Papua New Guinea company registration

DOING BUSINESS IN PAPUA NEW GUINEA IN 2017

Since 2003, Healy Consultants Group PLC has assisted our Clients with business registration in Papua New Guinea. Our Services include i) Papua New Guinea company incorporation ii) government license registration iii) business bank account opening iv) visa strategies v) employee recruitment and vi) office rental solutions.

SummaryLLCFast business setup solutionPLCRepresentative officeBranch office
Also known asLtdLtdPLCOverseas CompanyOverseas Company
Best use of company?All products and servicesClose a customer deal nowSecure public fundingMarketing & researchSpecific projects
How soon can you invoice Clients/sign sales contracts?3 months2 months4 monthsCannot3 months
How soon can you hire staff?3 months2 months3 months3 months3 months
How soon can you sign a lease agreement?3 months2 months3 months3 months3 months
How long to supply corporate bank account numbers?3 months2 months3 months3 months3 months
How long to supply company registration/tax numbers?3 months2 months3 months3 months3 months
Corporate tax rate on annual net profits?30%30%30%0%30%
Limited liability entity?YesYesYesNoNo
Government approval required for foreign owners?YesYesYesYesYes
Resident director/partner/manager/legal representative required?NoNoNoNoNo
Minimum paid up share capital?NoneNoneNoneNoneNone
Corporate bank account location?WestpacBSPBank PapuaANZPNG NDB
GST payable on sales to local customers?10%10%10%None10%
Average total business set up engagement costs?US$10,980US$25,280US$16,480US$13,980US$13,980
Average total engagement period?3 months2 months3 months3 months3 months

See full table

Accounting and tax considerationsLLCFast business setup solutionPLCRepresentative officeBranch office
Statutory corporate tax payable?30%30%30%0%30%
Legally tax exempt if properly structured?NoNoNoYesNo
Must file an annual tax return?YesYesYesYesYes
Must appoint an auditor?NoNoYesNoNo
Access to double taxation treaties?YesYesYesNoYes
Withholding tax on payments to foreign shareholders?15%15%15%None15%
Company RegistrationLLCFast business setup solutionPLCRepresentative officeBranch office
Resident director/partner/manager/legal representative required?YesYesYesYesYes
Minimum number of shareholders/partners?115Parent companyParent company
Minimum statutory paid up share capital?NoneNoneNoneNoneNone
Shelf companies available?YesYesYesNoNo
Time to incorporate a new entity?3 months2 months3 months3 months3 months
Can easily convert to a PLC?YesYesYesNoNo
Public register of shareholders and directors?YesYesYesYesYes
Public officer required?NoNoNoYesYes
Can have preference shareholders?YesYesYesNoNo
Business ConsiderationsLLCFast business setup solutionPLCRepresentative officeBranch office
Government grants available?YesYesYesNoYes
Can secure trade finance?YesYesYesNoYes
Can bid for Government contracts?YesYesYesNoYes
Good entity for trademark registration?YesYesYesNoYes
Can secure an import and export license?YesYesYesNoYes

Sponsorship by a local citizen required?No
Our Client needs to travel to PNG for business set up?No
Temporary physical office solutions available?Yes
You need a local resident as bank signatory?No
Can be wholly foreign owned?Yes
The entity will likely be regulated by?Companies Registry
Minimum number of directors/managers?1
Monthly VAT reporting to the Government?Yes
Must sign an office lease agreement during incorporation?No
shareholders & directors documents to be attested\translated?No
Each foreign director needs a personal income tax number?No
Foreign director needs a residence visa?No
Maximum number of staff allowed?No maximum number for any entity
Expatriate to local staff ratio?None
Can secure residence visa for business owner?Yes
Other useful information
What will be included in my customer sales invoice?Click link
This country has signed free trade agreements?Yes
This country is a member of WIPO/TRIPS?Yes
This country is a member of the ICSID?Yes
Average custom duties suffered?2.57%
Government foreign investment approval required?Yes
Average monthly office rental? (US$ per sq m)US$22
Minimum statutory monthly salary?US$180
Average monthly US$ salary for local skilled employees?US$540
US$ deposit interest rate? (1 year average)0.43%
Overseas remittance currency controls?Yes
Banking considerations
Multi-currency bank accounts available?Yes
Corporate visa debit cards available?Yes
Quality of e-banking platform?Good
Crowd funding available in this country?Yes
Group HQ tax incentives?No
Must file annual financial statements?Yes
Maximum shareholding for foreigners?100%
Security deposit to be kept with Government?No

Press the link headings below to read detailed, relevant, up to date information.

  • Advantages and disadvantages

    Advantages of Papua New Guinea company registration

      register business in Papua (PNG)

    1. A Papua New Guinean limited liability company can be incorporated within eight weeks, with only 1 director and 1 shareholder, who both can be of any nationality and our Client does not need to travel to complete corporate bank account opening and company registration in PNG;
    2. PNG is country that is rich in natural resources. Its economy is distinctively dualistic- compromising of a modern economy based on mining (gold, silver, copper, Nickel), petroleum and natural gas production and a traditional economy based on fishing, forestry, coffee, palm oil, copra, cocas and vanilla;
    3. 2015 was the first full year of LNG production and will be the main driver of PNG’s economic growth over the next decade;
    4. PNG have available to them numerous incentives to assist investors in their investment decision-making. The government has a range of direct and indirect taxation based incentives for large and small proposals. According to the Asian Development Bank, PNG grew 9.9% in 2014 and is likely to continue these trends based on increased resource extraction;
    5. PNG is a party to various international treaties, agreement and pacts that allow manufactured goods preferential access to various export markets, including duty free and reduced tariff entry to some of the largest markets in the world.
      • Papua New Guinea is a member of the Asia-Pacific Economic Cooperation (APEC) and the World Trade Organization (WTO), and therefore party to a number of agreements and understandings;
      • Papua New Guinea’s economic trading and development partners include, but not limited to, the United States, Australia, Japan, New Zealand, China, Germany, Great Britain, Malaysia as well as other APEC member countries;
      • Party to the Cotonou Agreement with the European Union(EU);

    6. The PNG government has achieved political stability since its independence and has reformed the labor market, deregulating it and offering employers and employees the opportunity to ensure productivity and wages remain in step with one another;
    7. PNG’s is a member of the Multilateral Investment Guarantee Agency, that guarantees foreign investors against losses caused by non-commercial risk, providing advisory and consultative services to facilitate a responsive investment climate to encourage capital flow.

    Disadvantages of Papua New Guinea company registration

    1. Foreign entrepreneurs and investors will find starting a business in PNG difficult because:
      • Government regulations, red tape and bureaucracy. PNG ranks 140th, as a “mostly unfree” economy, in the Heritage Foundation’s 2016 Index of Economic Freedom, a measure of freedom enjoyed in business, trade, monetary, financial, investment and labour markets. Forming a PNG company can take 8 to 12 weeks due to these restrictions;
      • A major business challenge is government corruption. PNG is ranked 139th in the 2015 Corruption Perceptions Index by Transparency International, a global measure of corruption among public officials and politicians. Under-the-table bribes are sometimes requested to expedite business operations, making operations difficult for companies bound by the Foreign Corrupt Practices Act and the UK Bribery Act;
      • Port Moresby ranks 137 of 140 countries in the Economist Intelligence Unit’s livability index, with a score that indicates that “most aspects of living are severely restricted.” There is high unemployment, and up to half the population reportedly lives in squatter settlements;
      • The country also suffers from high corporate tax rates; Foreign companies suffer a 48% tax while resident companies are taxed at 30%;
      • According to the World Bank Financial Development Report 2015, in PNG there is high cost of opening and maintaining accounts and lack of accessibility to of financial providers. This is highlighted the current banking options available in PNG.

    2. Our Clients find it difficult to deal with local employees because:
      • The “Wantok” system, the “Wantok” is a term used to denote anyone who is from your family or anyone who is close or from your village. The system often leads to many people abusing the “Wantok” system posing a problem for business.

    3. Foreign enterprises must apply for registration to be allowed to undertake activities in Papua New Guinea. Registration is not automatic and certain restrictions on foreign ownership apply; Additionally, there are Exchange controls in Papua New Guinea for inward investments, registration of foreign capital, foreign currency and repatriation of capital and earnings.
  • Best uses for a Papua New Guinea company

    Timber and other natural resources

    1. PNG is heavily forested with tropical trees whose wood is attractive for lumber companies. Exploitation of the country’s wood stocks and other natural resources are helping to drive an economic boom in the country;
    2. PNG’s agricultural industry is a source of potential investment with its resources in seafood, palm oil, coffee and cocoa.;
    3. PNG terrain is rich with mineral and resources and the recent development of the LNG investment has spurred international confidence in the country.

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Company registration

  • Time to incorporate: Eight weeks
  • Cost to set up: US$10,980
  • Minimum capital: US$0
  • Physical office required: No

Required appointments

  • Shareholders: 1
  • Directors: 1
  • Company secretary: No
  • Resident director: No

Key facts

  • Corporate tax rate: 48%
  • Corporate tax base: Worldwide
  • Shelf companies: No
  • Main company type: Limited Company

Contact us

For additional information on our company registration services in Papua New Guinea, please email us at email@healyconsultants.com. Alternatively please contact our in-house country expert, Ms. Grace Odhiambo, directly:
client relationship officer - Grace
customs Prime minister office png ports corporation travel png chamber of commerce and industry bank of papua new guinea immigration