Business entities in Papua New Guinea in 2023
Wholly foreign owned entities
100% foreign ownership is permitted for the various Papua New Guinea company entities. Neither a resident director nor a company secretary is required for establishing a company.
Limited liability company
This is the most common entity used for doing business in Papua New Guinea. It is also known as a private limited. As always, the company is a separate legal entity or ‘person’. In particular, a company is separate from its owners, shareholders and the persons who run it, the directors. All PNG LLCs must have one director and one shareholder. There are no minimum share capital requirements. PNG companies that are 50 percent or more owned by foreign investors require certification from the Investment Promotion Authority. Additionally, some activities are reserved for PNG nationals.
PNG branch
The establishment of a PNG branch may be preferable to incorporating a subsidiary if one of the objectives is to consolidate the financial results of the parent company.
Representative office
A PNG Representative Office can also be 100% foreign-owned and controlled, but is not permitted to make direct sales in PNG. Where a foreign company does not intend to carry on business in PNG it may seek to establish a representative office. Such an office must however only engage in activities which will not amount to carrying on business, for example market research.
Table of comparison between Papua New Guinea entities
| LLC | Branch | Rep office | |
|---|---|---|---|
| How long to set the company up? | 8 weeks | 8 weeks | 8 weeks |
| How long to open company bank account? | 4 weeks | 4 weeks | 4 weeks |
| Legal liability? | Limited | Unlimited | Unlimited |
| Wholly foreign owned? | Yes | Yes | Yes |
| Minimum paid-up share capital? | US$0 | US$0 | US$0 |
| Must file annual tax return? | Yes | Yes | Yes |
| Tax Registration required? | Yes | Yes | Yes |
| Corporate bank account recommendation | ANZ | ANZ | ANZ |
| Does our Client need to travel? | No | No | No |
| Resident director required? | No | No | No |
| Resident shareholder required? | No | No | No |
| Minimum directors allowed? | 1 | N/A | N/A |
| Minimum shareholders? | 1 | N/A | N/A |
| PNG company secretary required? | No | No | No |
| Corporate shareholders allowed? | Yes | Yes | Yes |
| Corporate director(s) allowed? | Yes | N/A | N/A |
| Public register of shareholders and directors? | Yes | Yes | Yes |
| PNG corporate tax rate? | 48% | 48% | 0% |
| Annual financial statements required? | Yes | Yes | No |
| Statutory audit required? | Yes | No | No |
| Allowed to issue sales invoices? | Yes | Yes | No |
| Allowed to sign contracts? | Yes | Yes | No |
| Allowed to import and export goods? | Yes | Yes | No |
| Can rent an office in PNG? | Yes | Yes | Yes |
| Legal Tax Exemption if properly structured | Yes | Yes | Yes |
| Allowed to hire staff | Yes | Yes | Yes |
| Estimate of total business setup costs in Yr. 1 | US$17,830 | US$13,980 | US$13,980 |
| Estimate of total annual costs thereafter (excl. accounting and tax fees) | US$5,340 | US$5,340 | US$5,340 |
| Draft Invoice | View invoice PDF | View invoice PDF | View invoice PDF |
