity declined markedly = over the ensuing nine years and since new labor laws were passed, worker efficie= ncy rose substantially. However, strikes and militant industrial action increased again in late 2002 and ear= ly 2003, with additional strikes in 2004.&nbs= p; The overall number of strikes fell in 2005. Through October 2005, there were 58 strikes with a loss of 442,586 man-hours, compared with 91 strikes and a lo= ss of 515,480 man-hours in the same period of 2004.

Congress continues to debate a comprehensive labor law reform, which may result in a return to inflexibility of the conditions of dismissal for employees.

Foreign-Trade Zones/Free Ports= &= nbsp; &nbs= p; &= nbsp; &nbs= p; Return to top

Peruvian law currently covers two types of free trade zones: export, transformation, industry, = trade and services zones (CETICOS), and a free trade zone (ZOFRATACNA) in Tacna.<= span style=3D'mso-spacerun:yes'> The rules and tax benefits applyin= g to these zones are the same for foreign and national investors.

Companies established at the CETICOS and ZOFRATACNA, which export no less than 92 per= cent of their output (more than 80 percent of production for the Loreto CETICOS = and more than 50 percent for ZOFRATACNA), are exempted until 2012 from all taxe= s, dues and contributions to the central government and municipalities, particularly income, sales (IGV), Municipal Promotion (IPM) and excise (ISC) taxes. CETICOS exist at Ilo, Matarani and Paita, with one authorized but not operating at Loreto. There is a concern that the Peruvi= an Government does not have the proper WTO waivers to validate the CETICOS exp= ort requirement. The U.S. automot= ive industry has expressed a specific concern that U.S. brands are unable to compete with used Japanese vehicles that enter the Peruvian market duty-free through the CETICOS. Importers located in ZOFRATACNA pay only 8 percent customs duties (normal rates are 1= 2 or 20 percent) on 1,086 items sold to retailers in the city of Tacna.

Foreign Direct Investment Statistics<= span style=3D'mso-tab-count:2'> &= nbsp; &nbs= p; &= nbsp; &nbs= p; Return to top

The stock of registered foreign direct investment in Peru was USD 14.3 billion = in December 2006, according to ProInversion, versus USD 13.9 billion at the en= d of 2005. ProInversion data place Spanish investors as holding the largest share (33 percent), with USD 4.7 billion invested. The United = States is the second largest investor, with USD 2.3 billion, and the United Kingdo= m is third, with USD 2.2 billion. However, according to the U.S. Department of Commerce, U.S. register= ed investment in Peru through December 2006 totaled USD 3.9 billion on a replacement-cost basis. The statistics are skewed because ProInversion records investments on the basis= of country registry, rather than control.&nbs= p; Thus, an investor registered in the Bahamas, for example, is recorde= d as British even if the parent is a U.S. company. As a result, U.S.-controlled inves= tment represents a much higher share than the official 15.8 percent. By sector, communications received= 34.7 percent of foreign direct investment in 2006, followed by the manufacturing industry (15.3 percent), mining (14.8 percent), and finance (12.5 percent).=

As of the end of 2006, investors had signed 640 legal stability contracts with the Government of Peru through ProInversion.&n= bsp; Legal stability contracts commit the government not to apply any fut= ure changes in the income tax, labor and other laws governing a specific invest= ment in exchange for commitments to invest a given amount. In addition to these contracts, the Government of Peru has signed numerous tax, foreign exchange and administra= tive stability contracts through several ministries, mainly the Ministry of Ener= gy and Mines.

Web Resources = &nb= sp; = &nb= sp; = &nb= sp; Return to top

Andean Community: http://www.comunidadandin= a.org/endex.htm

IPR Toolkit: http://www.buyusa.gov/peru/= en/166.html

Lima Airport Partners: http://www.lap.com.pe/

Lima Stock Exchange: http://www.bvl.c= om.pe/english/

Ministry of Energy and Mines: http://www.minem.= gob.pe/

National Institute for the Defense of Competition and Protection of Intellectual Property: http://www.indecopi.gob.p= e/

National Society of Mining and Petroleum: http:= //www.snmpe.org.pe/

Nation= al Superintendency of Taxation: http://www.sunat.gob.pe=

National Supervisory Committee of Corporations and Securities: http://= www.conasev.gob.pe/

Overseas Private Investment Corpora= tion: http://www.opic.gov/

Overseas Security Advisory Council:= http://www.ds-osac.org/

Petroperu: http://www.petroperu.com.pe/

ProInversion: http://www.proi= nversion.gob.pe/english/default.asp

State Procurement Council: http://www.co= nsucode.gob.pe/

Superintendency of Banking and Insu= rance: http://www.sbs.gob.pe/

Tacna Free Trade Zone: http://www.zofratacna.co= m.pe/home_ing.htm

Dun & Bradstreet S.A.C.: http://w= ww.dnbperu.com.pe/eng_default.asp=

Chapter 7: Trade and Project Financing

How Do I Get Paid (Methods of Payme= nt) &= nbsp; &nbs= p; &= nbsp; Return to top

The most common method of payment for exports to Peru is via open accounts, accounti= ng for 60% of total transactions, according to Banco de Crédito del Perú, Peru’s largest bank.&nb= sp; Open account use has increased dramatically as Peru’s economy = has strengthened since 1990. Documentary collections are the second most common payment method, involving over 20% of total transactions, with letters of credit accounting= for about 16% of transactions (down from close to 100% before 1990). Other payment methods are also use= d, including factoring, banker’s acceptances, cash in advance, etc. Banks are the usual collectors for exports to Peru.

The leading credit-rating agency in Peru is Dun & Bradstreet S.A.C. (www.dnbperu.com.pe; dnb@dnbperu.com.pe), followed by Cre= dit Report S.A. (gerenciape= @creditreportgroup.com) and Coface Peru (http://www.coface.co= m.pe; coface.peru@coface.com.pe)= .

There are three credit-reporting agencies in Peru, Infocorp/Equifax (www.infocorp.com.pe; info@infocorp.com.pe), CERTICOM (www.certicom.com.pe; certicom@certicom.com.pe), and CrediTrade S.A.: (www.creditrade.biz= ; info@creditrade.biz).

The Securities and Exchange Supervisory Agency (CONASEV) lists the following fo= ur risk-rating agencies:

- Apoyo & Asociados Internacionales S.A.C. Clasificadora de Riesgo = (www.aai.com.pe)

- Clasificadora de Riesgo Pacific Credit Rating SAC (www.ratingspcr.com)

- Class & Asociados S.A. Clasificadora de Riesgo (www.classrating.com)

- Equilibrium Clasificadora de Riesgo S.A. (www.equilibrium.com.pe)

How Does the Banking System Oper= ate &= nbsp; &nbs= p; &= nbsp; Return to top

With the opening to foreign institutions in the early 1990s, the Peruvian financial system modernized rapidly and became very competitive. Peru's banking system is composed = of 11= 4= commercial banks, ~~and~~ 41= 0= municipal and rural savings banks and microfinancial institutions, ~~together with~~ ~~four~~and 4 government-owned entities:= the Central Bank (Banco Central de Reserva del Peru, or BCRP), the government's financial agent (Banco de la Nacion), and two development banks (COFIDE and= the Agrarian Bank). These institu= tions--along with 4= ~~fourt= hree~~ finance companies, 5<= span class=3DmsoDel>~~five~~s~~i= x~~ leasing companies, 4= ~~four~~f~~ive~~ priv= ate pension funds administrators, 13<= span class=3DmsoDel>~~thirteen~~t~~welve~~ in= surance companies<= ins cite=3D"mailto:Marcos%20C%20Mandojana" datetime=3D"2007-02-01T15:39">, and 20= ~~twenty=~~ ~~2= 9~~ miscellaneous companies--are regulated by the Superintendency of Banks, Ins= urance and Pension Funds Administrators (known by its Spanish initials, SBS). SBS policy is generally to follow regulatory guidelines set by the ~~Basel,=~~ Switzerland-based Bank for International Settlements (BIS) where possible. For example, bank financial statem= ents must be audited in compliance with internationally accepted auditing standa= rds; in cases not covered by BIS guidelines, regulators use standards set by the= (U.S.) Financial Accounting Standards Board. In addition, SBS regulations require that all deposit-taking institutions have periodic compulsory assessments by at least two independe= nt credit rating agencies, whose capacity to perform is assessed by the SBS.

Customer deposits carry ~~deposit~~ insurance financed by commercial bank contributions to an insurance fund. The amount is adjusted quarterly on the basis of the wholesale price index. For the ~~September 2005-~~= December 20065= -= F= ebruary 2007 period, accounts were insured up to = 75,742~~7= 3,317~~ new sols (, about $231= ,6= 7~~5= 0~~0 ~~at current exchange rates~~). As it is legally empowered to do, t= he Central Bank envisions having to act as a "lender of last resort"= in the case of a run on any commercial bank only up to the limit of the bank's= net worth, since the SBS has set liquidity requirements on deposits and other short-term liabilities at relatively high levels. Banks must also meet liquidity requirements on all short-term liabilities, including amounts due to banks outside of Peru. Should the n= eed arise (in cases of currency stress), the Central Bank has immediate access = to ~~j= ust~~ ~~o= ver~~ $66= 2~~4= 0~~ million in credits from the Latin American Reserves Fund (Fondo Latinoameri= cano de Reservas, or FLAR), for up to one month<= del cite=3D"mailto:yepezma" datetime=3D"2007-02-01T11:57"> 180 days = or $828 million for up to three years. The Central Bank can also access o= ther credits, for longer terms. U.= S. Treasury instruments back FLAR’s assets.

The banking system is highly concentrated after a consolidation process underway since 1998. As of October 200= 6= 5= , the three largest banks held about 7075% of l= oans and almost~~a= bout~~ 780= % of deposits. Total commercial banking system assets were about $24.1~~20.7~~ bil= lion, up from an earlier peak of $18.6 billion in November 2002. The commercial bank loan portfolio trended down in recent years, but rallied vigorously from February 2004, reaching $1= 4.8~~1= 2.1~~ billion in October 20065. After topping out at nearly 12% in= mid 2001, non-performing loan portfolios dropped to 1.9~~3= .8~~% at the end of October 20064, an historical record even with<= span class=3DmsoDel>by the SBS&= #8217;s tough standards. Dollarization has been trending downward since 2002, helped= by reduced as devaluation expectations ~~have contracted~~ and ~~after~~ the appreciation of the ne= w sol since 2003, to 6574% of l= oans and 63~~6= 5~~% of deposits at the end of October 20065= .

Trade financing is available to the Peruvian purchasers of U.S. goods and services through their local banks. U.= S. suppliers of goods and services also have access to the Export-Import Bank = of the United States (Ex-Im Bank), which offers loans and loan guarantees to U= .S exporters and to the foreign purchasers of U.S. goods and services. Ex-Im also provides credit insuran= ce to U.S. businesses against non-payment by foreign buyers in the case of politi= cal or commercial risk. The Overs= eas Private Investment Corporation (OPIC), an independent U.S. government agenc= y, offers medium- to long-term financing and political risk insurance. The U.S. Trade and Development Age= ncy is an independent federal agency that assists U.S. companies competing for infrastructure and industrial projects by funding feasibility studies, orientation visits, specialized training grants, business workshops, and various forms of technical assistance.&nbs= p; Its areas of concentration are agriculture, energy, environment, hea= lth care, manufacturing, mining and minerals development, telecommunications, transportation, and water resources.

Foreign-Exchange Controls &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; Return to top

The P= eruvian government eliminated foreign-exchange controls in 1990. The Central Bank, however, ~~h= as~~ kept a tight lid on the amount that local pension funds can invest in foreign securities until mid-2006. As of = <= span class=3DmsoDel>~~Since~~ November 2006, tT= his limit rose tois ~~currently~~ 1= 2~~1= 0.~~5= % of pension funds (which totaled $14.4~~9.2~~ bill= ion inby Decem~~O= cto~~ber 20065= ), a limit the new Central Bank governor has indicated will= not be restrained as ttightly as in recent y= e= ars ~~= Banking Superintendency wants to raise to 20%~~. Companies and individuals are free= to maintain and operate accounts in domestic and foreign currencies at local or foreign banks.

U.S. Banks and Local Correspond= ent Banks &= nbsp; &nbs= p; Return to top

Citibank is the only U.S. bank operating in Peru. ~~BankBo= ston sold its assets to Banco de Credito and withdrew from the market.~~ In December 2005, Canadian-based Scoti= a Bank became Peru’s = t= hird-largest bank by acquiring = Banco Wiese Sudameris and taking = majority ownership of its affiliate, Banco Sudamericano ~~Banco Wiese Sudameris accepted a buyout offe= r from Canadian-based Scotia Bank and an Italian partner. Banco Sudamericano is considering = a buyout offer as well~~. M= ost U.S. companies select a correspondent bank by soliciting a recommendation f= rom their U.S. bank. Most Peruvian banks have correspondent banking relationships with a U.S. bank or banks. As of December 20065= , the Peruvian commercial banks that had correspondent banking relationships = with U.S. banks were (in alphabetical order):

Banco BBVA-Continental (http://www.bbvabancocontinental.com)

Banco de Comercio (http://www.bancomercio.com)

Banco de Credito del Peru (http://www.viabcp.com)

Banco Financiero del Peru (ht= tp://www.financiero.com.pe)

Banco Interamericano de Finanzas (ht= tp://www.bif.com.pe)

~~Banco Sudamericano (http://www.sudameric= ano.com)~~

~~Banco Wiese Sudameris (http://www.wiese.com.= pe)~~

Citibank (http://www.citibank.com/peru)=

Interbank (http://www.interbank.com.pe)<= o:p>

Scotiabank Peru ~~Standard Chartered~~ ( = <= span class=3DmsoIns>http://www.scotiabank.com.pe<= /a>http://www.standard= chartered.com/pe/index.html).

Project Financing &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; &nbs= p; Return to top

Since the market reforms of the early 1990s, the private sector has carried out all major projects. Foreign companies have undertaken large projects, with financing obtained in their countries of registration and/or from <= /ins>multilateral development banks. In recent = years, due to the Central Bank limit on the amount that Peruvian pension funds can invest abroad, there has been intense local competition for lending, intere= st rates have fallen below those in New York and London for creditworthy companies, and local banks have increased their sophistication. ~~In 199= 9, the giant Antamina copper-zinc mining project (Peru’s largest in recent history at $2.26 billion) was partly financed by local banks. (~~The number of projec= ts totally or partly financed locally has grown since 1999. The three major banks involved in = this area are Banco de Credito del Peru, Banco BBVA-Continental and Citibank.) Some projects, such as the Camisea natural gas pipeline, have been partly financed by multilateral development banks, including the IDB, World Bank and Andean Finance Corporation (CAF), with procurement open to U.S. bidders. However, even when multilateral development banks do not participate, companies seek to buy U.= S. equipment and other goods and services.&nb= sp; Some projects have been structured with simultaneous or subsequent financing from the local capital market (e.g. corporate bonds). The U.S. EXIM Bank is an active ma= rket participant. It provided $18 million in financing for a cryogenic gas liquefaction plant, which was inaugurated in August 2005. In 2004-2005, EXIM financed numerous small projects in the agribusiness sector. There are 12 active E= XIM Bank lenders/brokers operating in Peru.&nb= sp; Contact the US Commercial Service Lima office for a list of these companies.<= /p>

Web Resources = &nb= sp; = &nb= sp; = &nb= sp; Return to top

Export-Import Bank of the United St= ates: http://www.exim.gov

Country Limitation Schedule: http://www.e= xim.gov/tools/country/country_limits.html

OPIC: http://www.opic.gov

Trade and Development Agency: http://www.tda.gov/

SBA's Office of International Trade= : http://www.sba.gov/oit/

USDA Commodity Credit Corporation: = http://www.fsa.usda.gov/cc= c/default.htm

U.S. Agency for International Devel= opment: http://www.usaid.gov

Inter-American Development Bank: http://www.iadb.org

The World Bank Group: http://www.worldbank.org

Credit Rating Agencies<= /a>

Credit Report S.A.: http://w= ww.creditreportgroup.com/HomeI.htm=

Coface Peru: (http://www.coface.com.pe<= o:p>

Informa Peru S.A.: http://w= ww.informadelperu.com/english/index.html=

Credit Report= ing Agencies

Infocorp/Equifax: www.infocorp.com.pe=

CERTICOM: www.certicom.com.pe=

Risk-Rating Agencies

Apoyo & Asociados Internacionales S.A.C. Clasificadora de Riesgo: http://www.aai.com.pe/

Clasificadora de Riesgo Pacific Credit Rating SAC: http://www.ratingspcr.com

Class & Asociados S.A. Clasificadora de Riesgo: http://www.classrating.com

Equilibrium Clasificadora de Riesgo S.A.: http://www.equilibrium.com.pe

http://www.buyusa.gov/peru/en/.

Chapter 8: Business Travel

Busin= ess Customs = &nb= sp; = &nb= sp; = &nb= sp; Return to top

Peruvi= an society is conservative therefore business dress is conservative meaning suits and = ties for men and dresses and suits for women are the norm. The currency is the Nuevo Sol. As of January 2007, the exchange r= ate was 3.25 soles to one U.S. dollar. The metric system is used for weights, measures, and mathematical expression. It is customary to exchange business cards at the initial meeting.

&= nbsp;

For further information, business t= ravelers should note that the “Foreign Service Posts: Guide for Business Representatives” is available for sale by the Superintendent of Documents, U.S. Government Printing Office, Washington, D.C. 20402; tel. (2= 02) 512-1800; fax (202) 512-2250. Business travelers to Peru seeking appointments with U.S. Embassy Li= ma officials should contact the Commercial Service in advance. The Commercial Service can be reac= hed by telephone at (511) 618-2442 or 434-3040; by fax at (511) 434-3041, by E-mail at: Lima.Office.Box@mail.do= c.gov, or see our website at

Travel Advisory &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; &nbs= p; Return to top

The U.S. Department of State issues Consular Information Sheets for all foreign countries, including Peru. Th= is document may be obtained via the Internet, at website http://t= ravel.state.gov/travel/cis_pa_tw/cis/cis_998.html, or from the Embassy website http://peru.usembassy.gov; f= rom the Consular Affairs Bureau, Office of Overseas Citizen Services, Departmen= t of State, Room 4817, Department of State, 2201 C. Street, N.W., Washington, D.= C., 20520; or from the U.S. Embassy at the address noted in Chapter 9: Contacts, Market Research, and Trade Events. Travel information in general is also available at the telephone num= ber (202) 647-5225, or fax (202) 647-3000.&nbs= p; Useful information on guarding valuables and protecting personal security while traveling abroad is provided in the Department of State pamp= hlet “A Safe Trip Abroad.” This publication, as well as others such as “Tips for Traveler= s to Central and South America,” is available from the Superintendent of Documents, U.S. Government Printing Office, Washington, D.C., 20402.

Visa Requirements &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; &nbs= p; Return to top

A valid U.S. passport is required to e= nter Peru. Tourists staying less t= han 90 days do not require a visa. I= t is recommended that business travelers to Peru travel on a tourist visa provid= ed they are not reimbursed for their services while in Peru. However, if any compensation is ea= rned and paid while in Peru, a business visa is required and a tax declaration m= ust be processed before departing Peru. This process takes approximately three days. Travelers should contact the Peruv= ian Consulate General Office in Washington, D.C. at 1625 Massachusetts Avenue, N.W., 6th Floor, Washington, D.C. 20036, telephone number (202) 462-1081, or the nearest Peruvian consulate for visa information. There are Peruvian consulates in B= oston, Chicago, Denver, Hartford, Houston, Los Angeles, Miami, New York, Patterson= , San Francisco, and Washington D.C.

In general, the Department of State recommends that all U.S. citizens traveling overseas register with the American Citizen Services Unit, Consular Section= , of the U.S. Embassy. =

Travelers may register their stay in P= eru online at https://tra= velregistration.state.gov/ibrs. The U.S. Embassy in Peru is locate= d on Avenida La Encalada, Block 17, Monterrico, Lima. The American Citizen Services Unit= is open from 8:00 am to 12 noon on weekdays, except U.S. and Peruvian holidays. Prior registration = will facilitate the replacement of a lost or stolen U.S. passport. The loss or theft of a U.S. passpo= rt overseas should be reported immediately to the local police and the nearest U.S. Embassy or Consulate. The Embassy telephone number is (511) 618-2000. In case of an emergency after work= ing hours, U.S. citizens should contact the Embassy at 618-2936.

For information on how to apply for= a U.S. visitor visa for foreign contacts who need to travel to the United States, = see Embassy Lima’s website:

· = ; U.S. Embassy Lima Consular Section: http://lima= .usembassy.gov/visageneral.html

For general information about apply= ing for visas, see:

· = ; State Department Visa Web= site: http://travel.state.gov/vi= sa/index.html

· = ; United States Visas.gov: = http://www.unitedstatesvisas.gov= /

Please note that each applicant must qualify on their own merits, and that visas cannot be issued solely based o= n an invitation from a U.S. business or individual.

Telecommunications &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; &nbs= p; Return to top

The telecommunications industry in Peru has been steadily modernized<= /span> following the privatization of the national telephone company by Telefonica de Espana= in 1994. A long distance phone c= all to the States is around $ 0.35 per minute while Internet access is widely available at an extremely low cost (70 cents/hr.) through Internet cafes. Services are being offered such as= : ADSL Internet access, CableNet internet access, fixed wireline and wireless broadband services, Wi-Fi hot spots solutions (currently in some districts, hotels and universities) and VoIP long distance service. Telefonica purchased the assets of= Bell South and has 63% of the mobile market and 96% of the fixed line market. Some companies and individuals have complained about Telefonica’s customer service and slow installation rate. Other mobile competitor= s are Claro (America Movil subsidiary) and Nextel.

The Ministry of Transport and Communications is working on new regulations such as number portability for mobile phones, interoperability within telecom networks, network infrastructure sharing am= ong utilities service providers to promote Universal Access for the lower income population.

Broadband access through Internet cafes is wide= ly available in all cities and in most small towns. Mobile phones with the following protocols work in the local market: GSM/GPRS 1900 MHZ band (same as U.S.), CDMA1x -request international roaming service with your U.S. provider and Nextel Direct Connect radio service.

For travelers to Peru, a BlackBerry device will function if it has GSM/GPRS service, which can be provided by Cingular/AT&T Wireless or T-Mobile in= the U.S. For long distance calling there are a variety of pre-paid calling cards with very low cost, as well as Nextel's International Direct Connect with Peru's only all-you-can-eat f= lat rate for long distance. Long distance Direct Access through credit card numbers for AT&T, Sprint, and MCI WorldCom is also available. International calls can be made through Net2Phone service in most Internet cafes. Major U.S. lo= ng distance calling cards are accepted at major hotels.

Transportation &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; &nbs= p; Return to top

There = are a number of Peruvian airlines serving routes within Peru; among them are Lan = Peru (a subsidiary of Lan Chile), Taca, L.C. Busre, Aero Condor, ATSA, and Star Peru. Lima is served by three= U.S. airlines: American, Continental and Delta Airlines with direct flights to Miami, Houston and Newark, and Atlanta.&nb= sp; Lan Peru also provides direct flights to Bogota, Buenos Aires, Carac= as, Guayaquil, Mexico, Quito, Santiago, and Sao Paulo; and to the cities of Los Angeles, Miami, and New York. In addition to Lan Peru and Lan Chile, Aerolineas Argentinas, Aeropostal, Avia= nca, Copa, Lloyd Aero Boliviano, and Taca, offer international flights to the ma= in cities in South America. All the companies flying internationally offer regular cargo services to the U.= S. and other South American countries.

Public= ground transportation is not recommended due to a high incidence of traffic accide= nts in Peru, frequently involving mini-buses and buses. Taxis are abundant and not metered= , so fares must be negotiated before getting into the cab. The Commercial Service recommends = using the more reliable radio-dispatched taxis.&= nbsp; Transportation to and from the airport by radio taxi or taxi service= is approximately U.S. $25. Tips = are not expected on short rides. = If you lease a car with a driver, a tip is common.

While Peru is three times the size of California, the country has the same amount of paved roads as the state of Rhode Island. The Ministry of Transport and Communication (= MTC) estimates the total road network has 49,100 miles from which 6,921 are pave= d, 10,685 mi. are compacted roads, 8767 mi. are gravel roads and another 22,723 mi. are trails. A new entity “ProVias” was formed in August 2002 from the Direccion Nacional= de Caminos. Both entities are in charge of new projects for road construction and design, maintenance and environmental impact studies. The financial means for such projects come from three main sources: Ministerio = de Economia, Ministerio de Transportes and Multinational Organizations such as= the IDB, Corporacion Andina de Fomento (CAF), World Bank and Japan’s Bank= for International Cooperation (JBIC). Another governmental agency, “ProInversion” has been assigned the task of leading the privatization and concession program for t= he National Highway Network System. &nbs= p; Two (2) highways have been concessioned and there are twelve (12) highway networks pending concession representing an estimated total investm= ent of US$ 2.5 billion.

The Central, South and Southeast r= ail networks were privatized in September 1999. Due to a unique structure of privatizations through traditional Latin American concessioning models and European-influence (separation of infrastructure and operations), two paral= lel companies were formed in each network.

The concession of the Central rail= way of 310 mi. and the second highest in the world awarded to Ferrovias Central Andina (FVCA) is responsible for the maintenance and provision of assets, primarily infrastructure and rolling stock. The operating company, Ferrocarril Central Andino (FCCA) is responsible for the running of trains and provisio= n of services to the customers. FC= CA provides cargo transportation of minerals, fuels, cement, and food products. It reaches the stat= ion of La Cima at 4818 meters (15,807 feet) above sea level and links the Pacific = port of Callao and the capital city of Lima with the cities of Huancayo and Cerr= o de Pasco.= FCCA recently started operating seasonal weekend tourist train services from Lim= a to Huancayo. The Mi= nistry of Transport operates the 84 mi. Huancayo-Huancavelica railroad for passeng= er and cargo services.

The South and Southeast rail network of 672 mi. is run by Ferrocarril Transandi= no S.A. (FTSA) and operated by PeruRail S.A. providing cargo transportation and linking most of the tourist highlights of the Andes in Peru. It runs daily between the port of Matarani, the city of Arequipa and the Andean villages of Juliaca, Puno and Cusco. The main products transported are fuel, wheat (for Peruvian and Bolivian consumption), coal, cement, soya flour, coffee, beer, and non-alcoholic beverages. PeruRail also provides passenger services offering the routes between either Cusco or the Sacred Valley and Machu Picchu in Aguas Calientes and between Cusco and Lake Titicaca in Puno. In addition there is a = small railway system (160 mi.) owned by the mining company, Southern Peru Copper Corp. operating Cuajone-Toquepala-Ilo.

Language &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; Return to top

Business is conducted in Spanish. Although a great number of executi= ves in the Peruvian business community speak English, promotional literature shoul= d be translated into Spanish. Quec= ha and Aymara are spoken in the Andean highlands.= High tech companies like Microsoft and Claro promote their products = in the traditional languages.

Health = ; &n= bsp; = ; &n= bsp; = ; &n= bsp; = ; Return to top

Peruvian medical facilities do not generally mee= t U.S. standards, although some private clinics do. However, if visitors take certain precautions about food and drink, the level of risk is manageable. Cholera and other infectious disea= ses such as hepatitis are present in Peru.&nbs= p; Travelers in Peru should always substitute bottled beverages for potentially contaminated water. Avoid ice cubes. Fish, shellfish and vegetables should not be eaten unless well cooked, and all fo= od should be eaten while still hot. Peeled fruits should be safe. Travelers to the jungle areas of Peru should have up-to-date yellow fever vaccine and malaria prophylaxis.&nbs= p; There are several clinics in the Lima area which have U.S. trained personnel and up-to-date medical equipment. Since U.S. medical insurance is not always valid outside the United States, supplemental insurance is useful, especially to provide coverage for medical evacuation.

Local Time, Business Hours, and Holidays = ; &n= bsp; = ; Return to top

Lima i= s situated directly south of New York and is in the Eastern Standard time zone (UTC mi= nus 5), but Peru does not follow daylight saving time. Dates are written starting with th= e day of the month, followed by the month and finishing with the year.

&= nbsp;

Busine= ss hours in Peru are generally from 8:00 a.m. to 5:00 p.m. Breakfast meetings are becoming mo= re common, and business lunches are normally scheduled between the hours of 1:= 00 to 3:30 p.m. Some shops and businesses operate from 10:00 a.m. to 1:00 p.m. and from 4:00 p.m. to 8:00 p.m., although continuous operation is increasingly common. Business offices, excluding banks,= are closed on Saturdays. In the provinces, business hours are usually from 9:00 a.m. to 1:00 p.m. and from = 4:00 p.m. to 7:00 p.m. “Peru= vian time” refers to the fact that it is acceptable to arrive a half an ho= ur to one hour late for social functions.&nbs= p; However, punctuality is generally expected for business visitors for social and business functions.

&= nbsp;

The Pe= ruvian official holidays are:

&= nbsp;

Ma= undy Thursday	Ap= ril 5, 2007
Go= od Friday	Ap= ril 6, 2007
La= bor Day	Ma= y 1, 2007
Sa= ints Peter and Paul	Ju= ne 29, 2007
In= dependence Day	Ju= ly 28-29, 2007
Sa= nta Rosa de Lima	Au= gust 30, 2007
Ba= ttle of Angamos	Oc= tober 8, 2007
All Saints' Day	No= vember 1, 2007
Im= maculate Conception	De= cember 8, 2007
Ch= ristmas Day	De= cember 25, 2007
New Year's Day	Ja= nuary 1, 2008

The Embassy is closed on these holi= days and also on the following U.S. holidays:

Ma= rtin Luther King	Ja= nuary 15, 2005
Pr= esident’s Day	Fe= bruary 19, 2007
Me= morial Day	Ma= y 28, 2007
In= dependence Day	Ju= ly 4, 2007
La= bor Day	Se= ptember 3, 2007
Co= lumbus Day	Oc= tober 8, 2007
Ve= terans Day (observed)	No= vember 12, 2007
Th= anksgiving	No= vember 22, 2007

Temporary Entry of Materials and Personal Belongings = &nb= sp; Return to top

Goods for trade fairs may temporarily enter Peru= by paying a bond - but without paying duties - and following the normal documentation requirements mentioned in Chapter 5, Section “Import Requirements and Documentation.”&nbs= p; In addition to normal passenger baggage, a cellular phone (and its accessories) and a laptop are allowed without paying duties.

To access Peruvian customs informat= ion in English, refer to:

http://w= ww.sunat.gob.pe/aduanas/version_ingles/index.html

Web Resources = &nb= sp; = &nb= sp; = &nb= sp; Return to top

U.S. Commercial Service Lima: http://www= .buyusa.gov/peru/en/

State Department Consular Informati= on Sheet for Peru: http://t= ravel.state.gov/travel/cis_pa_tw/cis/cis_998.html

U.S. Embassy Lima: http://peru.usembassy.gov

State Department Travel Registratio= n: https://travelregistration.state.gov/ibrs.

State Department Visa Website: ht= tp://travel.state.gov/visa/index.html

United States Visas.gov: http://w= ww.unitedstatesvisas.gov/

U.S. Embassy Lima Consular Section:= ht= tp://peru.usembassy.gov/geninfo.html

Peruvian Customs Information in Eng= lish: http://w= ww.sunat.gob.pe/aduanas/version_ingles/index.html

http://www.ita.doc.gov/td/tic/<= /a>

Chapter 9: Contacts, Market Resear= ch, and Trade Events

Contacts &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; Return to top

U.S. Government

U.S. Department of Commerce (U.S. E= mbassy Lima, Peru)

U.S. Commercial Service Lima=

Unit 3780

APO AA 34031

Margaret Hanson-Muse, Commercial Co= unselor

Cesar Jochamowitz, Senior Commercial Specialist

Flora Muroi, Commercial Specialist<= /span>

Tel.: (511) 618-2442, 434-3040 Fax: (511) 434-3041

E-mail: Lima.Office.Box@mail.doc.gov

Website: http://www.buyusa.gov/peru/en/

&nb= sp; www.export.gov

Trade Information Center in Washing= ton: 1-800-USA-TRADE

U.S. Department of Commerce (Washin= gton, D.C.)

14th & Constitution Avenue, N.W= . Room Nr. 3017

Washington, D.C. 20230

Maria Cameron, Desk Officer<= /p>

Email: Maria_Cameron@ita.doc.gov (Maria(underscore)Cameron@ita.doc.gov)

Tel.: (202) 482-0475 Fax: (202) 482-0464 or (202) 482-4= 726

Website: www.doc.gov/

U.S Department of State (U.S. Embas= sy Lima, Peru)

Unit 3730

APO AA 34031<= o:p>

Ambassador J.= Curtis Struble

Adam S= hub~~Timothy Stater~~, Economic Counsel= or

Hal Howard, E= conomic Officer

Marcos Mandojana~~Samantha Carl-Yoder~~, Economic Of= ficer

Miguel Yepez,= Economic Specialist

Tel.: (511) 434-3000 Fax: (511) 434-4095<= o:p>

Website: http://usembassy.state.gov/lima/wwwhmain.html<= /span>

U.S Department of State (Washington= , D.C.)

2201 C Street N.W., Room 5906

Washington, D.C. 20520

Barbar= a Thomas~~Joaquin Monserrate~~, Peru Desk Of= ficer

Email: thomasbm@state.gov<= /ins>~~monserratejf@state.gov~~=

Tel.: (202) 647-3338 Fax: (202) 647-2628

Website: www.state.gov

U.S Department of Agriculture (U.S.= Embassy Lima, Peru)

Unit 3785

APO AA 34031

Foreign Agricultural Service (FAS)<= /span>

Tel.: (511) 618-2491, 434-3042 Fax: (511) 434-3043

~~Melinda Sallyards~~E= ugene Philhower, Regional Agricultural ~~Attachè~~<= /span>C= ounselor

Email: aglima@usda.gov

Carlos Gonzalez, Agricultural Attach&= eacute;

Email: Carlos.Gonzalez@usda.= gov

Gaspar Nolte, Agricultural Speciali= st

Email: Gaspar.Nolte@usda.gov

Violeta Gutierrez, Agricultural Mar= keting Specialist

Email: Violeta.Gutierrez@usda.gov

Websites: www.fas.usda.gov (FAS), www.usdaperu.org.pe (Post)

Animal and Plant Health Inspection = Service (APHIS)

Tel.: (511) 434-4202 Fax: (511) 434-0958

~~Carolin~~ = C= arolyn Cohen, Area Director for Chile, Peru, Bolivia (resident in Santiago)

Gladys Solano, APHIS Program Specia= list

Email: gladys.solano@aphis.usda.gov

Tel.: (511) 434-4202 Fax: (511) 434-0958

Website: www.aphis.usda.gov

U.S. Department of Agriculture (Was= hington, D.C.)

14th & Independence Avenue, S.W= .

Washington, D.C. 20250

Jeanne Bailey, Western Hemisphere Area Director, Office of Foreign ~~Agricultural~~ S= ervice ~~A= ffairs~~O= perations

Email: Jeanne.Bailey@usda.gov

Tel.: (202) 720-3221 Fax: (202) 720-5183

Website: www.usda.gov

U.S. Department of Agriculture, For= eign Agricultural Service, Trade Assistance and Promotion Office:

Tel.: (202) 720-7420, Fax: (703) 87= 5-4009

Export-Import Bank of the United St= ates (Ex-Im Bank)

811 Vermont Avenue, N.W.

Washington D.C. 20571

Tel.: Toll Free (800) 565-EXIM (394= 6)

Business Development (202) 565-3900

Fax: (202) 565-3931

Email: info@exim.gov

Website: www.exim.gov

Xiomara Creque, Acting Regional Director-Americas

Tel.: (202) 565-3477 Fax: (202) 565-3931

Ken Vranich, Business Development O= fficer

Tel: (202) 565-3905, Fax: (202) 565= -3961

ken.vranich.exim.gov

Overseas Private Investment Corpora= tion (OPIC)

1100 New York Avenue, N.W.

Washington, D.C. 20527

Tel.: InfoLine: (202) 336-8799

FactsLine:(202) 336-8700

Fax: (202) 408-8959

Email: info@opic.gov

Website: www.opic.gov

Juan Carlos Rivera Montes, Manager = – Small Business Center

Tel.: (202) 336-8685 Fax: (202) 408= -5142 / 218-0182

Email: j= rive@opic.gov

Deborah Moronese, Insurance Officer= – Small Business Center

Email: Dmoro@opic.gov

U.S. Trade and Development Agency (= TDA)

1000 Wilson Boulevard, Suite 1600

Arlington, VA 22209-3901

Tel.: (703) 875-4357 Fax: (703) 875-4009

Website: www.tda.gov

Anne McKinney, Regional Director

Keith Eischeid, Country Manager

Email: keischeid@tda.gov

United States Trade Representative = (USTR) &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp;

600 17^th Street, N.W.

Washington, DC 20508

Tel.: (202) 395-7360

Website: ww= w.ustr.gov

Ambassador Susan C. Schwab, US Trade Representative

Everett Eissenstat, Assistant = U.S.T.R. Americas

Email: contactustr@ustr.eop.gov

Government of Peru

Presidencia= del Consejo de Ministros

(Presidency of the Council of Ministers)

Av. 28 de Julio 878, Miraflores

Lima – 18, Peru

Tel.: (511) 447-0168, 447-1322 Fax:= (511) 446-0469

Website: www.pcm.gob.pe

Jorge del Castillo, President of the Council of Ministers

Ministerio de Agricultura

(Ministry of Agriculture)

Psje. Francisco de Zela s/n, Jesus Maria

Lima 11, Peru

Tel.: (511) 613-5800 / 433-3034, 433-2219 Fax: (511) 432-0990, 431-0109

Website: www.minag.gob.pe=

Juan Jose Salazar, Minister

Ministerio de Comercio Exterior y Turismo

(Ministry of Foreign Trade and Tourism)

Calle Uno Oeste s/n Piso 17, Urb. Corpac, San Isidro

Lima 27, Peru

Tel.: (511) 513-6100 Fax: (511) 224= -3362

Website: www.mincetur.gob.pe =

Mercedes Araoz, Minister

Ministerio de Economia y Finanzas

(Ministry of Economy and Finance)

Jr. Junin 3= 19, Piso 4

Lima 1, Peru

Tel.: (511) 426-8495 Fax: (511) 428= -2101

Website: www.mef.gob.pe

Luis Carranza, Minister

Ministerio de Energia y Minas

(Ministry of Energy and Mines)

Av. Las Artes 260

San Borja

Lima 41, Pe= ru

Tel.: (511) 224-4301 Fax: (511) 224= -4490

Website: www.minem.gob.pe=

Juan Valdivia, Minister

Ministerio de la Produccion

(Ministry of Production)

Calle Uno Oeste s/n, Piso 7

Urb. Corpac, San Isidro

Lima 27, Peru

Tel.: (511) 616-2200 Fax: (511) 616= -2200 x705

Website: www.produce.gob.pe

Rafael Rey, Minister

Ministerio del Interior

(Ministry of the Interior)

Plaza 30 de Agosto s/n - Piso 4, San Isidro

Lima 27, Pe= ru

Tel.: (511) 225-0202 Fax: 224-2405<= o:p>

Website: www.mini= nter.gob.pe

Pilar Mazzetti, Minister

Ministerio de Relaciones Exteriores

(Ministry of Foreign Affairs)

Palacio Torre Tagle , Ucayali 363

Lima 1, Peru

Tel.: (511) 311-2402 Fax: (511) 311= -2406

Website: www.rree.gob.pe

Ambassador Jose Antonio Garcia, Minister

Ministerio de Salud

(Ministry of Health)

Av. Salaverry Cdra. 8, Piso 4

Lima 1, Peru

Tel.: (511) 431-3331 Fax: (511) 431= -0093

Website: www.minsa.gob.pe=

Carlos Vallejo, Minister

Dirección General de Salud Ambiental (DIGESA)

Las Amapolas 350, Urb. San Eugenio, Lince

Lima 14, Peru

Tel.: (511) 442-8353 Fax: (511) 422= -6404

Website: www.digesa.sld.pe

~~J= orge Alberto Albinagorta~~Dr. Maria del Carmen Gastañaga, Director

Ministerio = de Transportes y Comunicaciones

(Ministry of Transport and Communications)

Calle Zorritos 1301

Lima 1, Peru

Tel.: (511) 315-7800 Fax: (511) 315= -7618

Website: www.mtc.gob.pe

Veronica Zavala, Minister

Ministerio de Vivienda, Construccion y Saneamiento

(Ministry of Housing, Construction and Sanitation)

Av. Paseo de la Republica 3661, San Isidro

Lima – 27, Peru

Tel.: (511) 211-7930, 211-7934 Fax:= (511) 441-7761

Website: www.vivienda.gob.pe<= /span>

Hernan Garrido Lecca, Minister

ProInversion

(Private Investment Promotion Agency)

Av. Paseo de la Republica 3661, Piso 9

Lima – 27, Peru

Tel.: (511) 612-1200 Fax: (511) 221= -2941, 221-2942

Website: www.proinver= sion.gob.pe/english/default.asp

Rene Cornejo, Executive Director

Instituto Nacional de Defensa de la Competencia y de la Protección de la Propi= edad Intelectual (INDECOPI)

(National Institute for the Defense of Competition and Protection of Intellectual Property)

La Prosa 138, San Borja

Lima – 41, Peru

Tel.: (511) 224-7800 / (511) 224 7777

Fax: (511) 224-0347 / (511) 224 7800 ext. 1715, atención al ciudadano

Website: http://www.indecopi.gob.pe=

Jaime Thorne, President

Ana Maria Capurro, General Manager

Comision de Promocion de la Pequeña y Micro Empresa (PROMPYME)

(Small and Micro-Enterprise Promotion Commission)

Av. Jose Faustino Sanchez Carrion 250, San Isidro

Lima – 27, Peru

Tel.: (511) 221- 0018 / (511) 221 1131

Fax: (511) 422-4063

E-mail: direccion@prompyme.gob.pe

Website: http://www.prompyme.gob.pe=

Hugo Rodriguez, Executive Director

Servicio Nacional de Sanidad Agraria (SENASA)

Ministerio de Agricultura

(Equivalent to APHIS. Supervises sanitary conditions of imported agricultural commodities and animals)

Av. La Molina 1915, La Molina

Lima – 12, Peru

Tel.: (511) 313-3300 / anexos 1800 ó 1801= Fax: (511) 313-3315

Website: www.senasa.gob.pe

Dr. ~~V= ictor Palma~~Jose Espinoza, National Chief ~~a= .i.~~

Instituto Nacional de Recursos Naturales (INRENA)

Ministerio de Agricultura

(Supervises matters related to use, exports, development, and preservation of land and natural resources such as wetlands, woodlands and wildlife)

Calle 17 No. 355

Urb. El Palomar, San Isidro

Lima – 27, Peru

Tel.: (511) 225-3287, 224-3298 , 225 1057 (directo de Jefatura= Sr. ~~A= lvarez~~A= ngeles)

Fax: (511) 224-3218

Website: www.inrena.gob.pe

~~L= eoncio Alvarez~~Isaac Roberto Angeles, Chief

Organismo Supervisor de la Inversión en Energía y Mineria – OSINERGMIN

(Supervising Agency for Investment in Energy and Mining)

Bernardo Monteagudo 222, Magdalena

Lima – 17, Peru

Tel.: (511) 219-3400, 219-3410, 219-3411 Fax: (511) 264-0450 x.350

E-mail: osinerg@osinerg.gob.pe

Website: http://www.osinerg.gob.pe

Alfredo Dammert, President<= /span>

Organismo Supervisor de la Inversión en Infraestructura de Transporte de Uso Público = 211; OSITRAN

(Supervising Agency for Investment in Public Use Transport Infrastructure)

Av. Bolivia 144, Piso 19,= Torre del Centro Cívico

Lima – 1, Peru=

Tel.: (511) 330-7575 Fax: (511) 433-1944

E-mail: info@ositran.gob.pe

Website: http://www.ositran.gob.pe

Juan Carlos Zevallos, Pre= sident

<= /p>

Organismo Supervisor de la Inversión Privada en Telecomunicaciones – OSIPTEL

(Su= pervising Agency for Private Investment in Telecommunications)

La = Prosa 136 , San Borja

Lim= a – 41, Peru

Tel.: (511) 225-1313, 225-2145 Fax: (511) 475-1816

Website: http://www.osiptel.gob.pe

Guillermo Thornberry, President

Superintendencia Nacion= al de Servicios de Saneamiento - SUNASS

(National Superintendence of Sanitation Services)<= /p>

Av. Bernardo Monteagudo 210 – 216 Magdalena del Mar=

Lima – 17, Peru

Tel.: (511) 264-1440 Fax: (511) 264= -4020

Website: http://www.sunass.gob.pe<= /span>

Jose Salazar, President

Private Sector Associ= ations

American Chamber of Commerce of Peru (AmCham)

Av. Ricardo Palma 836, Miraflores

Lima – 18, Peru

Tel.: (511) 241-0708, 241-0710 Fax:= (511) 241-0709

E-mail: amcham@amcham.org.pe

Website: www.amcham.org.pe

Fernando De la Flor, President

Aldo Defilippi, Executive Director

Confederacion Nacional de Instituciones Empresariales (CONFIEP)

(Confederation of Private Enterprise Institutions)

Av. Victor Andres Belaunde 147, Edificio Real 3, Piso 4 San Isidro

Lima – 27, Peru

Tel.: (511) 422-3311 Fax: (511) 422= -1509

E-mail: postmaster@confiep.org.pe

Website: www.confiep.org.pe

Jose Miguel Morales, President

Ximena Zavala, General Manager

Sociedad Nacional de Industrias (SNI)

(National Society of Industries)

Los Laureles 365 San Isidro

Lima – 27, Peru

Tel.: (511) 616-4444 Fax: (511) 442= -2573 / (511) 442-2570 / (511) 616-4433

E-mail: sni@sni.org.pe

Website: www.sni.org.pe

Eduardo Farah, President

Federico De Aparici, General Manager

Sociedad Nacional de Mineria, Petroleo y Energia

(National Mining, Petroleum and Energy Society)

Francisco Graña 671 Magdalena

Lima - 17, Peru

Tel.: (511) 460-1600 Fax: (511) 460-1616 =

E-mail: postmast@snmpe.org.pe<= /span>

Website: www.snmpe.org.pe=

Carlos del Solar, President

Katerina Podesta, General Manager

Asociacion de Exportadores (ADEX)

(Exporters' Association)

Av. Javier Prado Este 2875 San Borja

Lima – 41, Peru

Tel.: (511)618-3333, 346-2530 Fax: = (511) 346-1879

Email: postmaster@adexperu.org.pe, = cid@adexperu.org.pe

Website: www.adexperu.org.pe<= /span>

Luis Vega Monteferri, President

Alvaro Barrenechea, General Manager

Camara de Comercio de Lima

(Lima Chamber of Commerce)

Gregorio Escobedo 398 Jesus Maria

Lima – 11, Peru

Tel.: (511) 463-3434, 261-4400 Fax:= (511) 463-9864

E-mail: webmaster@camaralima.org.pe=

Website: www.camaralima.org.pe

Samuel Gleiser, President

José Rosas Bernedo, General Manager

Camara de Comercio de Arequipa

(Arequipa Chamber of Commerce)

Quesada 102-104, Yanahuara

Arequipa, P= eru

Tel: (5154) 25-4188

E-mail: ccia@camara-arequipa.org.pe=

Website: www.camara-arequipa.org.pe

Mauricio Chirinos, President

Camara de Comercio de Lambayeque

(Lambayeque Chamber of Commerce)

Av. Balta 504-506

Chiclayo, Peru

Tel: (5174) 23-8081

E-mail: camara@cclam.org.pe

Website: www.cclam.org.pe=

German Fernandez Castro, President

Camara Peruana de la Construccion (CAPECO)

(Chamber of Engineering and Construction Firms)

Victor Andres Belaunde 147, Edificio Real 3, Of. 402,

San Isidro, Lima 27, Peru

Tel.: (511) 441-7032/ Direct: (511) 422 5566&nbs= p; Fax: (511) 441-7028

E-mail: gerencia@capeco.org

Website: www.capeco.org

Lelio Balarezo, President

Carlos Vegas, General Manager

Asociacion de Bancos

(Association of Banks)

Calle 41 #975, Urb. Corpac San Isidro

Lima – 27, Peru

Tel.: (511) 224-1718 / Direct: (511) 612 3303 / Switchboard: (511) 612 3333<= /o:p>

Fax: (511) 224-1707 / (511) 224 9512

Enrique Arroyo Rizo Patron – General Manager

Email: estudioseconomicos@asbanc.= com.pe

Website: www.asbanc.com.pe

Ismael Benavides, President

Asociacion de Industriales Lacteos

(Dairy Association. Producers of dairy products)

Sociedad Nacional de Industrias

Los Laureles 365 San Isidro

Lima 27 - Peru

Tel.: (511) 616 4444 ext. 165 =

Fax (511) 441-1639

E-mail: adil@sni.org.pe

Rolando Piskulich, Manager

Asociacion Peruana de Porcicultores

(Pork Producers Association. Import= ers of animals, equipment and feed grain for pork production)

Pomalca 327 Urb. Centro Comercial Monterrico, Surco

Lima – 33, Peru

Tel.: (511) 436-3729, 436-4168 Fax:= (511) 436-3729

E-mail: asoporci@terra.com.pe<= /span>

Ana Maria Trelles, General Manager

Asociacion Peruana de Avicultura

(Poultry Producers Association. Import= ers of baby chicks, equipment and inputs for poultry and egg production)

Esmeralda 255 Chacarilla del Estanque

Lima – 33, Peru

Tel.: (511) 372-1551, 372-1540 Fax:= (511) 372-1538

E-mail: apavic@apavic.com

Website: www.apavic.com

Pedro Mitma, President

Mario Berrocal, General Manager

Percy Separovich, Health Safety Manager

Fongal Lima

(Dairy Producers Association. Importers of inputs, equipment, and cattle for milk production)

Pumacahua No. 877, Of. 306 Jesus Maria

Lima – 11, Peru

Tel: (511) 431-0549 Fax: (511) 423= -4642

E-mail: fongallima@infonegocio.net.pe=

Javier Valera, President

Comite de Molinos de Trigo

(Wheat Millers Committee. Importers = of wheat)

Los Laureles 365 San Isidro

Lima – 27, Peru

Tel.: (511) 616 4444 ext. 131 / (511) 442-2460&n= bsp; Fax: (511) 442-4351

E-mail: adaly@sni.org.pe

Alejandro Daly, Manager

Market Research &= nbsp; &nbs= p; &= nbsp; &nbs= p; &= nbsp; &= nbsp; Return to top

To view market research reports pro= duced by the U.S. Commercial Service please go to the following website: http://www.export.gov= /mrktresearch/index.asp and click on Market Research Library.

Please note that these reports are = only available to U.S. citizens and U.S. companies. Registration to the site is required, but free of charge.

Trade Events = &nb= sp; = &nb= sp; = &nb= sp; Return to top

Please click on the link below for information on upcoming trade events.

http://www.export.gov/= tradeevents/index.asp

http://www.buyusa.gov/peru/e= n/32.html

= Return to table of contents

Chapter 10: Guide to Our Services

The U.S. Commercial Service offers customized solutions to help your business enter and succeed in markets wor= ldwide. Our global network of trade specia= lists will work one-on-one with you through every step of the exporting process, helping you to:

Target the best markets with our world-class research
Promote your products and services to qualified buyers
Meet the best distributors and agents for your products a= nd services
Overcome potential challenges or trade barriers

For more information on the service= s the U.S. Commercial Service offers U.S. businesses, please click on the link be= low.

(Insert link to Products and Servic= es section of local buyusa.gov website here.)