Peru

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Return to homepage  |  Last updated: 18 November, 2020

As a consequence of the World Health Organization's declaration of the COVID-19 as pandemic, the Peruvian Government has addressed COVID-19 as a “Sanitary Emergency” that will conclude on December 07, 2020 according to the extension established by the Supreme Decree No. 027-2020-SA (published on August 28, 2020). It later involved that Peru enters into a State of National Emergency since March 16, 2020, as approved by the Supreme Decree No. 044-2020-PCM (published on March 15, 2020). According to Supreme Decree No. 174-2020-PCM (published on Oct 29, 2020) the State of National Emergency will end on November 30, 2020.

In this scenario, the Peruvian Government has announced the following emergency measures:

• Additional home office rules to employees from private sector in order to continue with business activities during this period of Sanitary Emergency. These rules are not applicable to employees affected with COVID-19 or medical rest.
• Exceptionally, employees can withdraw up to the amount of PEN 2,400 (USD 686 approximately) from their CTS accounts (in Spanish, Compensación por Tiempo de Servicios). It is a fund to protect to the employee when they are unemployed. According to the labor rules, employers must open and transfer funds twice per year to CTS accounts to its employees. The employees can not withdraw these funds until they are in unemployed situation or when a specific rule authorize it.
• The contributions to the Private Pension Fund are suspended for the salaries to be paid in April 2020 (10% of salary). Also, the Pension Funds Administrators will not discount April fees (applicable to the flow of funds) from the funds of the employees. However, the Collective Disability and Survival Insurance (in Spanish, Seguro de Invalidez y Sobrevivencia Colectivo del Sistema Privado de Pensiones) will be discount to employees.
• Employers will receive a subsidy from the Peruvian Government equivalent to the 35% of the gross salaries of the employees which salaries are no more than PEN 1,500 (USD 429 approximately).
• Peruvian Government will pay the subsidy mentioned in the previous paragraph through credit in the account. For these purposes, the employers must previously inform the Account Code for inter-bank transfers (in Spanish, Código de Cuenta Interbancaria - CCI) to SUNAT until 13 April, 2020 through SUNAT - Online Operations.
• Companies are prohibited from applying the perfect suspension of work to those employees for whom they have received said subsidy.
  

Main Home office rules

• Prohibition of subrogation: The subrogation of functions by the employee is prohibited, as well as access to third parties of confidential information or data owned by the employer.
• The employer is authorized to impose restrictions of access to its information systems, as well as to determine and inform the employee of the applicable responsibilities in case of improper or unauthorized use of such systems.
• Compensation of expenses incurred by the employee: In case the employee provides the means to carry out activities, the parties (i.e. employer and employee) may agree to compensate the additional expenses derived from their use.
• Working day (in Spanish, Jornada Laboral): The applicable working day is that agreed between employer and employee previously to the start of home office. This working day can only be distributed up to a maximum of 6 days a week.
• Inspection: The Labor Inspection Authority exercises the functions of supervision and demanding compliance with social and labor laws during the State of National Emergency. In this sense, they constitute very serious infractions:
  • Order, demand or allow the entry or permanence of people in place of work whose activity is not excepted during the State of National Emergency.
  • Non-fulfillment of home office rules to employees considered as employees at risk (i.e. Employees with respiratory and cardiovascular diseases, diabetes, among others diseases; or that due to their age they are considered within the risk group, among other clinical factors) during the State of National Emergency or Sanitary Emergency.
    

The Urgent Decree No. 127-2020 has made the following modifications to the Home office regime:

• The employer's power to implement Home Office is no longer conditional on the Sanitary Emergency due to COVID-19.
• Home Office can be implemented until July 31, 2021.
• The Right to Digital Disconnection was recognized to workers who provide services in the Home Office modality.
  • It consists of the right of workers to disconnect from the IT resources, telecommunications and similar means used for the provision of services during days of rest, leave and periods of suspension of the employment relationship.
  • During the digital disconnection, the employer cannot require the worker to perform tasks or work-related coordination.

Perfect suspension of work

• Main aspects
  • The employee doesn´t receive salary during the perfect suspension of his work.
  • The labor relationship is not concluded.
• Scope

Exceptionally, the perfect suspension of work will be applicable whenever the employers cannot:

• Implement the home office mode with their employees; or,
• Apply the license with payment of salary; or,
• Apply another measure that maintains the labor relationship and the perception of salary, privileging the agreement with the employees.

For this purpose, it will take into account (i) the nature of the employee's activities or (ii) the level of economic impact that the employers have as of April 15, 2020 (date of entry into force of Urgent Decree No. 038-2020).

• Deadline to apply the perfect suspension of work

The perfect suspension of work may be applicable up to January 5, 2021 due to extension of the Sanitary Emergency by Supreme Decree No. 027-2020-SA (published on August 29, 2020).

Financing of Micro, Small and Medium scale companies (hereinafter, “MIPYMES”) through Factoring Companies

• The purpose of these measures is to promote the financing of MIPYMES through the aid of Factoring Companies. The following companies are considered MIPYMES:

Type of company	Annual sales according to the Supreme Decree No. 013-2013-PRODUCE
Micro company	Up to 150 Tax Units (USD 182,608 approx.)
Small scale company	As of 150 Tax Units (USD 182,608 approx.) up to 1700 Tax Units (USD 2,069,565 approx.)
Medium company	As of 1700 Tax Units (USD 2´069,565 approx.) up to 2300 Tax Units (USD 2,800,000)

• Factoring and discount operations carried out within the framework of Legislative Decree No. 1399, will access the coverage provided by the CRECER Fund in favor of factoring companies.

FAE- MYPE Program

• The FAE-MYPE Program (Business Support Fund in favor of Micro and Small scale companies) aims to promote the financing of such companies through loans for working capital, as well as to restructure and refinance their debts, in order to maintain and promote their productive development.
• For purposes of granted od credits, this companies must carry out the following activities: production, tourism, commerce or related services.
• This program lasts for 5 years.

Implementation of Reactiva Peru program aimed to the Peruvian economic system to remain operational

Background and scope:

• By means Legislative Decree No. 1455, approved under the exceptional powers granted by Peruvian Congress to the Peruvian Government and amended by Legislative Decree No. 1457, was created the Reactiva Peru Program to provide liquidity to companies that have been affected with by the paralysis of their activities as a consequence of the COVID-19.
• To achieve this purpose, the Peruvian Government will guarantee the loans in local currency that are granted by Companies of the Financial System (CFS), from April 14, 2020 until November 30, 2020 (the original date was extended by Supreme Decree No. 335-2020-EF).
• Likewise, this loans granted cannot be used to pay off previous financial obligations.
• The Operating Regulations of Reactiva Peru Program was published on April 13, 2020 and will into force on April 14, 2020.

Mechanisms for granting guarantees:

• The guarantees will be granted under the following mechanisms:
• Guarantees to the credits portfolios that are implemented through a trust.
• Individual guarantees that are implemented through a commission in charge of a commission agent (in Spanish, Comisión de Confianza) or another financial instrument of a similar nature.
• These guarantees will only serve as coverage provided that they are used exclusively in operations of the Central Reserve Bank of Peru (BCRP).
• Companies that no apply to Reactiva Peru program

Loans will not be granted to companies that are in any of the following situations:

• Having tax debts managed by SUNAT, corresponding to the tax periods prior to the year 2020, enforceable in Coactive Collection Procedure (in Spanish, Procedimiento de Cobranza Coactiva) that totaling more than one (01) Tax Unit at the time of requesting the credit.
• If it is classified in the Superintendence of Banking, Insurance and Private Pension Funds Administrators Risk Center, if as of February 2020, less than 90% of its credit operations in the Financial System have a rating of “Normal” or “With Potential Problems” (CPP).
• Companies related to the Financial System Company granting the loan.
• The companies included in the scope of Law No. 30737, Law that ensures the immediate payment of civil reparation in favor of the Peruvian State in cases of corruption and related crimes, as well as any person or legal entity subjected to processes for corruption and related crimes or whose representatives, duly accredited before the granting Financial System Company, are being investigated for said crimes; being excepted the credits of the persons or legal entities that have complied with the total payment of the civil reparation that may take place and provided that they have the status of being able to contract with the Peruvian State.
• Companies dedicated to, or intending to develop, activities or the manufacture of products indicated in the "Exclusion List" established by Annex 1 of the Regulations of the Reactive Peru Program.
• Individuals or legal entities disqualified by the State Procurement Court of Supervisory Agency for State Procurement (OSCE for its initials in Spanish).

Other conditions

• Additionally, the companies benefitted from the Reactiva Peru Program may not distribute dividends or approve and/or distribute profits during the term of the loan, with exception of amount and/or percentage corresponding to the participation in the profits of the employees.
• The credits granted under the terms and conditions of the Reactiva Peru Program cannot be refinanced or restructured through the Accelerated Bankruptcy Refinancing Procedure (PARC for its initials in Spanish), created by Legislative Decree No. 1511, or another bankruptcy scheme.

Maximum coverage of guarantees:

The guarantees granted under Reactiva Peru Program will be subject to the following limits:

Small scale compa-nies

To determine the guarantees coverage, the following criteria can be used (whichever is greater): i.A maximum amount equivalent to three (03) months of average monthly sales for the fiscal year 2019, according to registers of SUNAT. ii.The amount equivalent to two (2) months average debt in force during the year 2019, according to Superintendence of Banking, Insurance and Private Pension Funds Administrators for credits to small scale companies, up to a maximum of PEN 40,000.00 (equivalent to USD 11,765 approx.)

Other compa-nies

The guarantees covers a maximum amount equivalent to three (03) months of average monthly sales for the fiscal year 2019, according to registers of SUNAT.

• In addition, must be considered that the guarantee granted by the Reactiva Peru Program the following coverage percentages on the loans (covering the outstanding balance of the loan granted): 

Total loans per debtor company (in local currency)	Guarantee coverage(%)
Up to PEN 90,000.00 (USD 26,470.58 approx.)	98%
As of PEN 90,001.00 (USD 26,470.88 approx.) to PEN 750,000.00 (USD 220,588.24)	95%
As of PEN 750,001.00 (USD 220,588.53) to PEN 7´500,000.00 (USD 2,205,882.35 approx.)	90%
As of PEN 7´500,001.00 (USD 2,205,882.65 approx.) to PEN 10´000,000.00 (USD 2,941,176.47approx.)	80%

About the use of guaranteed loans:

The guaranteed credits may not be used by the companies benefiting with the Reactiva Peru Program to finance the following:

• Acquisition of fixed assets.
• Purchase of shares or participations in companies, bonds and other monetary assets, as well as to make capital contributions.
• The payment of past due obligations with the CFS.
• Pre-payment of financial obligations (unexpired debt).

Activities customs allowed during the State of National Emergency

Cargo and goods transport are allowed, guaranteeing its entry and exit through ports, airports and enabled borders points, as detailed below:

Activities customs allowed during the State of National Emergency:

Cargo and goods transport carried out in the land, maritime and railway area.

All other activity related to cargo and goods transport carried out in the land, maritime and railway area, such as services provided by (i) general agencies, (ii) maritime agencies, (iii) customs agencies, (iv) cargo agencies, (v) warehouses, (vi ) logistics operators, (vii) suppliers, (ix) packaging, (x) pallet suppliers, (xi) vehicle custody companies, (xii) cargo inspections, (xiii) document delivery providers, (xiv) Tow track, (xv) vehicle maintenance shops, among others.

Customs/Import

• Temporary reduction to 0% of the CIF ad valorem tariff rate applicable to the import of goods (medicines and medical equipment) that are listed in the appendix of Supreme Decree No. 059-2020-EF, published on 28 March, 2020 (i.e. Chlorine, Sulfuric Acid, Anesthetics, esters, medical mask, among others).
• This measure is applicable for 90 calendar days counted as of 12 March, 2020. By means of a Supreme Decree, this period may be extended.
• Once the Sanitary Emergency is over, the customs duties will be applied to the importation of such goods (tariff rate: 6% or 11%, as the case may be).

Customs Procedures and Regulations

• The following customs procedures it will be in force on July 31, 2020:
  • Outright Exportation” – DESPA-PG.02 - Version No. 7.
  • Acts related to the exit of goods and means of transport” – DESPA-PE.00.21 – Version No. 1.
  • Material for Aeronautical Purposes”- DESP-PG.19 – Version No. 3.
• The following customs procedures have been modified:
  • Customs Warehousing – DESPA-PG.03-A – Version No. 1.
  • Physical Inspection – Extraction and Analysis of Samples – DESPA-PE.00.03 – Version No. 3
• The following procedures were approved:
  • Request  for Electronic Rectification of Declaration– DESPA-PE.00.11 – Version No. 3.
  • Import for Consumption – DESPA.PG.01 – Version No. 8.

Export of goods necessary to fight COVID-19

• It has been established that the export of goods that aid the fight against COVID-19 must have the approval of the Ministry of Health, regardless of the customs regime applicable to the specific good. The opinion of the Ministry must be issued within a maximum period of five (05) business days, under responsibility, and must then be communicated electronically to SUNAT.

Discretional application of customs fines

• SUNAT will not impose custom fines on Trade Operator (in Spanish, Operador de Comercio Exterior), intervening or third-party operator (in Spanish, Operador Interviniente o Tercero) that incurred that are incurred in the Intendancies of Customs of Chimbote, Mollendo, Pisco, Puerto Maldonado and Tarapoto, provided the following conditions are met:
  • The custom fine is incurred between July 1, 2020 and July 12, 2020 and that the custom penalty must be listed in the appendix I included in the Resolution No. 013-2020-SUNAT/300000 (published on July 5, 2020).
  • The custom fine is incurred between July 13, 2020 and July 31, 2020 and that the custom penalty must be listed in the appendix II included in the Resolution No. 013-2020-SUNAT/300000 (published on July 5, 2020).
  • The correct and/or omitted information was transmitted or registered.
    

Suspension of importation of products that can transmit the Avian Influenza Virus

• Suspension for a period of 180 calendar days, counted from April 19, 2020, of the following:
  • The importation of live birds, fertile eggs, SPF eggs, poultry meat and other products that can transmit or serve as vehicles for the Avian Influenza virus, from the states of North Carolina and South Carolina of the United States of America.
  • The cancellation of all sanitary import permits for the products described above, issued until April 18, 2020.
• These measures will not be applicable to merchandise that is in already in transit to Perú, allowing its entry whenever the corresponding sanitary inspections are carried out.
  

Suspension of Custom Procedures

• Suspension of Custom Procedures overseen by SUNAT and the Tax Court.
  • For Custom Procedures subject to positive and negative administrative silence (pending) this period began on March 16, 2020 and concludes on June 10, 2020, restarting on June 11, 2020.
  • For the others Custom Procedures (to be started or in process) this period began on March 23, 2020 and concludes on June 20, 2020 restarting on June 11, 2020.
    

Suspension of Custom Legal Proceeding overseen by Judiciary Branch

• Suspension of Custom Legal Proceedings overseen by Judiciary Branch until June 30, 2020.

Refund of Balance in Favor of the Exporter

• The Exporters that generated a net revenue not higher than 5,000 Tax Units during 2019 (PEN 21 MM = USD 6 MM approximately), may request the refund of Balance in Favor of the Exporter (in Spanish, Saldo a Favor Materia de Beneficio) by means Virtual Form No. 1649. The tax rules regarding natural disasters will apply to such refund requests.

Mandatory guidelines to develop proceedings and protocols to prevent the spread of COVID-19 in the Peruvian port facility

• The National Port Authority has approved the “Mandatory guidelines to develop proceedings and protocols to prevent the spread of COVID-19” that must be observed in all port facilities that conform the Peruvian Port System.

Reactivation, Continuity and Efficiency of the logistical operations of foreign trade

• Legislative Decree No. 1492 (published on May 10, 2020) provides various measures for the reactivation of logistical foreign trade operations linked to the entry and exit of goods and cargo transportation means to or from Peru, which includes the provision of cargo transportation services. and merchandise, linked to the foreign trade logistics chain, in all its modes, as well as activities related to it, in accordance with the provisions of the Peruvian Ministry of Transport and Communications.
• Among other provisions, Peruvian public entities are required to automate their processes and replace physical documents for digital or digitized documents, and exchange data between them, (i) in order to prevent the displacement of people, in order to prevent the spread of diseases, (ii) thus as to optimize the use of public resources, and (iii) decrease the transaction costs involved in foreign trade operations. The presentation of documents in physical form is exceptional.
  

Flexibilization of the credit risk provision rate – REACTIVA PERU and FAE-MYPE – Measure applicable to banks entities

• Exceptionally, a credit risk provision rate of 0% will be applicable to the part of the credits covered by REACTIVA PERU and MYPE Business Support Fund (FAE-MYPE) guarantee when credit counterparty substitution is applied.

Licenses and Environmental Certifications / Extension

Special measures are adopted to facilitate the processing, evaluation, approval or extension of the validity of qualifying titles in completed or pending administrative procedures, as well as Environmental Certifications, with the purpose of reactivating the process of promotion and execution of the projects of Public, Private and Public Private Investment. In this sense, the validity of the Licenses and Environmental Certifications that were necessary for the implementation of said projects, whose validity ends until December 31, 2020, remain in force for an additional twelve (12) months.

Accelerated Bankruptcy Refinancing Procedure

In order to ensure credit recovery and continuity in the payment chain in the national economy at all levels, through Legislative Decree No. 1511 (published on May 12, 2020), the Accelerated Bankruptcy Refinancing Procedure (PARC for its initials in Spanish) which will allow that companies affected by the liquidity crisis caused as a result of the spread of Covid-19 (Coronavirus), to celebrate a Business Refinancing Plan with their creditors, managing to reschedule their unpaid obligations, avoid their insolvency, loss of business and sources of employment. Qualified Entities can apply to benefit from PARC until December 31, 2020. This procedure will be supervised by Commission of Bankruptcy Proceedings of INDECOPI.

Previous Control of Transactions of Concentration Operation

The entry into force of the Emergency Decree No. 013-2019, the Emergency Decree establishing the Previous Control of Transactions of Concentration Operations, is extended until March 1, 2021, with the aim of modifying certain provisions to strengthen the previous evaluation system, as well as adequately incorporate the necessary implementation actions.

Among other provisions, the following anti-avoidance rule is established to determine if there is a concentration operation: The set of acts or operations carried out between the same economic agents within a period of 2 years shall be understood as a single transaction concentration operation.

On the other hand, it should be noted that Congress approved the Bill that proposes to replace the text of Emergency Decree No. 013-2019. On October 22, the Consumer Defense Commission presented the Opinion of the replacement text. Currently, it is under evaluation by the Executive Power.

Tax: Ahmed Vega – ahmedvega@Kpmg.Com
Legal: Roberto Casanova-Regis – rcasanovaregis@kpmg.com; Edgar Vera - egvera@kpmg.com