PERU Law and Practice Contributed by: Renzo Salvatore Monroy Pino, Roberto Shimabukuro Miyasato, Aníbal Urtecho Gómez and Alexander Montenegro, Monroy & Shima Abogados
negotiations. The settlement was presented by the government as both a defence of national economic interests and a reaffirmation of Peru’s commitment to investors and international trading partners. Use of Annulment Proceedings Peru has exercised its right to request annulment of ICSID awards in certain cases when it considered there were sufficient procedural or legal grounds. Grounds typically invoked include excess of powers by the tribunal, serious departure from fundamental rules of procedure, and lack of reasoning in the award. Consequences of Default The declaration of default in the Kuntur Wasi case has multiple consequences: • authorisation of forced execution on state assets in the USA; • damage to Peru’s reputation before the interna- tional investment community; • increased financing costs for future projects; • risk of deterring foreign capital inflows; and • direct payment on attached assets without going through the national budget system. Assessment Peru’s enforcement record reveals institutional capac- ity to manage awards effectively when there is proper co-ordination and political commitment, as evidenced by Gramercy . However, the Kuntur Wasi default dem - onstrates ongoing challenges in ensuring consistent, timely responses to enforcement proceedings across all cases. 2. Investment Treaties, Free Trade Agreements and Investment Laws 2.1 Bilateral and Multilateral Investment Treaties Peru has ratified approximately 31 bilateral invest- ment treaties (BITs) with various countries. Addition- ally, Peru has incorporated investment protection chapters into numerous free trade agreements (FTAs), which provide comparable or even more comprehen- sive protection than traditional BITs. These include trade agreements with the USA, Canada, China, the
EU, EFTA (European Free Trade Association) mem- ber states, and fellow members of the Pacific Alliance (Chile, Colombia and Mexico). Peru is also a party to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), a multilateral trade agreement that includes robust investment protection provisions. In total, Peru has more than 50 bilateral and multilateral instruments containing investment protection mechanisms. Main Trading Partners Peru’s BITs include treaties with countries from dif- ferent regions: • Asian countries ‒ Australia, China, South Korea, Malaysia, Singapore, Thailand, and Japan; • Americas ‒ Canada, the USA, Cuba, El Salvador, Argentina, Bolivia, Chile, Colombia, Ecuador, Para- guay, and Venezuela; and • European countries ‒ Germany, Belgium-Lux- embourg, Denmark, Spain, Finland, France, the Netherlands, Italy, Norway, Portugal, the UK, Czech Republic, Romania, Sweden, and Switzerland. Beyond BITs, Peru’s FTAs with investment chap- ters cover major trading partners, including the USA (through the USA‒Peru Trade Promotion Agreement), the EU, China, Canada, South Korea, and CPTPP member states (eg, Australia, Japan, New Zealand, Singapore, and Vietnam). Future Treaty Activity Peru continues to actively pursue investment pro- tection agreements. The country maintains ongoing negotiations and exploratory discussions with several partners, including potential agreements with India, Turkey, and Central American countries. Peru’s strat- egy has evolved from standalone BITs towards incor- porating investment protection within comprehensive trade agreements, reflecting modern trends in interna- tional investment law that balance investor protection with state regulatory sovereignty. 2.2 Model Bilateral Investment Treaty Peru has adopted a flexible approach to investment treaty negotiations rather than applying a single standardised model. The country’s treaty practice has evolved according to negotiating era and treaty part-
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