Peru – Secured Transactions Law Reform Project

Peru has recently undergone a reform of their secured transactions law, based on the OAS Inter-American Model Law. This law was published in 2018 by virtue of a legislative decree. It calls for the creation of an online registry (Sistema Informativo de Garantías Mobiliarias), to help prevent fraud, lower costs, facilitate out-of-court enforcement and clarify priorities. Despite its publication two years ago, the register is still not finalised and the old law is still in force. The new law is to facilitate access to credit for smaller and medium sized businesses because it allows for movable assets to be the subject of security interests. This includes vehicles, inventory, animals, etc. It states that anything to which the parties may attribute economic value can be used as a security interest, including future assets. This is an improvement from the current framework, which makes creation of security interests unduly difficult, because although it is possible to create pledges over specified commercial assets or agricultural assets, some movable property cannot be used as security interests. Currently, there are over 20 different types of security assets, and 17 registries. The law is fragmented, and it is difficult to ascertain out which law applies to which asset, or which assets can even be used as security interests.

Click here for the Act in Spanish

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