Peru

The International Secretariat’s assessment is that Requirement 1.5 is mostly met, which is an improvement from the previous targeted assessment conducted in 2022. The Secretariat's view is that the objective of this requirement, which seeks to ensure that annual planning for EITI implementation supports national priorities for the extractive industries by setting out realistic activities as a result of broad consultation with government, industry and civil society, has been mostly fulfilled, pending the revision and update of the work plan on an annual basis. As compared to the work plan reviewed in the previous targeted assessment, the current work plan is fully costed. The EITI work plan presented by the MSG aligns with national priorities outlined in the National Development Plan such as strengthening transparency, the fight against corruption and the good governance of natural resources. More specifically, the Supreme Decree 043-2023 establishes the General Government Policy for the current presidential term, which includes nine categories that set the basis for the country's policy framework and plans for the current presidential term. Based on this government policy, the Ministry of Energy and Mines (MINEM) has developed the National Mining Sector Plan, which prioritises harmonious relations through mechanisms of social consultation and citizen participation in mining-energy issues, in a transparent and efficient manner. This objective serves as a link between national sector policies and the EITI work plan and reflects the EITI Principles of ensuring a transparent and inclusive governance of the extractive sector. The work plan includes several activities aimed at strengthening subnational EITI implementation which has been identified as a priority of the MSG. The outcomes of the activities, the subnational EITI Reports, have been published and supported by the MSG. The work plan includes references to thematic areas linked to Beneficial Ownership Transparency and several commitments are linked to strengthening systematic disclosures and mainstreaming in the MINEM systems and in the portal of EITI Peru. In addition, the work plan includes a state commitment to continuously support the achievement of work plan objectives, mainstreaming administrative processes and allocating human resources to strengthen EITI implementation. Some actions included in the workplan aim to foster articulation and data sharing with entities holding key reporting information such as the MEF, SUNAT, OEFA, MINEM and ANA and to align their procedures to EITI reporting processes. The work plan is fully costed, and it includes references to funding sources for several of the deliverables including the National and subnational EITI Reports. The main source of funding is the MINEM, which assumes most of the operational costs associated with EITI implementation in Peru. Additionally, supporting entities are highlighted as additional funding sources. The Inter-American Development Bank (IADB) and the United States Agency for International Development (USAID) have played a major role in supporting EITI Peru in the implementation of activities and publications that foster dialogue at national and subnational levels. However, the work plan does not specify how other dissemination activities described in the document will be funded. The work plan was approved on 29 November 2022, and it includes time-bound activities involving civil society, government officials, companies and the national secretariat. MSG minutes also show discussions on the progress of the activities outlined in the workplan. Some of these activities focus on reporting tools and procedures aimed at strengthening the technical capacities of subnational MSGs in the discussions of the Regional Transparency Studies. The targeted assessment conducted by the International Secretariat on April 2022, required Peru to agree and publish a fully costed work plan aligned with the reporting and Validation deadlines, linked to the EITI Principles, and reflecting national priorities. The MSG has showed progress in fulfilling this requirement, although stakeholders confirmed that the MSG has not revised and updated the work plan on an annual basis. In the MSG’s comments to the draft Validation Report, they committed to develop a procedure by which activities identified annually in work plan activities would be reviewed and assessed by MSG members. This will help to respond to the corrective action for Requirement 1.5 calling for increased documentation of progress in responding to work plan activities.

The International Secretariat’s assessment is that Requirement 7.1 is exceeded, which is an improvement from the previous Validation. The Secretariat's view is that the objective of this requirement, which seeks to promote evidence-based public debate on the governance of the extractive industries by actively communicating relevant information to key stakeholders in a manner that is accessible and aligned with their needs, has been exceeded. National and subnational EITI Reports are written in an accessible and clear manner, and information about EITI implementation, including national and subnational reports, data and analyses is accessible on the EITI Peru website, hosted by the Ministry of Energy and Mines (MINEM). In addition, some subnational MSGs disseminate information through their own online portals, broadening the reach of the publications. MSG members, including civil society organisations and industry associations make independent efforts to disseminate EITI information through their respective websites. In addition to the EITI Peru website, the extractive sector information published by national EITI Reports is accessible to the public on the MINEM via publications such as the Statistical Mining and Hydrocarbon bulletins, in alignment with the national open data and digital transformation policies. In addition to the EITI reports and publications, the information disclosed by the EITI Peru website includes a visualisation platform that allows users to compare and download revenue data disaggregated by revenue stream, representing important steps towards open and interoperable data. EITI disclosures in Peru include comprehensive information at both the national and sub-national levels. The sub-national EITI Reports include data on the relevance of royalty revenues disaggregated by region and municipality, investments in public services, transfers made to public institutions and universities, and an assessment of the Standard Transparency Portals. In addition, the MSG has produced brief summary reports (Resumen Amigable) showcasing specific data about EITI implementation at both national and subnational levels and evidencing efforts to improve the accessibility of information. These summary-reports include infographics and tables with specific information and plain language that make data more easily understandable for citizens. Local stakeholders consulted for the Validation manifested the key role that the subnational EITI implementation and the disclosure of subnational data play in public debate and to keep grassroots organisations informed and involved. In addition to the EITI subnational reports and the brief-summary reports, the national and subnational MSGs have designed communication materials designed to facilitate access and understanding of the data by a diverse audience. These materials include infographics, subnational progress reports, and informative videos. These communicative pieces allow sectors of the population with diverse backgrounds and age ranges to access and understand the information. In the period under review, the MSG has organised events for socialising EITI Reports and data, including annual gatherings to mark the publication of EITI Reports. In July 2024, the Ministry of Energy and Mines presented the ninth EITI Report covering the 2021-2022 fiscal years. The MSG and its constituencies have supported subnational MSGs in organising gatherings to mark the publication of EITI subnational reports, citizen oversight activities, peer learning activities and public debate activities at the local level. With the support of USAID, constituencies at the MSG have developed communication campaigns aimed to inform grassroot communities about the transfers of royalties and encourage public monitoring by citizens. These communication efforts use social media, publications, and informative videos using local languages to inform the public. The international development community has played a key role in supporting public debate activities among civil society groups. In December 2023, the Inter-American Development Bank (IDB) published a study providing a detailed analysis of the achievements and areas for improvement of EITI Implementation in the country. It also presents specific recommendations for the short, medium and long term that were presented to the Ministry of Energy and Mines. Other organisations have played a role in funding these dissemination activities. Stakeholders consulted confirmed that the grants provided by these organisations have increased citizen participation in decisions on the use of natural resource revenues, and in monitoring extractive sector revenues, ensuring that companies and government are accountable for their commitments to communities.

The International Secretariat’s assessment is that Requirement 7.2 is mostly met. The Secretariat's view is that the objective of this requirement, which seeks to enable wider use and analysis of information on the extractive industries through the publication of data in open and interoperable formats, has been mostly fulfilled, pending the publication of extractive sector data in open and interoperable formats with other public datasets. Much of the information on EITI implementation is available on the EITI Peru’s website in PDF and open data formats, and statistical information on the extractive sector is also available for downloading in open data format on the websites of government agencies. However, not all extractive sector data disclosed by the EITI Report and the MSG are publicly available in machine-readable formats, including the summary data templates for EITI Reporting, which were submitted to the International Secretariat in October 2024. Although an online system for data collection and visualisation has been implemented and it is possible to download data in CSV format, the information is not yet updated to include data from the last EITI Reports covering the 2019-2022 fiscal years. In the MSG’s comments to the draft Validation Report, stakeholders noted that much of the information found in EITI reporting is available in excel format on the EITI Peru website. These comments also considered that EITI Peru was continuously striving to improve their data timeliness, with a key consideration that data be available in open and interoperable format. There is no evidence that the National Commission has discussed or adopted a specific policy on access, disclosure and re-use of EITI data, as required by requirement 7.2.a. However, consulted stakeholders expressed that the lack of such a policy is due to the existence of a national open data framework, including a Law on Transparency and Access to Public Information and its related regulations, and a Law on Digital Government and its related regulations. These frameworks set the base for digital cooperation between government agencies, regulate the disclosure and use of open data and are used by stakeholders for disclosing extractive sector information needed for the national and subnational EITI Reports.

The International Secretariat’s assessment is that Requirement 7.3 is fully met, as in the previous Validation. The Secretariat's view is that the objective of this requirement, which seeks to ensure that EITI implementation is a continuous learning process that contributes to policy formulation through regular consideration of findings and recommendations of the EITI process by the MSG and prioritisation of those actions deemed relevant, has been fulfilled. Improvements in the follow-up procedures for both the recommendations issued by the 2019 Validation and by the Independent Administrator could further strengthen the fulfilment of this requirement. The MSG considers the implementation of the EITI as a continuous learning process for both the MSG and for government agencies that has contributed widely to transparency and integrity in the public sector. The MSG has consistently reviewed the progress made in addressing corrective actions and recommendations issued by the Independent Administrator. These reviews are conducted annually during the initial stages of EITI Report preparation and are duly documented in the official minutes of MSG meetings. The MSG in Peru has integrated various lessons learned from the implementation of the EITI in the development of their activities, including steps taken to addressing the recommendations of EITI Implementation that can be found in the 2020-2023 EITI progress report. Progress in addressing the recommendation of implementing technological tools in the preparation of national transparency reports has also allowed for a timelier dissemination of information. The MSG has included in the work plan activities to address some information gaps from the previous Validation report, such as social and environmental expenditures by extractive companies and the environmental impact of extractive activities. The work plan also refers to activities to address the corrective actions from the previous Targeted Assessment.

The International Secretariat’s assessment is that Requirement 7.4 is mostly met, as in the previous Validation. The Secretariat's view is that the objective of this requirement, which seeks to ensure regular public monitoring and evaluation of EITI implementation, including review of whether it is meeting its objectives to ensure public accountability of EITI Peru, has been mostly fulfilled. The MSG in Peru has actively reviewed the progress and outcomes of EITI Implementation and evidence of these discussions is available in MSG minutes published in the EITI Peru website. The MSG minutes show evidence of regular discussion regarding progress in the implementation of engagement strategies, progress in the publication of EITI subnational reports and the progress in defining the scope of data disclosures. In September 2024, the MSG discussed the impact of EITI implementation and agreed on publishing a progress report in covering the period 2020-2023. Discussions related to the outcomes of EITI implementation were held regularly and are documented in MSG minutes. The 2020-2023 progress report highlights key priorities identified by the MSG, such as consolidating the National Secretariat and strengthening subnational EITI Implementation. The progress report highlights the adherence of three new regions that began implementing the EITI Standard in 2023, marking a total of eight regions with a subnational MSG. The 2020-2023 progress report identifies achievements and challenges for EITI Implementation, providing a detailed description of activities conducted towards meeting EITI Requirements, compliance with the recommendations in the EITI Reports and progress towards the objectives set out in the work plan. The documentation submitted by the MSG and the progress report identify some actions implemented to addressing governance challenges and extending the impact of EITI implementation. However, the documentation submitted by the MSG does not include gender disaggregated information or rationale on how the activities included in the progress report have strengthened women's participation in the MSG and in the EITI process. In their comments to the draft Validation Report, the MSG committed to including more gender disaggregated data in future reporting. The International Secretariat encourages Peru’s MSG to adhere to annual reviews of outcomes and impact to ensure that each EITI report can build off of lessons learned previously.

The International Secretariat’s assessment is that Requirement 1.1 is mostly met, which is an improvement from the previous targeted assessment conducted in 2022, where the requirement was deemed to have been ‘partly met’. The MSG’s ‘Stakeholder engagement’ template considers the objective is fully met, citing the technical and financial support provided by the central government for EITI implementation at the national and subnational levels. However, some consulted stakeholders from civil society cautioned that government commitment has not yet achieved a consistently high level in the last five years and questioned whether the objective should be considered fulfilled. The International Secretariat considers the objective to ensure a full, active and effective government lead for EITI implementation, both in terms of high-level political leadership and operational engagement as mostly fulfilled. Indeed, government has provided consistent financial support for EITI implementation and the presence of government officials in meetings during the Validation team’s visit are encouraging signs. However, a general lack of attendance by senior government officials in national MSG meetings in the period under review shows that there is room for increased participation by senior government officials. Implementation of the EITI in Peru began through Supreme Court decree No. 028-2011-EM. This decree created the multi-stakeholder group (MSG) and placed the Technical Secretary within the General Office for Social Management (OGGS) of the Ministry of Energy and Mines (MINEM). Since 2011, numerous public statements have been made indicating Peru’s continued adherence to the EITI Standard. Most recently, the former Minister of Energy and Mines reaffirmed Peru’s commitment to the EITI after a brief suspension due to missing reporting deadlines. Commitment is also shown through the continued expansion of subnational implementation in the country. The Vice Minister of Mines and the Vice Minister of Hydrocarbons were appointed as senior government officials representing the government constituency, with the latter serving as the lead government official. Within the OGGS, government officials also make up a technical team that consists of four permanent staff who carry out operational duties in the national secretariat. Some consulted civil society representatives commented that attendance at MSG meetings by senior government officials, such as the vice minister, had decreased in the last five years. This was echoed by some consulted industry representatives as well. The International Secretariat’s document review of MSG meeting minutes confirms the lack of attendance of government officials at the level of vice minister. Lack of attendance by high-level government officials, in the Secretariat’s view, is linked to the broader political context Peru finds itself in, with six Presidents in seven years, and the steady nomination of government officials to posts such as Minister and Vice Minister. Regarding the broader political context, representatives from the mining industry noted during consultations that the near-constant turnover in high-level government officials led to a lack of institutional knowledge of EITI implementation in the country. Civil society representatives echoed this sentiment, noting that a lack of steady engagement by high-level government officials was a growing weakness in EITI implementation. Despite the lack of steady presence by senior government officials, the technical secretariat team has consistently attended MSG meetings at the national and subnational level, as noted in MSG meeting minutes and subnational press releases. This team is well-capacitated both technically and financially and supports progress in addressing EITI Requirements and accompanying correction actions and strategic recommendations. The MINEM acknowledged the impact that political turnover has on providing a steady government partner in dialogue on extractive issues and highlighted the EITI as an interlocutor to improve their relations with industry and civil society stakeholders. While political instability has persisted since the MINEM’s acknowledgement of political turnover, the International Secretariat views this as an effort to overcome bottlenecks in institutional support for EITI implementation. Further efforts to overcome gaps in data transparency and timeliness include the MINEM’s agreement with civil society to provide financial support for the development of further online dissemination publications on the EITI Peru web page. The ‘Transparency template’ also details government efforts to support continued functioning of the GMP during the COVID-19 pandemic. For the Validation process, government entities provided data required and reporting templates were submitted by government in a timely manner. Since a lack of timely publication of annual EITI reports found in the 2022 targeted assessment, Peru’s EITI reporting has returned to regular publication of annual reports. The MINEM provides funding, through its annual budget, for EITI implementation at national and subnational levels (see here and here). However, some consulted civil society stakeholders noted that despite state funding, certain subnational MSGs still lack sufficient funding and questioned why subnational governments did not also provide funding. These stakeholders stated that some regions lacked the proper personnel to complete EITI reporting requirements and needed extra financing to achieve these goals. Despite these individual funding shortfalls, the International Secretariat views the financial support that Peru’s government provides for EITI implementation as essential to continued EITI implementation activities and commends government funding commitments made to date. Peru’s ‘Stakeholder engagement’ template submitted with this Validation details the process by which government stakeholders within the MSG liaise with the broader community at both the national and subnational level. This process includes formal mechanisms for requests flowing from central government to the broader community and vice versa. Given these communication channels and the government’s commitment to improved dialogue with civil society and industry stakeholders, the International Secretariat is optimistic that issues such as funding shortfalls at the subnational level can be addressed.

The International Secretariat’s assessment is that Requirement 1.2 is fully met, as in the previous targeted assessment conducted in 2022. The MSG’s ‘Stakeholder engagement’ template also considers that the objective to ensure that extractive companies are fully, actively and effectively engaged in the EITI, both in terms of disclosures and participation in the work of the multi-stakeholder group, and that the government ensures an enabling environment for this, is fulfilled. Consulted industry stakeholders echoed what was found in the template, noting that representatives are present at all national and subnational MSG meetings and have played a fundamental role in the subnational expansion of the EITI in Peru. Industry engagement in Peru’s EITI implementation is conducted through the National Society of Mining, Petroleum and Energy (SNMPE), a business association which represents mining and oil and gas companies. In terms of national production, the SNMPE represents over 80% of all metallic mining production other than gold, where it represents 67% of production. In oil and gas, the SNMPE represents 89% and 99% of total production, respectively. Consulted industry stakeholders expressed confidence in the role of the SNMPE to represent their views, and the SNMPE plays a central role in training new members on their EITI reporting responsibilities. All changes to company membership within the SNMPE are clearly documented. Through the SNMPE, industry representatives are present at both national and subnational MSG meetings. MSG meeting minutes for national MSG meetings affirm the SNMPE’s presence in all MSG meetings. At the subnational level, the MSG’s ‘Transparency template’ describes how SNMPE’s efforts have predated Peru’s formal expansion to subnational EITI implementation. Documentation provided in annexe to this template show the SNMPE’s presence in subnational MSG meetings and at subnational events. Screenshots of conversations likewise show the day-to-day communications undertaken by SNMPE with both association members and outreach to stakeholders not within the association. Through documentation and consultations, industry stakeholders indicated that there was an enabling environment for company participation with regard to relevant laws, regulations and administrative rules. In practice, these stakeholders noted that short timelines for company reporting had led to strain among member companies in fulfilling EITI deadlines. Key to delays, as noted by industry representatives, was the contracting of a consultant to write the 2021-2022 EITI Report. These delays caused the reporting window for companies to be significantly shorter than anticipated. Presence of EITI supporting companies in Peru The following EITI supporting companies operate in Peru are Barrick Gold, BHP, Poderosa, Freeport-McMoRan, Glencore, Gold Fields, JX Nippon Mining & Metals, Minsur, MMG, Newmont, Repsol Group, Rio Tinto, Shell plc, Southern Copper, Sumitomo Metal Mining, Teck, Trafigura and Woodside. Of these, Poderosa is a MSG member and actively participates in MSG meetings and reporting. The larger business association, SNMPE, includes most of these companies as members and represents these companies’ interests while liaising with the broader industry constituency.

The International Secretariat’s assessment is that Requirement 1.3 is mostly met, which constitutes a regression from the targeted assessment conducted in 2022. There are civil society representatives substantially involved in EITI implementation, including those outside of the multi-stakeholder group, who are active and fully able to engage in effective advocacy and collaboration around issues of importance during MSG meetings and EITI-related activities. However, the International Secretariat considers that early evidence on the impact of the Law No. 32302, amending Law No. 27692 creating the Peruvian Agency for International Cooperation (APCI) – further referred to as ‘APCI law’, passed in April 2025 –o constitute breaches of the EITI protocol: Participation of civil society related to freedom of expression and operation. Civil society representatives on the MSG maintain strong networks with community-based organisations in regions where extractive activities occur and are able to consult with this broader community to present to the other constituencies that make up the MSG. In the period under review, civil society stakeholders worked with industry and government to transmit EITI materials to the broader CSO community in innovative ways, such as an explanatory video in Quechua and a YouTube channel with short videos explaining technical EITI topics. Subnational MSGs serve as key interlocutors of EITI information to surrounding communities and subnational MSG meetings give local CSOs an opportunity to advocate directly with government and industry stakeholders on issues of importance. Despite the positive signs of civil society engagement mentioned in the preceding paragraph, amendments in 2024 to laws that broaden government oversight of CSOs receiving foreign funding (‘APCI law’) was noted a cause for concern in the draft assessment. In its comments to the draft assessment, civil society disagreed with the assessment of the draft report as ‘fully met’ and provided several examples of tangible impacts of the law on their activities and the type of communication they publish. They confirmed that some civil society engaged in the EITI process have started to practice self-censorship on any statement that could be interpreted as encouraging, recommending, promoting or advocating litigation against the state. Some statements that they fear could be interpreted as violations of the law have been taken down from a few CSO websites. They also noted that some civil society representatives have started cancelling activities such that provide technical assistance and legal advice to organisations which are engaged in litigation cases against the government. There is a linkage to the EITI process given that organisations engaged in the EITI process have been affected and the activities relate to extractive governance issues. For example, civil society organisations substantially engaged in the EITI process provide technical and legal assistance to environmental and human rights defenders of communities impacted by both legal and illegal mining activities, including legal suits against the Peruvian government. Although the law has been recently enacted and its implementing rules are yet to be approved, the Secretariat considers that early trends of its application are not negligible considering the effect of the law on civil society’s ability to freely express their views. There are also early indications that the new APCI law has slowed down the execution of grants and work plans. Stakeholders noted that civil society organisations feel restrained from implementing their activities out of abundant caution of not violating the new law. Registrations of organisations have also become burdensome with the new law’s requirements. The Secretariat considers that these constitute a restraint on civil society’s freedom to operate. For a complete analysis of Requirement 1.3, the Civil Society Protocol and an overview of the broader civic space, as well as a closer description of the APCI law and its documented and potential impacts on civil society engaged on the EITI process, please refer to Annexe A.

The International Secretariat’s assessment is that Requirement 1.4 is fully met, which is an improvement from the previous targeted assessment conducted in 2022. The MSG’s ‘Stakeholder engagement’ template considers that the objective to ensure that there is an independent MSG that can exercise active and meaningful oversight of all aspects of EITI implementation that balances the three main constituencies’ (government, industry and civil society) interests in a consensual manner is fulfilled. Consulted stakeholders from all constituencies acknowledged that the MSG was imperfect but agreed with the assessment that the objective continues to be fulfilled. The International Secretariat notes improvements in the engagement from senior government officials and the return to timely EITI reporting as grounds for an improved assessment of fully met. Peru’s MSG was first established in 2011 through Supreme Court Decree No. 028-2011-EM. The initial invitation to participate was open and transparent with a clear government commitment to work with civil society and companies. Nomination processes of each constituency group are clearly indicated, with reference to when MSG members have changed. While outreach to stakeholders outside of the EITI process occurs in each constituency group, some consulted civil society and industry stakeholders considered that government representation on the MSG was too centred on the Ministry of Energy and Mining. These stakeholders suggested that other relevant government entities, such as the National Superintendency of Customs and Tax Administration (SUNAT) and the Ministry of Environment (MINAM) become formal members of the government constituency. Despite these assertions, all consulted stakeholders considered that they were adequately represented on the MSG. Nomination processes for each constituency group are clearly documented. For government, Supreme Court Decrees serve as the nomination process for appointing the Vice Ministers as government representatives. Replacement of members occurs through Authoritative Resolutions. For industry, the SNMPE conducts a formal election procedure where nominations and replacements are tabled and discussed during committee meetings. EITI documentation affirms that all replacements followed this statutory procedure. For civil society, the same procedure is used at the national and subnational level, with elections occurring every two years. EITI documentation describes the process by which current CSO representatives send a letter of convocation to the larger CSO group requesting that interested parties submit a letter of interest. Voting is conducted virtually and is transparent. It is not clear whether gender balance was directly considered in these nomination procedures. In the MSG’s comments on the draft Validation Report, the MSG provided additional information on the processes by which the MSG is managed and where this information can be found on government systems, such as the Unified Register for Commissions of the Executive Power (RUCPE). Further information on gender considerations in nomination procedures was not provided during the MSG commentary period. The MSG’s Terms of Reference (ToR) take the form of the legal decree that created the multi-stakeholder group. This decree includes the rules, responsibilities and rights of the multi-stakeholder group. In general, stakeholders considered themselves capacitated to carry out their duties, though some consulted civil society stakeholders noted inadequate funding to accomplish everything considered a priority. EITI documentation details outreach activities through media, websites and letters and the country website, hosted by MINEM, is one of multiple sources that disseminate information about the EITI process to the wider public. EITI reporting notes that Peru’s MSG does not have a specific code of conduct, but that the MSG maintained its actions within the framework of integrity and ethical conduct. The MSG’s ‘Stakeholder engagement’ template confirms the approval of work plans to guide oversight of implementation, with the 2022-2024 work plan approved on 29 November 2022. This template also describes its agreement with the Independent Administrator on the ToR for preparing the 2021-2022 EITI Report. Key internal governance rules and procedures by which the MSG conducts itself include decision-making by consensus and the treatment of all parties in an equal manner. During consultations, stakeholders did not indicate that they had been prohibited from raising issues for discussion at the MSG. MSG members serve for terms of two years and convocations for new members are clearly documented. National MSG meetings occur on a monthly basis, with subnational MSG meetings occurring at varying frequencies. Stakeholders did not raise issues with the amount of notice given before MSG meetings or the timely circulation of documents. MSG discussions at the national level are clearly recorded, with access to meeting minutes on the EITI Peru website. EITI reporting confirms that there is not a per diem practice for MSG members in Peru.

The International Secretariat’s assessment is that Requirement 3.1 is exceeded. The resources listed below provide valuable insights into Peru’s extractive industries, offering stakeholders public access to an overview of the extractive sector in the country and its potential. Therefore, the objective of this requirement to ensure public access to an overview of the extractive sector in the country and its potential, including recent, ongoing and planned significant exploration activities is considered exceeded. The 2021-2022 EITI Report provides a comprehensive overview and history of Peru's extractive sector, including its economic impact, reserves, production volumes, and exploration activities for both mining and metals and hydrocarbon sectors. It also features an analysis of the artisanal and small-scale mining sector, covering employment and production by mineral, but stops short of listing exports. Subnational EITI reports further provide specific overviews and histories for each of their respective regions. An overview of mining exploration activities is provided in the 2021-2022 EITI Report including the company list, type of project, region and principal product. A dedicated report 2022 mining exploration project portfolio from the Ministry of Energy and Mines (MINEM), provides a comprehensive overview of the exploration projects, project stages and location. MINEM also publishes a monthly statistical bulletin with detailed data on mining production, exports, and market trends. The 2022 Annual Mining Report discloses comprehensive information on production, reserves, exports, investments, exploration, employment, and the sector’s economic and social contributions. For the hydrocarbon sector, Perupetro’s 2022 Annual Hydrocarbon Report provides data on production, reserves, and active contracts.The EITI Report includes a dedicated section on exploration and production within the mining and hydrocarbon sectors. This section provides an overview of exploration activities, including a list of active exploration contracts during the reporting period. Periodic updates on hydrocarbon production are available through MINEM and Perupetro’s websites.

The International Secretariat's assessment is that Requirement 6.3 is mostly met, which is a regression from the previous Validation. While the 2021-22 EITI Report and other sources outlined below provide an overview of the sector's economic contribution including government revenues, exports and employment in the mining sector, a gap remains in employment data for the hydrocarbon sector. This gap limits the full achievement of the requirement’s objective, which is to provide the public with a comprehensive understanding of the extractive industries' contribution to the national economy and the extent of the country's dependence on natural resources. The Secretariat considers the objective of this requirement to be mostly fulfilled. The 2021-22 EITI Report provides the extractive industries' contribution, in absolute and relative terms, to GDP, government revenues and exports. The report provides the mining sector's contribution to employment in absolute terms and disaggregated by gender but only provides PeruPetro's employment, not employment in the whole oil and gas sector and not disaggregated by gender. In the MSG’s comments to the draft Validation Report, they committed to providing employment data for the entire hydrocarbon sector, as opposed to figures representing only PeruPetro. The Anuario Minero 2022, provides a historical overview of mining investment by department and details the mining investment portfolio by project, company, location (departamento), project, and investment. It also includes data on direct mining employment, disaggregated by department and further broken down by gender. PeruPetro’s 2022 Annual Statistics, provide an overview of the extractive industries' contribution to the national economy, covering production by location, reserves, active contracts, and exploration-phase contracts. In its 2023 sustainability report and our human capital report, Perupetro provides employment data disaggregated by gender. The EITI report provides includes a section on informal and small-scale and artisanal mining, including some information on illegal mining. It provides an overview of the sector’s activity and its contribution to national production. The report on the trail of illicit gold proceeds by the department against transnational organized crime, along with the analysis on illegal mining by the Superintendencia further provide information on the impact of illegal mining impact on the national economy. The reports mentioned above provide valuable insights into the extractive sector’s economic contribution, including government revenues, exports of the extractive sector and its percentage contribution towards total export of the country, number of employed people by gender and regions where production is concentrated. In comments to the draft Validation Report, MSG stakeholders committed to providing further disaggregated employment data by gender in future EITI reporting.

The International Secretariat’s assessment is that Requirement 2.1 is exceeded, which is an improvement from the previous Validation. The MSG’s ‘Transparency’ template considers that the objective of ensuring public understanding of all aspects of the regulatory framework for the extractive industries is fulfilled. Consulted stakeholders did not express additional views on progress towards this objective. The International Secretariat considers the objective to be exceeded given that laws and policies related to the legal framework and fiscal regime are noted in EITI reporting and are systematically disclosed. Ongoing and recent reforms in the extractive sector are outlined in the 2021-2022 EITI Report. The legal and regulatory framework for the mining and hydrocarbon sectors is contained in the Mining Law and Hydrocarbon Law, respectively. In mining, the 2021-2022 EITI Report provides succinct descriptions of the legal framework and fiscal regime with clear reference to where these laws and regulations can be found on the government’s digital information platform. There are clear laws for large-scale mining as well as small-scale and artisanal mining. In terms of modifications to rules and regulations in the period under review, the 2021-2022 EITI Report notes various changes to decisions related to mine closure, timing of the ‘consulta previa’ (prior consultation) and other social and environmental protections. Exploration and exploitation of mining rights are governed by concessions and these rights are clearly described in EITI reporting and on government websites. Likewise, the roles and responsibilities of relevant government entities are noted through EITI reporting. In the hydrocarbon sector, descriptions of the legal framework and fiscal regime are also found through EITI reporting, with the full text found on government websites. Modifications to rules and regulations in the oil and gas sector, noted in the 2021-2022 EITI Report, include modifications made by Supreme Court Decree 029-2021-EM to the regulations on the qualification of interests for oil and gas exploration and production. Exploration and exploitation of oil and gas rights are governed by licensing and service contracts where Petroperu is often involved. The roles and responsibilities of relevant government entities are noted through EITI reporting. Of note in the fiscal regime for the mining and hydrocarbon sectors is the widespread use of fiscal devolution. ‘Canon’ as it is called in Peru, consists of various subnational transfers (see Requirement 5.2) of extractive revenues to regions where these activities occur, including regions that host pipelines transporting crude oil and natural gas. These transfers support substantial investments in social services and infrastructure projects. Also particular to Peru is the Work for Taxes (Obras por impuestos) program (see Requirement 4.3) which provides companies from a wide range of industries the option to implement government-approved infrastructure projects, which are offset against the companies’ Corporate Income Tax payments. EITI reporting details systematically disclosed information on recent reforms to this Work for Taxes system. These reform plans have taken the form of the National Multisectoral Policy for Small-scale and Artisanal Mining. Several government stakeholders consulted during the Validation mission highlighted these efforts as key to combatting informal mining. Several civil society and industry stakeholders also acknowledged the severity of the issue posed by illegal mining, with the former noting that much of the violence perpetrated against human and environmental rights defenders could be linked to illegal mining operations. Industry stakeholders noted the high presence of illegal activities in the production and sale of gold and its linkages to organised crime. Other reforms taking place during the assessment period are summarised through the 2021-2022 EITI Report. Links are not included in these summaries, but the Resolution and Supreme Court decision numbers are noted, allowing for readers to find the full text of these resolutions on government websites.

The International Secretariat’s assessment is that Requirement 2.4 is fully met. Based on comments provided in the template and feedback gathered through stakeholder consultations, most stakeholders considered that the objective has largely been fulfilled. From the Secretariat’s perspective, Peru maintains good practice in terms of comprehensively publishing the full text of oil and gas contracts, including amendments, annexes and riders. Perupetro provides a complete list of all exploration and exploitation contracts. In mining, systematically disclosed lists of awarded mining concessions and investment contracts provide comprehensive coverage of active concessions and it is the Secretariat’s understanding that concessions are pro forma. Stability contracts are disclosed and the Peruvian Agency for Private Investment (Proinversion) provides a list that includes all active contracts. Considering these factors, the objective of ensuring the public accessibility of all licenses and contracts underpinning extractive activities, as a basis for the public’s understanding of the contractual rights and obligations of companies operating in the country’s extractive industries, is fulfilled. Peru does not have a specific government policy on contract transparency. Consulted government stakeholders considered the 2019 Law on Transparency and Access to Public Information (LOTAIP) to sufficiently ensure that licenses and contracts can be published. These stakeholders noted that all oil and gas contracts and mining licenses are published under LOTAIP and a standalone law on contract disclosure was not necessary. Perupetro, as the state-owned enterprise (SOE) in the oil and gas sector, enters into license and service contracts with independent oil companies and also operates its own wells. Perupetro publishes the original contracts and what appears to be amendments, annexes and riders to contracts for each lot on its website. These publications include contracts entered into both before and after 1 January 2021 and fulfils the aspect of Requirement 2.4 that mandates full publication of contracts entered into or amended after the beginning of 2021. In 2021-2022, there were 25 active exploitation contracts and seven exploration contracts in 2021, with this figure dropping to six in 2022. Currently, there are 27 active exploitation contracts and five active exploration contracts. In mining, pro forma mining concessions are typically used to grant mining rights. The model mining concession is publicly available on the INGEMMET website and is also described through EITI reporting. The 2021-2022 EITI Report provides a list of all active mining concessions. This information is mirrored on the Institute for Geology, Mining and Metallurgy (INGEMMET) website and contains information on concessions awarded before and after 1 January 2021. Exploration investment contracts are also used in circumstances requiring significant investment at the exploration phase. These contracts offer certain incentives, such as tax offsets equivalent to sales tax paid on capital expenditures linked to exploration activities. The full text of these contracts is available on the Ministry of Energy and Mines (MINEM) website. Another important, though less-frequently used mode of granting mining concessions are Stability Contracts (Contrato de Garantía y Medidas de Promoción a la Inversión) are signed with mining companies that assure that the financial and economic terms agreed-upon at signing are maintained throughout the life of the contract. EITI reporting outlines the basic tenets of stability contracts and the Proinversion website provides a publicly available list to these contracts, with links to the full contract text.

The International Secretariat's assessment is that Requirement 6.4 is fully met, recognising the efforts of Peru’s MSG to address many encouraged aspects of this requirement. The MSG’s ‘Transparency template’ considers that the objective of providing a basis for stakeholders to assess the adequacy of the regulatory framework and monitoring efforts to manage the environmental impact of extractive activities is fulfilled. At the same time, during consultations, government and civil society stakeholders raised concerns about various aspects of the regulatory framework and monitoring efforts that point to room for improvement in these areas. The International Secretariat’s view agrees with that expressed during consultations that regulatory and disclosure efforts on environmental impact should be improved before this objective can be considered exceeded. The 2021-2022 EITI Report devotes significant space to explaining Peru’s legal provisions and administrative rules related to environmental management, monitoring and impact of extractive investments. These explanations cite relevant legal statutes (with links to systematic disclosure) and responsible parties for Environmental Impact Studies (EIA), mine closure plans and other monitoring mechanisms used to assess the environmental impact of extractive activities. Aggregated figures on the number of each of these mechanisms are provided for 2021 and 2022. Helpfully, recent amendments and reforms to these regulatory instruments are also detailed through EITI reporting and focus on greenhouse gas emissions from the mining sector. Civil society actors have also conducted their own studies of the environmental impact of illegal mining, adding to the public knowledge around this matter. There have been significant efforts to outline the regulatory framework and monitoring efforts of the environmental impact of extractive activities and stakeholders offered numerous suggestions to improve these processes. Some consulted government stakeholders considered the environmental permitting process to be too complex and time-consuming, resulting in disengagement from extractive companies. A primary bottleneck identified by these stakeholders was the large number of government agencies involved in the permitting process. On the implementation side, many civil society stakeholders did not consider that legal provisions and administrative rules were respected in practice. They noted that a lack of public accessibility to the actual environmental impact assessments and mine closure plans of specific companies prevented their full understanding of companies’ environmental obligations during production, and after commercial viability had ceased. Despite the detailed information on environmental monitoring procedures and aggregate figures of studies per type and region, it does not appear that the studies themselves are systematically published, although this is not a mandatory aspect of Requirement 6.4. In addition, the 2021-2022 EITI Report, as a public source of reference, should ensure that links leading to further information on environmental impact, including the studies themselves, are stable and working.

The International Secretariat’s assessment is that Requirement 2.2 is mostly met, which is a regression from the previous Validation. The MSG’s ‘Transparency’ template considers the objective of transparency in licensing practices is mostly fulfilled. Consulted stakeholders did not express particular views on the fulfilment of the objective . The International Secretariat considers that, with the additional information provided through stakeholder consultations, the objective of this requirement is mostly fulfilled. In the mining sector, information about the process for awarding licenses, including technical and financial criteria, and contracts is clearly documented through EITI reporting and on government websites. The Institute for Geology, Mining and Metallurgy (INGEMMET) is responsible for processing licensing requests on a first come, first served basis. Consulted government stakeholders confirmed that a first come, first served system is the only method for awarding mining licenses. In their comments to the draft Validation Report, the MSG clarified the process for mining license transfers, mining suspension and mining cessation, noting that these laws and regulations are found in the General Mining Law. Technical and financial criteria for mining license transfers is clearly documented in these laws and regulations. MSG comments to the draft Validation Report explained that actual transfers that occurred in the period under review, including the identity of the license and its recipients, is publicly available through the SUNARP online portal, upon request. These stakeholders noted that they will consider detailing this information in future EITI reports for ease of access. While less prevalent than mining licenses, there are also Guarantee Contracts for the Promotion of Investment in the mining sector that can be awarded through direct negotiation to large-scale mining projects above USD 20 million. The process for the award of these contracts is available on the Ministry of Energy and Mines (MINEM) website and is briefly summarised through EITI reporting, although it does not appear that the 2021-2022 EITI Report notes recent modifications to these regulations. EITI reporting could be used to summarise these modifications to regulations governing stability contracts described through MINEM publications. MSG comments to the draft Validation Report confirmed the International Secretariat’s understanding that the transfer of mining contracts is between private individuals and outside the remit of mining authorities’ approval. These comments confirmed that there were no transfers of mining contracts in 2022. In terms of mining license allocations in 2022, systematic disclosures through the MINEM mirror information found in the 2021-2022 EITI Report and ‘Transparency’ template, reporting the award of 3,739 mining titles. Information on the award of mining titles is available for previous years and also include basic data on sustainability contracts entered into with mining companies and the expected date that these activities will begin. Available documentation and stakeholder consultations did not comment on the efficiency and effectiveness of licensing procedures, which is encouraged. In terms of non-trivial deviations from statutory procedure, government stakeholders indicated that there was a system in place to ensure that awards adhered to regulations without indicating what this system was. The MSG did not communicate their view on the robustness of the assessment of deviations. There is no information available on the review of the transfers of licenses. License allocation in the artisanal and small-scale mining (ASM) sector is under the purview of the Regional Directorate for Energy and Mines, as noted in successive EITI Reports. There is little information on license allocations in this sector for the period under review other than an explanation of the concession size that indicates it as an ASM mining area. During consultations, government stakeholders noted that many subnational governments do not have the personnel or technical capacity to properly handle ASM license allocation tasks. Links to where information can be found in ASM license allocations and transfers in the period under review do not appear to be available. In the oil and gas sector, information about the process for awarding contracts, including the technical and financial criteria, is described on Perupetro’s website and in the 2020-2021 EITI Report. Additional information on technical and financial criteria can be found in the regulations associated with the Hydrocarbon Law. Perupetro is charged with negotiating oil and gas contracts with international oil companies (IOCs). These contracts can take the form of license contracts, service contracts and other types of related contracts, such as transport contracts and are entered into through direct negotiation and competitive bidding. Processes used in competitive bidding are clearly outlined on Perupetro’s website and a list of approved bidders can be found on the SOE’s website as well. This list, however, is incomplete without a full list of bidders, including those that were not selected. EITI reporting does not clearly indicate the procedure for transferring oil and gas contracts but consulted government stakeholders clarified that these are allowed and conducted through Supreme court decrees. It is not clear whether such transfers took place in the period under review. While there are clear technical and financial criteria used in the award process, government stakeholders confirmed during consultations that there is no weighting of these criteria during the transfer of oil and gas contracts. The 2021-2022 EITI Report notes that there was one production contract awarded in 2021 and zero contracts awarded in 2022. Up to date figures on oil and gas exploration and production contracts can be found on Perupetro’s website (here) and includes active contracts entered into before EITI implementation began in Peru. Data related to oil and gas contract transfers in the period under review does not appear to be available. Available documentation and stakeholder consultations did not comment on the efficiency and effectiveness of contracting procedures.

The International Secretariat’s assessment is that Requirement 2.3 is mostly met, which is a regression from the previous Validation. The MSG’s ‘Transparency’ template considers the objective of transparency in extractives property rights to be fulfilled, as did consulted government stakeholders. The International Secretariat considers that the objective is mostly fulfilled as expiration dates are not included in the oil and gas register. Likewise, license duration in the mining sector could be more clearly explained. In the MSG’s comments to the draft Validation report, stakeholders committed to including more information on license and contract duration and expiry. In the mining sector, the System for Mining Rights and Cadastre (SIDEMCAT) and the Mining Cadastre Map (GEOCATMIN) both serve as systematic disclosure points for information on property rights related to extractive deposits and projects. It appears that this cadastre and map cover all active licenses and contracts, including those held by material companies and those classified as artisanal and small-scale. Successive EITI Reports have also included much of the required information on active licenses and mining contracts in annex for ease of reference, which summarises annual MINEM publications of exploration and mining investment projects. Information regarding the name of license holders, license coordinates date of application, award, duration and commodity produced are available through these sources and in the linked full text of mining licenses. In terms of duration, Article 10 of the Mining Law notes that mining concessions are granted in perpetuity as long as the concessionaire continues to fulfil all obligations, namely the payment of derecho de vigencia. Monitoring of derecho de vigencia payments is publicly accessible, as is a list of cancelled licenses due to non-payment. In the MSG’s comments on the draft Validation Report, Peru MSG confirmed the International Secretariat’s understanding and added that concessionaires are also required to demonstrate continued minimum production at the concession. Lack of fulfilment of these aspects could lead to state-imposed penalties, and in severe cases, the rescission of the concession. In the oil and gas sector, Perupetro hosts an online viewing platform that is complimented by the SOE’s up to date list of contracts by lot. Combined, these two sources provide information on all active oil and gas contract holders, including those considered material and included in the scope of the 2021-2022 EITI Report. License holder names are listed, including share of participating interest, and license coordinates are found in the full text of each contract. Date of application and award are clear for contracts listed and EITI reporting provides expiration dates for all production contracts. For the five contracts in exploration phase, however, expiration dates are not clearly indicated. The commodity associated with each oil and gas production contract can be found in the full text of these contracts, but EITI reporting could include additional information on commodity for each contract.

The International Secretariat’s assessment is that Requirement 2.5 is partly met. The MSG’s ‘Transparency’ template considers that the objective of enabling the public to know who ultimately owns and controls the companies operating in the country’s extractive industries is not fulfilled. The Secretariat’s view concurs with the MSG’s self-assessment. While beneficial ownership data is collected by government agencies, there is no public access to this information and some consulted government stakeholders cast doubt on whether public accessibility was possible in the short to medium term. Peru MSG does not use the 2021-2022 EITI Report to provide an overview of beneficial ownership work by the MSG to date. The latest EITI Report provides reference to the previous 2019-2020 EITI Report that outlines what were at the time, recent actions by government to improve the legal and regulatory framework for the collection of beneficial ownership data by government. The Secretariat commends the prior work done by Peru MSG and government officials around beneficial ownership transparency but laments the missed opportunity to use the 2021-2022 EITI Report to disclose this information for companies participating in EITI reporting. Various norms have been passed in the last decade to strengthen Peru’s understanding and oversight of ultimate beneficial owners. The National Superintendency of Customs and Tax Administration (SUNAT) is charged with collecting beneficial ownership information from all companies, as beneficial ownership laws apply across all business sectors. These laws contain a definition of beneficial owner that includes a threshold (10%) for reporting as well as a definition for politically exposed persons (PEP) with penalties for late or absent reporting. Beneficial ownership laws do not extend to the public disclosure of this information. During consultations, the International Secretariat was informed by multiple government stakeholders that these beneficial ownership laws do not extend to foreign companies that hold extractive concessions, potentially pointing to an area for improvement. These stakeholders noted that while foreign companies that are awarded concessions are then required to form a domestic subsidiary, information sharing does not extend to reporting foreign beneficial ownership and PEP information. Instead, an affirmation from the company’s headquarters of the applicable anticorruption clause is deemed sufficient. The 2021-2022 EITI Report does not provide evidence of MSG discussion around beneficial ownership as a country priority or for those companies participating in EITI reporting. The Secretariat understands that many companies operating in Peru’s extractive sector are publicly listed, but the EITI Report does not provide an overview of where citizens can find respective stock exchange filings that could shed light on the ultimate owners of these companies. Consultations with the Independent Administrator revealed that beneficial ownership information was not requested from companies participating in the EITI reporting cycle. Legal ownership for participating companies is publicly available through Register of Legal Persons managed by the National Superintendence of Public Registries (SUNARP).

The International Secretariat's assessment is that Requirement 2.6 is mostly met, which is a regression from the previous Validation. The MSG’s ‘Transparency’ template considers the objective of ensuring an effective mechanism for transparency and accountability for well-governed state-owned enterprises (SOE) and state participation more broadly is fully met. Stakeholders consulted did not express particular views on the objective of this requirement, although the International Secretariat considers that the objective is mostly met, given weaknesses in the MSG’s review of the practices of SOEs’ financial relations with the state beyond the SOEs’ publications of their own financial statements. The 2021-2022 EITI Report confirms that state participation in the oil and gas sector gives rise to material payments from two SOEs – Perupetro and Petroperu. The former, Perupetro, engages in hydrocarbon production and collects payments from international oil companies that operate wells in Peru. The latter, Petroperu, participates in the transportation of hydrocarbon products. While there are not direct discussions on the materiality of the payments of these SOEs, the International Secretariat is not concerned about the exclusion of other potential SOEs in the oil and gas sector. The 2021-2022 EITI Report does not describe the statutory financial relations between oil and gas SOEs and the state but does refer to the 2019-2020 EITI Report that provides further information, including links to government sources. Perupetro and Petroperu are governed by the 2005 Hydrocarbon Law, which details the financial relations between these SOEs and the state. Provisions on transfers of funds to the state, retained earnings, reinvestment and third-party financing are described through this law. Consulted government stakeholders confirmed the arrangement by which oil and gas SOEs are able to retain funds to apply to overhead costs but that all other revenues must be transferred to the state. In practice, EITI reporting contains limited information on Perupetro’s financial relations with the state outside of aggregate figures on revenues received in the form of royalties and from its own sales of hydrocarbons from wells operated by the SOE. Audited financial statements from Perupetro, however, provide more detailed information on the transfer of funds from Perupetro to the state (including statutory transfers to the Ministry of Energy and Mining (MINEM) and the Supervisory Agency for Investment in Energy and Mining (OSINERGMIN)), retained earnings and reinvestment. While it is not clear whether Perupetro’s financial statements note third-party financing and debts serviced by the SOE, its 2022 Sustainability Report indicates that the company is self-sustaining and does not receive outside financial assistance. Peru’s other oil and gas SOE, Petroperu, also publishes audited financial statements that contain information on the transfer of funds to the state, retained earnings and reinvestments. Petroperu, provides detailed information about third-party financing and debt servicing (including repayment schedule and interest rate) in annex to its financial statements. These data are of particular importance given media reports of Petroperu’s outstanding loans to government. The Secretariat commends Perupetro and Petroperu for the consistent publication of audited financial statements. There is no evidence, however, that the MSG reviewed these financial statements to provide an annual diagnostic of adherence to statutory rules governing oil and gas SOEs’ financial relation with the state. With regards to state participation in oil and gas companies and projects, Peru’s EITI reporting and a review of SOE financial statements note that Perupetro and Petroperu are 100% state-owned. It is the International Secretariat’s understanding that Perupetro does not have ownership of subsidiary companies and that due to the contractual regime present in the upstream oil and gas sector, does not hold participating interests or equity stakes in extractive projects outside of those which it operates directly. Petroperu, on the other hand, possesses numerous wholly owned subsidiary companies, including the Talara Refinery, which has been linked to the SOE’s indebtedness. These subsidiary companies are detailed through its 2022 annual report. Due to its position in the midstream sector, Petroperu has not historically held participating interests or equity stakes in extractive projects. However, as of October 2023, Perupetro and Petroperu jointly operate two lots in the Talara field. Regarding the encouraged aspects of Requirement 2.6.c, Perupetro and Petroperu provide detailed information related to rules governing operating and capital expenditures and corporate governance. In the mining sector, there are no SOEs involved in the production or sale of mineral commodities, but Activos Mineros (AMSAC), takes part in environmental remediation activities once a mine has reached the end of its commercial life. AMSAC receives the majority of its funding from the Ministry of Energy and Mines (via the National Budget) and is under the scope of the National Fund for Financing State Business Activities (FONAFE). AMSAC also receives payments from mining companies operating under Transfer Contracts, which contain contractual obligations for investment projects. The Las Bambas project represents the majority of contractual payments flowing to AMSAC. The reconciliation of revenue flows related to AMSAC is a clear improvement from the previous Validation. AMSAC’s statutory financial relations are described in previous EITI Reports and also through their annual sustainability reports. Statutory rules and practices regarding transfer of funds between the state and AMSAC are clearly described in these sustainability reports. Detailes on how AMSAC invests proceeds are detailed and it is the Secretariat’s understanding that AMSAC is not able to retain earnings or engage in third-party financing. AMSAC does not have ownership over other mining companies nor participation in extractive projects and has remained wholly owned by the state. In the MSG’s comments to the draft Validation Report, they expanded on the role of AMSAC, which also supports the promotion of private investment both the extractive sector, and more broadly. Regarding the encouraged aspects of Requirement 2.6.c, AMSAC provides detailed information related to rules governing operating and capital expenditures and corporate governance.

The International Secretariat's assessment is that Requirement 4.2 is partly met, as opposed to being considered ‘not applicable’, as in the previous Validation. The MSG’s ‘Transparency’ template considers that this requirement remains ‘not applicable’, but the Secretariat considers that the objective of transparency in the sale of in-kind revenues of oil and gas is not fulfilled given that Perupetro’s audited financial statements indicate that Savia Peru S.A. made in-kind payments in the period under review. The previous Validation considered that Requirement 4.2 was ‘not applicable’ but included a corrective action requesting specific attention be paid to whether Savia Peru S.A.’s operation of Block Z-2B led to material payments. Coincidentally, Perupetro’s audited financial statements reported that payments to the SOE from this Block were made in-kind. The financial statements indicated that this is the only Block/company that made in-kind payments in the year under review. Savia’s operation of Block Z-2B is unique in that it was (expired in November 2023) the only remaining Services Contract in effect in the country. While Savia operated another contract, this is a License Contract. The 2021-2022 EITI Report is an improvement upon the corrective action to evaluate Savia’s materiality. EITI reporting indicates that Savia is indeed a material company (~7% of petroleum production in 2022). Perupetro’s financial statements indicate that Savia is in the process of closing its other operation in Block Z-6, which could indicate that the majority of the production comes from Block Z-2B. Given the potential of the in-kind payments made by Savia for Block Z-2B to be material, Peru MSG and the Independent Administrator should address these payments in the context of Requirement 4.2.

The International Secretariat's assessment is that Requirement 4.5 is mostly met. The MSG’s ‘Transparency’ template states that this requirement is ‘not applicable’ but that required information, outside of financial support from the state, is available through the data collection exercise undertaken by the Independent Administrator. The Secretariat considers that the objective to ensure the traceability of payments and transfers involving SOEs and to strengthen public understanding of whether revenues accruable to the state are effectively transferred to the state and of the level of state financial support for SOEs is mostly fulfilled given that company payments to Petroperu are only provided in aggregate and there is opportunity to improve data granularity through company-level disclosure. Payments received by AMSAC, whether by government or private companies, are fully disaggregated. Perupetro’s audited financial statements provide aggregate company payments by revenue stream, but not by individual company. Additional publications found on Perupetro’s website provide additional information on payments by individual contract. Petroperu, however, only reports company payments in aggregate, by revenue stream. This limits the public’s ability to fully understand transactions between private companies and this oil and gas SOEs. With regards to SOE transfers to government, the 2021-2022 EITI Report and audited financial statements of Perupetro and Petroperu clearly show payments and transfers to government. AMSAC, in its capacity in environmental remediation, receives payments from government and private companies and does not make transfers to government. Government transfers to SOEs are clearly documented through SOE financial statements. Perupetro’s audited financial statements indicate that the company is self-sustaining and did not receive financial assistance from the state. Petroperu, on the other hand, has received substantial financial assistance from the state and documents the terms and payment modalities, as well as account status, for these loans through their audited financial statements. In mining, AMSAC’s audited financial statements show the transfers that the SOE receives from the Ministry of Energy and Mines.

The International Secretariat's assessment is that Requirement 6.2 remains not applicable. The MSG’s ‘Transparency’ template also indicates that this requirement should be not applicable, but the Secretariat did not find documented discussion of this requirement in either the 2021-2022 EITI Report or in MSG meeting minutes to provide evidence that this requirement remains not applicable. Peru’s subnational transfer system (see Requirement 5.2) and Work for Taxes (Obras por impuestos) (see Requirement 4.3) arrangements provide many of the services and accomplish many of the infrastructure goals that are often carried out through quasi-fiscal expenditures in other countries. While not always the case, quasi-fiscal expenditures are often used in place of direct government financing when central governments decide not to finance these activities through the national budget. Subnational transfers are clearly documented and reflected in the national budget and are therefore not considered under Requirement 6.2. In terms of Work for Taxes arrangements, the Secretariat’s opinion is that these infrastructure projects do not qualify as quasi-fiscal expenditures (even when carried out by extractive SOEs) because ‘payment’ comes in the form of Corporate Income Tax offsets that do not qualify as off-budget expenditures in the national budget. Consulted government stakeholders added that information on these offsets can be found through monthly publications on the Ministry of Economy and Finance website.

The International Secretariat’s assessment is that Requirement 3.2 is fully met, which is a regression from the previous Validation. The MSG’s ‘Transparency’ template considers that the objective of ensuring public understanding of extractive commodity production levels and the valuation of extractive commodity output is fully met, which was echoed by government stakeholders consulted for this Validation. In the mining sector, the Ministry of Energy and Mines (MINEM) produces monthly and annual reports with information on production levels and the valuation of all mineral commodities. The 2021-2022 EITI Report reflects information found on government websites and figures reported by government broadly align with third-party sources, such as USGS survey data. Production volumes are further disaggregated by region and company, although not by project, which is encouraged. EITI reporting adds context to production volumes over time by explaining trends from year to year. Government publications discuss global trends affecting the valuation of different mineral commodities, but it is not clear whether these prices reflect the value of production of these minerals in Peru’s country context. During consultations, government stakeholders noted that there is a system in place to ensure the reliability of values associated with production but did not elaborate further. Additional information related to the calculation of production values in the mineral sector was not provided during the MSG commenting period. Concerning encouraged aspects of Requirement 3.2, the Secretariat did not find documented discussion on the reliability of production information, although this does not affect the overall assessment and sources of production data are clearly indicated. On the other hand, government sources provide estimates of artisanal and small-scale production (which mainly takes place in four main regions of Peru: Madre de Dios, Puno, Piura and Arequipa) and discusses ongoing efforts to further formalise illegal mining operations. From available disclosures, it is not clear whether Peru MSG considers government estimates of artisanal and small-scale mining to conform with international data standards and methodologies for calculating extractive commodity production data. In the oil and gas sector, Perupetro produces regular reports on production levels of petroleum and natural gas and includes year-on-year pricing information from a variety of international sources. Production volumes are further disaggregated by region, company and project (lot). Average production by producer in shared lots is provided through EITI reporting and systematic disclosure. Variations on production from one year to another are given context through EITI reporting, which summarises the systematically disclosed information. Concerning encouraged aspects of Requirement 3.2 aimed to strengthen implementation of the requirement, such as documented conversations on the reliability of production information, is not discussed in government sources or through the 2021-2022 EITI Report.

The International Secretariat’s assessment is that Requirement 3.3 is fully met, as in the previous Validation. The MSG’s ‘Transparency’ template considers that the objective of ensuring public understanding of extractive commodity export levels and the valuation of extractive commodity exports is fulfilled. Consulted government stakeholders did not express particular views on the fulfilment of this objective but the International Secretariat agrees with the MSG’s view that the objective is fulfilled. In the mining sector, the Ministry of Energy and Mines (MINEM) publishes annual reports detailing the volumes and values of mineral exports by commodity. Artisanal and small-scale contributions to overall exports are included in export totals but are not disaggregated to provide a detailed understanding of ASM contributions to overall exports. The 2021-2022 EITI Report reflects information found on government websites and provides clear links to where this information can be found. There is brief discussion of the methods used to calculate mineral export values. While only encouraged by Requirement 3.3, mineral exports are not further disaggregated by state/region of origin, company or project. In the oil and gas sector, Perupetro, in collaboration with the National Data Centre and Ministry of Energy and Mines, provides annual publications detailing the volumes and values of exports by commodity. The 2021-2022 EITI Report reflects information found on government websites and provides clear links to where this information can be found. While export values are provided with links to sources of export data, the methodology behind how these values are calculated is not provided. While only encouraged by Requirement 3.3, oil and gas exports are not further disaggregated by state/region of origin, company or project. Other encouraged aspects of Requirement 3.3, such as reporting on the reliability of export information does not appear to be documented in government disclosures or through EITI reporting for either mining or oil and gas. On the other hand, sources of export data and how export data is calculated are discussed in government disclosures. EITI reporting and government disclosures devote significant attention to the presence of illegal mining in Peru but do not provide estimates of contributions to export data from this sector. Consulted industry stakeholders consider that approximately 40% of gold production in Peru stems from illegal sources. Given the significance of illegal mining, it is important for EITI Reports and government publications to provide estimates, including those produced by third parties, for public reference.

The International Secretariat's assessment is that Requirement 4.1 is mostly met with improvements. The MSG has clearly defined materiality thresholds and identified the companies making material payments, with 51 companies and six government entities fully reporting in accordance with the materiality definition. It appears that these thresholds ensure comprehensive coverage. The material revenue streams are publicly listed and described in the EITI Report. Building upon lessons from the previous Validation, the MSG has strengthened data reliability and comprehensiveness procedures. However, EITI reporting does not include full government disclosure for each type of revenue stream, including those below the materiality threshold. This information is essential to assess the extent of reconciliation coverage. Various government platforms publish disaggregated data on tax and non-tax revenues, but these are not always presented at the level of detail required by the EITI Standard and do not cover the entirety of revenue types. Therefore, the Secretariat’s view is that the objective of ensuring comprehensive disclosures of company payments as the basis for detailed public understanding is mostly fulfilled. The MSG materiality decisions for both revenue streams and companies are documented in the MSG meeting minutes. For mining companies, the materiality threshold was set at those exceeding 1.5% of the total annual production during the 2021–2022 fiscal years. Similarly, in the oil sector, companies producing more than 1.5% of annual liquid hydrocarbons and more than 1% of annual gas production were included. Through this approach the achieved revenue coverage is of 89.46% for mining, 97% for oil and 98% for gas, with 51 companies participating in the reconciliation process. The material revenues are described in the EITI Report including those defined under Requirement 4.1.c. Entities such as MEM, SUNAT and Petroperu systematically disclose tax and non-tax revenues (see here, here, here and here). However not all extractive revenues are disaggregated as required under the EITI Standard and Peru’s EITI Report does not indicate the coverage of reconciliation compared to full government revenues by each revenue stream. Previous validations raised concerns about the value production-based approach—particularly for companies near the materiality thresholds. To address corrective actions from the previous Validation, Peru supplemented the production-based materiality approach with an ex-post assessment to ensure all material payments were disclosed, as recommended in the previous Validation. EITI Peru formally requested that SUNAT verify whether any companies responsible for more than 3% of income tax payments had been excluded from the reporting scope defined by the MSG. The tax authority, SUNAT, confirmed that no companies meeting this criterion, and with material production for each subsector, had been omitted from the list submitted by the MSG. This double approach also seeks to ensure that significance of a company is not underestimated due to tax credits such as those under Works for Taxes (WxT) mechanism, which allows companies to use part of their income tax obligations to finance public investment projects. For the first time, Peru implemented an online reporting platform hosted by the Ministry of Energy and Mines. Through this platform, 50 companies and 5 government entities submitted their information via annexes, except for Chinalco and the Tax Authority (SUNAT). Under a confidentiality agreement, SUNAT provided company data to the Independent Administrator (IA) and Chinalco submitted its information directly to the IA. For all other entities, the IA accessed the Ministry’s online system to retrieve the submitted annexes. Stakeholders observed that further development of this digital system could greatly improve the efficiency of the IA’s work in the future. A key improvement during this reporting phase is the reconciliation of additional revenue streams, including contractual royalties and contributions to OSINGERMIN and OEFA, addressing the gaps identified in previous Validations. This approach ensured that fully reported receipts by material government entities. Additionally, stakeholders highlighted notable progress in the timeliness of confidentiality waivers with SUNAT, further enhancing the reporting process.

The International Secretariat's assessment is that Requirement 4.3 is not applicable. In Peru, companies involved in the extraction of oil, gas, or minerals are not legally required to undertake infrastructure projects in direct exchange for resource extraction rights. However, certain frameworks, such as Peru's "Works for Taxes" (WxT, obras por impuestos) regime, create a form of indirect infrastructure contribution. Under this program, companies can offset their Corporate Income Tax obligations by executing pre-approved public works projects instead of paying cash taxes. During the fiscal year under review, the regulatory framework was modified to expand Works for Taxes funding sources and eligible activities, including emergency investments, operations, and maintenance. Notably, both the number of projects and total investment in 2022 exceeded those of 2021, reaching 464.45 million soles. This increase is attributed to the coordinated efforts of the Peruvian Agency for Private Investment (ProInversión), ministries, and regional governments, which facilitated the awarding of projects that benefited local communities. The WxT mechanism allows companies to contribute to infrastructure development, but these contributions are considered voluntary and come with conditions that are not tied directly to the extraction rights, meaning these arrangements do not meet the definition of a barter-type infrastructure provision under the EITI Standard.

The International Secretariat's assessment is that Requirement 4.4 is mostly met. The 2021-2022 EITI Report discloses some disaggregated revenues associated with the transportation of oil, gas and minerals. The MSG is yet to document its assessment on the materiality of transportation and provide the level of details and disaggregation commensurate with other payments and revenue stream to fulfil the objective of ensuring transparency in transportation revenues as a basis for promoting greater accountability in extractive commodity transportation arrangements. The EITI Report discloses transportation-related revenues linked to three entities: the Supervising Agency for Investment in Energy and Mining (OSINERGMIN), the Energy and Social Inclusion Fund (FISE), and the state-owned enterprise PetroPeru. The EITI Report explains that the contributions – Aportes por Regulación (APR) –is calculated based on the monthly billing of extractive companies, excluding the Value Added Tax (IGV). The portion related to transportation is then determined as a percentage of the total APR. The EITI Report also discloses FISE’s revenue derived from natural gas transportation tariffs. Details of these arrangements can be found in OSINERGMIN publications. The SOE, PetroPeru, owns and manages the pipeline Norperuano (OPN). The aggregated revenues from oil transportation through this pipeline are disclosed on the audited financial statements. The company’s annual reports and financial statements also include volumetric forecasts of crude oil transportation. Although revenues from this activity do not appear to be material, the MSG has not yet documented the rationale for considering them non-material. In the MSG’s comments to the draft Validation Report, stakeholders confirmed that that OPN pipeline was mostly, if not completely, out of service between 2016 and 2022, which reduced revenues from this pipeline to the extent that it is not a material revenue stream. The International Secretariat accepts this explanation and does not deem the lack of disaggregation of these revenues to be a gap in the assessment of Requirement 4.4. Furthermore, the Secretariat commends Peru MSG for including these revenues in aggregate. PetroPeru’s audited financial statements also include an impairment evaluation due to stoppages caused by incidents affecting OPN, as also indicated in the EITI Report. The OPN pipeline is a critical piece of infrastructure for the transportation of crude oil in Peru and its operational status and financial health directly affect the transportation of hydrocarbons, including revenues generated from this activity. Given the OPN’s critical role in Peru, a comprehensive description of the transportation arrangements related to this infrastructure would help stakeholders better understand the full scale of the system’s operational and financial challenges.

The International Secretariat's assessment is that Requirement 4.7 is mostly met. The 2021-2022 EITI Report provides a high level of disaggregation and consulted stakeholders highlighted that most, but not all, payments from the oil, gas and mining sector are by company and not by individual project. The Secretariat’s view is that the objective is mostly fulfilled, given that it is not clear what revenues are levied on project level, and hence it cannot be established if revenue data levied at the project level is fully disaggregated and publicly accessible. Reconciled financial data on material revenues and payments is disaggregated by company, government entity, revenue stream and by project for oil royalties. The EITI Report provides information on the legal framework, and most revenues are charged at the company-level. Stakeholder consultations noted that only “derecho de vigencia”, which is charged per hectare of land granted under a specific mining concession is levied at project-level and this information is systematically disclosed. In the mining sector, payments such as royalties (“regalía minera”), the special mining tax (“impuesto especial a la minería”) and the special mining levy (“gravamen especial a la minería”), are consolidated at company-level and not by individual concession. Stakeholders clarified that, in the past, mining royalties and the special mining tax were based on the value of production rather than operating profits. At that time, some companies reported payments at project level. However, in 2012, the calculation basis shifted from the value of production to operating profits, leading to the consolidation of payments at the company level. Unlike mining royalties, oil royalties (Regalía Petrolera) are based on production measured at an agreed fiscalisation point. The EITI Report discloses oil royalties at individual “lote” (contract) level, indicating that payments are recorded separately for each block, rather than being automatically aggregated at the company level. However, in other cases, royalties for multiple “lotes” operated by the same company are consolidated into a single total. This means that reporting by “lote” can effectively be considered project-level reporting for oil and gas royalties, but for companies that aggregate multiple “lotes” (such as SAPET DEVELOPMENT PERU INC, operating blocks VII and VI), additional clarifications from the MSG on individual “lote” contributions would be necessary to align fully with project-level reporting standards or further clarification if these multiple lotes could be considered substantially interconnected agreements. Finally, other payments, applicable to both sectors, such as income tax and contributions to OSINERGMIN and OEFA are paid by company. While the report explains the basis of extractive company payments, there are areas that could be further clarified. Some consulted stakeholders pointed out that project-level disclosure was yet to be addressed by EITI Peru. It is unclear whether the MSG reviewed the legal instruments in Peru for the purpose of project level reporting, especially for payments where it seems applicable, such as of “derecho de vigencia” and oil royalties.

The International Secretariat's assessment is that Requirement 4.8 is fully met. Stakeholders consulted did not express any views on progress towards this objective. Peru EITI has consistently published information in accordance with the EITI Standard, its work plan, and provision 4.8. However, it has requested several extensions, resulting in two suspensions for failing to meet reporting deadlines. The most recent report, covering fiscal years 2021-2022, was published in May 2024, aligning with provision 4.8.b, ensuring data is no older than the second-to-last complete accounting period. On the other hand, it is noteworthy that Peru published at least seven subnational reports including for regions Loreto, Arequipa, Moquegua, Piura, Apurimac and La Libertad. Moreover, Peru is working on improving timeliness challenges by implementing the use of an EITI reporting platform. It is the Secretariat’s view that with the timely publication of its latest report, Peru has ensured that public disclosures of company payments and government revenues from oil, gas and mining remain sufficiently timely to be relevant to inform public debate and policymaking.

The International Secretariat's assessment is that Requirement 4.9 is mostly met. Peru EITI has described audit and assurance procedures of company payments and government revenues from the oil, gas, and mining sectors. The MSG has also agreed on measures to ensure the credibility of company data. Audits of government entities conducted by the Office of the Comptroller General are publicly accessible. The EITI Report includes conclusions derived from the reconciliation process and confirms that all companies submitted required documents. However, it does not provide details on the extent to which companies complied with the quality assurances for financial data and consulted stakeholders informed that not all companies had their financial statements audited, which was a requirement for reporting companies. The EITI Report does not have a statement of reliability of government and company disclosures, or a summary of key findings with relationship to companies’ financial disclosures. While progress has been made in addressing corrective actions from the previous Validation, the Secretariat’s view is that the fulfilment of this requirement is mostly met. Quality assurances followed the standard ToR’s approach to conventional reporting, reconciliation (see Requirement 4.1). The EITI Report includes an explanation of the underlying audit and assurance procedures that both companies and government entities are subject to. This is an improvement since Peru’s 2018 EITI Validation. Peru was then required to examine audit and assurance procedures for both companies and government entities involved in the EITI reporting process, and to agree on what information should be provided to ensure the credibility of the data. In Peru, for taxation purposes, companies are classified as Principales Contribuyentes (main contributors) and MEPECOs (small and medium taxpayers). Most reporting companies fall under the PRICO category, meaning they are subject to enhanced monitoring by the tax authority SUNAT. Information provided to SUNAT is considered an affidavit. When PRICOs declare payments, the system automatically verifies the accuracy of the submitted information. Additionally, companies above a certain threshold in a given fiscal period must present their audited financial statements according to the timelines established by the Superintendency of Values and Markets (SVM). For government entities, the General Comptrollership of the Republic (Oficina de la Contraloría General de la República, OCG), the highest oversight body, is responsible for regulating and ensuring, among other things, the internal control and reliability of financial statements. In the 2018 Validation, the MSG explained that the OCG can audit the financial statements and budgets of public entities or contract external firms under its own regulations. All government entities covered by EITI reporting must undergo annual audits. Audits can be publicly found (see for instance here, here, here and here). Peru’s MSG agreed on the assurances that reporting companies had to provide to ensure the credibility of data as well as provisions for safeguarding confidential information. These assurances include providing information with authorised signatures from company representatives, confirming that their 2021-2022 financial statements have been audited and indicating their most recent fiscal revision by SUNAT or another private entity. In cases where entities or information have not undergone auditing, this information will be disclosed to the MSG. Consulted stakeholders from SUNAT noted that some companies had financial statements, these are not always audited. This is because some companies are subsidiaries, and only the parent company's financial statements are audited.. Additionally, documentation and stakeholder consultations indicated that there was an agreement with the Financial Intelligence Unit (UIF) to verify company payments. Although both the EITI Report and consulted stakeholders indicated that companies provided the requested documentation, the Report does not provide comment on the extent to which payments were actually verified with the UIF. Furthermore, it remains unclear whether and to what extent quality assurances were followed, as the EITI Report does not include a summary of key findings from the assessment on the reliability of financial data disclosed. Contextual information is in the report is clearly sourced.

The International Secretariat's assessment is that Requirement 5.1 is mostly met. In the ‘Transparency’ template the MSG assessed progress as largely fulfilling the objective of this Requirement. Peru’s EITI Reports as well as government websites indicate and describe how revenue streams are collected and allocated, including distribution to subnational entities. However, the Secretariat’s view is that to fulfil the objective of ensuring the traceability of extractive revenues, more clarity is needed regarding revenues that may not be recorded in the national budget. While MSG comments provided information on the expenditures of some off-budget funds, corresponding information on transfers from Perupetro was not provided and does not appear to be publicly available. The 2021-2022 EITI Report explains collection mechanisms and it’s indicated that revenues are recorded in the Treasury Single Account (TSA), managed by the Directorate General of the Public Treasury (Dirección General del Tesoro Público, MEF) and either retained in the national budget or redistributed to subnational entities. The TSA which consists of a main bank account at the Bank of the Nation (Banco de la Nacion), with collecting and paying sub-accounts for each spending agency at the same bank. Subnational EITI reports have covered well the basis for the allocation and actual allocations in the period under review. The MSG has gone a step further by assessing the effectiveness of execution, including the management of special funds. Similarly, systematic disclosures on subnational transfers provide valuable information on revenue composition, collection mechanisms, and allocation formulas. In the ‘Transparency’ template the MSG provided links to government description of the Camisea Socio-Development Fund (FOCAM). Under this arrangement, the central government, through the MEF allocates 25% of the royalties from the Camisea Gas project to FOCAM. These funds are then transferred to regional and local governments for socio-economic development projects. In MSG comments to the draft Validation Report, stakeholders confirmed that FOCAM revenues first pass through the national budget. These revenues are also traceable through EITI reporting. EITI reporting and systematic disclosures document off-budget revenues managed by the SOE Activos Mineros from contractual royalties, with corresponding financial statements showing the flow of these revenues. Another portion of the gas royalties from the Camisea project is, according to law, allocated to the Police and Armed Forces Fund. They are not mentioned in the 2021-2022 EITI Report. Third-party sources have indicated that these are only documented when expenditures occur rather than at the time of transfer. While MSG comments to the draft Validation Report confirm the execution of these expenditures, there is a lack of publicly available information in Perupetro’s audited financial statements and annual reports that demonstrate the transfer of these royalties ahead of execution. Another revenue stream to be considered under this requirement is WxT mechanism. Instead of making payments that would enter the public treasury, companies directly invest in infrastructure, health, or education projects, based on a list of prioritized public investment needs. The Ministry of Economy and Finance (MEF) maintains a centralised database of WxT projects and publishes an open data file that ranks participating companies along with the corresponding investment amounts. In addition, both national and subnational EITI reporting disclose the committed and executed amounts under this mechanism, thereby enhancing transparency and allowing for public oversight of these quasi-fiscal contributions. There is no indication of other significant off-budget revenues or untraceable beyond those already disclosed, However, it is the Secretariat’s view is that a definitive and clearer statement with regards to the inexistence of any additional off-budget revenues is needed.

The International Secretariat's assessment is that Requirement 5.3 is fulfilled. Peru subnational reporting addresses a description of revenues and their use for specific programmes, activities, projects, as well as information on country’s planning processes linking to publicly available information. The Secretariat’s view is that the objective of strengthening public oversight of the management of extractive revenues, and the use of these revenues to fund specific public expenditures is fulfilled. This conclusion is based on consideration of the steps Peru has taken to analyse on revenue management and expenditures at the subnational level, of key area of interest for stakeholders. Peru’s EITI reports provide detailed insights into the revenue flow cycle and its management. This is completed through subnational reporting, which presents execution percentages by each government entity and moving forward analyses disparities among them. The report also examines the coherence between what planned and actual executions by level of government. For instance, the 2022 Arequipa Report identifies that execution only partially aligns with initial planning. Additionally, EITI Peru seeks to address whether higher extractive revenue correlates with improvements in social and economic indicators compared to the rest of local governments. Furthermore, the report provides data on the use of extractive revenues for environmental management. Overall, subnational EITI reports offer recommendations and in-depth analyses to enhance efficiency and accountability of extractive revenue management.

The International Secretariat's assessment is that Requirement 4.6 remains not applicable in the period under review. The previous Validation deemed this requirement ‘not applicable’ as it was established that subnational government entities do not levy any specific taxes on extractives industries. Other taxes collected by subnational governments appear to be immaterial. In the transparency template, the MSG indicated that neither regional and local governments apply taxes or payments on extractive companies. The Secretariat’s assessment is that Requirement 4.6 remains not applicable, similar to the previous Validation. There is no indication that subnational government entities levy specific taxes on the extractive industries. Additionally, neither the EITI Report nor the reviewed subnational reports mention direct payments from extractive companies to subnational government entities.

The International Secretariat's assessment is that Peru has exceeded Requirement 5.2, as in the previous Validation. The objective of this requirement is to enable stakeholders at the local level to assess whether the transfer and management of subnational transfers of extractive revenues are in line with statutory entitlements. Peru has been a pioneer in decentralising EITI implementation at the regional level, with five active regional multi-stakeholder groups (MSGs). EITI reporting, subnational reports and other sources provide a comprehensive overview of subnational transfers, offering detailed insights into their management. Therefore, the Secretariat considers this requirement to be exceeded. Peru’s mineral revenue-sharing system allocates mining and hydrocarbon revenues to subnational governments that host extractive activities based on production levels. Subnational areas that host the transportation routes also receive transfers. Subnational transfers flow through a decentralised governance structure of national, regional, and municipal governments that can all receive separate funds. The 2021-22 EITI Report outlines the revenue-sharing formula and details the value of subnational transfers of mining and petroleum revenues for each beneficiary local government. In Peru, transfers of extractive sector revenue between national and subnational government entities are legally mandated. The country has a well-defined legal framework governing the distribution of these transfers among national, regional, and local governments. The legal framework, allocation criteria, methodology for subnational transfers, budget monitoring and execution are publicly available on the Ministry of Economy and Finance website and in the 2021-2022 EITI Report. The actual amount allocated in the budget, as well as the amount transferred to national, regional and local governments, is publicly available in the open data portal of the Ministry of Economy and finance website. The EITI Report states that the reconciliation of royalty payments between amounts collected by SUNAT and payments made by companies revealed a minor discrepancy of 0.002% in 2021, while no difference was found in 2022.The Ministry of Economy and Finance's Transfers Transparency Portal provides detailed information on subnational transfers at the regional, municipal, and provincial levels. It also discloses the direct beneficiaries/entities receiving the transfers and the correlation between the authorised and actual transferred amounts. The portal offers regularly updated, monthly disaggregated data on subnational transfers and unspent canon. Additionally, the 2021-2022 EITI Report includes disaggregated information on transfers to departments, local and regional governments, and universities. Beyond the information provided in the 2021-2022 EITI Report, Peru has been a pioneer in decentralising EITI implementation at the regional level. Currently, five regional EITI subnational MSG’s are active in Moquegua, Piura, Arequipa, Loreto, and Apurímac, while three additional regions, Áncash, La Libertad, and Cajamarca, are in the process of forming their own MSGs. These subnational reports provide detailed insights into the process for subnational transfers of mining and oil and gas canon and royalties. They also offer a comprehensive analysis of how these funds are allocated and executed by municipalities and local entities. The reports disclose information related to the allocation and execution of subnational transfers in public investment such as education, culture and sports, health, transport, energy and communication among others. Consulted stakeholders emphasised the importance of assessing the effective use of revenues, a primary concern for communities and local stakeholders. Subnational reports highlight the existence of transparency portals by public institutions, which allow for analysis of how funding is utilised particularly in water services, education, and municipal management. These subnational reports also outline budget execution levels in municipalities receiving funding. Peru EITI has described audit and assurance procedures of company payments and government revenues from the oil, gas, and mining sectors. The MSG has also agreed on measures to ensure the credibility of company data. The EITI Report includes an explanation of the underlying audit and assurance procedures that both companies and government entities are subject to.

The International Secretariat's assessment is that Requirement 6.1 is mostly met, as in the previous Validation. In the ‘Transparency’ template the MSG assessed progress as partially met. The objective of enhancing the public understanding of extractive companies’ social and environmental contributions and assess their compliance with legal and contractual obligations has been mostly fulfilled. Since the last Validation, Peru has made progress in collecting data on mandatory social and environmental expenditures. While mandatory social and environmental expenditures in the mining sector are publicly available through various sources, gaps remain in the disclosure of social and environmental expenditures from the hydrocarbon sector. There has been progress in gathering data on voluntary social expenditures in both the mining and oil and gas sectors through a unified format, facilitating the distinction between voluntary and mandatory social expenditures in line with the recommendations from the previous Validation. However, the Secretariat was unable to confirm if the information from the hydrocarbon sector is publicly accessible on a portal. Further disaggregation of environmental payments would also be beneficial. It’s therefore the Secretariat’s view that requirement 6.1 is mostly fulfilled. Companies are required to undertake mandatory social and environmental expenditures by law. Peru has established the “Social Funds" in 2008 with the enactment of legislative Decree No. 996, which regulates the use of resources from private investment promotion processes for sustainable development projects in the areas affected by extractive projects. The 2021-2022 EITI Report provides detailed information on the social fund’s specific names/associations, including the number of projects, project execution progress, regions, and payments disaggregated by investment priorities (water, sanitation, education, health, and energy). Stakeholder consultations noted that company payment obligations to specific social funds are attached to each contract entered into with companies. The 2021-2022 EITI Report notes that mining companies report social expenditures through the Consolidated Annual Declaration (DAC). The information from the DAC is presented on the website on mining social investment from the Ministry of Energy and Mines, which provides data on mining companies' social expenditure disaggregated by year, region, province, district, company name, investment category, and activity type. Under activity type the data can be further disaggregated by donation, equipment or project, indicating expenditures made in cash and in-kind. The EITI Report highlights that the Supreme Decree No. 023-2018-EM introduced a standardised format for hydrocarbon companies to report voluntary payments to the General Office of Social Management (OGGS) of the Ministry of Energy and Mines (MINEM). Additionally, Ministerial Resolution No. 286-2023-MINEM/DM from July 2023 introduced a unified format for reporting voluntary social commitments across mining, hydrocarbons, and electricity sectors, requiring biannual submissions to MINEM's General Office of Social Management via their extranet. Regarding mandatory environmental payments, the social fund’s investments prioritise water and sanitation. The EITI Report discloses environmental payments made by companies to OEFA (Organismo de Evaluación y Fiscalización Ambiental), responsible for overseeing environmental regulations in sectors such as mining, hydrocarbons, electricity, fisheries, and industries. It compares company-disclosed payments with OEFA’s data. The report also compares companies disclosed payments with OSINERGMIN’s data (Organismo Supervisor de la Inversión en Energía y Minería). OSINERGMIN is the public regulatory body ensuring the proper functioning, safety, and compliance of the energy and mining sectors, with a focus on environmental protection and safety through inspections and audits. In line with Requirement 4.1, the Secretariat considers social and environmental expenditures material for the review period. The MSG has defined materiality thresholds, identified companies making material payments, and publicly listed the material revenue streams in the EITI Report. In accordance with Requirement 4.9, Peru EITI has outlined audit and assurance procedures for company payments and government revenues from the oil, gas, and mining sectors. The MSG has also agreed on measures to ensure the credibility of company data.