Regulatory Policy in Peru 2026

This chapter reviews Peru’s strategy, practices, and impact of regulatory delivery, including its approach to regulatory enforcement and inspections. The chapter discusses the level of compliance with regulations and assesses the governance of economic regulators with a specific focus on their independence. Last, it describes processes for administrative reviews and appeals.

Line ministries and other entities must “comply with and enforce the regulatory framework related to their field of competence, exerting the appropriate sanctioning authority” (Organic Law of the Executive Branch (LOPE) and General Administrative Procedure Law (LPAG). Therefore, ministries, economic regulators and other agencies have enforcement and inspection units to perform these tasks.

There is no general policy on regulatory compliance and enforcement across government agencies, each institution has its own legal framework and its own set of enforcement practices. As a result, there is no aggregate data collected on the level of compliance with regulations. Each government body with the task of promoting compliance produces periodic or ad hoc reports that contain unstandardised information about inspections and enforcement, as well as sanctions levied. However, these data do not allow to evaluate the performance of inspectorates vis-à-vis their short- and long-term objectives. The high level of informality in the country poses challenges for the development of strategies to promote compliance. Both the Superintendency of Land Transportation of People, Cargo and Goods (SUTRAN) and the National Superintendence of Labor Supervision (SUNAFIL) reported that a high number of regulated business units operate informally, making it hard to identify them correctly and ensuring that they comply with the regulation. In fact, SUNAFIL has introduced specialised teams that help reduce informality and foster compliance in different contexts (i.e. mining industry).

According to the latest OECD Economic Survey of Peru (OECD, 2023[1]) almost 81% of all workers are employed in the informal sector. Both the SUTRAN and the SUNAFIL reported the challenge that represents to devise and implement strategies to promote compliance in the face of the high incidence of informality amongst the regulated business units.

According to business representatives, in some cases compliance is improving, especially on those areas in which the government entity is applying enforcement strategies based on technology and data and follows risk-based approaches. These includes the OEFA, as well as the OSINERGMIN. However, the lack of comparable time-series data makes an evaluation of the trend in the level of compliance not possible.

Peruvian law mandates that government entities must work towards the enforcement of the regulatory framework under their competence. There is no mandate or obligation to concentrate the duties of enforcement and inspections into a single entity. As a result, there is a plethora of units in charge of the enforcement and inspection of activities, depending on the regulatory framework and the organisation of the public administration.

In general terms, the enforcement and inspection units can be classified in two types: inspectorates within line ministries, and inspectorate agencies with a larger degree of independence. The former includes, for instance, the General Directorate of Environmental Health and Food Safety of the Ministry of Health, and the latter includes agencies such as OEFA; SUTRAN, SUNAFIL, and the economic regulators such as OSINERGMIN.

For all inspectorates except for the SBS, the LPAG regulates the way in which public administration entities interact with the public at large, through the establishment of uniform standards and principles governing all administrative acts including enforcement and inspection decisions. For instance, the LPAG sets general rules as to how to undertake administrative procedures, the use of silent is consent rule, appeal mechanisms with regard to administrative decisions, and the determination of sanctions. It is important to mention that some entities are taking steps to promote compliance by providing guidance and carrying out preventive inspections.

The legal status, degree of independence, budget and other characteristics vary across enforcement and inspection units, just as their enforcement practices do (see below). A clear example is the SBS, which is a constitutionally autonomous institution, organised under public law, which purpose is to protect the interests of the public in the fields of the financial, insurance private pensions systems, and it has the same public regime as the Central Bank of Peru.

In general terms, enforcement and inspection units manifest lack of operational and human resources to perform their duties effectively, although the issue of reported more incisively by inspectorates that depend from line ministries.

The use of risk-based and data-driven approaches to enforcement and inspections is taking place in some inspectorates, especially in those with larger degree of autonomy. One of these examples is provided by OEFA. Following a review by the OECD of its enforcement and inspection policies and practices, OEFA worked to update and upgrade its procedure and system of data analysis and collection, and as a result have implemented a structure of risk-based inspections. The inspectorate units of OSINERGMIN and OSIPTEL are also exploring approaches to plan and execute their enforcement and inspection activities following risk analyses. The OSITRAN is investing in systematising information gathering with the aim to monitor more effectively compliance obligations to enhance inspection efficiency through better data management. OSINERGMIN has approved general guidelines for planning risk-based supervision and is implementing a procedure to standardise the use of risk-prevention and risk-management activities. SUNASS and SUNAFIL informed of their plans to move towards a system of enforcement and inspection based on risk, although the lack of data and technological and financial resources hinder progress. However, these examples are few and the general rule is that the inspections and enforcement activities in Peru have in general not adopted novel approaches based on data and risk.

There is no legal obligation for inspectorates to co-operate and co-ordinate efforts. In practice, co-ordination across inspectorates happens on an ad hoc basis, or depending on the sector under regulation, but it is not a widespread practice. For instance, OEFA has established formal mechanisms to co-ordinate compliance monitoring and enforcement and inspection efforts in the environmental sector with agencies such as OSINERGMIN and other government entities with regulatory capacities in the protection of the environment.

Another common challenge for inspectorates which are not embedded within the ministry or sector regulator, is the lack of mechanisms to allow inspectorates to participate actively in the process of drafting new regulation or revision of existing ones. These inspectorates have the mandate to enforce regulations and therefore have the data and knowledge of what works and what does not in terms of regulatory compliance and can inform with quality inputs the process of drafting regulations. However, OEFA; SUTRAN and SUNAFIL report that they are seldom invited by their corresponding ministries to provide inputs during the regulatory drafting process.

The following economic regulators exist in Peru:

• The SUNASS is in charge of regulating, supervising and monitoring the provision of drinking water and sewage services.

• The OSIPTEL, is responsible for regulating and supervising telecommunications in the country.

• The OSINERGMIN is in charge of regulating and supervising electricity, hydrocarbon and mining sectors.

• The OSITRAN is the entity responsible to supervise and regulate the investment in public transport infrastructure (airports, seaport services, railways, highways, and waterway).

Each regulator is constituted through specific laws, but its main objectives, principles and normative functions are complemented on general rules approved by supreme decrees. Main organisational features and powers are stated in Law 27332: Framework Law on Regulatory Agencies for Private Investment in Public Utilities. Law 27332 also grants all Peruvian sector regulators with functions to supervise, set tariffs, issue regulations, inspect the activity of regulated entities and issue sanctions, as well as to solve conflicts and claims.

This law defines regulatory agencies as entities with administrative, functional, technical, economic and financial autonomy. Therefore, OSITRAN, OSIPTEL, OSINERGMIN and SUNASS are self-governing to define their technical guidelines, objectives, and strategies.

OECD (2017[2]) defines several dimensions that create a culture of independence in regulatory agencies, amongst them role clarity, independence of leadership, financial independence, and transparency and accountability.1

Economic regulators OSIPTEL, OSINERGMIN, OSITRAN and SUNASS have detailed functions that allow them to operate with technical and administrative independence from the central government. The main functions of the regulators are stated in different legal instruments. However, regulators depend on the PCM or MEF for the approval of several procedures, amongst them budget, strategic plan, staff assignment chart, and permission for international travel by staff, amongst others (OECD, 2023[3]).

Co-ordination with ministries includes providing non-binding technical opinions that contribute to the formulation and refinement of policies, laws, and ministerial regulations. However, the review team did not identify formal, institutionalised regular mechanisms for high-level co-ordination between the regulators and other public authorities that intervene in sector regulator.

On independence of leadership, economic regulators have adopted a commission model, composed of five board directors (with the exemption of OSINERGMIN that consists of six). The selection process is carried out through a public contest managed by a Selection Committee which includes officials from PCM, MEF and the corresponding sector ministry. The President of the Council of Ministers chooses the board member from a short list of selected candidates. Board members are appointed for a five-year term on a staggered basis. Board members can be removed through government decisions signed by the President of the Council of Ministers, the Minister of Economy and Finance, and the corresponding sector minister based on a limited and defined set of criteria.

The financial resources available for each regulator consist of up to 1% of the total annual amount of revenues from regulated entities after consumer and municipal taxes. This amount is set through supreme decree, approved by the Council of Ministries, and endorsed by the President of the Council of Ministries and the MEF. At the time of preparation of this report, for OSIPTEL and OSINERGMIN, the fee level is set at a level lower than 1%, where fees are fixed for a period of three years based on a proposal by the regulator. In the specific case of SUNASS, a recent expansion of the scope of its activities to include economic regulation of Sanitation Service Providers in small cities and rural areas meant that the water regulator now receives resources from the government budget, which has become its main source of funding. This reliance of SUNASS on government budget comes with budget uncertainty due to fiscal consolidation efforts, which threatens its financial independence.

In general, transparency obligations focus on general and budget information of agencies, public procurement, official activities, and public finance management, which are some of the basic obligations in many OECD countries for public institutions. In general, economic regulators display more in depth information than the rest of the central administration. Examples include more detailed information on meetings with stakeholders, an open call for comments from the stakeholders on draft regulatory proposals, and performance indicators related to financial and budgetary matters.

Results from the 2018 OECD Indicators on the Governance of Sector Regulators for Peru’s OSINERGMIN, OSIPTEL and OSITRAN regulators show some differences across Peru’s regulators in terms of their independence, accountability, and scope of action (Figure 6.1). Moreover, OSITRAN holds a narrower scope of action than OSINERGMIN and OSIPTEL. When compared with the OECD average across the same three sectors (energy, e-communications and rail transport), Peru’s economic regulators on average have more good practice governance arrangements in place to support their independence, but a lower uptake of good practice arrangements to enhance their accountability (Figure 6.2). No survey data for 2018 was available for SUNASS.

Overall, Peruvian economic regulators benefit from arrangements that are aligned with OECD best practices in terms of governance. Furthermore, all economic regulators have engaged with the Secretariat to assess and improve their governance.2 However, frequent initiatives and proposals emanating from both the Congress and the public administration over the last years have introduced potential threats to independent decision-making processes and governance of Peru’s economic regulators (e.g. proposed changes to rules of appointment and dismissal of board members3). Future reform could be oriented toward strengthening the governance of Peruvian economic regulators by enhancing the culture independence. This includes revisiting the administrative approvals that regulators must undergo before the PCM and the MEF, by enhancing formal co-ordination mechanisms, and by improving accountability obligations and ensuring that their technical opinions are binding.

Economic regulators in Peru are exempted from the obligations to implement regulatory management tools established in the General Law, except for the Regulatory Quality Analysis. However, all Peruvian economic regulators implement RIA and stakeholder engagement in the preparation of draft regulation.

Economic regulators have issued internal regulations to provide the framework for the preparation and assessment of the RIA. For instance, the General Regulation of OSINERGMIN establishes the regulatory approach based on the cost-benefit analysis, so that the benefits and costs of the decisions taken by this public entity must be evaluated before they are adopted. Additionally, OSINERGMIN reformed its Regulation of Organization and Functions to establish the need to conduct the studies required to carry out the RIA, and approved and issued the Methodological Guideline for performing Regulatory Impact.

All Peruvian economic regulators have published and made available the manuals and guidelines to prepare RIA. They include detailed explanations on the cases in which RIA should be prepared, what information must be submitted as part of the analysis, and the process that must be undertaken for revision and approval. For instance, SUNASS published the Technical guidelines for the preparation of the Regulatory Impact Analysis in 2021. It contains descriptions on how to define the objective of the regulation, how to identify and assess the alternatives to regulation, the requirement to conduct and impact analysis, the need to anticipate and describe a strategy for enforcement, monitoring and evaluation.

In some cases, the RIA process is more sophisticated stages than requirements introduced by recent legislation in the country. For instance, both OSIPTEL and OSINERGMIN have implemented a proportional analysis to RIA, in which they undertake a more profound analysis of the cost and benefits for those regulations that are anticipated to have larger impacts.

As part of the RIA process, all economic regulators perform public consultation of draft regulation and the RIA on their websites. The RIA manuals or guidelines contain provisions on how and when to undertake public consultations, and the way to include and report on how feedback received modified the draft regulation. They all encourage early consultation, which economic regulators in Peru perform in specific cases. For instance, OSITRAN has regulated two stages for performing the consultation: early stage and during the process. OSIPTEL, one of the pioneers in the implementation of RIA in Peru, carries out consultation in two moments: before the approval of the regulatory proposal when it is in early draft form, and before the approval of the final text of the regulation.

The practice of applying the tool of ex post assessment of regulation is taking hold amongst some of the Peruvian economic regulators. OSINERGMIN carried out seven regulatory policy impact assessments. These ad hoc assessments were aimed to quantify ex post the impacts of regulations and supervision actions on audited activities, using different criteria. Moreover, OSINERGMIN reported to have completed the ex post assessment of a technical regulation on domestic gas cylinders, in which the basis of comparison was the corresponding ex ante RIA prepared four years ago. OSIPTEL has performed some ex post assessments in and ad hoc manner and to specific regulations. In general, these are related with interconnection prices or charges, which are subject to periodic reviews.

The Peruvian Constitution (CPP) warrants the right to appeal to Peruvian citizens and companies. The first level of appeal is provided by the Courts of First Instance. They are situated at the third hierarchical level in the organisation of the Judicial Power of Peru. Each province has at least one court of first instance, although several provinces can be aggregated in one court depending on workload. The courts of first instance have jurisdiction over legal issues of more demand and are subdivided according to specialty categories. The categories are:

• civil, which deals with all topics related to civil law with the exception of those related to family law. Within this category the commercial subspecialty is included, which currently has Commercial Chambers and Courts in the Superior Court of Justice of Lima;

• criminal, who addresses crimes and other topics related to criminal law;

• labour, who deals with issues related to labour law;

• family, who addresses issues related to family law;

• and administrative litigation, which hear cases in which a public institution violates a citizen's right.

The second level of appeal is provided by the Superior Courts of Justice. The Superior Courts of Justice are the second hierarchical level in the organisation of the Judicial Branch of Peru, only below the Supreme Court of the Republic. Each Superior Court has its headquarters in the locality indicated by the Law of the Judiciary jurisdiction in its respective Judicial District and has jurisdiction in its respective Judicial District.

Each Superior Court is made up of a certain number of Superior Chambers according to the workload. Similar to the Courts of first instance, these are subdivided according to categories. The Organic Law of the Judiciary establishes the following categories: civil chambers, criminal chambers, labour chambers, family chambers, commercial chambers, which are considered a sub-specialty of civil chambers, and contentious-administrative chambers.

The Superior Courts have the function of being courts of appeal and hear appeals filed against sentences and resolutions issued by Courts of First Instance. There is no second appeal against what was decided by a Superior Chamber since Peruvian legislation only recognizes the right to a double instance appeal.

[1] OECD (2023), OECD Economic Surveys: Peru 2023, OECD Publishing, Paris, https://doi.org/10.1787/081e0906-en.

[3] OECD (2023), Progress Review of Peru’s Telecommunications Regulator: Driving Performance, The Governance of Regulators, OECD Publishing, Paris, https://doi.org/10.1787/a6a74d3e-en.

[6] OECD (2020), Driving Performance at Peru’s Transport Infrastructure Regulator, The Governance of Regulators, OECD Publishing, Paris, https://doi.org/10.1787/d4ddab52-en.

[5] OECD (2019), Driving Performance at Peru’s Energy and Mining Regulator, The Governance of Regulators, OECD Publishing, Paris, https://doi.org/10.1787/9789264310865-en.

[4] OECD (2019), Driving Performance at Peru’s Telecommunications Regulator, The Governance of Regulators, OECD Publishing, Paris, https://doi.org/10.1787/9789264310506-en.

[2] OECD (2017), Creating a Culture of Independence: Practical Guidance against Undue Influence, The Governance of Regulators, OECD Publishing, Paris, https://doi.org/10.1787/9789264274198-en.