Peru - Selling to the GovernmentPeru - Selling to the Government
Many governments finance public works projects through borrowing from Multilateral Development Banks. Please refer to “Project Financing” Section in “Trade and Project Financing” for more information. When selling to the Peruvian government, interested suppliers must participate in a tender process, in which registration with the National Registry of Suppliers (Registro Nacional de Proveedores, or RNP) is necessary. The RNP includes the following categories:
Peruvian law allows an independent distributor to pay commissions or fees to third parties 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 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 distributors, and the rates vary depending on product, client, and competition.
Government agencies must announce tender notices for all major purchases in their official publications, and at times, in the main local newspapers. Peru is not a signatory to the World Trade Organization (WTO) Agreement on Government Procurement; however, the United States - Peru Trade Promotion Agreement (PTPA) includes a chapter on Government Procurement (“Contratacion Pública” in Spanish).
In spite of the PTPA’s stipulations, selling to government agencies remains problematic. In 2007, the Peruvian government passed the Government Procurement Law (Legislative Decree No. 1017 (LD 1017)) that regulates public tenders for major purchases of goods, supplies, and works by government agencies. However, the Armed Forces and National Police have continuously favored government-to-government procurements (i.e., purchases by a Peruvian government agency from a foreign government entity or government-owned company) in lieu of open tenders. In July 2012, the Government Procurement Supervisory Agency (OSCE) stated that government-to-government procurement does not fall under the jurisdiction of Peru’s government procurement law. This ruling is further substantiated in an article within the 2013 Budget Law. These legal precedents have allowed the Ministries of Defense and Interior to lobby further legislation regarding procurement contracts.
Another mechanism U.S. firms can use to sell to the Peruvian government is through Peru’s Public-Private Partnership programs. A Public-Private Partnership (PPP) allows for the participation of private investors in public infrastructure projects and/or services derived from them, either in the construction, operation and maintenance stages of a project or only in the operation and maintenance of existing infrastructure. Under Peruvian law, the types of PPPs include concession contracts, account participation, contracts for management, shared risk contracts, specialization contracts, joint ventures in addition to other contractual modalities allowed under Peruvian law.
In the PPP process, the government maintains property rights to the project infrastructure, including any new facilities built by the private investor. At the end of the contract, the property is transferred to the government. A full listing of PPP projects can be viewed at the Peruvian Private Investment Promotion Agency’s (Proinversion) website. Additionally, many governments finance public works projects through borrowing from the Multilateral Development Banks. Please refer to “Project Financing” Section in “Trade and Project Financing” for more information.
Prepared by our U.S. Embassies abroad. With its network of 108 offices across the United States and in more than 75 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.
- suppliers of goods
- services
- goods and services
- construction firms
- construction consultants
Peruvian law allows an independent distributor to pay commissions or fees to third parties 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 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 distributors, and the rates vary depending on product, client, and competition.
Government agencies must announce tender notices for all major purchases in their official publications, and at times, in the main local newspapers. Peru is not a signatory to the World Trade Organization (WTO) Agreement on Government Procurement; however, the United States - Peru Trade Promotion Agreement (PTPA) includes a chapter on Government Procurement (“Contratacion Pública” in Spanish).
In spite of the PTPA’s stipulations, selling to government agencies remains problematic. In 2007, the Peruvian government passed the Government Procurement Law (Legislative Decree No. 1017 (LD 1017)) that regulates public tenders for major purchases of goods, supplies, and works by government agencies. However, the Armed Forces and National Police have continuously favored government-to-government procurements (i.e., purchases by a Peruvian government agency from a foreign government entity or government-owned company) in lieu of open tenders. In July 2012, the Government Procurement Supervisory Agency (OSCE) stated that government-to-government procurement does not fall under the jurisdiction of Peru’s government procurement law. This ruling is further substantiated in an article within the 2013 Budget Law. These legal precedents have allowed the Ministries of Defense and Interior to lobby further legislation regarding procurement contracts.
Another mechanism U.S. firms can use to sell to the Peruvian government is through Peru’s Public-Private Partnership programs. A Public-Private Partnership (PPP) allows for the participation of private investors in public infrastructure projects and/or services derived from them, either in the construction, operation and maintenance stages of a project or only in the operation and maintenance of existing infrastructure. Under Peruvian law, the types of PPPs include concession contracts, account participation, contracts for management, shared risk contracts, specialization contracts, joint ventures in addition to other contractual modalities allowed under Peruvian law.
In the PPP process, the government maintains property rights to the project infrastructure, including any new facilities built by the private investor. At the end of the contract, the property is transferred to the government. A full listing of PPP projects can be viewed at the Peruvian Private Investment Promotion Agency’s (Proinversion) website. Additionally, many governments finance public works projects through borrowing from the Multilateral Development Banks. Please refer to “Project Financing” Section in “Trade and Project Financing” for more information.
Prepared by our U.S. Embassies abroad. With its network of 108 offices across the United States and in more than 75 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.