ABOWI in Peru: Law combines tradition and modernity
ABOWIs virtual journey to Lima, Peru talking to an experienced and international established lawyer Fernando Castañeda Melgar about globalization, advice to law students, and the two worlds in Peru’s economy, the formal and informal – by Josefine Antonia Schulte, stud. jur. from Berlin, Germany.
The third largest country in South America is the next point of contact for ABOWI. We have questions about legal matters with luggage and we look forward to the answers. Peru enjoys the reputation of being a multicultural country that honors traditions, has excellent cuisine and is a popular holiday destination with extensive nature reserves. About 31.5 million people live in Peru, it is located in the west of South America and borders on Ecuador, Colombia, Brazil, Bolivia and Chiele.
The ABOWI project is an interview series aiming to interview 197 lawyers out of every state in the world about globalization and differences in the law world. ABOWI stands for across Borders with information asking ‚What unites lawyers worldwide?‘
As a law student, I am answering my own questions, those unanswered in my studies or books and talking to experienced lawyers, learning from people all over the world about their struggles caused by their location. I want to know about their ideas, experiences and I want to share them with others. Especially during the COVID19 Pandemic and the online studies of students worldwide, it is important to stay connected with the world, sharing useful knowledge, disregarding the large negativity of the news.
My interview partner Fernando Castañeda Melgar was kind enough to share his views and experiences in the Peruvian and international law world. Castañeda Melgar and his partner’s law firm is called Aramburu Castañeda Boero Abogados (short ACB Abogados) and is located in San Isidro, Lima, Peru. ACB Abogados has been focusing successfully on the corporate field for 27 years. Also very interesting, they are the local partners of the Diaz Reus international law alliance, offering their services in 24 countries of the world.
JAS: Please introduce yourself shortly in terms of name, age, origin, and how long you have been practicing the profession of law?
F. Castañeda Melga: My name is Fernando Castañeda Melgar; I am 52 years old, Peruvian, and have been practicing the profession of law for 27 years.
2. JAS: What made you become a lawyer in the first place or has your country of living something to do with it?
F. Castañeda Melgar: Law was not originally my first choice, I was very interested in engineering and economics when I was 15 years old. Back then (1983), your parents and family asked you quite often what would you do after school, and what career would you chose…and somehow you had to have a clear mind about that. But things change, don’t they? And that’s when Law showed up. In secondary 4 I had a teacher who was actually a lawyer who had this amazing class of “Problemas Peruanos” which was a blend of Peruvian republican history, constitutional analysis, social awareness, and politics. And we had debate teams in that class. The early 80’s in Peru had social unrest, economic instability and therefore this class was just perfect for debate. I liked to talk, to work with sources and discovered to have some skill in quickly answering back to the opponent team, so I felt I was very comfortable with the dynamics of the class. My teacher (Sr. Lorgio Devoto was his name) started to call me “colleague” and Dr. Castañeda (in Peru lawyers are referred to as “doctors” even if you aren’t. In fact I am not, I hold a Masters degree but not a Ph.D.).
The last two years of school made me finally find my calling, feeling that Law had the capability of reshaping certain structures, and foster development.
3. JAS: What is your expertise?
F. Castañeda Melgar: My expertise is on: (i) Real Estate; (ii) M/A; (iii) Antitrust and Unfair Competition.
4. JAS: How is the social recognition of a career in law in Peru? (E.g. in Germany the societal recognition is quite high especially for people without any contact points with lawyers. There is certainly a stereotype of the superior and rich lawyer.)
F. Castañeda Melgar: It has mixed feelings. On the one hand, there is a lot of questioning due to the bad reputation of lawyers always linked to corruption issues, mainly in the small matters of food and eviction processes or inheritance that affect many people, especially with few economic resources. On the other hand, lawyers are linked to power as well, be it economic or political, due to the need to translate the country’s great interests into regulations and contracts.
5. JAS: What is the societal sense of justice in Peru?
F. Castañeda Melgar: The sense of justice in Peru is very poor. The processes last for long years and their outcome is unpredictable, always threatened by corruption and bad practices by lawyers.
6. JAS: What challenges as a lawyer are you facing on a day to day basis?
F. Castañeda Melgar: The excessive bureaucracy, the low qualification of public servants, the lack of digitization of the state apparatus, the little predictability of the procedures, and the time they may last. I may add the instability that currently exists in the country, which implies changes to the tax and labor regimes, and even the constitution itself.
7. JAS: You are a lawyer in Peru but at the same time you live in a globalized world. But how is the cooperation with lawyers and clients outside of Peru? Do you face any prejudices?
F. Castañeda Melgar: Cooperation with international lawyers is excellent. We do not face any prejudice because the transactions in which we participate have an international structure. The country risk factor always arises, but the international arbitration and stabilization clauses of the income tax regime have been useful to give confidence to the foreign investor.
8. JAS: During my research, I saw that you are very well internationally and widely positioned, how does that come? How does that influence your work as a lawyer?
F. Castañeda Melgar: Our work is always oriented to satisfy international standards. This leads us to select our staff with great care, use technology tools, and fulfill all entrustments on time and meticulously. This is how we have felt it needs to be done throughout our experience of 27 years of practice.
9. JAS: How internationally well-positioned are lawyers in your country in terms of language?
F. Castañeda Melga: The segment of lawyers that handles international cases, is fluent in English. They have studied LLMs at universities in the United States or English-speaking countries.
10. JAS: What is the level of demand for international cases and clients in your experience?
F. Castañeda Melgar: In my own experience it is 20-25% of my work.
11. JAS: As your international client, what sort of legal advice is highly requested?
F. Castañeda Melgar: Tax planning, incorporation of NewCos, contracts negotiation, acquisitions.
12. JAS: What I was wondering and I am probably not the only one, is the belief about Peruvians informal economy, especially in public procurement. What is thereto this belief of the Perus shadow economy?
F. Castañeda Melgar: In Peru, from an economic point of view, we live in two worlds: the formal and the informal. International cases are never counterpart to the informal world, but they do suffer from the delays and other impacts of dealing with the informal world. For example, ensuring sources of water, gravel, and wood in the exploitation of hydrocarbons crosses you with that world that you have to know how to understand and handle. This shadow economy amounts to 75% of our GNP.
13. JAS: If so, what is done against it from a lawyer’s perspective?
F. Castañeda Melgar: Contracts must include force majeure and termination clauses to avoid penalties caused by the delays referred to in my previous answer.
14. JAS: How do you assess the global market in the future, in Germany you need to specialize in a specific law area at some point during your studies, do you believe it is useful and sensible to specialize in international law?
F. Castañeda Melgar: In Peru, in the last third of your Law School career you can take elective courses according to your academic and professional preferences. Later, in professional life, it is essential to have a specialization of this type and to organize a firm that provides a wide variety of services, preferably those that are demanded by companies. I would recommend specializing in contracts and M/A which would open a chance for you to work with international clients.
15. JAS: From your experience, how sensible is the decision for a career in law? Would you make the same decision?
F. Castañeda Melgar: I think I would. It is a matter of calling, but I think it is a career with a great future in Peru.
16. JAS: What advice would you give to a law student or those, who are interested in it?
F. Castañeda Melgar: Chose a good Law School, then chose a good lawyer (and if possible Law Firm) to learn from. Be an outstanding student and learn a second language, preferable English.
17. JAS: From your experience, what has to be done to bring lawyers globally together? Or is it unnecessary in your opinion?
F. Castañeda Melgar: It is a must to bring lawyers globally together. Alliances and networks are working fine. It is of the utmost importance that you can offer legal services to your clients almost under the same trade dress sort to say, where you can assure integrity, quality, and commitment.
I am thanking my interview partner Fernando Castañeda Melga for his openness and honesty. Especially interesting, I found his answers to special features of Peru and Peru’s informal economy, how it is ensured that it does not impact international cases and workings. On the other hand, I think the advice he gives to every law student is very practical and good. The studies of law in Germany lack the application of knowledge in practice. It gives the students a lot of abstract knowledge, but no knowledge, what reality has to do with it. As suggested by Castañeda Melgar, I believe becoming a student employee in a good law firm is a very wise choice and good be vital to remember the theories on real-life cases.
In the matter of globalization, Castañeda Melgar has made different experiences than former interview partners with a well working international network. However, I found his approach towards international cases admirable, and his guiding principles in a nutshell of integrity, quality, and commitment are probably some of the most important fundamentals in the work of a lawyer, no matter the case or location.
“For the sake of simplicity, the masculine form is used throughout the text; the […] female form is of course included ”.
stud. iur. Josefine Antonia Schulte
Dr. Schulte Rechtsanwalt
Tel: +49 30 22 19 220 20
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Across Borders With Information – ABOWI, a series of interviews by Josefine Schulte law student from Berlin in Germany. Questions and Answers: A trip around the world that reveals differences and prejudices. What moves lawyers around the world? Josefine Schulte asks her way from Azerbaijan to Cyprus.
Dr. Schulte Rechtsanwalt
Dr. Thomas Schulte
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Telefon: 030 22 19 220 20
Telefax: 030 22 19 220 21