The process of incorporating a Papua New Guinea
(PNG) company is simple and relatively cheap. But
before you rush out the door to incorporate a PNG company, there
are several things you need to know.
Setting up your PNG company
Under the Companies Act 1997 (PNG) a company must have:
A name [Note: the name should not contravene
any law, be misleading or identical to the name of another
One or more shares
One or more shareholders
One or more directors [Note: at least one
director must be a resident of PNG. A company is not required to
appoint a secretary but can if it wants]
A physical address in PNG (a P.O Box will not be
There is no requirement for a company to have a memorandum and
articles of association. A company constitution can be adopted at
Forms to complete
You can download the required forms (listed below) from www.ipa.gov.pg or collect them
from the Companies Office located on the ground floor of IPA Haus,
Munidubu Street, (Corner of Lawyers Rd & Champion Pde)
Konedobu, Port Moresby, PNG.
Form 1 Application for Registration of a Company
Form 2 Consent of Directors of Proposed Company
Form 3 Consent of Secretary of Proposed Company (if appointing
Form 4 Consent of Shareholder
Form 6 Application of a Company Name
The prescribed fee for incorporating a company is 500 Kina (or
about AUD$220). A further fee of 50 Kina (or about AUD$22) is
required to reserve the name of the company.
Shareholding and Investment Promotion Authority
A company which is wholly owned, or 50% or more owned or
controlled by a PNG non-citizen, will require formal certification
from the Investment Promotion Authority (IPA). It
is not uncommon for the certification process to take 3 to 6 months
Without IPA certification
If you do not obtain IPA certification when required, you run
the risk of any contracts your company enters into being found
unenforceable. You may also be liable for breaches of the
Investment Promotion Act 1992. Penalties may include fines not
exceeding 100,000 Kina (approximately AUD$43,000); and/or 2 years
If IPA certification is required you will need to complete Form
3 - Application for Certification (Form 3) and attach supporting
documentation, which normally includes:
Copy of Certification of Incorporation
Budget/Cash flow forecast
Positions and nationalities of staff to be employed
CV or Personal Profile
Police clearance report or Character check
Value of initial capital investments
Copies of any agreements.
Prior to lodgement it is always recommended that a qualified and
admitted PNG lawyer review the Form 3 for completeness.
The Form 3 prescribed fee is 2,000 Kina (or about AUD$880).
Upon incorporation – Company seal, VAT/GST &
Once your PNG company is incorporated, there are a few other
considerations you need to be aware of to avoid potential problems
down the track.
You need to obtain a company seal. Even though there is no
express legislation requiring you to make a company seal, you are
required to have a seal to issue share certificates or for entering
into deeds and contracts. A company seal can be obtained from most
print shops within a few days. Company seals cost about K50 (or
about AUD$20) depending on the size.
Registration for VAT and GST purposes
You should always consider obtaining tax advice from a qualified
legal professional. Some things you need to be aware include the
requirement to appoint a PNG resident to be a public officer.
Section 354 of the Income Tax Act 1959 (PNG) provides that a
company must (unless exempted by the Commissioner General) appoint
a PNG resident to be a public officer. The appointment is required
to be made within 3 months from the date the company starts
business operations or derives income.
Your company may need to register as a "group
employer" if it will employ more than one employee in PNG with
a weekly salary of more than 126 Kina per week. If this is the case
then the company must register as a "group
employer". The process involves submitting a written notice to
the Internal Revenue Commission.
Goods and Services Tax (GST)
Any business or individual whose annual turnover exceeds (or is
likely to exceed) 250,000 Kina must register for GST. A business
with a turnover of less than 250,000 Kina (or about AUD$125,000)
per year can register for GST on a voluntary basis. Registration
forms are available for download at http://www.irc.gov.pg/tax_forms.html.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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