Published by ChinaMNC · Tunchang

China-Peru Free Trade Agreement Upgrade Takes Effect: What Foreign Founders Need to Know

The upgraded China-Peru FTA entered into force on November 1, 2026. Learn how new rules on standards, e-commerce, supply chains, and investment can benefit foreign founders operating in China.

China-Peru FTA Upgrade: A New Chapter for Trade and Investment

The upgraded Protocol to the China-Peru Free Trade Agreement (FTA) officially entered into force on November 1, 2026. The Protocol, signed in November 2024, modernizes the original FTA that took effect in March 2010—China's first comprehensive FTA with a Latin American country. For foreign founders registering or operating a company in China, this upgrade brings tangible changes to trade rules, investment protection, and business mobility that can lower costs and open new opportunities.

Background: Deepening Economic Ties

China and Peru are comprehensive strategic partners with highly complementary economies. China is Peru's largest global trading partner, largest export market, and largest source of imports. Peru is China's fourth-largest trading partner in Latin America and an important investment destination. Bilateral trade reached US$50.4 billion in 2025, nearly seven times the US$6.4 billion recorded in 2009. The upgrade negotiations were launched in November 2018, substantively concluded in June 2024, and the Protocol was signed in November 2024. Both sides have now completed their domestic ratification procedures.

Key Highlights of the Upgraded Protocol

The Protocol strengthens the rules framework and improves market access conditions. For foreign founders, the changes translate into more predictable operations and reduced trade costs.

1. Modernized Rules and New Disciplines

The upgrade adds independent chapters on standards cooperation, competition policy, e-commerce, global supply chains, and environment. It also refines existing chapters on rules of origin, customs procedures and trade facilitation, sanitary and phytosanitary measures, intellectual property, trade in services, temporary entry of business persons, and investment.

Notably, the global supply chains chapter encourages multimodal transport and promotes infrastructure development for foreign trade logistics—an innovative feature in FTAs. The standards and conformity assessment cooperation chapter establishes a dedicated cooperation mechanism and an indicative list of cooperation areas, creating a platform for mutual recognition of standards. This will help reduce trade costs for companies in both countries.

2. Improved Trade and Investment Environment

On trade in goods, the Protocol includes electronic data exchange provisions, completes the transposition of product-specific rules of origin, and sets detailed requirements for customs clearance, including express and perishable goods. It also enhances transparency of sanitary and phytosanitary regulations and establishes a consultation mechanism to resolve technical issues promptly.

On services and investment, four new annexes cover professional services, transport services, cultural and audiovisual services cooperation, and telecommunications services, raising regulatory cooperation. A fast-track application procedure for business persons' entry improves visa processing efficiency. The investment dispute settlement mechanism is significantly improved, with detailed provisions on most-favored-nation treatment and expropriation, providing stronger protection for mutual investment.

3. Future-Oriented Liberalization

The two sides agreed to launch negotiations on negative lists for services trade and investment within two years after the Protocol's entry into force. This will further open services and investment and tap into trade and investment potential. Additionally, they committed to reviewing the competition chapter every two years to assess the possibility of higher commitments.

What This Means for Foreign Founders in China

For foreign entrepreneurs establishing a company in China, the upgraded FTA offers several practical advantages:

• Lower trade costs: Simplified customs procedures and mutual recognition of standards can reduce time and expenses for importing goods from Peru or exporting to Peru.
• Easier business mobility: Fast-track visa procedures for business persons facilitate short-term assignments and meetings.
• Stronger investment protection: Improved dispute settlement and clearer rules on expropriation and most-favored-nation treatment provide greater legal certainty.
• New opportunities in services: Commitments in professional, transport, cultural, and telecom services may open niches for service-oriented businesses.
• Supply chain resilience: The global supply chains chapter supports logistics infrastructure and multimodal transport, helping companies diversify and stabilize supply chains.

Implementation and Resources

China has completed its implementation preparations. The full text of the Protocol is available on the China Free Trade Area Service Network (http://fta.mofcom.gov.cn), where businesses can also seek clarification. The General Administration of Customs has issued the revised Measures for the Administration of Origin of Imported and Exported Goods under the China-Peru FTA.

The Ministry of Commerce will work with relevant departments and local governments to enhance publicity and services for businesses, monitor the agreement's implementation, and maintain communication with Peru to ensure high-quality implementation. Foreign founders are encouraged to consult these resources and seek professional advice to fully utilize the upgraded FTA.

Take Action

Foreign founders interested in registering or operating a company in China can contact ChinaMNC on WhatsApp / WeChat at +86 153 1898 8535 for expert assistance.

This summary is based on information published by the relevant Chinese government website and is general information, not legal or tax advice.