Register company in Papua New Guinea (PNG)
To register company in PNG is hassle-free if you are familiar with the entire incorporation process. With Tetra Consultants at the wheel, you will be able to dedicate your time and resources to other more important channels.
With our lean-and-mean mentality, you can rely on our team of experts to provide you with a seamless experience throughout the whole process to start a business in PNG. Our ultimate goal is for your Papua New Guinea company to be operationally ready within the stipulated time frame.
Our service package includes everything you will require to set up a company in PNG:
- PNG company registration with the Investment Promotion Authority (IPA)
- Professional local nominee director services
- Local company secretary and registered address
- Corporate bank account opening
- Annual accounting and tax services
How long to register company in PNG and open corporate bank account?
- Tetra Consultants will complete your Papua New Guinea company formation through a seamless and fuss-free procedure.
- Upon receiving the required due diligence documents of the directors and shareholders, Tetra Consultants will conduct a company registration search to check the availability of your preferred company name and prepare the required incorporation documents.
- The process to incorporate a company in PNG can be carried out remotely and you will not be required to travel during the registration process.
- Within 2 weeks, you can expect to receive the documents of your new company including the certificate of formation, Memorandum and Articles of Association and the registrar of directors and shareholders.
- After successful company formation, Tetra Consultants will assist in opening a corporate bank account with a local bank or with an overseas global bank depending on your long-term objectives. Opening a bank account in Papua New Guinea for foreigners will usually take around 4 weeks to be completed.
- Consequently, you can expect to start operations and issue invoices with your Papua New Guinea Company within 6 weeks upon engaging Tetra Consultants.
- Tetra Consultants’ team of Chartered Accountants will ensure that your newly established company will continue to meet regulatory laws set by the Internal Revenue Commission. This includes providing you with monthly bookkeeping, preparation of financial statements and annual tax return filings.
Can a foreigner register company in PNG?
- Papua New Guinea’s government offers foreign investors several options on the different types of business entities to choose from. Tetra Consultants will advise you on the steps and requirements for starting business in PNG.
- Every PNG company must have at least one director and one shareholder. If the company does not apply for an IPA certificate, the director must be a local resident director.
- All foreign entities seeking to set up a business in Papua New Guinea must apply for an IPA certificate. A business is considered a foreign entity if at least 50 percent of it is owned or controlled by non-citizens.
- As long as the company applies for the necessary certificate through the local authority, the company can be fully foreign-owned. There will be no nationality requirements for all officeholders.
- There are many types of business structures in Papua New Guinea. When deciding the most suitable entity type, it is important to consider various factors, including the availability of personal liability protection, tax ramifications, ownership and management flexibility as well as compliance requirements.
- Before the start of the engagement, Tetra Consultants will fully understand your business before recommending the optimal business entity. Some general considerations we take into account include the type of business activity, tax obligations and nationalities of shareholders and directors.
Types of companies in Papua New Guinea
- Tetra Consultants will assist in completing the process to register company in PNG. There are 4 main types of business entities you can consider.
Limited Liability Company
- A limited liability company is the most common choice for foreigners setting up a business in Papua New Guinea.
- With a limited liability company, you can benefit from the protection of limited liability and regulated access to capital. Primarily adopted by large businesses, a limited liability company allows shares to be freely and easily transferable.
- Shareholders are protected according to the level of their contribution to the capital. With limited liability imposed on its shareholders, in any event of winding up, you will not have to worry about incurring the debts and obligations of your company.
- To incorporate your limited liability company in Papua New Guinea, you must have at least one director and one shareholder.
- In addition, you are also required to maintain a local registered office that is accessible for the public and another address for the business. Unlike incorporating in other jurisdictions, limited liability companies in Papua New Guinea require no minimum share capital.
- If you are a foreign investor, you will have to decide between incorporating as a new company or as a foreign company. Should you opt for the latter, you must apply within 14 days for Certification under the Investment Promotion Act, 1992.
- A partnership is formed between 2 or more entities or natural persons.
- A partnership in Papua New Guinea is not considered to be a separate legal entity. As such, partners face unlimited liability and jointly share the obligations of the partnership. With unlimited liability, this means that in any event of a winding-up, partners will have to be personally liable for all debts and obligations incurred by the partnership.
- Each partner may contribute money, property, labour, or skills, and each expects to share in the profits and losses of the partnership.
- A branch office is viewed as an extension to its foreign parent company.
- It is permitted to perform or conduct trade activities as per set out or predetermined by its foreign company. Typically, a branch is also set up for the purposes of consolidating the financial outcome of its parent company.
- To register, you will not require a resident director nor a company secretary. A branch office also does not have to meet any minimum paid-up share capital.
- Similar to a branch office, a representative office can also be 100% foreign-owned and controlled.
- However, an exception that applies to a representative office is that it is restricted from making sales in Papua New Guinea and can only be primarily used to spread and promote materials regarding its parent company.
- It is best advised to be used for the purpose of conducting market research.
- There are not many terms and criteria imposed to set up a representative office. You can expect no minimum paid-up share capital, no need for a resident director and a company secretary.
How to register company in PNG?
Step 1: Choosing an optimum business structure to register company in PNG
- Prior to company formation, it is essential to choose the correct type of company.
- Based on your business structure 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
- Tetra Consultants will search and reserve your company name through the Investment Promotion Authority. After confirming the availability of your company name through the IPA company register, our team will reserve your company’s name for up to 2 months.
Step 3: Preparation and submission of the required documents to register company in PNG
- Before Tetra Consultants can incorporate your company in Papua New Guinea with the registrar of companies, you must provide a list of necessary KYC documents. Some of these documents include the names of directors, the company’s resolution and identification proof.
- According to the information provided, Tetra Consultants will draft and prepare the Memorandum and Articles of Association, business plan, PNG IPA company registration form and other incorporation documents. Tetra Consultants will then proceed to register your business with the local authority.
Step 4: Tax registration
- Upon successful incorporation of your company, 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 separate registration with the Commissioner of Customs and Excise.
Step 5: 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.
What are the exact documents I need to prepare to register company in PNG?
- If the shareholders of the company are natural persons, you will be asked to submit the following document for each shareholder:
- Police Clearance Report/Character Check Report
- Visa Copy (if residence is in Papua New Guinea)
- Work Permit (if employed in Papua New Guinea)
- If the shareholders of the company are corporate entities, you will be asked to submit the following document 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 made of the Certificate of Incorporation
- Other relevant supporting documents
- All applicants 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 your Papua New Guinea company. However, Tetra Consultants still recommend that your company has a constitution to specify the regulations for your company’s operations.
Accounting and tax obligations
- Accounting and tax considerations are important factors when incorporating your company. By outsourcing your Papua New Guinea accounting and tax obligations to Tetra Consultants, you can be confident that you will be in the best hands. Our team of consultants will ensure that your firm’s financial statements, corporate tax returns and audits are timely completed without the need for you to travel.
- Additionally, outsourcing your accounting and tax needs to Tetra Consultants will allow you to reduce overhead costs while being ensured of timely reporting and filings. Before the start of the engagement, our accounting team will also keep you updated on all the mandatory deadlines and expectations. Thereafter, we will prepare all necessary filings in advance to ensure that the stipulated deadlines are met.
Annual reporting requirements
- The financial fiscal year in Papua New Guinea runs from 1 January to 31 December each year.
- For non-resident companies, tax returns for income sourced from Papua New Guinea have to be submitted each year. Meanwhile, for resident companies, all annual tax returns need to be reported yearly.
- As for registered foreign companies, you will also have to submit a copy of your audited financial statements.
- Tax returns have to be lodged on or before February 28 of the following year.
- As for financial statements, companies need to close their books and acquire an audit opinion by 31 March.
- Businesses should generally adopt the International Financial Reporting Standards when preparing their financial statements.
- All resident companies in Papua New Guinea are subjected to a flat Corporate Income Tax rate of 30%.
- Non-resident companies can expect to pay a 48% tax rate imposed on Papua New Guinea-sourced income.
- Late payment penalties for income tax will be charged at 20% per annum.
Withholding tax and GST
- If you are looking to distribute dividends to non-residents, you can expect to be subjected to a withholding tax rate held at 15%.
- Levied on the sale of goods and services in Papua New Guinea, the standard goods and services tax rate is held at 10%.
- Tetra Consultants will assist you in registering for these tax considerations.
Is Papua New Guinea a good place to register company in?
- Following the resignation of Papua New Guinea’s former Prime Minister Peter O’Neill, there are greater hopes among the citizens towards more anti-corruption efforts.
- According to Transparency International’s 2020 Corruption Perceptions Index, Papua New Guinea is ranked 142nd among 179 countries highlighting the high level of public sector corruption plaguing the country.
- Weeks of prolonged political instability plagued Papua New Guinea in 2019. The political instability was largely linked to key party defections and dissatisfaction over the failure in handling certain key issues.
- As a major exporter of mineral and agricultural commodities, Papua New Guinea’s economy has been growing steadily since 2018.
- According to the 2020 Index of Economic Freedom, Papua New Guinea is ranked 108th freest, suggesting that the country is still far from achieving economic freedom.
- According to the World Bank’s 2020 Ease of Doing Business Report, Papua New Guinea is ranked 142th when it comes to evaluating the ease of starting a business.
- According to Asian Development Bank, in 2017, 37.5% of Papua New Guinea’s population was living below the national poverty line.
- While Papua New Guinea’s official languages include Tok Pisin, English, Hiri Motu and Papua New Guinean Sign Language, Tok Pisin remains one of the most widely spoken in the country.
- Since 2003, many refugees and asylum seekers have been transferred to the country. Unfortunately, medical facilities in Papua New Guinea have been unable to cope with the additional needs of these refugees and asylum seekers.
- The government of Papua New Guinea recognises the importance and key functionality of Information and Communication Technologies in promoting inclusive and sustainable growth as highlighted in the 2018 Asia Pacific Economic Cooperation.
- In 2016, the government of Papua New Guinea imposed a mandatory process of SIM card registration to ensure that the country’s technological development is balanced with ensuring the country’s security.
- The complexity of extending mobile networks into the remote and mountainous areas of Papua New Guinea also leads to a proportion of its population still being kept away from accessing mobile coverage.
- As part of its aim to build a pro-business environment, Papua New Guinea has since introduced various amendments to the Investment Promotion Act 1992 such as the promotion of local-foreign partnerships.
- Papua New Guinea’s taxation laws include significant tax incentives to assist businesses and investors in building their companies.
- With Australia’s strong and influential role in helping fund the legal industry in Papua New Guinea, Papua New Guinea’s legal system is said to be competent and independent from political interference.
- Exploiting the country’s natural resources for economic growth, the country is now suffering from land tenure issues.
- With the lack thereof in fishing regulations imposed, Papua New Guinea is plagued with an overfishing problem, affecting the country’s marine life.
Looking to register company in PNG?
- Contact us to find out more about how to register a business in PNG. Our dedicated and experienced team will revert within the next 24 hours and provide you with advice for all your queries.
What is the best business in Papua New Guinea?
- You can consider setting up a business in the agriculture sector as the agriculture sector is one of the most important industries in Papua New Guinea. Accounting for more than one-quarter of the country’s GDP, the agriculture sector contributes significantly to the economy’s income and employment. As such, there are many opportunities for a business in the agriculture sector. You can also consider setting up a business that introduces technological solutions or equipment to improve farming and harvesting methods in Papua New Guinea.
- Alternatively, you may choose to set up a business in the tourism industry. Although Papua New Guinea is generally regarded as unsafe for tourists, it is still a popular tourist location for outdoor activities such as diving due to the vast coral reefs and beautiful scenery. You may also consider starting up a small business that sells commodities in Papua New Guinea.
How much does it cost to start a business in Papua New Guinea?
- While there are no paid-up capital requirements when doing business in Papua New Guinea, Tetra Consultants will recommend setting aside at least US$5,000 as your paid-up capital to fund your overhead expenditures as well as initial deposit for corporate bank account opening.
- As for Tetra Consultants’ engagement fees, this will depend on the exact services needed from Tetra Consultants. Our fees are inclusive of government fees and all fees will be clearly stated in our engagement letter prior to the start of the engagement. Tetra Consultants believes in transparency with our valued clients and there are no hidden fees.
Do I need a company secretary to incorporate a company in Papua New Guinea?
- No, a company secretary is not necessary to incorporate a company in Papua New Guinea. However, Tetra Consultants can provide you with a local secretary to assist in the annual tax filing and accounting requirements. If you wish to employ a secretary, you will have to get the consent of the secretary and submit Form 3.
Do I need a resident director to incorporate a company in Papua New Guinea?
- No, if you register with the Investment Promotion Authority (IPA) and get an official certificate, you will not need to employ a local resident director. The company can be fully foreign-owned.
What are the requirements to incorporate a company in Papua New Guinea?
- To incorporate a company in Papua New Guinea, the company must have at least one resident director and one shareholder. However, there will be no nationality requirements for all officeholders in the company if the company applies for an official certificate from the IPA. A company with an IPA certificate does not need a local resident director and can be fully foreign-owned.
- A company incorporated in Papua New Guinea also requires a physical address in Papua New Guinea. A post office box is insufficient to meet this requirement as you will need a registered address to conduct business activities.
How to register my business name in Papua New Guinea?
- All limited liability companies must register for a business name to carry out business activities in Papua New Guinea. After you have confirmed the availability of your company name through the PNG company register, you can choose to either register your business name online or download the application form from the IPA and submit the form to the nearest office.
- If you wish to make any changes to the name of your foreign company, you will have to submit a Form 48.
What is IPA in Papua New Guinea?
- It stands for the Investment Promotion Authority, which is the governmental organisation that houses the Companies Office of Papua New Guinea and the Intellectual Property Office of Papua New Guinea.
- The organisation mainly provides information about company incorporation and investment opportunities in Papua New Guinea. All foreign companies must register with them.
What company documents do I need to keep at the registered office?
- You will be required to keep documents such as the constitution of the company if applicable, personal information about the current directors and secretary, meeting minutes, copies of all written communications to shareholders or holders of the same class of shares, copies of all financial statements and accounting records, an interests register and the share register.
Is Papua New Guinea safe?
- Papua New Guinea is not a very safe place for foreigners due to the large number of crimes in the country. Theft, pickpocketing and assault are common crimes in Papua New Guinea. There are also frequent social unrest and tension between clan groups in the region, especially in the capital of Port Moresby and regions in the Highlands.
- Generally, it is recommended that you get a local guide if you are travelling to Papua New Guinea.
Who is responsible for registering business names in PNG?
- The Investment Promotion Authority is the agency in charge of registering business names in PNG in the company register.