With the recent introduction of business-friendly amendments to the Investment Promotion Act 1992, setting up company in Papua New Guinea is a more and more common option for foreign investors. If you are a business owner looking to expand into the Asia-Pacific market through Papua New Guinea, there are some things you need to know about the incorporation process and requirements before you register company in PNG. Tetra Consultants has prepared this comprehensive guide to help you get started with ease.
Requirements for foreigners setting up company in Papua New Guinea
- Foreigners looking to register company in PNG will be able to do so with a minimum of one director and one shareholder. You will also require a local resident director, unless you apply for an IPA certificate with the Investment Promotion Authority.
- In particular, applying for an IPA certificate is compulsory for all foreign entities setting up in Papua New Guinea. Foreign entities refers to businesses with at least half the company owned or controlled by non-locals. With an IPA certificate, the company can be fully foreign-owned.
- After understanding the requirements to setting up company in Papua New Guinea, the next step is to understand the incorporation process. To complete incorporation successfully and smoothly, Tetra Consultants recommends that you follow the steps below:
Steps for setting up company in Papua New Guinea
Step 1: Choosing an optimum business structure
- Before company formation, it is crucial to select the correct type of company.
- The most common entity for foreign investors in Papua New Guinea is the Limited Liability Company, which offers the advantages of liability protection. Other business structures available include the Partnership, Branch Office and Representative Office.
- Based on your business needs and long-term goals, Tetra Consultants will advise you on the most optimum business entity, paid-up share capital, corporate structure, and business licenses if applicable.
Step 2: Reservation of company name
- After selecting a suitable business structure, you can proceed to determine a unique name for your new business.
- Tetra Consultants will search and reserve your company name through the Investment Promotion Authority company registry. The name can be reserved for up to 2 months.
Step 3: Preparation of the required documents to register company in Papua New Guinea
- Before Tetra Consultants can register company in Papua New Guinea with the registrar of companies, you must provide a list of necessary KYC documents. The exact documents needed depend on the details of your business.
- If the shareholders of your business are natural persons, you will have to submit the following documents for each shareholder:
- Police Clearance Report/Character Check Report
- Notarized Passport copy
- Visa Copy (if residence is in Papua New Guinea)
- Work Permit (if employed in Papua New Guinea)
- Bank Statement
- If the shareholders of your business are corporate entities, you will have to submit the following documents for each corporate entity:
- Latest audited financial statement for the shareholding company
- Latest audited financial statement for the ultimate holding company
- Register of shareholders and directors
- A copy of the Certificate of Incorporation
- Other relevant supporting documents
- All applicants will also need to submit a budget forecast, business plan, value of initial capital investment and copies of agreements if applicable.
- Unlike other jurisdictions, there is no need to prepare a Memorandum and Articles of Association to register company in Papua New Guinea. However, Tetra Consultants still recommends that your business has a constitution to specify the regulations for your company’s operations.
Step 4: Filing for registration with the Investment Promotion Authority
- Tetra Consultants will then proceed to draft and prepare the Memorandum and Articles of Association, business plan, Papua New Guinea IPA company registration form and other incorporation documents. Afterwards, we will register your business with the IPA.
- After receiving approval, Tetra Consultants will courier the Certificate of Incorporation, Memorandum and Articles of Association, IPA certificate and other corporate documents to your preferred address.
Step 5: Tax registration
- Upon successful formation of your business, Tetra Consultants will follow up in obtaining a Taxpayer Identification Number with the Internal Revenue Commission (IRC).
- If your business operations involve the act of importing or exporting goods, we will also do a registration with the Commissioner of Customs and Excise.
Step 6: Corporate bank account opening
- Tetra Consultants will then proceed to open a corporate bank account with a reputable bank of your choice.
- In most cases, the directors and shareholders do not have to travel. However, if travel is necessary, we will have a representative accompany you to the bank meeting. Alternatively, our team will negotiate with the banks to conduct a conference call instead or to request a waiver.
- Once your bank account has been successfully opened, Tetra Consultants will courier the internet banking token and access codes to your preferred address.
Need help setting up company in Papua New Guinea?
Starting a business in Papua New Guinea may seem intimidating at first, especially if it is an unfamiliar region with an unfamiliar language and business environment. However, with Tetra Consultants at the helm, you will not have to worry. Our team of experienced and dedicated professionals will be able to guide you through the full process and ensure your compliance at every stage.