Papua New Guinea company registration

DOING BUSINESS IN PAPUA NEW GUINEA IN 2022

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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.

Compare different PNG entities LLC Fast business setup solution PLC Representative office Branch office
Also known as Ltd Ltd PLC Overseas Company Overseas Company
Best use of company? All products and services Close a customer deal now Secure public funding Marketing & research Specific projects
How soon can you invoice Clients/sign sales contracts? 3 months 2 months 4 months Cannot 3 months
How soon can you hire staff? 3 months 2 months 3 months 3 months 3 months
How soon can you sign a lease agreement? 3 months 2 months 3 months 3 months 3 months
How long to supply corporate bank account numbers? 3 months 2 months 3 months 3 months 3 months
How long to supply company registration/tax numbers? 3 months 2 months 3 months 3 months 3 months
Corporate tax rate on annual net profits? 30% 30% 30% 0% 30%
Limited liability entity? Yes Yes Yes No No
Government approval required for foreign owners? Yes Yes Yes Yes Yes
Resident director/partner/manager/legal representative required? No No No No No
Minimum paid up share capital? None None None None None
Corporate bank account location? Westpac BSP Bank Papua ANZ PNG NDB
GST payable on sales to local customers? 10% 10% 10% None 10%
Average total business set up engagement costs? US$17,830 US$25,280 US$16,480 US$13,980 US$13,980
Average total engagement period? 3 months 2 months 3 months 3 months 3 months

See full table

Accounting and tax considerations LLC Fast business setup solution PLC Representative office Branch office
Statutory corporate tax payable? 30% 30% 30% 0% 30%
Legally tax exempt if properly structured? No No No Yes No
Must file an annual tax return? Yes Yes Yes Yes Yes
Must appoint an auditor? No No Yes No No
Access to double taxation treaties? Yes Yes Yes No Yes
Withholding tax on payments to foreign shareholders? 15% 15% 15% None 15%
Company Registration LLC Fast business setup solution PLC Representative office Branch office
Resident director/partner/manager/legal representative required? Yes Yes Yes Yes Yes
Minimum number of shareholders/partners? 1 1 5 Parent company Parent company
Minimum statutory paid up share capital? None None None None None
Shelf companies available? Yes Yes Yes No No
Time to incorporate a new entity? 3 months 2 months 3 months 3 months 3 months
Can easily convert to a PLC? Yes Yes Yes No No
Public register of shareholders and directors? Yes Yes Yes Yes Yes
Public officer required? No No No Yes Yes
Can have preference shareholders? Yes Yes Yes No No
Business Considerations LLC Fast business setup solution PLC Representative office Branch office
Government grants available? Yes Yes Yes No Yes
Can secure trade finance? Yes Yes Yes No Yes
Can bid for Government contracts? Yes Yes Yes No Yes
Good entity for trademark registration? Yes Yes Yes No Yes
Can secure an import and export license? Yes Yes Yes No Yes

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? 5%
Government foreign investment approval required? Yes
Average monthly office rental? (US$ per sq m) US$22
Minimum statutory monthly salary? US$200
Average monthly US$ salary for local skilled employees? US$540
US$ deposit interest rate? (1 year average) 0.516%
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

Papua New Guinea business setup summary

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;
    8. There are a range of lucrative tax incentives for companies in PNG, such as i) a corporate tax-exemption of 10 years for companies located in any of the designated rural development areas; ii) all export-oriented companies are entitled to exemption from their corporate profit taxes and iii) a full deduction of the capital costs for industrial plants that had been used for agribusiness and tourism.

    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 101th, as a “mostly unfree” economy, in the Heritage Foundation’s 2019 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 138th in the 2018 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 135 of 140 countries in the Economist Intelligence Unit’s livability index 2019, 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 2019/2020, in PNG there is high cost of opening and maintaining accounts and lack of accessibility to of financial providers. This is highlighted in the current banking options available in PNG;
      • The country has an inadequate and poor supply of infrastructural facilities which deters the overall development of the businesses incorporated there. Moreover, PNG faces major challenges like i) having the lowest national water coverage in the Pacific region; ii) having a poor road network in the country and iii) having a poor internet and broadband connectivity which gives limited access to international telecommunication services to the country’s population.
    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.

Contact us

For additional information on our company registration services in Papua New Guinea, please contact our in-house country expert, Ms. Lee Wen Bin, directly:
Consultant at HC - Wen Bin
  • Ms. Lee Wen Bin
  • Client Engagements Department, Deputy Director
  • Contact me!
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