Company Formation in Papua New Guinea

Company Formation in Papua New Guinea

Papua New Guinea is the most diverse island country in the world. The island country is located in the South Pacific region. The country not only has scenic beauty but is also a reservoir of valuable renewable resources. If you're considering company formation in Papua New Guinea? This is a comprehensive guide that will walk you through the process of company incorporation in Papua New Guinea. From the registration requirements and legal considerations to ongoing compliance, we have got you covered.

About the Company Incorporation in Papua New Guinea

PNG is a commodity-based economy with ups and downs over the past few years. The government is welcoming and is taking steps to reduce the downs and boost the economy to maintain growth. So, by company incorporation in Papua New Guinea, you can practically expect rapid economic growth in the island country of PNG. PNG is also a key supplier of agricultural commodities like palm oil, coffee and cocoa. With an increasing global demand for these commodities, we can expect positive long-term growth. PNG waters give around 10% of the world's annual tuna. The long-term GDP seems secure, with significant opportunities.

As per the official data from the World Bank, the GDP of PNG was 30.63 billion USD in the year 2022 and is forecasted to hit 31.09 billion USD by the end of 2023.

Business Expansion Services for Startups

Eligibility Criteria for Company Incorporation in Papua New Guinea

Global Crypto Compliance 2024: Regulations in Every Country

Global Crypto Compliance 2024 provides a comprehensive overview of cryptocurrency regulations across the globe.

Download PDF

Types of Business Structure for Company Formation in Papua New Guinea

Limited Liability Company

Limited Liability Company is the most popular and most preferred form of business structure for foreign investors looking for company formation in Papua New Guinea. The access to capital is regulated, but the company enjoys limited liability. Most large businesses go for this business structure. The transfer of shares can take place freely and easily. Shareholder's liability is limited to the extent of their capital contribution. A minimum of one director and one shareholder is required to incorporate an LLC in PNG. If you're a foreign investor, you have to make a decision either to incorporate a new company or a foreign company. If you go for a foreign company formation in Papua New Guinea, you must apply within 14 days to obtain a certification under the Investment Promotion Act of 1992.

Partnership

A partnership is an agreement between two or more business entities or individual persons. However, a partnership does not enjoy a separate legal entity and the partners have to bear the unlimited liability, and they jointly share the obligations of the partnership.

Branch Office

A branch office is merely an extension of its foreign parent company. It conducts only those trade activities which its foreign company predetermines. The purpose of setting up a branch office is to integrate the financial outcomes of its parent company. No resident director or a company secretary is required. Further, there is also no requirement for minimum paid-up share capital.

Representative Office

A representative office is similar to a branch office and is permitted to have 100% foreign ownership. However, there is a bar on representative offices to make sales in PNG. The work is limited to spreading and promoting materials of its parent company. If you only intend to conduct market research, then this is the most suitable form of business structure.

Standard maintained by Enterslice in its Services

Tax Structures for Incorporated Companies in Papua New Guinea

The tax regime in PNG is governed by the Income Tax Act, the Goods and Services Tax Act, the Customs Act and the Stamp Duties Act. No Capital Gains Tax regime is there in PNG. The IRC and the Customs Services Commission are the bodies that govern these laws. In PNG, income tax is levied at the rate of 30% on the resident company and 48% on a non-resident company. Taxable income is computed at the rate of 5% of the gross fares in case of overseas shippers or charterers carrying passengers, livestock, mail or goods outside PNG. Resident companies are required to file tax returns every year, whereas non-resident companies are required to file tax returns on the PNG-sourced income during the year. The last date to file a return is the 28th of February of the succeeding year. Where the tax return is filed by a registered tax agent, then the last date to file is the 30th of April or such other later date as may be prescribed by the Commissioner.

Procedure company formation in Papua New Guinea

Choose a company name

The first step towards company formation in Papua New Guinea is choosing a name for your company. The Investment Promotion Authority (IPA) provides the guidelines for acceptable names.

Preparation of required necessary papers

Some necessary papers are to be prepared during the company formation in Papua New Guinea. They are: i) Articles of Association if the business structure chosen by you is Limited Liability or Public Limited Company. ii) The application form for company registration is applicable for all types of business structures.

Identify company officers and shareholders.

At least one director must be appointed in the case of Limited Liability Companies and Public Limited Companies. One representative must be appointed in case of a branch office. The minimum age of directors and representatives should be 18 years. Shareholders can be either individual persons or corporate entities.

Capital requirements

There is no specific capital requirement for company formation in Papua New Guinea. However, the capital should be adequate for the nature and scale of the business.

Register your company

The registration process demands that an application form be submitted to the Investment Promotion Authority along with the necessary papers prepared. The manner in which it can be done is either in person or online.

Register for taxes

Just after the registration is complete, tax registration has to be done with the Internal Revenue Commission (IRC). It can be done either in person at the local tax office or online.

Obtain necessary permits and licenses

Various permits and licenses must be obtained for company formation in Papua New Guinea based on the nature of the activities. One must check with the relevant authorities and industry regulators for specific requirements.

necessary papers Required for Company Incorporation in Papua New Guinea

The following necessary papers are required for company incorporation in Papua New Guinea: i) Memorandum of Association and Articles of Association ii) Application for name reservation sent to the Investment Promotion Authority iii) Information about the directors and shareholders including name, address, occupation and shareholding iv) Designated Registered Office Address v) list of directors and shareholders vi) Written consent from individuals agreeing to act as directors vii) Tax File Number and Business Tax Number issued by the Internal Revenue Commission viii) Business licenses from relevant business authorities.

Tax Incentives Offered for Company Formation in Papua New Guinea

To attract investment and promote economic development, PNG offers various tax incentives. Companies specified as "Pioneer Industries" in the Income Tax Act are eligible for tax credits. Pioneer Industries are those industries that make a remarkable contribution to economic development. These incentives vary from province to province. These incentives include tax concessions and other benefits. Companies investing in infrastructure projects are eligible for tax credits under the Infrastructure Tax Credit Scheme. The Scheme was launched to encourage private sector involvement in infrastructure development. The Investment Promotion Authority has come up with various incentives to promote foreign and domestic investment, such as tax holidays, reduced tax rates, and other benefits for qualifying projects. A tax credit scheme has been implemented by PNG for qualifying agricultural projects. This aims to encourage investment in agriculture. GST and Customs Duty exemptions are provided to certain projects or industries on specific imported goods. To support the development of clean energy sources, the companies involved in renewable energy projects are granted certain tax credits.

Challenges of Company Formation in Papua New Guinea

Let’s Connect with our business expansion Consultant

Feel free to reach out to us in case of any queries or issues. We will give you instant support.

Benefits of Company Incorporation in Papua New Guinea

Investment Promotion Authority (IPA) Incentives

Various incentives such as tax holidays, reduced tax rates, and other benefits for qualifying projects are offered by IPA to promote investments. Only a few businesses are granted tax holidays. During tax holidays, the businesses operate without paying any taxes. Reduced tax rates granted to businesses provide a competitive advantage and encourage investments in specific sectors. Accelerated depreciation allowance is offered by IPA. This allows businesses to recover the cost of capital investments more quickly.

Enhanced Credibility

Registering a company can enhance the credibility and reputation of a business. The clients, customers and partners gain confidence. A registered and incorporated business is legally recognized as a distinct legal entity. The legal status assures the stakeholders, including customers, suppliers and partners, about the legitimacy of the business and its operations. Registering a business opens access to various business opportunities, such as government tenders and contracts.

Access to funding

Registering a business makes access to funding from investors, banks or financial institutions easier than unincorporated businesses. Eligible businesses are offered business loans by commercial banks and financial institutions. The loan amount can be utilized for the purpose of working capital, expansion or capital expenditure. Grants or subsidies are provided by the government to businesses, especially in sectors prioritized for economic development. Grants and subsidies are granted to promote specific industries or address social and environmental goals. Financing options are offered by Development Finance Institutions, both local and international. Development Finance Institutions grant loans, equity or other financial instruments.

Benefits of working with Enterslice that you can’t miss

Expertise and Experience

The team of professionals at Enterslice are experts in legal, financial and business domains. With our experience in company formation in Papua New Guinea, we will navigate you through the complex regulatory landscapes and provide strategic advice.

Regulatory Updates

The team at Enterslice stays abreast with the regulatory changes and updates. We keep clients informed about any developments that may impact company formation in Papua New Guinea. This proactive approach helps businesses adapt to evolving legal requirements.

International Presence

With our global presence, we can assist businesses in cross-border operations by providing insights into global regulatory frameworks and assisting with international compliance.

Customized Solutions

Enterslice provides tailor-made solutions based on the specific needs and requirements of each client. Customization ensures that the services provided align with the business's unique circumstances.

Services related to Company Formation in Papua New Guinea provided by Enterslice

Business Structure Advisory

Enterslice will walk you through the best suitable corporate structure for company formation in Papua New Guinea. We are proficient in advising on the right set-up of the business. For company formation in Papua New Guinea, we conduct a thorough analysis of the nature of the business, scale of business, industry in which it is operated and future plans to understand its specific needs and objectives. We fulfil the business registration process. We also aid in opening bank accounts for making transactions.

Legal Advisory and Compliance Services

For every company formation in Papua New Guinea, legal advisory and compliance services are crucial to navigating complex legal landscapes, ensuring regulatory adherence, and mitigating legal risks. Professionals at Enterslice offer a range of services to assist businesses in understanding and complying with applicable laws and regulations. Enterslice drafts legal agreements and necessary papers in such a way that they align with the legal and regulatory requirements. We also execute contracts.

Accounting and Auditing Services

Experts at Enterslice prepare accurate financial statements. Our accounting services include bookkeeping services, where all the day-to-day financial transactions, such as sales, purchases, receipts and payments, are accurately maintained. Our auditing services include internal audits, global audits, and virtual audits. We advise on accounting and financial reporting services.

Tax Advisory Services

For navigating through complex tax regulations, optimizing tax positions and ensuring compliance with tax laws, tax advisory is necessary. Professional tax advisors at Enterslice develop tax planning strategies to optimize a company's tax position, reduce tax liabilities and maximize available tax benefits. Enterslice advises on International Tax Service. We ensure corporate tax and regulatory compliance. We provide advice on income tax notices and conduct international tax planning.

CFO Services provided by Enterslice

Enterslice provides CFO Services. CFO services are designed to provide financial leadership and strategic guidance to businesses. Our professionals keep themselves abreast with financial technology trends and advise on adopting relevant technologies for financial processes. We facilitate communication with the board of directors, investors and other stakeholders on financial matters. We provide interim CFO services during transitional periods or when a company is in need of temporary financial leadership. We identify the opportunities for efficiency and process improvement within the finance function.

Manufacturing Sector in Papua New Guinea

Papua New Guinea has a diverse economy with various sectors contributing to its GDP. The manufacturing sector is one of the significant components of the country's economy. The manufacturing sector in PNG encompasses a range of industries, including food and beverages, textiles, wood and paper products, chemicals and machinery. A notable portion of the manufacturing sector involves processing agricultural products. Production of processed food and beverages like coffee, cocoa and palm oil form a part of the manufacturing sector. The government of PNG is actively promoting local industries to become self-reliant and reduce reliance on imports. This includes initiatives to support local manufacturers and value addition to raw materials. The government has invested in attracting foreign investment in the manufacturing sector to promote economic growth and job creation. Foreign investors can find ample opportunities in areas such as agro-processing and value-added manufacturing. PNG is also known for its resource-based industries, including mining and petroleum. The manufacturing sector may be involved in processing and refining activities related to these natural resources. Wood processing and production of paper and wood-based products are significant in the manufacturing sector, given the country's rich forestry resources.

Cryptocurrency and Fintech Advisory Services by Enterslice

Enterslice cryptocurrency and fintech advisory services include providing guidance on the regulatory landscape for cryptocurrencies in different jurisdictions. While the company is being formed in Papua New Guinea, we assist with legal compliance related to cryptocurrency exchanges and trading platforms. We advise on Initial Coin Offerings (ICOs), Security Token Offerings (STOs) and other tokenization methods. We develop and review whitepapers for cryptocurrency projects. We also assist in anti-money laundering (AML) and Know-your-customer (KYC) compliance for cryptocurrency businesses. Our work is to make you understand the Fintech and cryptocurrency business and compliance with relevant financial regulations.

Our Success Story

We have 10+ years of experience in company incorporation in Papua New Guinea and other legal compliances. We are a global network of legal consultants, and our journey is full of success stories that we have achieved through these years by making hassle-free company incorporation in Papua New Guinea. We provide quality service, which results in client satisfaction. We streamline your company formation in Papua New Guinea, making it easier for our clients to understand.

Our Commitment to Excellence

Timely Delivery

Meeting deadlines and delivering services within agreed-upon timeframes. Timely delivery is a critical aspect of client satisfaction and contributes to the overall commitment to excellence.

Innovation and Technology

We embrace innovation and leverage technology to enhance the efficiency and effectiveness of services. This may include the use of advanced tools and platforms for better service delivery.

Transparent Processes

We provide transparency in processes, including clear communication about timelines, costs, and any potential challenges. This contributes to building trust with clients.