APEC DEREGULATION REPORT 2000

Chapter 10 : Deregulation/ Regulatory Review

Objective

APEC Economies will facilitate free and open trade and investment in the Asia-Pacific Region by, inter alia:

(a) Improving the transparency of regulatory regimes; and

(b) Eliminating those distortions arising from domestic regulations that restrict trade or investment and are not necessary to achieve a legitimate objective.

Guidelines

Each APEC economy will:

(a) explore economy-wide processes for the transparent identification and review of those domestic regulations that may cause distortions that restrict trade or investment, ensuring that reviews consider whether identified distortions are necessary to achieve a legitimate objective; and

(b) consider the adoption of regulatory reform programs that seek to reduce the costs of regulation of particular industries or sectors whilst maintaining the achievement of legitimate objectives.

Collective Actions

APEC Economies have agreed to take collective actions to help achieve these goals. These actions are contained in Collective Action Plans (CAPs) which are updated annually. The current CAP relating to deregulation/regulatory review can be found in the Deregulation Collective Action Plan.

APEC Principles to Enhance Competition and Regulatory Reform

The APEC Leader’s Declaration of September 1999 endorsed the following Principles: Non Discrimination

(a) Application of competition and regulatory principles in a manner that does not discriminate between

or among economic entities in like circumstances, whether these entities are foreign or domestic.

Comprehensiveness

(b) Broad application of competition and regulatory principles to economic activity including goods and services, and private and public business activities.

(c) The recognition of the competition dimension of policy development and reform which affects the efficient functioning of markets.

(d) The protection of the competitive process and the creation and maintenance of an environment for free and fair competition.

(e) The recognition that competitive markets require a good overall legal framework, clear property rights, and non discriminatory, efficient and effective enforcement.

Transparency

(f) Transparency in policies and rules, and their implementation.

(g) Clear responsibility within domestic administrations for the implementation of the competition and efficiency dimension in the development of policies and rules, and their administration.

The Government is committed to the continuation of the deregulation process, through privatization programs and concessions granted in infrastructure and public utilities projects in several economic sectors. In addition, Peruvian public institutions in charge of enforcing the defense of free trade regulations and market access, will continue supervising potential non tariff measures and other bureaucratic barriers imposed by public institutions.

*Peru's Approach to Deregulation/Regulatory Review in 2000*
*Section*	*Improvements Implemented* *Since Last IAP*	*Current Regulatory Review Policies / Arrangements*	*Further Improvements Planned*
*General Policy* *Position*	There has been no change in the general policy approach to regulatory review since the last IAP was prepared.	Since 1990, Peruvian Government has promoted macroeconomic discipline, established market rules, dismantled the trade protection structure, reinserted the economy into the world financial circuit and brought about an all encompassing deregulation of the economy. In 1993, the National Institute for the Defense of Competition and Protection of Intellectual Property (Indecopi) was created simultaneously with the Technical and Commercial Regulations Commission. The latter is a functional body responsible for enforcing the defense of free trade regulations and for supervising all the non tariff measures which are established, in some cases having the faculty to nullify them. Other functional body of Indecopi, which is in charge of supervising all the bureaucratic barriers to entry imposed by public institutions, is the Market Access Commission. The role of both commissions is complementary. While the first focuses on non-tariff measures that could restrict foreign trade, the second one focuses on measures that restrict or limit the access of firms to domestic markets. http://www.copri.gob.pe/ http://www.indecopi.gob.pe/	The Government is committed to the continuation of the deregulation process, through privatization programs and concessions granted in infrastructure and public utilities projects in several economic sectors In addition, Peruvian authorities will continue supervising free trade regulations and bureaucratic barriers imposed by public institutions.

*Peru's Approach to Deregulation/Regulatory Review in 2000*
*Section*	*Improvements Implemented* *Since Last IAP*	*Current Regulatory Review Policies / Arrangements*	*Further Improvements Planned*
*Identification and Review of Proposed Regulations*	There has been no change since the last IAP was prepared with respect to economy-wide processes for the identification and review of proposed regulations that may cause distortions that restrict trade or investment		At the end of 2000 a multisectoral coordination mechanism will be approved, for making more expedite and efficient the notification of proposed regulations to other WTO countries (see also section on Standards and Conformance )
*Identification and Review of Existing Regulations*	On August 2000, an integral Proposal for the Modification and Simplification of Administrative Processes in the public sector was published in the Official Gazette (“El Peruano”).	Any person or enterprise can file a lawsuit against a public institution at Indecopi (Technical and Commercial Regulations Commission or the Market Access Commission) when any regulation imposes unnecessary, unjustified or illegal barriers to trade or bureaucratic barriers to the domestic market. Indecopi, through these commissions also can initiate “ex oficio” investigations against other public institutions that impose such restrictions, when its effect on the market is significative. Composition of relevant review bodies: Indecopi’s Technical and Commercial Regulations Commission (TCRC) and Market Access Commission (MAC) are quasi jurisdictional bodies in charge of pursuing investigations and deciding cases related to trade barriers and market access. Each

*Peru's Approach to Deregulation/Regulatory Review in 2000*
*Section*	*Improvements Implemented* *Since Last IAP*	*Current Regulatory Review Policies / Arrangements*	*Further Improvements Planned*
		Commission is composed of six -part time- commissioners and a -full time- technical secretary. 2. Regulations Review Criteria 2.1.The criteria used when determining whether regulations achieve legitimate objectives in the case of the TCRC and the MAC are as follows: (i) Rationality. TCRC and MAC evaluate whether the aim, purpose or requirement introduced by a regulation is consistent with principles of logic, is proportional with the pursued objectives and do not prevent the proper functioning of a competitive market. (ii) Legality. In the case of non-tariff measures, the TCRC evaluates the legal status of the regulation, and whether it satisfies the legal requirements. In the case of the MAC the evaluation also includes an analysis of subject of matter jurisdiction. (iii) Legitimate objectives. In the case of non- tariff measures the TCRC evaluation also considers the impact of regulation on health, safety, and environment. (see also the section on Non Tariff Barriers)

*Peru's Approach to Deregulation/Regulatory Review in 2000*
*Section*	*Improvements Implemented* *Since Last IAP*	*Current Regulatory Review Policies / Arrangements*	*Further Improvements Planned*
*Reform of Industry/Sector Specific Regulation*	The main improvements achieved since 1999 IAP are: - On mid year 1999, the Peruvian Government privatized the railroad network. - In 1999, the Government granted a 30-year concession for the small port of Matarani on the southern coast. - On February 2000, the license for the exploitation model of the Camisea natural gas project was awarded to a consortium. - On July, this year the Peruvian Congress enacted Law Nº27322, related to the Framework for Regulators on Public Services. This Law simplifies and defines a common structure for regulatory agencies (Osiptel, Osinerg, Sunass and Ositran), specially regarding its		The main sectors in which Peruvian Government will continue with deregulation through privatization and concessions granted in infrastructure and public utilities projects are: - Airports - Ports - Roads and highways - Irrigation projects - Gas distribution - Forestry - Mining - Agriculture http://www.copri.gob.pe/

*Peru's Approach to Deregulation/Regulatory Review in 2000*
*Section*	*Improvements Implemented* *Since Last IAP*	*Current Regulatory Review Policies / Arrangements*	*Further Improvements Planned*
	quasi jurisdictional and administrative bodies. - On July, 2000, the Peruvian Cong ress enacted Law Nº 27336 related to development of faculties and functions of Osiptel”. This Law strengthens the attributions of the telecommunications regulatory agency, in order to make more effective the enforcement of regulations in this sector. - The Peruvian Congress enacted Law Nº 27311 related to the Strengthening of the Consumer Protection System”. This Law introduces new procedures for the resolutions of conflicts between consumers and suppliers. http://www.copri.gob.pe/

*Improvements in Peru's Approach to Deregulation/Regulatory Review since 1998*
*Section*	*Position at Base Year (1998)*	*Cumulative Improvements Implemented to Date*
*General Policy* *Position*	Since 1990, the Peruvian economy has been involved in a deep process of structural reform, one committed to modernizing economic and institutional areas, while also attracting investment. To reach that goal the Government has promoted macroeconomic discipline, established market rules, dismantled the trade protection structure, reinserted the economy into the world financial circuit and brought about an all encompassing deregulation of the economy. Regarding this last topic, since 1990, the Peruvian Government has significantly deregulated the following areas: Investment Foreign technology Exchange regulations Labor regime Financial, insurance and capital markets Foreign trade Sectoral laws Taxation System Liberalization of markets and deregulation shall be complemented with the creation of institutions in charge of the promotion of competition and good business practices. In 1993, the National Institute for the Defense of Competition and Protection of Intellectual Property (Indecopi) was created simultaneously with the Technical and Commercial Regulations Commission. The latter is a quasi jurisdictional body responsible for enforcing the defense of free trade regulations and for supervising all the non tariff measures which are established, in some cases having the faculty to nullify them. Other quasi- jurisdictional body of Indecopi, which is in charge of supervising all the bureaucratic barriers to entry imposed by public	The main improvements achieved since 1998 IAP are: - On mid year 1999, the Peruvian Government privatize the railroad network. - In 1999, the Government granted a 30-year concession for the small southern port of Matarani. - On February, 2000, the license for the exploitation model of the Camisea natural gas project was given t a consortium.

*Improvements in Peru's Approach to Deregulation/Regulatory Review since 1998*
*Section*	*Position at Base Year (1998)*	*Cumulative Improvements Implemented to Date*
	institutions, is the Market Access Commission. The role of both commissions is complementary. While the first focuses on non- tariff measures that could restrict foreign trade, the second one focuses on measures that restrict or limit the access of firms to domestic markets.
*Identification and Review of* *Proposed Regulations*		On August 2000, an integral Proposal for the Modification and Simplification of Administrative Processes in the public sector was published in the Official Gazette (“El Peruano”).
*Identification and Review of* *Existing Regulations*	Any person or enterprise can file a lawsuit against a public institution at Indecopi (Technical and Commercial Regulations Commission or the Market Access Commission) when any regulation imposes unnecessary or unjustified barriers to trade or bureaucratic barriers to the domestic market. Indecopi through these commissions can also initiate “ex oficio” investigations against other public institutions that impose such restrictions, when its effect in the market is significative. Composition of relevant review bodies: Indecopi’s Technical and Commercial Regulations Commission (TCRC) and Market Access Commission (MAC) are quasi jurisdictional bodies in charge of pursuing investigations and deciding cases related to trade barriers and market access. Each commission is composed of six -part time- commissioners and a -full time- technical secretary. 2. Regulations Review Criteria 2.1.The criteria used when determining whether regulations	On August 2000, an integral Proposal for the Modification and Simplification of Administrative Processes in the public sector was published in the Official Gazette (“El Peruano”).

*Improvements in Peru's Approach to Deregulation/Regulatory Review since 1998*
*Section*	*Position at Base Year (1998)*	*Cumulative Improvements Implemented to Date*
	achieve legitimate objectives in the case of the TCRC and the MAC are as follows: (i) Rationality. TCRC and MAC evaluates whether the aim, purpose or requirement introduced by a regulation is consistent with principles of logic, is proportional with the pursued objectives and do not prevent the proper functioning of a competitive market. (ii) Legality. In the case of non-tariff measures, the TCRC evaluates the legal status of the regulation, and whether it satisfies the legal requirements. In the case of the MAC the evaluation also includes an analysis of subject of matter jurisdiction. (iii) Legitimate objectives. In the case of non tariff measures the TCRC evaluation also considers the impact of regulation on health, safety, and environment.
*Reform of Industry/Sector* *Specific Regulation*	The 1999 version of the IAP underlined the Government’s commitment to continue with the deregulation and privatization process initiated in 1990. Specifically, five main areas were mentioned in the last IAP: Airports Ports Concessions National Road Networks Irrigation projects Transport and Gas Distribution	Main improvements since last IAP are: - On mid year 1999, the Peruvian Government privatize the railroad network. - In 1999, the Government granted a 30-year concession for the small southern port of Matarani.. - On February 2000, the license for the exploitation model of the Camisea natural gas project was given to a consortium - On July, this year the Peruvian Congress enacted Law Nº27322, related to the Framework for Regulators on

*Improvements in Peru's Approach to Deregulation/Regulatory Review since 1998*
*Section*	*Position at Base Year (1998)*	*Cumulative Improvements Implemented to Date*
		Public Services. This Law simplifies and defines a common structure for regulatory agencies (Osiptel, Osinerg, Sunass and Ositran), specially regarding its quasi jurisdictional and administrative bodies, - On July, 2000, the Peruvian Congress enacted Law N 27336 related to development of faculties and functions of Osiptel”. This Law strengthens the attributions of the telecommunications regulatory agency, in order to make more effective the enforcement of regulations in this sector. - The Peruvian Congress enacted Law Nº 27311 relate to the Strengthening of the Consumer Protection System”. This Law introduces new procedures for the resolutions of conflicts between consumers and suppliers

APEC Agreements and Declarations

APEC DEREGULATION REPORT 2000 - PERU