General context, key principles and hot topics
1 Identify the highest-profile corporate investigation under way in your country, describing and commenting on its most noteworthy aspects.
The most relevant criminal investigations still relate to Operation Car Wash, in which Brazilian construction companies are alleged to have bribed Peruvian public officials to have infrastructure work contracts awarded at inflated prices.
2 Outline the legal framework for corporate liability in your country.
Statute No. 30424 (the law regulating the administrative liability of corporations, in force as of 1 January 2018) and its Regulation (Supreme Decree No. 002-2019-JUS) establish the liability of corporations for collusion crimes, domestic and transnational bribery, influence peddling, money laundering and funding of terrorism. In this sense, if an individual linked to a corporation commits any of these crimes, either in the corporation’s name or on behalf of the corporation and to its benefit, whether directly or indirectly, the corporation could be liable for the crime autonomously. However, if the corporation proves that, before the crime was committed, it had an effective criminal compliance programme in place, it could expect immunity from sanctions or a reduced sanction. This programme should be assessed under the guidelines issued by the Superintendency of the Securities Market (SMV), which constitutes a reference when assessing the implementation and operation of criminal compliance programmes. The Peruvian Technical Standard (NTP) document titled NTP-ISO 37001 on anti-bribery management systems could also be considered a reference to this evaluation.
3 Which law enforcement authorities regulate corporations? How is jurisdiction between the authorities allocated? Do the authorities have policies or protocols relating to the prosecution of corporations?
Statute No. 30424 establishes that a prosecutor will lead the investigation. Nevertheless, it requires the intervention of the SMV to issue a technical report regarding the effectiveness of the compliance programme of the company being investigated. If this report establishes that the compliance programme is appropriate, the prosecutor must dismiss the case.
Currently, there is a legislative initiative to ensure that the prosecutor is not bound by the conclusion of the SMV’s report.
4 What grounds must the authorities have to initiate an investigation? Is a certain threshold of suspicion necessary to trigger an investigation?
According to the Supreme Court, only a ‘simple initial suspicion’ is required to initiate a preliminary investigation, which in turn constitutes ‘the least intensive degree of suspicion’.
5 How can the lawfulness or scope of a notice or subpoena from an authority be challenged in your country?
For these cases and others in which the investigated party considers that his or her rights are not being respected, or that he or she is being subjected to illegal requirements (e.g., fishing expeditions), a motion may be filed with the preliminary investigation judge, who may invalidate the subpoena or limit its scope.
6 Does your country make use of co-operative agreements giving immunity or leniency to individuals who assist or co-operate with authorities?
Originally, the Code of Criminal Procedure regulated only effective co-operation for individuals. Depending on the relevance of the information provided, a prosecutor may request a criminal judge to exonerate or reduce the sanction.
Statute No. 30737 modified the Code of Criminal Procedure and now companies are allowed to enter into co-operative agreements with the prosecutor. In exchange for providing relevant, verifiable and timely information to clarify the facts being investigated and to prosecute the individuals involved, companies may obtain an exemption or reduction of the sanction.
Likewise, the clemency proceeding established in Legislative Decree No. 1034 (Law of repression of anticompetitive behaviour, of 25 June 2008) allows those who violate the competition rules to be exonerated from an administrative sanction or to mitigate its magnitude if they provide evidence that helps to detect and prove the existence of collusion (i.e., a cartel) and to sanction the liable parties.
7 What are the top priorities for your country’s law enforcement authorities?
Authorities focus their efforts on the investigation of emblematic corruption (some relating to the covid-19 pandemic) or money laundering, which, in some cases, involve the political and business elite. For instance, the current president and former presidents, political parties that have participated in presidential campaigns, and construction companies and their executives, among others, are being investigated for the aforementioned crimes.
8 To what extent do law enforcement authorities in your jurisdiction place importance on a corporation having an effective compliance programme? What guidance exists (in the form of official guidance, speeches or case law) on what makes an effective compliance programme?
From a law enforcement authority perspective, it is important that a company being investigated under Statute No. 30424 has an effective compliance programme in place before an offence is committed if the legal entity intends to obtain immunity or a reduced sanction. Under Article 17 of this Statute, an effective compliance programme must be appropriate to the nature, risks, needs and characteristics of the company. As a result, the Regulation of Statute No. 30424 establishes that the first step to designing and implementing a compliance programme must be an assessment of the company’s risk profile. In this context, the Regulation also states that the minimum elements of a compliance programme are:
- a thorough risk assessment and controls;
- an in-house compliance officer;
- a whistleblowing hotline and complaints procedures;
- periodical training; and
- continuous monitoring and assessment of the compliance programme.
The guidelines issued by the SMV are a reference framework to assess whether the elements listed above have been adequately implemented. Further, based on our experience, for a company’s compliance programme to work efficiently, it is essential that there is a true ‘tone at the top’, reflected, for example, by providing autonomy and sufficient resources to the compliance officer. In addition, to the extent that is appropriate for the particular company, lawyers are advised to follow the standards outlined in the updated guidelines for Evaluation of Corporate Compliance Programs, published by the US Department of Justice Criminal Division.
Regarding anticompetitive matters, the National Institute for the Defence of Competition and Intellectual Property (Indecopi) has published a guide to antitrust compliance programmes.
9 Does your country regulate cybersecurity? Describe the approach of local law enforcement authorities to cybersecurity-related failings.
The National Cybersecurity Policy of 2017 is applicable to public administration entities. The main aspects of this Policy are (1) to protect the information, data and state information infrastructure and the technology used for processing the same from internal or external threats, whether deliberate or accidental, to ensure the confidentiality, integrity, availability, legality and reliability of the information, and (2) to ensure the implementation of legislative proposals and regulations relating to information security or cybersecurity.
Statute No. 30999 (Cyber Defence Law) establishes the regulations framework on cyber defence of Peru, regulating the military operations in and through the cyberspace executed by bodies that are part of the Ministry of Defence within their scope of competence. The purpose of this regulation is to defend and protect the sovereignty, national interests, national critical assets and key resources to maintain the nation’s capacity to face threats or attacks in and through cyberspace insofar as they affect national security.
Since the legislation is relatively recent, there is still no case law.
10 Does your country regulate cybercrime? What is the approach of law enforcement authorities in your country to cybercrime?
Statute No. 30096 (Law of Computer Crimes) sanctions behaviour such as illegal access and attacks on the integrity of computer systems (hacking), propositions with sexual purposes to underage children through technological means and computer fraud, among other things. As of January 2021, these offences are investigated by the Prosecutor’s Office through its Specialist Cybercrime Prosecution Unit.
Cross-border issues and foreign authorities
11 Does local criminal law have general extraterritorial effect? To the extent that extraterritorial effect is limited to specific offences, give details.
Article 2 of the Criminal Code establishes a general rule that Peruvian law applies to a crime committed abroad, when:
- the person committing the crime is a Peruvian public official or worker fulfilling the duties of his or her office;
- public security or peace are attacked, or the incident involves money laundering, provided the effects of the incident occur in Peru;
- the act or behaviour offends the Peruvian state and national defence, the powers of the state or constitutional order, or the monetary order;
- the act or behaviour is committed against a Peruvian or by a Peruvian and the crime is foreseen as susceptible to extradition pursuant to Peruvian law, provided it is also punishable in the state where it was committed and the agent enters Peru in any way;
- a transnational bribery offence (sanctioned in Article 397-A of the Peruvian Criminal Code) is perpetrated by a Peruvian or by a representative of a legal entity domiciled in Peru; or
- Peru is obliged to repress the behaviour according to international treaties.
In turn, Article 397-A of the Criminal Code sanctions any person who offers, grants or promotes bribery, directly or indirectly, to foreign officials in exchange for obtaining a particular advantage for himself or herself or for others within the framework of international economic or trade activities (transnational bribery).
12 Describe the principal challenges that arise in your country in cross-border investigations, and explain whether and how such challenges depend on the other countries involved.
In such investigations, one of the main challenges is the time it takes to process the official communications with the authorities of other countries, for example, for international judicial assistance. However, in respect of the emblematic cases, such as Operation Car Wash, the delay in replies and effective assistance by foreign authorities has been considerably reduced.
During the covid-19 pandemic, prosecutors started to conduct witness interviews through digital platforms. Nowadays, depositions and audiences are being conducted both virtually and in person.
13 Does double jeopardy, or a similar concept, apply to prevent a corporation from facing criminal exposure in your country after it resolves charges on the same core set of facts in another? Is there anything analogous in your jurisdiction to the ‘anti-piling on’ policy as exists in the United States (the Policy on Coordination of Corporate Resolution Penalties) to prevent multiple authorities seeking to penalise companies for the same conduct?
Under the protection of Article 6(c) of the Code of Criminal Procedure, the non bis in idem principle or res judicata is applicable if there is the intention of criminally investigating a company in Peru for deeds that have previously been subjected to a final decision by a foreign authority against the same company.
If a company is being investigated both administratively and criminally for the same deeds and on the same grounds, by virtue of Article III of the Preliminary Title of the Code of Criminal Procedure, the criminal jurisdiction prevails over the administrative one.
Other than this, there is no institution that is analogous to the US ‘anti-piling on’ policy.
14 Are ‘global’ settlements common in your country? What are the practical considerations?
There is no record of any global settlement, nor any specific regulation of the matter.
15 What bearing do the decisions of foreign authorities have on an investigation of the same matter in your country?
Matters investigated in another country that could have an effect in Peru can be considered as evidence to initiate a criminal investigation. Likewise, Peru has signed bilateral agreements with other countries on international legal assistance in criminal matters, which include various obligations of mutual assistance, such as sharing relevant information and evidence. For example, this has been happening in Operation Car Wash with the information provided by the Brazilian authorities.
Economic sanctions enforcement
16 Describe your country’s sanctions programme and any recent sanctions imposed by your jurisdiction.
The Peruvian government has not imposed economic sanctions against foreign countries, governments, entities or people who may represent a threat to the interests of Peru or of the international community.
17 What is your country’s approach to sanctions enforcement? Has there been an increase in sanctions enforcement activity in recent years, for example?
Peru has not applied any economic sanctions.
18 Do the authorities responsible for sanctions compliance and enforcement in your country co-operate with their counterparts in other countries for the purposes of enforcement?
19 Has your country enacted any blocking legislation in relation to the sanctions measures of third countries? Describe how such legislation operates.
There is no blocking legislation in Peru.
20 To the extent that your country has enacted any sanctions blocking legislation, how is compliance enforced by local authorities in practice?
There is no blocking legislation in Peru.
Before an internal investigation
21 How do allegations of misconduct most often come to light in companies in your country?
Misconduct usually arises through media reports, internal audits and, in those companies supervised by a financial intelligence unit (companies within the financial system, mining activity, construction, etc.), through reports of suspicious operations of money laundering or financing of terrorism to the regulator.
22 Does your country have a data protection regime?
Statute No. 29733 (Law of Personal Data Protection, published on 3 July 2011) and its Regulation (Supreme Decree No. 003-2013-JUS) have the purpose of guaranteeing the fundamental right of protection of privacy. Companies are expected to provide appropriate treatment of the personal data of their clients, workers and other natural persons concerning their activity.
The titleholder of the personal data has the rights of information, updating, inclusion, correction, suppression, opposition, objective treatment, protection and of being indemnified. The National Authority for the Protection of Personal Data may sanction a company if it proves that it made any inappropriate use of personal data.
23 To the extent not dealt with above at question 9, how is the data protection regime enforced?
The Peruvian Data Protection Authority has been issuing fines for non-compliance with the rules on personal data protection since 2015. The organisations that have been fined are of different types and include clinics, universities, banks and public entities. As an example, Google Inc was sanctioned in 2016 with a fine of US$75,000. In February 2022, Peru’s National Superintendency of Migration was sanctioned for failing to implement the necessary security measures to prevent the leaking of data on people entering and leaving the country.
It is important to bear in mind that Peruvian data privacy rules are applicable not only to individuals and legal entities established in Peru, but also to those using media located in the Peruvian territory.
24 Are there any data protection issues that cause particular concern in internal investigations in your country?
If an internal investigation entails sharing information with peers located abroad (for example, a parent company or law firm), the cross-border flow of information must be duly communicated to the national authority and comply with the legal provisions.
25 Does your country regulate or otherwise restrict the interception of employees’ communications? What are its features and how is the regime enforced?
Although there is no rule that specifically regulates the control of work tools (email, cell phones, etc.) by an employer, Article 2.10 of the Constitution establishes that every person has the right to secrecy and to the inviolability of communications and private documents.
The Constitutional Tribunal (Docket Nos. 114-2011-PA/TA, 3599-2010-PA/TC and 05532-2014-PA/TC) and the Supreme Court (Cassation No. 14614-2016-Lima) have established, from a labour point of view, that an employer is forbidden to inspect the use of corporate email assigned to its employees, unless it has the express authorisation of the employees every time it wants to log in to view the email. Thus, a general waiver signed by an employee when joining the company will not be sufficient.
However, in the criminal sphere (Nullity Appeal No. 817-2016/Lima), the Supreme Court established that if there is a high probability that corporate email has been used to exchange communications with criminal content, it is not illegal or unconstitutional for the employer to inspect its employees’ email for the purposes of a criminal claim. A prosecutor may subsequently use the email as admissible evidence in a criminal procedure.
The Superintendency of the Securities Market’s guidelines indicate that protocols could be established for the intervention, access and review of the means of communication and computer equipment owned by employers and provided to employees, such as corporate email, mobile phones or other electronic devices, computer equipment and internet access, among other things.
Dawn raids and search warrants
26 Are search warrants or dawn raids on companies a feature of law enforcement in your country? Describe any legal limitations on authorities executing search warrants or dawn raids, and what redress a company has if those limits are exceeded.
Search warrants are used frequently by prosecutors, particularly in emblematic investigations for corruption or money laundering crimes, such as Operation Car Wash, or proceedings against senior public officials.
According to Article 214 of the Code of Criminal Procedure, it is possible to raid a company in any of the following situations: (1) in a case of flagrante delicto; (2) there being an imminent danger of a crime occurring; or (3) when there are reasonable grounds to consider that there is evidence inside the premises being searched. In the latter case, judicial authorisation will be required, which will specify the scope and duration of the search, among other things. Both the search and the seizure of documents must be limited to what has been authorised by the judge.
There is a possibility of controlling a warrant dictated by a judge through an appeal in which the pertinence, proportionality and reasonableness of the measure are discussed. However, even if the search is considered legal, the judge can be asked to exclude privileged material and any documents not related to the investigation.
Note that, in the administrative field, the regulation of the powers, rules and organisation of the National Institute for the Defence of Competition and Intellectual Property (Indecopi) (under Article 2 of Legislative Decree No. 807) allows unannounced visits – not searches – during a proceeding. If a company denies access to the authority, a judicial mandate will be required.
27 How can privileged material be lawfully protected from seizure during a dawn raid or in response to a search warrant in your country?
Privileged material cannot be seized during a search ordered by a judge and carried out by a prosecutor. In this sense, it is recommended that all materials or reports of this nature be labelled as ‘protected under professional secrecy’, in accordance with the procedure established in Article 2.18° of the Constitution, Article 30° of the Attorney’s Code of Ethics and Article 165° of the Criminal Code.
The presence of an external lawyer is recommended during a search to enforce privilege over documents having such a condition. Note that the Supreme Court has ruled that ‘the right to professional secrecy must prevail over the right to obtain evidence’ (Cassation No. 272-2016-Tacna, fj.13).
28 Under what circumstances may an individual’s testimony be compelled in your country? What consequences flow from such compelled testimony? Are there any privileges that would prevent an individual or company from providing testimony?
As investigated parties, people are not compelled to testify. They have the right to remain silent, and silence cannot be treated negatively. As witnesses, however, people are compelled to testify. The testimony constitutes evidence in the criminal proceeding and must satisfy the requirements specified in Article 166 of the Code of Criminal Procedure (Cassation No. 1312-2018-Huancavelica, fj 22).
There is the possibility of opposing the testimony under certain specific circumstances, such as the fact that questions may refer to the witness’s criminal liability, that the investigated party is a close relative or that the questioning is about some type of professional secrecy or state secret.
Moreover, investigated parties are not compelled to collaborate with their own prosecution.
Whistleblowing and employee rights
29 Describe the whistleblowing framework in your country. What financial incentive schemes exist for whistleblowers? What legal protections are in place for whistleblowers?
Although there are no financial incentives for whistleblowers in criminal procedures, Article 39° and 40° of the Regulation of Statute No. 30424 establishes that companies must adopt protection measures to avoid retaliation (any recrimination, discrimination or sanction) against the people that use a whistleblowing channel. Further, the guidelines issued by the Superintendency of the Securities Market establish that the registering of these measures in favour of whistleblowers could be considered as evidence of the proper functioning of a compliance programme.
30 What rights does local employment law confer on employees whose conduct is within the scope of an investigation? Is there any distinction between officers and directors of the company for these purposes?
During the process of an internal investigation, non-specific labour rights are applicable. This relates to actions, the legal entitlement and enforceability, of which goes beyond the standard entitlements of employees (as set forth in the Constitution), such as presumption of innocence, due process, right of defence, right to intimacy, right to secrecy and inviolability of communications, among other things.
There is no distinction between company officers and directors for these purposes.
31 Do employees’ rights under local employment law differ if a person is deemed to have engaged in misconduct? Are there disciplinary or other steps that a company must take when an employee is implicated or suspected of misconduct, such as suspension or in relation to compensation?
All employees have the same rights during the term of an employment contract, even if an employee is deemed to be involved in misconduct. During an investigation, the employer cannot adopt any type of preventive measure (for example, suspension of the contract), unless it has the employee’s consent. The only exception to this rule is foreseen for cases of sexual harassment, in which the employer is entitled to suspend – or transfer to another workplace – the alleged harasser to protect the victim.
Despite the foregoing, in practice employers usually grant paid leave unilaterally to employees involved in an investigation, so that they do not have to attend the workplace while the internal investigation is being carried out. Notwithstanding the foregoing, this practice could be questioned, alleging an affectation to the right to ‘effective occupation’ or even alleging the existence of a dismissal without legal cause.
Finally, the employer may adopt disciplinary measures when it indubitably verifies that an employee has engaged in labour misconduct or irregularity. If a dismissal proceeding is initiated, the employee must be notified in a letter of the facts that constitute the serious offence that may lead to dismissal and must be granted a term to issue a defence against the imputation made.
32 Can an employee be dismissed for refusing to participate in an internal investigation?
As a general rule, an employee should volunteer or give his or her consent to participate in an investigation.
However, the seriousness of the investigated deeds and how they relate to the position of the employee could mean a failure to comply with the labour obligations if he or she refused to collaborate during an investigation process. In such a situation, we consider that this would constitute an assumption of a violation of good faith. In this situation, the employer may impose reasonable and proportionate disciplinary measures (i.e., warning, suspension or even dismissal).
It is advisable for companies to include in their internal policies a duty for employees to collaborate in any investigation process. Moreover, this duty should be established both in the ethics code or internal regulation adopted as a part of the compliance programme.
Commencing an internal investigation
33 Is it common practice in your country to prepare a document setting out terms of reference or investigatory scope before commencing an internal investigation? What issues would it cover?
It is not a common practice. However, it is recommended that at the commencement of each internal investigation, a document be prepared that authorises it and defines its objectives and scope, as this will determine the conduct and faculties of the investigation team.
Likewise, it is important to prioritise other aspects, such as the hypothesis of the investigation, the team in charge of the investigation (having verified that it is not constituted by any of the individuals under investigation) and defining the means of proof to be used, as well as the fact that, owing to the nature or complexity of the investigated deeds, external advice will be required, both legal and regarding public relations. In some cases, a forensic expert will be required to analyse e-data such as emails, files, images, videos, etc.
The Superintendency of the Securities Market (SMV) guidelines recommend conducting a timely and thorough investigation, free from any influence or bias, to avoid affecting the impartiality, independence and objectivity of the investigator. Further, the person or team conducting the internal investigation should be exempt from any conflict of interest.
34 If an issue comes to light prior to the authorities in your country becoming aware or engaged, what internal steps should a company take? Are there internal steps that a company is legally or ethically required to take?
There is no legal obligation for companies to report dishonest behaviour that has occurred and has been identified. However, once an internal investigation has commenced, the company must try to remedy or compensate the damage caused, and identify and correct any internal proceeding the failure of which originated the dishonest behaviour, particularly any action relating to the compliance model. Likewise, according to Article 38° of the Regulation of Statute No. 30424, the internal investigation and subsequent self-reporting could be taken as a sign of an effective compliance model and, therefore, could release the company from liability.
35 What internal steps should a company in your country take if it receives a notice or subpoena from a law enforcement authority seeking the production or preservation of documents or data?
It is advisable for a company to have a protocol to address such requests satisfactorily and in which the following steps are established:
- identification of the events that have brought about the authority’s request, in collaboration with the company’s legal department or external legal advisers;
- verification of the validity of the authority’s request, that is to say it is not violating any fundamental right such as due process, professional secrecy or protection of personal data;
- informing the competent authority if the information is in the hands of third parties or if it requires a third party’s authorisation to be submitted;
- a detailed review of the information, prior to submission, to identify any legal contingency that could arise from it;
- designing a defence strategy, both from a legal and a communication point of view, to mitigate the contingencies that could be generated by the submission of information; and
- if, because of receiving a notice or subpoena, a company becomes aware of any dishonest behaviour within the company, an internal investigation must be commenced to establish its scope.
36 At what point must a company in your country publicly disclose the existence of an internal investigation or contact from a law enforcement authority?
There is no obligation to publicly disclose the existence of an internal investigation. However, at the moment of deciding whether to disclose this information, companies must take the following factors into consideration:
- the degree of probability that the prosecutor or another authority becomes aware of the facts that are the subject matter of the investigation;
- the existence of an internal investigation may demonstrate to the authorities that the company itself, through its compliance model, identified, investigated and sanctioned dishonest behaviour; and
- by collaborating with the authorities in providing relevant information that allows clarification of the criminal deed, the company could be applying for an attenuation or exemption of the sanction.
37 How are internal investigations viewed by local enforcement bodies in your country?
There is no case law for reporting internal investigations to the local authorities under Statute No. 30424. This is because spontaneous internal investigation for suspicion of criminal wrongdoings is a tool that has only recently been available within the Peruvian corporate environment. However, any form, or sign, of collaboration with the investigation is always well received by prosecutors. The SMV guidelines refer to an internal investigation as an example of risk correction and mitigation.
38 Can the attorney–client privilege be claimed over any aspects of internal investigations in your country? What steps should a company take in your country to protect the privilege or confidentiality of an internal investigation?
Although there is no specific regulation in Peru, the attorney–client privilege could be claimed over the findings of an internal investigation in which an external attorney directly participated. In this sense, it is advisable that the instrument or document that initiates the investigation identifies the external attorneys who will participate and that their intervention is documented, for example, during the interviews and in the communications exchanged by the team in charge of the inquiry.
To ensure privilege protection, it is advisable that the documents collected should be kept in the custody of the external attorneys.
39 Set out the key principles or elements of the attorney–client privilege in your country as it relates to corporations. Who is the holder of the privilege? Are there any differences when the client is an individual?
According to the Code of Ethics of the Peruvian Bar Association, there is no distinction in the treatment of the attorney whether the client is an individual or a corporation. In this sense, the scope of the attorney–client privilege is the same for both.
Likewise, in the framework of an internal investigation, to avoid the lawfulness of the gathered information or the scope of the attorney–client privilege being questioned, it is advisable to inform the parties at each stage of the investigation that the external attorney only represents the interests of the company; thus, the privilege will be between the attorney and the company and not between the attorney and the employee being interviewed.
The holder of the privilege is the client.
40 Does the attorney–client privilege apply equally to in-house and external counsel in your country?
Although there is no specific regulation in Peru, based on the guidelines adopted by foreign courts (for example, in the European Court of Justice Akzo Nobel Chemicals Ltd case), certain Peruvian specialists consider that the attorney–client privilege applies only when external attorneys are involved.
41 Does the attorney–client privilege apply equally to advice sought from foreign lawyers in relation to investigations in your country?
To the extent that the waiver to the privilege corresponds to the client, it would apply equally to the advice provided by both national and foreign external attorneys regarding an investigation carried out in Peru.
42 To what extent is waiver of the attorney–client privilege regarded as a co-operative step in your country? Are there any contexts where privilege waiver is mandatory or required?
The waiver of the attorney–client privilege could be seen as co-operative if it can provide useful information to the authorities. In such cases, if the company has relevant information and seeks to obtain benefits from the investigation, such as mitigation or, at best, exemption, it is advisable to provide all the information required by the authorities.
43 Does the concept of limited waiver of privilege exist as a concept in your jurisdiction? What is its scope?
Currently, there is no specific regulation in Peru. Therefore, a company can waive privilege before the prosecutor and maintain privilege before third parties denying the production of the same information. However, law enforcement may share the information waived to other government agencies.
There are recent legislative proposals (e.g., Bills No. 012/2021 and No. 565/2021) suggesting that the information to be disclosed to the authorities during the process of effective collaboration should be complete.
44 If privilege has been waived on a limited basis in another country, can privilege be maintained in your own country?
The attorney–client privilege can be maintained in Peru after a limited waiver in another country. However, the information disclosed in another country may be shared with Peruvian authorities through international co-operation.
45 Do common interest privileges exist as concepts in your country? What are the requirements and scope?
The concept does exist in Peru. The Code of Ethics of the Peruvian Bar Association regulates it in Chapter IV, according to which it is possible for an attorney to represent more than one client in the same proceeding, provided the interests of the clients are not directly adverse, or if the attorney has the informed written consent of the clients involved.
Note that one attorney could not represent the defendant and the aggrieved in the same proceeding.
46 Can privilege be claimed over the assistance given by third parties to lawyers?
Privilege includes all those who assist external attorneys, such as experts, accountants and translators, among others.
47 Does your country permit the interviewing of witnesses as part of an internal investigation?
48 Can a company claim the attorney–client privilege over internal witness interviews or attorney reports?
Yes. In turn, when a lawyer is commissioned to conduct an internal investigation, it is advisable that, at each stage of that investigation, the lawyer announces that the intervention is on behalf of the company and not as an attorney of any internal witness. Further, it is advisable to inform affected employees that the information collected would be evaluated along with other information that may be gathered.
49 When conducting a witness interview of an employee in your country, what legal or ethical requirements or guidance must be adhered to? Are there different requirements when interviewing third parties?
The parameters of the interviews within an internal investigation are not regulated in Peru. However, to avoid the admissibility of the gathered evidence being questioned if the company decides to share it with the competent authority, it is advisable to inform the employee or third party before starting the interview that the attorney–client privilege applies to the company and not the employee or third party.
The Superintendency of the Securities Market has issued guidelines for when employees are being investigated. For example, it is advisable to guarantee and respect their constitutional rights of no incrimination, contradiction, production and review of the evidence, among other things.
50 How is an internal interview typically conducted in your country? Are documents put to the witness? May or must employees in your country have their own legal representation at the interview?
Although there are no specific guidelines for conducting interviews, it is common for an attorney to participate in them as a representative of the company. Likewise, minutes are usually written, transcribing part of the information provided.
Employees do not usually request the intervention of their lawyers in interviews. However, if an employee does request that a lawyer attends, the employer should agree to the request to prevent the employee from alleging any coercion in making his or her statement.
While the covid-19 pandemic continues, internal interviews may be conducted via digital platforms with appropriate protocols and strict security measures in place to ensure confidentiality and legal privilege.
Reporting to the authorities
51 Are there circumstances under which reporting misconduct to law enforcement authorities is mandatory in your country?
There is no legal obligation for companies to report misconduct to the authorities.
52 In what circumstances might you advise a company to self-report to law enforcement even if it has no legal obligation to do so? In what circumstances would that advice to self-report extend to countries beyond your country?
Self-reporting is advisable when it is probable that a company may obtain a benefit in exchange for the information it provides and that the prosecutor may find out about the wrongdoing by other means. Self-reporting will be considered as evidence that a company’s compliance programme was efficient, and the company could receive a reduced penalty or even an exemption from a penalty. If the decision to self-report has been made in Peru, it is advisable also to make the self-report in other countries that have jurisdiction to prosecute the crimes.
The latest legislative proposal (Bill No. 676-2021) suggests that spontaneous reporting to the authorities should be one of the criteria considered when determining the amount of the fine to be imposed on a company for misconduct.
53 What are the practical steps needed to self-report to law enforcement in your country?
There is no express regulation on how to self-report. It is advisable that an external attorney seek an interview with the prosecutor to establish his or her interest in the matter. However, it is also advisable to delay arranging such an interview until after an internal investigation has established the actual scope of the misconduct, the persons involved and the legal, financial and reputational contingencies that could be activated.
Furthermore, it is advisable for the company keep a register of reports filed to the authorities. According to the Superintendency of the Securities Market’s guidelines, this could prove the effectiveness of the compliance programme.
Responding to the authorities
54 In practice, how does a company in your country respond to a notice or subpoena from a law enforcement authority? Is it possible to enter into dialogue with the authorities to address their concerns before or even after charges are brought? How?
How a company should respond to a notice or subpoena will depend on the conditions under which it has been served. If the company is included as a defendant in an investigation, it is recommended that its attorneys review the case file held by the authorities before providing any kind of statement or information. However, if a company has been called only as a witness, its lawyers do not have the right to review the case file. Nevertheless, the company representative who has been called as a witness does have the constitutional right to be advised by an attorney during his or her testimony before the authorities. In addition, prior to the deposition, the prosecutor must tell the witness the reason for being called and the facts on which the witness will testify.
In-house or external lawyers may have interviews with prosecutors to address their concerns, such as clarifying the scope of the subpoena and the deadline with which they must comply.
55 Are ongoing authority investigations subject to challenge before the courts?
Motions challenging investigations may be filed when the investigated deeds lack any criminal nature or when fundamental rights are violated, such as due process and the right to produce evidence, among other things.
56 In the event that authorities in your country and one or more other countries issue separate notices or subpoenas regarding the same facts or allegations, how should the company approach this?
Companies should address the local subpoena to the full extent regardless of the existence of a foreign subpoena. Local law enforcement authorities will not take into account the subpoenas issued by foreign authorities in making any alterations to the scope of their inquiry and will expect compliance with the local request. Therefore, companies should verify that the information provided to the different authorities, both domestic and foreign, is not contradictory.
57 If a notice or subpoena from the authorities in your country seeks production of material relating to a particular matter that crosses borders, must the company search for and produce material in other countries to satisfy the request? What are the difficulties in that regard?
The general rule is that the company must comply with the subpoena. However, if the scope is unreasonable or the costs to produce the material are prohibitive, a motion may be filed with the competent judge.
58 Does law enforcement in your country routinely share information or investigative materials with law enforcement in other countries? What framework is in place in your country for co-operation with foreign authorities?
There has been an increase in law enforcement co-operation with other countries as a result of Operation Car Wash. The Code of Criminal Procedure regulates the formalities that must be observed.
59 Do law enforcement authorities in your country have any confidentiality obligations in relation to information received during an investigation or onward disclosure and use of that information by third parties?
A prosecutor’s investigation is confidential. Only the investigated parties and the attorneys of the alleged victims may have access to it (note that in corruption or money laundering cases, the victim is represented by the state attorney). If the case reaches trial, which is public, the information may be disclosed.
Confidential information about proceedings in Peru is usually leaked to the media when a case is of public interest.
60 How would you advise a company that has received a request from a law enforcement authority in your country seeking documents from another country, where production would violate the laws of that other country?
A legal report from counsel in the foreign country should be obtained, explaining that the information may not be produced.
61 Does your country have secrecy or blocking statutes? What related issues arise from compliance with a notice or subpoena?
There are some sectors in which statutes of secrecy exist, such as banking, tax reports and communications. If a foreign state requires this type of information, it must obtain an order from a Peruvian judge.
62 What are the risks in voluntary production versus compelled production of material to authorities in your country? Is this material discoverable by third parties? Is there any confidentiality attached to productions to law enforcement in your country?
The confidentiality of the information or documentation provided to the authorities need only be maintained during the investigation phase. The information may be revealed at trial. Further, foreign regulators may seek the information produced through international co-operation channels.
Prosecution and penalties
63 What types of penalties may companies or their directors, officers or employees face for misconduct in your country?
The sanctions to companies imposed by a criminal judge are fines, temporary suspension of activities, cancellation of licences, debarments and, when a company has been incorporated and operated just to commit crimes, the dissolution of the company. A monitor can be appointed for up to two years. The natural persons, public and private officers can be sanctioned with imprisonment, fines and disgorgement. This is all without prejudice to repairing the generated damages that must be jointly and severally assumed by the natural persons and the company.
64 Where there is a risk of a corporate’s suspension, debarment or other restrictions on continuing business in your country, what options or restrictions apply to a corporate wanting to settle in another country?
Peruvian courts have no jurisdiction to avoid companies resettling in another country. However, information about local wrongdoing may be shared with foreign authorities through international co-operation to enable suspensions or debarments.
65 What do the authorities in your country take into account when fixing penalties?
A judge will consider the benefit the company has obtained or expects to obtain from committing the crime when imposing a fine, which is usually between twice and six times the amount of the benefit. If the benefit cannot be determined, the company’s annual income will be considered by the judge to fix the fine.
The most recent amendment proposal to Statute No. 30424 (Bill No. 676-2021) suggests criteria for the judge to determine the amount of the fine, such as the number and hierarchy of employees involved in the misconduct, the extent of the damage, the behaviour after the commission of the offence and the willingness to mitigate or repair the damage, among other things.
Resolution and settlements short of trial
66 Are non-prosecution agreements or deferred prosecution agreements available in your jurisdiction for corporations?
Effective collaboration agreements provide one means by which a company can, at best, be exempted from punishment. For this purpose, the company must admit committing the crime, provide evidence against third parties (usually public officers) and remediate. Based on the quality of the information disclosed, benefits such as suspension or reduction of the sentence, or even exemption, can be applied. If it is found that a company hid information or did not fully collaborate, the agreement can be reverted and the criminal proceedings may continue.
67 Does your jurisdiction provide for reporting restrictions or anonymity for corporates that have entered into non-prosecution agreements or deferred prosecution agreements until the conclusion of criminal proceedings in relation to connected individuals to ensure fairness in those proceedings?
The effective collaboration agreements are ruled precisely by secrecy from the beginning to the end of the investigation. The other investigated parties do not know the identity of the collaborator.
68 Prior to any settlement with a law enforcement authority in your country, what considerations should companies be aware of?
The company should weigh the collateral effects of confessing to committing a crime, such as reputational and financial damage. Likewise, the company should consider that its collaboration may result in members or former members of the company being investigated or eventually sentenced to imprisonment.
69 To what extent do law enforcement authorities in your country use external corporate compliance monitors as an enforcement tool?
Since January 2018, as a complementary measure, external monitors may be imposed for up to two years as a sanction by a judge. However, there is no case law to indicate that this measure has been enforced to date.
70 Are parallel private actions allowed? May private plaintiffs gain access to the authorities’ files?
Private actions parallel to the criminal proceeding are allowed, as is a proceeding for reparation or indemnification for damages. However, if the injured party so desires it, that party can take on a civil action in the criminal proceeding and request civil reparation in the same criminal proceeding. In these circumstances, the party injured by the crime will have access to all the evidence in the criminal proceeding.
Publicity and reputational issues
71 Outline the law in your country surrounding publicity of criminal cases at the investigatory stage and once a case is before a court.
The Code of Criminal Procedure establishes the prohibition of publishing the procedural actions during a prosecution investigation. However, the trial is public. There are certain exceptions, including when the sexual morality, the private life or the physical integrity of someone participating in the trial is affected, when national security is affected, or when a particular commercial or industrial secret is threatened.
72 What steps do you take to manage corporate communications in your country? Is it common for companies to use a public relations firm to manage a corporate crisis in your country?
There is no general rule, and a lawyer’s recommendations will vary depending on the assessment of each case. Having said that, if the client is a large corporation and is facing a severe crisis in connection with a criminal investigation, it is always advisable to hire a public relations agency, which should work alongside the lawyers to assess both the accuracy and the strategic effects of the information provided to stakeholders and of public opinion. Further, the company’s strategy should aim to stop the spread of news about any criminal involvement and, if it does occur, it is advisable to issue clarification to the public regarding any incorrect information that is disseminated.
73 How is publicity managed when there are ongoing related proceedings?
Publicity depends on the degree of media coverage, or on the role of the company or the individual in society. The statements of a company under investigation must be short and not lead to speculation.
In Peru, confidential information about an investigation is usually leaked to the media when there is a case of public interest.
Duty to the market
74 Is disclosure to the market in circumstances where a settlement has been agreed but not yet made public mandatory?
It could be mandatory if the company in which the settlement has been agreed is a listed company and if the settlement, or the settled issue, is capable of having significant influence on the security of the company, its business, its financial situation or any other aspect that could be considered relevant by a reasonable investor, or that could alter the decision to sell, purchase or keep securities for a reasonable investor. If deemed mandatory, a reserved report could be made; thus, the company will report the settlement to the regulator only. However, authorisation for such a report is at the regulator’s discretion. Hence, if granted, full disclosure will not be required until the judge has approved the settlement.
Environmental, social and corporate governance (ESG)
75 Does your country regulate ESG matters?
ESG is not specifically regulated under any legislation in Peru for its general application. However, there is some regulation for certain sectors that requires the application of ESG matters, such as the following acts and resolutions:
- Resolution 033-2015-SMV/01, issued by the Superintendency of the Securities Market, requires that listed companies shall disclose annual sustainability reports.
- Directive 068-2015/DE-FONAFE, whereby the National Holding Fund for State Enterprises (Fonafe) approved the Guidelines for Corporate Social Responsibility applicable to 32 state-owned companies that span the electric, financial, oil and gas industries, among others.
- Resolution 1928-2015 (issued by the Banking and Insurance Superintendence), whereby the agency requires the application of the Ecuador Principles for loans of more than US$10 million granted to execute investment projects. The objective of this Resolution is to avoid exposing the financing system to social and environmental risks relating to the execution of said projects.
The Lima Stock Exchange (BVL), in alliance with S&P Dow Jones Indexes, launched the S&P/BVL Peru General ESG Index in November 2021, to rate the performance of Peruvian companies’ listed securities. Unlike previous measurement systems that have only considered corporate governance aspects, the S&P/BVL Peru General ESG Index establishes that the mentioned companies must meet determined environmental, social and corporate governance criteria.
In addition, environmental regulations applicable to extractive sectors in Peru (i.e., mining, oil and gas, and electricity) requires the application of social indicators as part of the social responsibility programmes implemented by companies and included in their environmental assessments.
76 Do you expect to see any key regulatory or legislative changes emerge in the next year or so designed to address ESG matters?
To date, there are no regulatory projects in place that would suggest the introduction of key legislative changes to address ESG issues in the near future.
77 Has there been an increase in ESG-related litigation, investigations or enforcement activity in recent years in your country?
There is no legislation that regulates litigation proceedings concerning ESG matters; hence, there is no case law.
78 Do you expect to see any key regulatory or legislative changes emerge in the next year or so designed to address corporate misconduct?
Currently, the approval of the final version of Bill No. 676-2021, which would amend Statute No. 30424, is being debated. The main changes that could be approved include the expansion of the scope of offences for which companies could be held liable, such as tax crimes, customs crimes and fraud, among other things.
 Alberto Rebaza is managing partner, Augusto Loli, Héctor Gadea and María Haydée Zegarra are partners and Sergio Mattos is a senior associate at Rebaza, Alcázar & De Las Casas.