LOBBYING IN PERU

Authors: José Caro John and Juan Diego Ugaz (Payet, Rey, Cauvi, Pérez Abogados)

Constitution: The basic source of law is the written Constitution of 1993. Owing to the guarantees given by the Constitution, the following activities are not considered to be lobbying:

• statements, expressions, testimonies and comments made through written articles, publications and speeches;
• the dissemination of news or other material distributed to the general public or disseminated through any means of social communication;
• the information, in writing or by any other means that can be registered or provided to the public administration in response to a request made by it;
• the information provided in any means of social communication within the framework of the exercise of freedom of expression;
• affirmations, statements or comments made at any public meeting within the framework of the exercise of the right to freedom of expression, opinion and assembly;
• the free exercise of legal defence and advice, within the provisions of the legal system; and
• other similar efforts that do not lead to decision-making by the public administration.

However, the right to petition the government is also regulated by the Constitution of 1993 and it is outside the scope of lobbying regulation.

Legislative system: The Peruvian legislative system is a unicameral parliament comprising 130 congressmen directly elected by legislative elections every five years. Under certain circumstances, the legislative system can delegate to pass laws on matters that have been approved by the Congress, through legislative decrees and for a specific period.

Congressmen cannot carry out lobbying activities during their term in Congress and for 12 months after they leave their position.

The structure of the legislative system could change as a result of a referendum convened for 9 December 2018.

National subdivisions:

Law No. 28,024, the Law that regulates the management of interests in public administration (the Lobby Law) and its Regulations approved by Supreme Decree No. 099-2003-PCM (the Regulations) are applied at all levels, including regional, provincial and municipal levels.

Consultation process: The legislative process includes a representational period in which members of Congress return to their constituencies to hold public hearings or private meetings with their local communities to gather information on their needs or requirements. This information is taken back to Congress with the purpose of passing laws. The project planning also includes a prior consultation with the communities living in the areas that will be affected by the legislation in order to reach a social agreement with them regarding the particular project. Once the social agreement is obtained, the project will continue until fully executed.

Judiciary: The judiciary system is deemed independent and coequal to the legislative and executive powers. The judges are appointed by the National Council of Magistrates, and their performance is supervised by the Office of Judicial Control.

General: Lobbying is regulated by the government through the Lobby Law published on 23 June 2003 and its Regulations published on 20 December 2018.

Originally, the entity in charge of supervising the correct registration and control of the lobbyists was the National Superintendence of Public Registries (SUNARP), based on the provisions of the Lobby Law, however, in 2017 this law was modified by Legislative Decree No. 1,353 published on 7 January 2017. In this regard, Title IV - Public Registry of Interest Management, where the control functions were established, was abrogated.

Currently, the Lobby Law establishes that each public entity must keep a record of electronic visits in which information is recorded about people who attend meetings or hearings with a public official. This information must be published on the website of each entity in a clear and complete manner.

Likewise, public officials, such as the President, first and second Vice Presidents, members of Congress, ministers, vice ministers, regional presidents and mayors, who detect an action of interest management by a person who has not been consigned in the registry of visits, have a duty to register the omission.

Definition of Lobbying: The definition of lobbying is provided in article 3 of the Lobby Law, which establishes the management of interests as a legal activity through which natural or legal persons, national or foreign, transparently promote their points of view in the political decision-making process, in order to guide such decision in the direction they desire.

Registration and other disclosure: Originally the registration of lobbyists was mandatory, according to the Lobby Law. However, in 2017, the law was modified by Legislative Decree No. 1,353, published on 7 January 2017.

Title IV - Public Registry of Interest Management, in which it was established that in order to exercise interest management acts, professional managers should be registered in the Public Registry of Interest Management, was abrogated.

Evidently, the purpose of registering the lobbyists was to maintain transparency in the decision-making processes of the public administration in order to avoid acts of corruption.

At present, there is no rule that requires a lobbyist to identify him or herself as such, resulting in a voluntary act based on transparency in the management of interests in public administration. However, each public entity must keep a record of electronic visits in which information is recorded about people who attend meetings or hearings with a public official.

Activities subject to disclosure or registraton: According to the Lobby Law, public entities must keep a record of electronic visits in which information is recorded about people who attend meetings or hearings with a public official. This information must be published on the website of each entity in a clear and complete manner. This registration includes both oral and written communications. Finally, the level of the official in the hierarchy does not have a bearing on the duty to disclose communications.

Entities and persons subject to lobbying rules: The Lobby Law is applied in the field of public administration, which encompasses entities that are included in article I of the Preliminary Title of Law No. 27,444 - the Law of General Administrative Procedure; it also includes companies involved in the business management of the state.

The Law does not include the jurisdictional functions of the judiciary, the constitutionally autonomous bodies and the authorities and courts before which the administrative processes are followed.

Consequently, the management of interests relates both to public officials included in article 5 of the Lobby Law, such as the President, Vice Presidents, members of Congress, ministers and mayors, as well as lobbyists, who may be natural or legal persons, national or foreign, who boost the development of acts of management of their own interests or of third parties.

The distinction of classes of interest managers was repealed by Legislative Decree No. 1,353, where it expressly established two classes: those that performed acts of management of their own interests; and those that were performed in representation of third-party interests.

Lobbyist details: Article 22 of Supreme Decree No. 099-2003-PCM indicates the procedure and form of the management act. For this reason, it is important that a certificate be issued that determines the motive and purpose of the management act, identifies the specific public decision that is sought and provides a brief summary of the points discussed during the management act.

As a result of the amendment of the Lobby Law, the communication of this record is made through the electronic registry of visits held by public entities in which information is recorded on persons who attend meetings or hearings with a public official.

Therefore, it is the responsibility of each entity to publish on its website the information contained in the visitors’ registry and in the official agenda of each public official belonging to the organisation.

Content of reports: Owing to the repeal of the article that created the Public Registry of Interest Management, the obligation of interest managers to semi-annually report their activities to SUNARP was also repealed, which potentially jeopardises the transparency and regulation of the management of interests in Peru.

Financing of the registration regime: The Lobby Law established a regulation for the registration of the fund system, controlled by SUNARP, where all the management acts were registered. However, the regulation was repealed. Currently, Peruvian legislation does not have regulation in that area.

Public access to lobbying registers and reports: The records of visits of interest managers is public information and should be disseminated through the transparency portals that each public entity has on its website, as specified in articles 6 and 16 of the Lobby Law, and in article 5 of Law No. 27,806 - the Law on Transparency and Access to Public Information.

Code of conduct: Both the Lobby Law and its Regulations establish some legal and ethical duties. The lists are in article 10 of the Lobby Law and article 37 of the Regulations.

The Regulations set forth a list of ethical standards to be met by any private actor that engages in lobbying practices. These standards are:

• knowing and understanding the Lobbying Act and the Regulations;
• providing certain and updated information to the public officer;
• avoiding filing any petition or requirement that leads the public officer to breach any of its obligations;
• avoiding promising or offering any kind of illegal benefit, directly or indirectly, to an officer or any of its relatives;
• avoiding performing lobbying actions with public officers with whom the private actor has a kinship relationship;
• acting loyally and diligently;
• maintaining confidentiality over the information that has been handed to a representative;
• the individual representing other private actors shall avoid acting on behalf of different legal persons when there is a conflict of interest among them;
• attending meetings with public entities during work hours and at the institutional office; and
• reporting the breach or contravention of the Lobbying Act and its Regulations.

In addition, there is nothing impeding each public entity from establishing its own code of conduct according to its internal policies.

Media: There are no such restrictions in broadcast and press regulation in Peru.

General: According to Law No. 28,094 (the Law on Political Organisations), political parties receive financing from the public sector only if they obtain representation in Congress, and political organisations are allowed to receive financing from the private sector, provided that it does not come from a prohibited source.

Registration of interests: All income or contributions must be paid through the banking system and controlled by the National Office of Electoral Processes (ONPE).

According to the Law on Political Organisations, both political parties and politicians must declare their interests. Therefore, political parties, regional or departmental bodies, and political organisations of provincial and district scope must present to the Peruvian Tax Authority, every six months from the beginning of the fiscal year, a report detailing all of their financial transactions. Likewise, the Peruvian Tax Authority may require from the political parties a list of contributions, which must specify the amount of each contribution, and, where appropriate, the names and addresses of the persons who have donated them.

Contributions to political parties and officials: According to the Law on Political Organisations, the verification and external control of the financial activity of political parties, regional or departmental bodies and provincial and district political organisations is exclusively the responsibility of the ONPE, through the Peruvian Tax Authority.

In addition, each political party must implement a system of internal control to ensure the proper use and accounting of the acts and documents from which rights and obligations of economic content are derived, according to the statutes of each political party.

Sources of funding for political campaigns: Political campaigns for public office are financed by the public sector, as long as the political parties that are campaigning obtain representation in Congress. In that regard the state will allocate the equivalent of 0.1 per cent of the tax unit for each vote cast.

These funds are granted from the general budget and are received by the political parties to be used in training and research activities during the five-year period following the election, as well as for their ordinary operating expenses.

All political parties can receive private financing through:

• quotas and monetary contributions from their members;
• income from any additional business activities and the returns from their own assets. These may not exceed 30 tax units per year, if the contributors cannot be identified;
• income from other contributions under the terms and conditions provided for in the Law on Political Organisations;
• interest on loans owned by them;
• legacies they receive; and
• in general, any benefit in cash or in kind they obtain.

Lobbyist participation in fundraising and electioneering: There is currently no regulation on the information that the registry must contain or the reports that the interest manager must provide.

Independent expenditure and coordination: Parallel political campaigning independent of candidates or political parties is not regulated in Peru.

Gifts, travel and hospitality: Public officials included in the scope of the Lobby Law are prohibited from accepting, directly or indirectly, any favour on the part of interest managers or third parties on whose behalf they are acting. The prohibition includes gifts, donations, free services, job offers and jobs.

This extends to the spouse of the public official, as well as his or her relatives up to the fourth degree of consanguinity and second degree of affinity.

Anti-bribery laws:

Articles 393 and 394 prohibits any form of accepting or receiving by public officials any kind of donation, promise, advantage or economic benefit to perform or omit acts in violation of their obligations or to perform acts according to their positions. Also, the public officials are prohibited from requesting any kind of donation, promise, advantage or economic benefit.

Article 397 of the Criminal Code prohibits any form of offering, giving or promising a public official any kind of donation, promise, advantage or economic benefit to perform or omit acts in violation of their obligations.

Similarly, article 400 of the Criminal Code punishes those who invoke or have actual or simulated influence, or receive, make or promise for themselves or for a third party, a donation or promise or any other advantage or benefit with the offer to intercede before an official or public servant who is or was involved in a judicial or administrative case.

Likewise, article 401 of the Criminal Code punishes the public official who, abusing his or her position, unlawfully increases his or her patrimony with respect to his or her legitimate income.

In addition, Law No. 30,424, modified by Legislative Decree No. 1,352 and amended by means of Law No. 30,835, regulates the administrative responsibility of legal entities. This Law came into force on 1 January 2018 and applies only to the following crimes: (i) generic and specific bribery; (ii) money laundering; (iii) financing of terrorism; (iv) collusion; and (v) influence peddling.

Even though the mentioned law regulates the ‘administrative responsibility of the legal entities’, it has criminal consequences. It also sets exemptions and mitigations for legal entities involved in the execution of the crimes referred to above.

Likewise, the Lobby Law includes a ban on public officers accepting, directly or indirectly, any generosity from interest groups. The prohibition includes gifts, donations, free services, job offers and jobs.

The Peruvian competition agency, utilities regulators, electoral entities and some ministries have issued regulations by which they prohibit their employees from accepting gifts or any other advantages offered by individuals or corporations involved in the duties of the public entity.

Some agencies have stated that in specific contexts a public officer may accept a gift, particularly under situation of protocol, or if the gift is an award for the academic performance of the public officer.

Revolving door: According to article 9 of the Lobby Law, public officials may not perform the activities of interest managers during the exercise of their functions, and for up to one year after completing them, in the areas in which they had direct competence.

Prohibitions on lobbying: There is no rule that directly prohibits lobbying or engaging in such services. However, the Lobby Law regulates how lobbying is carried out.

Recent cases: Former presidential candidate Keiko Fujimori, who is also the president of the majority party in Congress, is serving a 36-month term of preventive imprisonment. This measure was taken by the court because evidence linked to money laundering and undeclared campaign funding in her 2011 presidential campaign.

Remedies and sanctions: There are no administrative sanctions for lobbyists in cases of non-compliance or failure to register or report. However, as we pointed out, the lobbyists could be investigated and accused by the district attorney in the event of the commission of a crime.

Updates and trends:

On 13 September 2018 Legislative Decree 1,415 was published in the Official Gazette, introducing certain amendments to the Lobbying Act and stating that new regulations will be enacted within 60 days of the publication of the Legislative Decree. These amendments are not yet into force, but 30 days after the enactment of the new regulations they shall be effective.