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Peru's political system and how laws are made: what investors need to know

Last verified: 2026-10-28 · Status: Changing

Peru is a unitary presidential republic: the President is elected for five years with no immediate reelection, and since July 2026 Congress is bicameral again, with a Senate of 60 members and a Chamber of Deputies of 130 under the constitutional reform in Ley Nº 31988. Bills start in the Chamber of Deputies and go to the Senate for review; the Executive can legislate by delegated legislative decrees and by emergency decrees on economic and financial matters, both now subject to Senate control. Investors rely on equal treatment of foreign and domestic investment, contract law stability agreements (contratos ley), expropriation only with prior cash compensation, and the rule that tax changes need a law and that annual taxes change only from 1 January of the following year.

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Key facts

Presidential term (no immediate reelection)	5 yearsConstitución art. 112, as of 2026-10-28 · in force
Start of the current presidential term (swearing in before Congress)	2026-07-28 dateConstitución art. 112; JNE proclamation of 3 July 2026 for 2026 to 2031, as of 2026-07-28 · in force
Vote margin in the 7 June 2026 presidential runoff	49641 votesJNE general proclamation act, 3 July 2026, as of 2026-07-03 · in force
Senate seats (constitutional minimum)	60 seatsConstitución art. 90 as amended by Ley Nº 31988, as of 2026-10-28 · in force
Chamber of Deputies seats (constitutional minimum)	130 seatsConstitución art. 90 as amended by Ley Nº 31988, as of 2026-10-28 · in force
Term of senators and deputies (immediate reelection allowed)	5 yearsConstitución art. 90 as amended by Ley Nº 31988, as of 2026-10-28 · in force
Largest party in the Chamber of Deputies, 2026 to 2031 (Fuerza Popular)	41 seatsJNE proclamation of 19 June 2026, as of 2026-06-19 · in force
Parties with seats in the 2026 to 2031 Congress	6 partiesJNE proclamation of 19 June 2026, as of 2026-06-19 · in force
Days for the President to promulgate or observe a law	15 daysConstitución art. 108 as amended by Ley Nº 31988, as of 2026-10-28 · in force
Vote to override presidential observations	More than half of the legal number of members of each chamber ruleConstitución art. 108 as amended by Ley Nº 31988, as of 2026-10-28 · in force
Vote to pass or amend an organic law	More than half of the legal number of members of both chambers ruleConstitución art. 106 as amended by Ley Nº 31988, as of 2026-10-28 · in force
Vote for a constitutional reform	Absolute majority of each chamber plus referendum, or more than two thirds of each chamber in two successive ordinary legislatures ruleConstitución art. 206 as amended by Ley Nº 31988, as of 2026-10-28 · in force
When laws on annual taxes take effect	1 January of the year after promulgation ruleConstitución art. 74, as of 2026-10-28 · in force
Expropriation compensation	Prior cash payment of appraised value including damages, contestable in court ruleConstitución art. 70, as of 2026-10-28 · in force
Border strip where foreigners may not hold mines, land, water or energy sources without a supreme decree	50 kmConstitución art. 71, as of 2026-10-28 · in force

The rule

1. The President is Head of State and is elected by direct vote; the winner needs more than half of the votes cast, with spoiled and blank ballots excluded. If nobody reaches that majority, a runoff between the top two is held within 30 days of the official proclamation of the count. Two vice presidents are elected on the same ticket. The presidential term is five years with no immediate reelection; a former President may run again only after at least one full constitutional term has passed.Constitución Política del Perú de 1993, Art. 110, art. 111 and art. 112, 1993-12-30 official text · verified 2026-10-28 · changed: General elections were held on 12 April 2026 and the runoff on 7 June 2026. On 3 July 2026 the Jurado Nacional de Elecciones proclaimed the Fuerza Popular ticket the winner for 2026 to 2031 with 9,223,396 votes against 9,173,755 for Juntos por el Perú, and the new President, Keiko Fujimori Higuchi, was sworn in before Congress on 28 July 2026.

2. Congress has two chambers. The Senate has at least 60 senators elected for five years, with at least one elected in each electoral constituency and the rest in a single national district; the Chamber of Deputies has at least 130 deputies elected for five years. Either number can be raised by organic law. Senators and deputies may be reelected immediately to the same seat. The Presidency of Congress alternates between the presidents of each chamber. A senator must be Peruvian by birth and at least 45 years old (or a former member of Congress); a deputy must be Peruvian by birth and at least 25.Constitución Política del Perú de 1993, art. 90 as amended by Ley Nº 31988 (constitutional reform restoring bicameralism), published 20 March 2024, Art. 90; Ley Nº 31988 First Final Complementary Provision, 2024-03-20 official text · verified 2026-10-28 · changed: Ley Nº 31988 replaced the 130 seat single chamber Congress with a Senate and a Chamber of Deputies, effective from the next general elections. The first bicameral Congress was elected on 12 April 2026: the JNE proclaimed 60 senators (30 in the single national district and 30 in multiple districts) and 130 deputies on 19 June 2026. Six parties won seats; in the Chamber of Deputies Fuerza Popular holds 41 seats, Juntos por el Perú 32, Partido del Buen Gobierno 18, Renovación Popular 15, Partido Cívico Obras 14 and Ahora Nación 10.

3. The President and the deputies have the right to propose laws; other branches, autonomous public bodies, regional and local governments, professional associations and citizens may also propose laws in their own areas. No bill can be passed without the approval of the competent committees, and every law must be voted in its chamber. Bills sent by the Executive as urgent have priority. A bill approved by the Chamber of Deputies goes to the Senate, which approves or amends it within the term in its rules and sends it to the President; if the Senate's review term lapses, the bill approved by the Deputies is sent for promulgation. A bill rejected by either chamber is archived.Constitución Política del Perú de 1993, art. 105 and art. 107 as amended by Ley Nº 31988, Art. 105 and art. 107, 2024-03-20 official text · verified 2026-10-28

4. The President must promulgate an approved law within 15 days or send observations on all or part of it within the same term. Congress overrides the observations with more than half of the legal number of members of each chamber, and the President of Congress then promulgates the law. If the President neither promulgates nor observes, the President of Congress promulgates. A law is binding from the day after its publication in the official gazette El Peruano unless the law itself defers its effect. Organic laws need more than half of the legal number of members of both chambers.Constitución Política del Perú de 1993, art. 106 and art. 108 as amended by Ley Nº 31988; art. 109, Art. 106, art. 108 and art. 109, 2024-03-20 official text · verified 2026-10-28

5. Congress may delegate power to legislate to the Executive by legislative decrees (decretos legislativos) on a specific matter and for a fixed term set in an enabling law; the President reports each decree to the Senate or the Permanent Commission. The President may also issue emergency decrees (decretos de urgencia) with force of law on economic and financial matters when the national interest requires it, reporting to the Senate, which can amend or repeal them under its rules. The Senate controls legislative decrees, emergency decrees, treaties and state of exception decrees. Much of Peru's business law (tax, investment, labor and sector regimes) is in legislative decrees, so enabling laws are a key signal of coming reforms.Constitución Política del Perú de 1993, art. 104 and art. 118 Nº 19 as amended by Ley Nº 31988; art. 102-A added by Ley Nº 31988, Art. 102-A Nº 9 and 10, art. 104 and art. 118 Nº 19, 2024-03-20 official text · verified 2026-10-28

6. The Senate elects three of the seven Board members of the Banco Central de Reserva and ratifies the Executive's choice of BCRP President, by an absolute majority of its legal members, and can remove them for serious misconduct with the same vote. It also ratifies the Superintendent of Banking, Insurance and Pension Funds (SBS), appoints the Comptroller General on the Executive's proposal, elects the Constitutional Court members by two thirds, and approves the treaties listed in art. 56 before ratification. The Chamber of Deputies interpellates and censures ministers and grants or denies confidence. The Budget Bill and the General Account of the Republic are examined by a bicameral committee with equal numbers of senators and deputies.Constitución Política del Perú de 1993, art. 78, art. 81, art. 86, art. 87 as amended and art. 102-A and art. 102-B as added by Ley Nº 31988, Art. 78, art. 81, art. 86, art. 87, art. 102-A and art. 102-B, 2024-03-20 official text · verified 2026-10-28

7. The President may dissolve the Chamber of Deputies (not the Senate) if it has censured or denied confidence to two Councils of Ministers. The dissolution decree must call elections for a new Chamber within four months, the new Chamber completes the dissolved Chamber's term, and dissolution is not allowed in the last year of the term or under a state of siege. During the interregnum the Executive legislates by emergency decrees linked to the normal functioning of the State, which the Senate reviews.Constitución Política del Perú de 1993, art. 134 and art. 135 as amended by Ley Nº 31988, Art. 134 and art. 135, 2024-03-20 official text · verified 2026-10-28

8. Constitutional reforms need an absolute majority of the legal number of members of each chamber and ratification by referendum; the referendum can be skipped if each chamber approves the reform in two successive ordinary legislatures with more than two thirds of its legal members. The President cannot observe a constitutional reform. Initiative belongs to the President with the Council of Ministers, the deputies, and citizens equal to 0.3 percent of the electorate.Constitución Política del Perú de 1993, art. 206 as amended by Ley Nº 31988, Art. 206, 2024-03-20 official text · verified 2026-10-28

9. Taxes are created, amended, repealed or exempted only by law, or by legislative decree under delegated powers; tariffs and fees are set by supreme decree. Regional and local governments can create, amend and remove contributions and fees within limits set by law. No tax may be confiscatory. Budget laws and emergency decrees may not contain tax rules, and laws on annual taxes apply from 1 January of the year after promulgation. Tax rules issued in breach of this article have no effect.Constitución Política del Perú de 1993, Art. 74, 1993-12-30 official text · verified 2026-10-28

10. Freedom of contract means parties can validly agree under the rules in force when the contract is signed, and contract terms cannot be changed by later laws or other rules. Through contratos ley the State can grant guarantees and assurances that cannot be modified by legislation. Domestic and foreign investment are subject to the same conditions, and production and foreign trade are free. The State guarantees free holding and disposal of foreign currency. Property is inviolable; it can be expropriated only for national security or public need declared by law and after payment in cash of an appraised compensation that includes any damage, which the owner can contest in court.Constitución Política del Perú de 1993, Art. 62, art. 63, art. 64 and art. 70, 1993-12-30 official text · verified 2026-10-28

11. Within 50 kilometres of the borders, foreigners may not acquire or hold mines, land, forests, water, fuels or energy sources by any title, directly or indirectly, alone or through a company, on pain of forfeiture to the State, unless public need is expressly declared by a supreme decree approved by the Council of Ministers. Elsewhere foreigners have the same property rights as Peruvians but may not invoke diplomatic protection.Constitución Política del Perú de 1993, Art. 71, 1993-12-30 official text · verified 2026-10-28

Event	Date	Official source
General elections (President, Senate, Chamber of Deputies, Andean Parliament)	12 April 2026	PCM note of 10 April 2026
First round proclaimed; runoff between Fuerza Popular and Juntos por el Perú	17 May 2026	JNE note of 17 May 2026
Presidential runoff	7 June 2026	JNE note of 3 July 2026
60 senators and 130 deputies proclaimed	19 June 2026	JNE note of 19 June 2026
President elect proclaimed for 2026 to 2031	3 July 2026	JNE note of 3 July 2026
President sworn in before Congress	28 July 2026	TC note of 28 July 2026
Regional and municipal elections	4 October 2026	IRTP note of 5 October 2026
Regional runoff where no ticket reached 30 percent	6 December 2026	JNE note of 10 October 2026

The 2026 election cycle and the political calendar, from official JNE, PCM and TC notes, verified 28 October 2026.

Party	Seats
Fuerza Popular	41
Juntos por el Perú	32
Partido del Buen Gobierno	18
Renovación Popular	15
Partido Cívico Obras	14
Ahora Nación	10
Total	130

Chamber of Deputies seats by party, 2026 to 2031 (JNE proclamation of 19 June 2026). The JNE note does not give the Senate breakdown.

Power	Body	Article
Initiates ordinary bills (with the President)	Chamber of Deputies	Art. 107
Reviews, amends or rejects bills from the Deputies	Senate	Art. 102-A Nº 1 and art. 105
Controls legislative decrees, emergency decrees, treaties and state of exception decrees	Senate	Art. 102-A Nº 10
Elects three BCRP directors and ratifies the BCRP President	Senate	Art. 86 and art. 102-A Nº 5
Ratifies the SBS Superintendent	Senate	Art. 87 and art. 102-A Nº 6
Censures ministers and votes confidence	Chamber of Deputies	Art. 102-B
Can be dissolved by the President after two censures or denials of confidence	Chamber of Deputies only	Art. 134
Studies the Budget Bill	Bicameral committee	Art. 78

Who does what under the bicameral Constitution (Ley Nº 31988).

Worked example

Timing a tax change. A law raising an annual tax that is promulgated in December 2026 applies from 1 January 2027; one promulgated on 2 January 2027 applies only from 1 January 2028 (Constitution art. 74). Monthly taxes such as VAT are not covered by this deferral, so watch effective dates in the law itself (art. 109).
Reading a reform signal. If Congress passes an enabling law delegating powers to the Executive on tax or investment matters for, say, 90 days, expect a batch of legislative decrees within that term (art. 104); each is then reported to and controlled by the Senate (art. 102-A Nº 10).

Step by step

1. Map which body you need: ordinary bills start in the Chamber of Deputies (art. 107), the Senate reviews them (art. 105), and regulators such as the BCRP Board and the SBS depend on Senate votes (art. 86 and art. 87).
2. Track enabling laws and the legislative decrees issued under them; they carry most tax and sector reforms (art. 104).
3. For long horizon projects, ask whether a legal stability agreement or a contrato ley is available, since contract terms cannot be changed by later law (art. 62); the investing section covers the stability agreement regime.
4. Before buying land or mining or energy assets near a border, check the 50 kilometre rule and the supreme decree route (art. 71).
5. Use the reform tracker and the calendar for bills in Congress and election dates; see start/reform-tracker and /calendar/.

Common traps

Using an outdated Constitution. Many online copies, including the Congress updated text, still show a 130 member single chamber in art. 90; the bicameral text in Ley Nº 31988 governs from the 2026 elections.
Assuming an emergency decree can change taxes. Art. 74 bars emergency decrees and budget laws from containing tax rules.
Treating the 50 kilometre border rule as a technicality. Acquisitions in breach are forfeited to the State (art. 71).
Expecting the President to block Congress for long. Observations are overridden by more than half of the legal members of each chamber (art. 108), and a constitutional reform cannot be observed at all (art. 206).

Sources

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