Formal registration of companies has many immediate benefits for the companies and for business owners and employees. Legal entities can outlive their founders. Resources are pooled as several shareholders join forces to start a company. Formally registered companies have access to services and institutions from courts to banks as well as to new markets. And their employees can benefit from protections provided by the law. An additional benefit comes with limited liability companies. These limit the financial liability of company owners to their investments, so personal assets of the owners are not put at risk. Where governments make registration easy, more entrepreneurs start businesses in the formal sector, creating more good jobs and generating more revenue for the government.
Below is a detailed summary of the bureaucratic and legal hurdles faced by entrepreneurs wishing to incorporate and register a new firm in Peru. It examines the procedures, time and cost involved in launching a commercial or industrial firm with up to 50 employees and start-up capital of 10 times the economy's per-capita gross national income.
| No. | Procedure | Time to Complete | Associated Costs |
|---|---|---|---|
| 1 | Check the uniqueness of company name and reserve it online | 1 day | PEN 9 for search + PEN 9 for reservation |
| 2 | Prepare draft deed of incorporation with the notary online | 1 day | no charge |
| 3 | Sign the deed of incorporation before a notary public, file online the deed of incorporation with the Public Register of Commerce and obtain Certificate of Registration and obtain taxpayer identification number (Registro Unico del Contribuyente, RUC) | 8 days | USD 200 notary fee (both fees depend on market conditions) plus registration fees which are composed by: 0.3% of capital + USD 15 for performing the registration + USD 8 per appointment of each director, manager or other representative, up to the limit of PEN 3,650 (equivalent to 1 UIT - Peruvian Tax Unit as of January 2012). |
| 4 | The notary stamps the accounting book and the minute book | 1 day | USD 7 per book of no more than 100 pages. Most companies have between 5 and 9 of these books. Thus, the cost will range between USD 35 and USD 63. |
| 5 | Obtain municipal license from the City Council | 15 days | Fees vary depending on the District Council where the company’s office is located. In San Isidro between PEN 391 and PEN 489. |