For foreign investors in Peru, securing long-term rights to land is often critical for capital-intensive projects in energy, mining, and infrastructure sectors. While standard land leases under Peruvian law are limited to 10 years, alternative structures, such as usufruct (“usufructo”), surface rights (“derecho de superficie”), and concessions (“concesiones”), offer longer durations, greater flexibility, and stronger legal protections. These mechanisms are widely used to align land rights with project lifecycles and financing requirements.

Limitations of Standard Land Leases

Peruvian law imposes clear limitations on standard land leases. The maximum duration for private land leases is ten years, and renewals are subject to both statutory limits and negotiation with the landowner. These restrictions can pose challenges for investors, as short-term leases may not align with the operational or financing timelines of large projects, creating uncertainty for lenders and developers. Consequently, foreign investors often explore alternative legal frameworks that offer greater long-term security and operational certainty.

Usufruct

Usufruct is governed by Articles 949–1021 of the Peruvian Civil Code and grants a person, known as the usufructuary, the right to use and enjoy another person’s property, including the fruits and profits it generates, while preserving the property’s substance. Ownership remains with the original owner, referred to as the naked owner.

As a limited real right, usufruct is enforceable against third parties. Its duration is typically up to 30 years, though this can vary by agreement, and usufruct over property owned by legal entities or for corporate projects may be structured differently. The usufructuary has the right to use the property according to its intended purpose, receive benefits such as rent, agricultural yield, or operational profits, and transfer or mortgage the usufruct unless expressly prohibited. At the same time, the usufructuary is obligated to preserve the property’s substance, maintain it, make necessary repairs, and pay any taxes or charges related to the usufructed property, unless otherwise agreed.

This structure offers investors full operational control for project purposes and protects investments in land improvements, while remaining compatible with environmental and regulatory obligations. In practice, usufruct is commonly used in agricultural projects, residential developments, and energy ventures, providing investors with long-term rights without requiring full ownership.

Surface Rights

Surface rights are governed by Articles 949–951 and 951-A of the Peruvian Civil Code. They allow a person to construct, improve, or exploit structures on land owned by another, effectively separating ownership of the land from the improvements or structures built upon it.

As a limited real right distinct from land ownership, surface rights typically last between 30 and 50 years and can be renewed up to 99 years by agreement. The holder of surface rights is entitled to construct and operate buildings, infrastructure, or industrial facilities, transfer, mortgage, or lease the improvements, and receive profits from their use or operation. At the same time, the holder must return the land to the owner under the agreed conditions at the end of the term, maintain the improvements, and comply with applicable environmental and zoning regulations.

In practice, surface rights are widely used in large-scale energy plants, mining camps, industrial parks, and urban development projects.

Concessions

Concessions are public law instruments that permit private parties to exploit public resources or use public land within a regulated framework. They are primarily governed by sector-specific legislation, including the General Concession Law (Ley de Concesiones de Obras Públicas) for infrastructure and transport projects, as well as the Mining Law and Electricity Law for extractive and energy-related projects.

A concession constitutes a contractual right granted by the state and is enforceable under both administrative and civil law. The duration varies depending on the sector and project, often aligning with the lifespan of the project and ranging from 20 to 50 years or more. The concessionaire is entitled to exploit the resource or land according to the terms of the concession contract, collect revenues from operations, and transfer or mortgage the concession within the limits set by law and the contract. At the same time, the concessionaire must comply with operational, environmental, and safety regulations, pay any fees, royalties, or taxes stipulated in the concession, and complete the works or operational milestones agreed in the contract.

Concessions are particularly relevant in energy generation, mining, water management, transport infrastructure, and public utilities, offering private parties long-term operational rights over public assets or resources.

Considerations for Foreign Investors

Foreign investors often favor usufruct, surface rights, and concessions over traditional leases due to the longer durations these structures offer, which align with project lifespans and financing requirements. They provide legal certainty by clearly separating ownership from usage rights, reducing the risk of disputes, and offer operational flexibility, including the ability to construct, improve, and transfer projects. These arrangements also facilitate access to financing, as lenders and project financiers prefer structures that provide long-term security. Additionally, they ensure compliance with sector-specific regulations, particularly in energy, mining, and infrastructure. Overall, these alternatives enable investors to secure land for large-scale, capital-intensive projects while remaining fully compliant with Peruvian property law.

How We Can Assist

While standard land leases in Peru are limited to 10 years, usufruct, surface rights, and concessions provide foreign investors with the legal certainty, flexibility, and operational control necessary for major investments. They are especially relevant in sectors with long-term horizons, such as energy, mining, and infrastructure.

Our services include:

• Structuring Agreements: Advise on the optimal use of usufruct, surface rights, or concessions to align with project timelines, financing requirements, and regulatory compliance.
• Drafting and Negotiation: Prepare and negotiate robust, enforceable contracts that clearly define rights, obligations, and duration.
• Registration and Compliance: Handle registration for usufruct and surface rights before the Public Registry and ensure compliance with sector-specific regulations for concessions.
• Due Diligence: Conduct thorough legal due diligence on land titles, ownership, encumbrances, and regulatory constraints.
• Foreign Investor Support: Guide foreign clients on cross-border considerations, government approvals, and structuring through local entities when needed.

We provide end-to-end support to secure long-term, legally sound land-use rights, minimising risk and facilitating investment in Peru’s energy, mining, and infrastructure sectors.