Setting Up a Company in Peru

By Ricardo Guevara Bringas

Establishing a company to do business in Peru is very often one of the major hurdles a foreigner faces when relocating  here. This articles covers the three most common areas that investors should consider. 1) What kinds of companies be set up? 2) What are the migratory issues involved? 3) What are the legal procedures that need to be followed?

Choosing the Type of Company

Foreign investors can find a large variety of companies to be established in Peru. There are many kind of limited liability companies, i.e., shareholders are liable up to the money they have contributed to the company's share capital. Among such companies, we find: the SRL (Sociedad Comercial de Reponsabilidad Limitada- Limited Liability Commercial Company that may be compared with a limited liability company) and the Sociedad Anónima – Corporation.

It may be stated that there a 3 kind of Sociedad Anónimas in Peru which are the following: Sociedad Anónima ordinaria – Standard Corporation. This Sociedad Anónima ordinaria must have less than 750 shareholders and its corporate name must be followed by the abbreviation "S.A." There is also the Sociedad Anonima Abierta which must have more than 750 shareholders. This kind of structure is normally used by big corporations with a lot of shareholders. Its corporate name must be followed by the abbreviation "S.A.A". Finally, there is the Sociedad Anónima Cerrada – Closed Corporation which must have no more that 29 shareholders. Its name must be followed by the abbreviation "S.A.C." This is a very popular company since its organization may be very flexible. For instance there is no need for a board of directors.

In addition, it must be said that there is no a minimum share capital required in Peru. However, there is a particular migratory status, i.e., foreign investor that requires a minimum share capital of USD 25,000 in order to apply for a visa.  

Migratory issues

It has been a very common practice in Peru to establish companies with only a passport and a tourist visa. Today, migratory authorities in Peru ask foreigners who hold a tourist visa to obtain a special permission to sign contracts before signing any document. The granting of such a permit is very fast, it only takes few minutes at the DIGEMIN (Peruvian General Directorate of Immigration and Naturalization).

If the foreigner lives abroad, it is possible to set up the company through a power of attorney granted to a lawyer or anybody else at the Peruvian Consulate of his country. Such power of attorney must be registered with the Registros Públicos (Peruvian Public Register). At this stage it is important to note that even tough tourists with a special permission are entitled to set up a company, they cannot assume any managerial function without having a visa that allow them to work in Peru. Directors and managers of a company must have a visa and/or a carné de extranjería (residence card).

Moreover, there is a special visa for those who want to set up a company and stay in Peru. Such visa is called "visa de inversionista" (investor visa). As it has been previously said, the investor must pay up a share capital of US$ 25.000. In addition he or she must submit a business plan before the DIGEMIN. In such document the investor must promise that the company will hire 5 employees within the 2 next years.

Legal Formalities

We will mention below the main legal formalities to be carried out when setting up a company:

• Obtaining a permission to sign contracts before the DIGEMIN
• Or, granting a power of attorney to somebody to set up the company before the Peruvian Consulate at the country of residence of the grantor and then legalizing the signature of the Consulate at the Peruvian Ministry of Foreign Affairs.
• Signing the by-laws prepared and signed by a Peruvian lawyer.
• Opening a banking account in Peru in the name of the company to be created and paying up the share capital.
• Signing the by-laws before a Notary.
• Registering the company with the Registros Públicos.
• Registering the company with the local tax authority – SUNAT in order to obtain a fiscal number – RUC.
• Obtaining the municipal authorization to open the business – licencia de funcionamiento.

Do not forget that each company has its own and particular life. So it is very important that the by-laws are well adapted to the shareholder and the activity of your business.