PERU Law and Practice Contributed by: Camilo Maruy, Maite Colmenter, Roberto Polo and Llanet Gaslac, Rebaza, Alcázar & De Las Casas
6.4 Fiduciary Investment There is no specific standard such as the modern portfolio theory (MPT) in Peru. The trustee must invest in accordance with the terms of the trust agreement. Although there is no express legal obligation to diversify investments, the trustee is expected to act in a professional and prudent man - ner at all times, in accordance with the terms of the contract and Peruvian law. It is quite common for a Peruvian fideicomiso to hold/ own the shares of an operating company. While it is not common for the trustee to operate the company whose shares are held in the fideicomiso , there is no legal restriction to prevent this. In such cases, the trustee must manage the operating company as pro - vided for under the respective trust agreement. 7. Citizenship and Residency 7.1 Requirements for Domicile, Residency and Citizenship Domicile For tax purposes, an individual will be considered domiciled in Peru under the following conditions. • Individuals with Peruvian citizenship: they will be considered domiciled in Peru when they habitually reside in the country (ie, the individual will remain in Peruvian territory for a period of more than 183 cal - endar days within a 12-month period). In this case, tax residency will only be reinstated as of the next taxable year, ie, 1 January of the following year. • Individuals with foreign citizenship: they will be considered domiciled in Peru when they have resided or remained in the country for more than 183 calendar days within a 12-month period. On the other hand, individuals, whether Peruvian or foreign citizens, who qualify as Peruvian domiciled, will lose such domiciled status in the following cases. • When they acquire migratory residence in another country and leave Peru, provided that this is evi - denced by a valid visa or a work contract with a minimum duration of one year, duly certified by the
Peruvian Consulate or its equivalent. In such cas - es, the change in tax residency becomes effective from the date on which both conditions are met. • When they remain absent from Peru for more than 183 calendar days within any 12-month period. The regulation also states that Peruvian citizens who have lost their residency status will regain it upon returning to the country, unless they do so on a tem - porary basis, defined as remaining in Peru for 183 days or less within any 12-month period. In such cases, tax residency will only be reinstated as of the next taxable year, ie, 1 January of the following year. Residency Migratory residence in Peru can be categorised as follows. • Temporary residence: individuals with no intention to permanently reside in Peru (ie, tourists). • Residence for residency purposes: allows an individual to reside in Peru. This can be granted for a fixed term or indefinitely (permanent residency) for various reasons, including work, resident family member, education, humanitarian grounds, retire - ment, among others. Citizenship Peruvian citizenship can be obtained by birth, natu - ralisation or by option. • By birth: individuals born in Peruvian territory. • By naturalisation: foreign individuals who have legally resided in the country for more than two consecutive years (and met other additional condi - tions) • By option: individuals born in foreign territory but have at least one Peruvian parents; or foreign spouses of Peruvian citizens who have legally resided in Peru for at least two years. 7.2 Expeditious Citizenship The means and requirements for an individual to obtain Peruvian citizenship include the following. • When a foreigner obtains Peruvian nationality by any means, their minor children (if applicable) may automatically acquire Peruvian nationality. The
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