Mergers and Acquisitions (M&A) in Peru: Legal Procedures and Guidance

With Support from Cosmos Legal

Peru’s corporate landscape has become increasingly attractive for mergers and acquisitions (M&A) due to its stable legal framework, growing economy, and strategic position in Latin America. Successfully navigating M&A processes in Peru requires understanding corporate law, tax regulations, and due diligence requirements. Cosmos Legal, experienced in cross-border transactions and corporate law, provides expert guidance to ensure a smooth and compliant M&A process.

1. Legal Framework for M&A in Peru

M&A transactions in Peru are governed by:

• Peruvian Companies Law (Ley General de Sociedades)

• Commercial and civil codes

• Securities and financial market regulations (for public companies)

• Tax laws governing asset transfers, corporate restructuring, and shareholder equity

Types of M&A in Peru include:

• Merger: Combining two or more companies into a single legal entity

• Acquisition: Purchase of a company’s shares or assets by another entity

• Consolidation: Formation of a new company from the assets and operations of multiple companies

Cosmos Legal ensures that all legal and regulatory requirements are met, protecting both buyers and sellers throughout the transaction.

2. Key Steps in the M&A Process

Step 1: Due Diligence

• Examine financial, legal, operational, and regulatory aspects of the target company

• Assess contracts, intellectual property, employment matters, and tax compliance

• Identify potential risks and liabilities

Cosmos Legal assists with comprehensive due diligence to uncover critical legal and financial issues.

Step 2: Structuring the Transaction

• Decide whether the transaction will involve asset purchase or share purchase

• Draft the M&A agreement, covering terms, representations, warranties, and indemnities

• Consider financing arrangements and regulatory approvals

Step 3: Regulatory Approvals

• Notify or obtain approvals from the Public Registry (Registro Mercantil) for mergers or restructurings

• Seek clearance from competition authorities (Indecopi) if required for market concentration

• Ensure compliance with tax authorities (SUNAT) for asset transfers or restructuring

Cosmos Legal ensures timely submission and compliance with all regulatory obligations.

Step 4: Execution and Closing

• Transfer shares or assets according to the agreement

• Update corporate records and share registers

• Complete required tax filings and notifications

3. Special Considerations

• Foreign Investors: May require approval from the Ministry of Foreign Trade and Tourism or other government agencies

• Employee Rights: Employment contracts may need to be transferred or renegotiated

• Intellectual Property: Proper assignment of patents, trademarks, and licenses is critical

• Tax Planning: M&A transactions often involve strategic tax planning to optimize efficiency

4. Benefits of Professional Legal Support

• Ensure compliance with Peruvian corporate, tax, and competition laws

• Minimize transactional risk through detailed due diligence

• Streamline documentation, approvals, and closing processes

• Protect the interests of both buyers and sellers in complex transactions

Conclusion

Mergers and acquisitions in Peru involve detailed legal, financial, and regulatory processes. Foreign and domestic investors benefit greatly from professional guidance to navigate these complexities. With expertise in cross-border transactions, Cosmos Legal provides end-to-end support for M&A transactions, ensuring compliance, minimizing risks, and facilitating successful corporate growth.