For investors researching how to incorporate a company in Peru, it is important to consider the regulations the country has. A map of Peru and its key cities is important when deciding where to incorporate a company in Peru. According to the World Bank Group’s Doing Business Index, Peru ranks as the third-best country in Latin America for doing business. The government has a track record of improving the country’s commercial environment. Legislation has been passed to facilitate foreign investment and treat both foreign and local companies equally. Moreover, incorporating a company in Peru is a relatively straightforward process. Peru offers highly competitive conditions that are worth exploring, especially if you are considering how to incorporate a company in Peru. The textile sector is experiencing an annual growth rate of 11% and is known for its highly competitive prices. In the decade between 2010 and 2019, it attracted USD$1 billion in Foreign Direct Investment. By April 2021, 37 IT projects received FDI funding and there were over 200 fintech companies collectively worth $15-20 billion. It can be overwhelming to incorporate a company in Peru, especially if you’re unsure of the legal requirements. This article will help you register your company successfully, including finding a legal representative.
9 steps to successfully register your company in Peru:
1. Understand the types of legal entities available
There are different types of legal entities to choose from when deciding to incorporate a company in Peru, including: Closely-Held or ‘Closed’ Corporation (Sociedad Anónima Cerrada or SAC), Open Stock Corporation (Sociedad Anónma Abierta or SAA), Limited Liability Company (Sociedad de Responsabilidad Limitada or SRL), Association, Foundation, Branch Office (Sucursal), Individual Company of Limited Responsibility (Empresa Individual de Responsabilidad Limitada, or EIRL). Most experts recommend a Closely-Held Corporation (SAC) for new companies in Peru. This is because it allows for easier decision-making on business activities, as a formal “Board of Directors” structure is not mandatory. With a SAC, transferring shares is also faster because the final shareholders don’t need to be registered in the Public Registries. This means there are no extra costs involved in the process when you incorporate a company in Peru.
2. Appoint a Legal Representative
A Legal Representative in Peru is the legal face of the company before government authorities. The Legal Representative makes decisions on behalf of your company on legal matters. As such, the person appointed as Legal Representative for your company holds certain legal liabilities. This individual must be either a local national or a foreign national with a valid Peruvian visa. To incorporate a company in Peru, a legal representative is required and extremely crucial to the company´s operations.
3. Choose your company name
After that, you can select and reserve your company name. The government authority in charge will confirm if your preferred name is available. In Peru, this is done by the National Superintendency of Public Registries, known locally as SUNARP). To ensure you get your preferred company name and avoid delays during this step, it’s best to provide three potential name options for SUNARP to review. You will certainly need the support of a legal representative when deciding to incorporate a company in Peru.
4. Identify your shareholders
Every legal entity in Peru must have at least 2 shareholders, with a maximum of 20 shareholders. These can be foreign individuals or other legal entities.
5. Establish a fiscal address
One important step in the guide about how to incorporate a company in Peru is related to establishing a fiscal address. You must register a fiscal address within Peru for your company in order to receive correspondence from government authorities.
6. Prepare and sign the Public Deed
When determining whether to incorporate a company in Peru, you’ll need a public deed. This means creating a draft of the constitution act and having it reviewed and approved by a Public Notary. Once approved, the Public Notary and all company owners (if there are multiple) must sign and stamp the deed. Then, you’ll present the public deed before the SUNARP.
7. Register for your tax ID
Every legal entity must be registered with the national tax authority, and get its own tax identification number. This number is known as a Registro Único de Contribuyentes (RUC). The agency responsible for this in Peru is the National Superintendency of Tax Administration (Superintendencia Nacional de Administración Tributaria, or SUNAT).
8. Open a corporate bank account and deposit your company share capital
Peruvian law doesn’t require a minimum share capital for new companies. However, to formalize your company, you need to deposit your desired share capital amount in a Peruvian bank. This will also enable you to open and activate a corporate bank account, which is crucial for those who want to operate and incorporate a company in Peru. To open a bank account, you’ll need to provide your company’s information. Consult a local lawyer in Peru to find out what documentation you need and how to prepare it properly to save time. It’s recommended to open a bank account with at least S/500.00 Peruvian soles, depending on the type of bank account.
9. Legalize your company’s accounting books
In this stage, the company needs to legalize its accounting books. If your company chooses to issue electronic accounting books, you can present them to the SUNAT via their online platform. If you choose to work with physical accounting books, check with your Peru accounting consultant on how the legalization process works. After completing this process, this new company is ready to begin operations.
