Published by ChinaMNC · Shangsi
China-Peru FTA Upgrade Protocol Takes Effect: What Foreign Founders Operating in China Need to Know
The upgraded China-Peru free trade agreement protocol entered into force on November 1, 2026, introducing new rules on standards, e-commerce, supply chains, and investment. This article outlines the key changes and practical implications for foreign founders doing business in China.
China-Peru FTA Upgrade Protocol Enters into Force
On November 1, 2026, the Protocol to Upgrade the Free Trade Agreement between China and Peru (the "Upgrade Protocol") officially took effect. The Protocol was signed on November 14, 2024, following the announcement of the substantive conclusion of negotiations in June 2024. Both sides have completed their domestic ratification procedures. The Chinese Ministry of Commerce (MOFCOM) has published the text on the China Free Trade Area Service Network (http://fta.mofcom.gov.cn).
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. The original China-Peru FTA, signed in April 2009 and effective since March 2010, was China's first comprehensive FTA with a Latin American country. Bilateral trade reached USD 50.4 billion in 2025, nearly seven times the USD 6.4 billion recorded in 2009.
Key Highlights of the Upgrade Protocol
The Upgrade Protocol modernizes the original agreement and aims to create a more favorable business environment for enterprises from both countries. For foreign founders operating in China—whether importing from Peru, investing in Peruvian ventures, or leveraging China as a hub—the changes bring new opportunities and considerations.
1. Updated and Expanded Rules
The Protocol introduces new standalone chapters on standards cooperation, competition policy, e-commerce, global supply chains, and the environment. It also refines existing provisions on rules of origin, customs procedures and trade facilitation, sanitary and phytosanitary (SPS) measures, intellectual property, trade in services, temporary entry of business personnel, and investment. Notably, the global supply chain chapter encourages multimodal transport and promotes infrastructure development for foreign trade logistics—an innovative feature in a bilateral FTA. The standards and conformity assessment chapter establishes a dedicated cooperation mechanism and an indicative list of cooperation areas, aiming to facilitate mutual recognition of standards and reduce trade costs for enterprises.
2. Improved Trade and Investment Environment
In goods trade, the Protocol includes electronic data exchange provisions and completes the transposition of product-specific rules of origin. It sets detailed requirements for customs clearance, including responses to inquiries, information exchange, and clearance of express and perishable goods. It also enhances transparency of SPS laws and regulations and establishes a consultation mechanism to address technical issues. In services and investment, the Protocol adds four annexes covering professional services, transport services, cultural and audiovisual services cooperation, and telecommunications services. It introduces a fast-track application procedure for business personnel entry to improve 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 Commitments
Both sides agreed to launch negotiations on negative lists for services trade and investment within two years after the Protocol enters into force, aiming to further liberalize services and investment and unlock potential. They also committed to review the competition chapter every two years to assess the possibility of making higher commitments.
Implementation and Resources for Businesses
China has completed its domestic preparations to ensure smooth implementation. The Protocol text is available on the China FTA Service Network. Additionally, 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. MOFCOM will work with relevant departments and local governments to strengthen publicity and services for enterprises, monitor the implementation, and maintain communication with Peru through the FTA implementation mechanism to ensure high-quality implementation and help enterprises benefit from the arrangement.
Practical Implications for Foreign Founders in China
If you are a foreign founder registering or operating a company in China, the upgraded Protocol may affect your business in several ways:
- Importing from Peru: The refined rules of origin and customs procedures, including electronic data exchange and express clearance, can simplify and speed up import processes. Familiarize yourself with the revised origin management measures to ensure compliance and take advantage of preferential tariffs.
- Standards and conformity assessment: The new cooperation mechanism may eventually lead to mutual recognition of standards, reducing technical barriers and costs for products traded between China and Peru. Stay informed about developments under this chapter.
- Services and investment: If your company provides professional services, transport, cultural, or telecom services, the new annexes may offer improved market access and regulatory cooperation. The fast-track visa procedure for business personnel can facilitate short-term assignments.
- Investment protection: The enhanced dispute settlement and investment provisions provide stronger safeguards for investments in either country, which is relevant if you are considering expanding into Peru.
To fully leverage these changes, ensure your company's registration and operations comply with Chinese regulations, and consult the official texts and resources mentioned above.
This summary is based on information published by the relevant Chinese government website and is general information, not legal or tax advice.
For assistance with company registration and operations in China, foreign founders can contact ChinaMNC on WhatsApp / WeChat at +86 153 1898 8535.