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Economy ProfilePapua New Guinea

Economy Pro le of Papua New Guinea

Doing Business 2018 Indicators(in order of appearance in the document)

Starting a business Procedures, time, cost and paid-in minimum capital to start a limited liability company

Dealing with constructionpermits

Procedures, time and cost to complete all formalities to build a warehouse and the quality control andsafety mechanisms in the construction permitting system

Getting electricity Procedures, time and cost to get connected to the electrical grid, the reliability of the electricity supply andthe transparency of tariffs

Registering property Procedures, time and cost to transfer a property and the quality of the land administration system

Getting credit Movable collateral laws and credit information systems

Protecting minority investors Minority shareholders rights in related-party transactions and in corporate governance

Paying taxes Payments, time and total tax rate for a firm to comply with all tax regulations as well as post-filing processes

Trading across borders Time and cost to export the product of comparative advantage and import auto parts

Enforcing contracts Time and cost to resolve a commercial dispute and the quality of judicial processes

Resolving insolvency Time, cost, outcome and recovery rate for a commercial insolvency and the strength of the legal frameworkfor insolvency

Labor market regulation Flexibility in employment regulation and aspects of job quality

About Doing BusinessThe Doing Business project provides objective measures of business regulations and their enforcement across 190 economies andselected cities at the subnational and regional level.

The Doing Business project, launched in 2002, looks at domestic small and medium-size companies and measures the regulationsapplying to them through their life cycle.

Doing Business captures several important dimensions of the regulatory environment as it applies to local rms. It providesquantitative indicators on regulation for starting a business, dealing with construction permits, getting electricity, registeringproperty, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts and resolvinginsolvency. Doing Business also measures features of labor market regulation. Although Doing Business does not present rankingsof economies on the labor market regulation indicators or include the topic in the aggregate distance to frontier score or ranking onthe ease of doing business, it does present the data for these indicators.

By gathering and analyzing comprehensive quantitative data to compare business regulation environments across economies andover time, Doing Business encourages economies to compete towards more e cient regulation; o ers measurable benchmarks forreform; and serves as a resource for academics, journalists, private sector researchers and others interested in the businessclimate of each economy.

In addition, Doing Business o ers detailed subnational reports, which exhaustively cover business regulation and reform in di erentcities and regions within a nation. These reports provide data on the ease of doing business, rank each location, and recommendreforms to improve performance in each of the indicator areas. Selected cities can compare their business regulations with othercities in the economy or region and with the 190 economies that Doing Business has ranked.

The rst Doing Business report, published in 2003, covered 5 indicator sets and 133 economies. This years report covers 11indicator sets and 190 economies. Most indicator sets refer to a case scenario in the largest business city of each economy, exceptfor 11 economies that have a population of more than 100 million as of 2013 (Bangladesh, Brazil, China, India, Indonesia, Japan,Mexico, Nigeria, Pakistan, the Russian Federation and the United States) where Doing Business, also collected data for the secondlargest business city. The data for these 11 economies are a population-weighted average for the 2 largest business cities. Theproject has bene ted from feedback from governments, academics, practitioners and reviewers. The initial goal remains: to providean objective basis for understanding and improving the regulatory environment for business around the world.

The distance to frontier (DTF) measure shows the distance of each economy to the frontier, which represents the bestperformance observed on each of the indicators across all economies in the Doing Business sample since 2005. An economysdistance to frontier is re ected on a scale from 0 to 100, where 0 represents the lowest performance and 100 represents thefrontier. The ease of doing business ranking ranges from 1 to 190. The ranking of 190 economies is determined by sorting theaggregate distance to frontier scores, rounded to two decimals.

More about Doing Business (PDF, 5MB)

Ease of Doing Business inPapua New Guinea

Region East Asia & Pacific

Income Category Lower middle income

Population 8,084,991

GNI Per Capita (US$) 2,528

City Covered Port Moresby

DB2018Rank190 1

109

DB2018DistancetoFrontier(DTF)0 100

59.04

0 100

63.89:Samoa(Rank:87)

62.70:RegionalAverage(EastAsia&Pacific)

59.04:PapuaNewGuinea(Rank:109)

55.58:Palau(Rank:130)

51.45:MarshallIslands(Rank:149)

48.74:Kiribati(Rank:157)

DB 2018 Distance to Frontier (DTF)

Note: The distance to frontier (DTF) measure shows the distance of each economy to the frontier, which represents the best performance observed on each ofthe indicators across all economies in the Doing Business sample since 2005. An economys distance to frontier is re ected on a scale from 0 to 100, where 0represents the lowest performance and 100 represents the frontier. The ease of doing business ranking ranges from 1 to 190.

Rankings on Doing Business topics - Papua New Guinea

Startinga

Business

Dealingwith

ConstructionPermits

GettingElectricity

RegisteringProperty

GettingCredit

ProtectingMinorityInvestors

PayingTaxes

TradingacrossBorders

EnforcingContracts

ResolvingInsolvency

1

28

55

82

109

136

163

190

Rank

129117

107

122

42

89 91

137

171

141

Distance to Frontier (DTF) on Doing Business topics - Papua New Guinea

Startinga

BusinessChange:+0.51

Dealingwith

ConstructionPermits

Change:+0.53

GettingElectricity

Change:+0.03

RegisteringProperty

Change:+0.11

GettingCredit

Change:0.00


Change:0.00

PayingTaxes

Change:+0.38


Change:0.00

EnforcingContractsChange:0.00

ResolvingInsolvencyChange:+0.16

0

20

40

60

80

100

DTF

81.04

64.42 65.53

55.38

70.00

53.33

71.71

60.47

36.2132.31

Starting a BusinessThis topic measures the paid-in minimum capital requirement, number of procedures, time and cost for a small- to medium-sizedlimited liability company to start up and formally operate in economys largest business city.

To make the data comparable across 190 economies, Doing Business uses a standardized business that is 100% domesticallyowned, has start-up capital equivalent to 10 times income per capita, engages in general industrial or commercial activities andemploys between 10 and 50 people one month after the commencement of operations, all of whom are domestic nationals. Startinga Business considers two types of local limited liability companies that are identical in all aspects, except that one company is ownedby 5 married women and the other by 5 married men. The distance to frontier score for each indicator is the average of the scoresobtained for each of the component indicators.The latest round of data collection for the project was completed in June 2017. See the methodology for more information.

What the indicators measure

Procedures to legal ly start and operate acompany (number)

Pre-registration (for example, name verificationor reservation, notarization)

Registration in economys largest business city

Post-registration (for example, social securityregistration, company seal)

Obtaining approval from spouse to start businessor leave home to register company

Obtaining any gender-specific permission thatcan impact company registration, companyoperations and process of getting nationalidentity card

Time required to complete each procedure(calendar days)

Does not include time spent gatheringinformation

Each procedure starts on a separate day (2procedures cannot start on the same day)

Procedures fully completed online are recordedas day

Procedure is considered completed once finaldocument is received

No prior contact with officials

Cost required to complete each procedure (% ofincome per capita)

Official costs only, no bribes

No professional fees unless services required bylaw or commonly used in practice

Paid-in minimum capital (% of income per capita)

Funds deposited in a bank or with third partybefore registration or up to 3 months afterincorporation

Case study assumptions

To make the data comparable across economies, several assumptionsabout the business and the procedures are used. It is assumed that anyrequired information is readily available and that the entrepreneur will payno bribes.

The business:- Is a limited liability company (or its legal equivalent). If there is more thanone type of limited liability company in the economy, the most commonamong domestic rms is chosen. Information on the most common form isobtained from incorporation lawyers or the statistical o ce. - Operates in the economys largest business city and the entire o cespace is approximately 929 square meters (10,000 square feet). For 11economies the data are also collected for the second largest business city.- Is 100% domestically owned and has ve owners, none of whom is a legalentity; and has a start-up capital of 10 times income per capita and has aturnover of at least 100 times income per capita. - Performs general industrial or commercial activities, such as theproduction or sale of goods or services to the public. The business doesnot perform foreign trade activities and does not handle products subjectto a special tax regime, for example, liquor or tobacco. It does not useheavily polluting production processes. - Leases the commercial plant or o ces and is not a proprietor of realestate and the amount of the annual lease for the o ce space is equivalentto 1 times income per capita.- Does not qualify for investment incentives or any special bene ts. - Has at least 10 and up to 50 employees one month af ter thecommencement of operations, all of whom are domestic nationals. - Has a company deed 10 pages long.

The owners: - Have reached the legal age of majority. If there is no legal age of majority,they are assumed to be 30 years old. - Are sane, competent, in good health and have no criminal record. - Are married and the marriage is monogamous and registered with theauthorities. - Where the answer di ers according to the legal system applicable to thewoman or man in question (as may be the case in economies where thereis legal plurality), the answer used will be the one that applies to themajority of the population.

Standardized Company

Legal form Private Limited Liability Company

Paid-in minimum capital requirement PGK 0


IndicatorPapua NewGuinea

East Asia &Pacific

OECD highincome Overall Best Performer

Procedure Men (number) 6 7.0 4.9 1.00 (New Zealand)

Time Men (days) 41 22.7 8.5 0.50 (New Zealand)

Cost Men (% of income per capita) 11.5 18.4 3.1 0.00 (United Kingdom)

Procedure Women (number) 6 7.0 4.9 1.00 (New Zealand)

Time Women (days) 41 22.8 8.5 0.50 (New Zealand)

Cost Women (% of income per capita) 11.5 18.4 3.1 0.00 (United Kingdom)

Paid-in min. capital (% of income per capita) 0.0 15.1 8.7 0.00 (113 Economies)

FigureStartingaBusinessinPapuaNewGuineaandcomparatoreconomiesRankingandDTF


0 100

92.54: Samoa (Rank: 33)

88.49: Marshall Islands (Rank: 72)

82.32: Regional Average (East Asia & Pacific)

81.96: Palau (Rank: 124)

81.04: Papua New Guinea (Rank: 129)

77.47: Kiribati (Rank: 147)

Note: The ranking of economies on the ease of starting a business is determined by sorting their distance to frontier scores forstarting a business. These scores are the simple average of the distance to frontier scores for each of the component indicators.

FigureStartingaBusinessinPapuaNewGuineaProcedure,TimeandCost

Procedures (number)

1 2 3 4 * 5 * 60

5

10

15

20

25

30

35

40

Time (days)

0

1

2

3

4

5

6

7

8

Cost (%

of incom

e per capita)

Time(days) Cost(%ofincomepercapita)

* This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure.

Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list formen and women, the graph shows the time for women. For more information on methodology, see the Doing Business website(http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below.

DetailsStartingaBusinessinPapuaNewGuineaProcedure,TimeandCost

Applies to women only.

Takes place simultaneously with previous procedure.

No. Procedures Time to Complete Associated Costs

1 Obtain a company seal

Agency : Seal maker

Although companies are not expressly mandated by law to make a companyseal, they are required to have a seal to meet the Companies Actrequirements for issuing share certi cates for entering into deeds andcontracts. The fee for a seal varies with its size but is about PGK 4080. A sealcan be obtained in a week and can also be applied for online:http://www.theodist.com/print-shop/custom-rubber-stamps .

4 days PGK 60

2 Reserve company name and complete the registration process

Agency : Registrar

A company registration application must be submitted to the Registrar ofCompanies. Using standard Form 1, the application must include 3 proposednames of the company, the postal and street address of the registeredo ce, and the number and names of the directors, the shareholders, andthe secretaries.

Form 1 must also be accompanied by - A certi ed copy of the company constitution, if applicable- Form 6, an application for name reservation

A company is no longer required to have a memorandum or articles ofassociation. A proposed company may opt to have a constitution but is notrequired to do so.

Total fees to register are

Form 1 - PGK 400 (Online) and PGK 500 (Over the counter)Form 6 - PGK 50 (Online) and PGK 100 (Over the counter)

7 days PGK 600

3 Register with the Tax Authorities and the Employment Register

Agency : Internal Revenue Commission

Under the Income Tax Act, a company carrying on business or derivingincome in Papua New Guinea must appoint a Papua New Guinea resident tobe a public o cer. The appointment must be made 3 months from the datethe company starts business operations or derives income in the country, bywritten notice to the Internal Revenue Commission.All tax notices and forms are led to the attention of the Internal RevenueCommissioner. Although di erent o cers in this agency will likely attend tothe separate notices and forms, these forms can be submitted to theCommissioner in a single ling. The procedure takes a week to a month. If a company employs one or more employees in Papua New Guinea with aweekly salary of more than PGK 126 a week, they must register as a groupemployer by submitting a written notice to the Internal RevenueCommission. No fees apply. Any business or individual whose annual turnover exceeds (or is likely toexceed) PGK 100,000, must register for goods and services tax (GST) by lingForm 1 with the Internal Revenue Commission. This standard form requiresthe company business name and a description of its proposed mainbusiness activities along with the street and postal address of the registeredo ce and a statement of its monthly sales and liabilities (approximate). Nofees apply.

9 days no charge

4 Apply for a trade license from the National Capital District Commission

Agency : National Capital District Commission

Companies in Port Moresby must obtain a trading license from the NationalCapital District Commission.

20 days PGK 50

5 Open an account at an Authorized Superannuation Fund (ASF)

Agency : Authorized Superannuation Fund

According to the amendment to the Superannuation (General Provisions)Act 2000, a company with 15 or more employees must contribute to anAuthorized Superannuation Fund (ASF; a superannuation fund that theCentral Bank has approved and licensed).

An employer must remit its employer contributions to the ASF within 14 daysof the end of each calendar month in which the relevant contribution is duefor deduction from an employee's pay. It is an o ence not to makecontributions. Under the act, the Central Bank has the power to instigateproceedings against any o ence by a person. It takes 710 days to open anaccount.

9 days(simultaneous withpreviousprocedure)

no charge

6 Register workers with the private insurers for work injury

Agency : Insurance company

Although there is no registration requirement, it is an o ence for anemployer to employ any worker without an insurance or indemnity policyissued by a licensed insurer for injury to the worker arising out of or duringemployment. Registration time is 1030 days.


PGK 200

Dealing with Construction PermitsThis topic tracks the procedures, time and cost to build a warehouseincluding obtaining necessary the licenses and permits,submitting all required noti cations, requesting and receiving all necessary inspections and obtaining utility connections. Inaddition, the Dealing with Construction Permits indicator measures the building quality control index, evaluating the quality ofbuilding regulations, the strength of quality control and safety mechanisms, liability and insurance regimes, and professionalcerti cation requirements. The most recent round of data collection was completed in June 2017. See the methodology for moreinformation


Procedures to legally build a warehouse (number)

Submitting all relevant documents and obtainingall necessary clearances, licenses, permits andcertificates

Submitting all required notifications andreceiving all necessary inspections

Obtaining utility connections for water andsewerage

Registering and selling the warehouse after itscompletion



Each procedure starts on a separate daythough procedures that can be fully completedonline are an exception to this rule



Cost required to complete each procedure (% ofwarehouse value)


Building quality control index (0-15)

Sum of the scores of six component indices:

Quality of building regulations (0-2)

Quality control before construction (0-1)

Quality control during construction (0-3)

Quality control after construction (0-3)

Liability and insurance regimes (0-2)

Professional certifications (0-4)


To make the data comparable across economies, several assumptionsabout the construction company, the warehouse project and the utilityconnections are used.

The construction company (BuildCo):- Is a limited liability company (or its legal equivalent) and operates in theeconomys largest business city. For 11 economies the data are alsocollected for the second largest business city. - Is 100% domestically and privately owned; has ve owners, none of whomis a legal entity. Has a licensed architect and a licensed engineer, bothregistered with the local association of architects or engineers. BuildCo isnot assumed to have any other employees who are technical or licensedexperts, such as geological or topographical experts. - Owns the land on which the warehouse will be built and will sell thewarehouse upon its completion.

The warehouse: - Will be used for general storage activities, such as storage of books orstationery. - Will have two stories, both above ground, with a total constructed area ofapproximately 1,300.6 square meters (14,000 square feet). Each oor willbe 3 meters (9 feet, 10 inches) high and will be located on a land plot ofapproximately 929 square meters (10,000 square feet) that is 100% ownedby BuildCo, and the warehouse is valued at 50 times income per capita. - Will have complete architectural and technical plans prepared by alicensed architect. If preparation of the plans requires such steps asobtaining further documentation or getting prior approvals from externalagencies, these are counted as procedures. - Will take 30 weeks to construct (excluding all delays due to administrativeand regulatory requirements).

The water and sewerage connections: - Will be 150 meters (492 feet) from the existing water source and sewertap. If there is no water delivery infrastructure in the economy, a boreholewill be dug. If there is no sewerage infrastructure, a septic tank in thesmallest size available will be installed or built. - Will have an average water use of 662 liters (175 gallons) a day and anaverage wastewater ow of 568 liters (150 gallons) a day. Will have a peakwater use of 1,325 liters (350 gallons) a day and a peak wastewater ow of1,136 liters (300 gallons) a day. - Will have a constant level of water demand and wastewater owthroughout the year; will be 1 inch in diameter for the water connectionand 4 inches in diameter for the sewerage connection.

Standardized Warehouse

Estimated value of warehouse PGK 396,084.10



East Asia &Pacific


Procedures (number) 17 15.2 12.5 7.00 (Denmark)

Time (days) 217 138.2 154.6 27.5 (Korea, Rep.)

Cost (% of warehouse value) 1.2 2.2 1.6 0.10 (5 Economies)

Building quality control index (0-15) 10.0 8.9 11.4 15.00 (3 Economies)

FigureDealingwithConstructionPermitsinPapuaNewGuineaandcomparatoreconomiesRankingandDTF


0 100



68.68: Samoa (Rank: 83)

68.38: Palau (Rank: 85)



Note: The ranking of economies on the ease of dealing with construction permits is determined by sorting their distance to frontierscores for dealing with construction permits. These scores are the simple average of the distance to frontier scores for each of thecomponent indicators.

FigureDealingwithConstructionPermitsinPapuaNewGuineaProcedure,TimeandCost

Procedures (number)

1 2 * 3 * 4 * 5 6 7 8 9 10 11 * 12 13 14 * 15 16 170

50

100

150

200

Time (days)

0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

Cost (%

of w

arehouse value)

Time(days) Cost(%ofwarehousevalue)



FigureDealingwithConstructionPermitsinPapuaNewGuineaandcomparatoreconomiesMeasureofQuality

Papua New Guinea Kiribati Marshall Islands Palau Samoa East Asia & Pacific

0

2

4

6

8

10

12

Index score

10.0

6.0

1.0

7.06.0

8.9

DetailsDealingwithConstructionPermitsinPapuaNewGuineaProcedure,TimeandCost



1 Request and obtain planning permission from the NCD PhysicalPlanning Board

Agency : NCD Physical Planning Board

30 days PGK 100

2 Request and obtain certi cate of ownership and site map

Agency : National Department of Land

30 days PGK 100

3 Request and obtain permission from the Fire Authority

Agency : PNG Fire Services

30 days no charge

4 Request and obtain project clearance from the Health Department

Agency : Health Department

29 days no charge

5 Request and obtain project clearance from the Water and SewageAuthority

Agency : Water and Sewage Authority (Eda Ranu)

27 days no charge

6 Request and obtain building permit from the National Capital DistrictCommission (NCDC)

Agency : National Capital District Commission (NCDC)

The building permit is issued after all clearances have been obtained.

90 days PGK 2,516

7 Request and receive foundations work inspection from the Municipality

Agency : Municipality

In some cases, a telephone call is enough to schedule the inspection.However, in other cases, BuildCo might have to provide transportation tothe inspector. Inspections must be requested by BuildCo at each phase ofthe construction work.

1 day no charge

8 Request and receive concrete work inspection from the Municipality


1 day no charge

9 Request and receive steel work for slabs inspection from theMunicipality


1 day no charge

10 Request and receive frame inspection from the Municipality


1 day no charge

11 Request and receive damp-proof course inspection from theMunicipality


1 day no charge

12Request water and sewage connection


1 day no charge

13 Receive plumbing inspection


1 day no charge

14 Connect to water and sewage services


29 days PGK 2,000

15Request occupancy permit

Agency : NCDC

In the case of a small project, the Municipal Building Board is not required toissue an approval and the occupancy permit can be granted in a day.However, if the building requires an approval by the Building Board (as is thecase with the Doing Business case study), the issuance of the permit will takea month since the board meets once a month. The Chief Building Inspectorproposes the project to the Building Board, which then grants the naldecision. The occupancy permit may also be issued upon completion ofcertain phases of the project.

1 day no charge

16 Receive inspection


1 day no charge

17 Obtain occupancy permit


29 days no charge

DetailsDealingwithConstructionPermitsinPapuaNewGuineaMeasureofQuality

Answer Score

Building quality control index (0-15) 10.0

Quality of building regulations index (0-2) 2.0

How accessible are building laws and regulations in your economy? (0-1) Available online;Free of charge.

1.0

Which requirements for obtaining a building permit are clearly speci ed in the buildingregulations or on any accessible website, brochure or pamphlet? (0-1)

List of requireddocuments; Feesto be paid;Requiredpreapprovals.

1.0

Quality control before construction index (0-1) 1.0

Which third-party entities are required by law to verify that the building plans are incompliance with existing building regulations? (0-1)

Licensedengineer.

1.0

Quality control during construction index (0-3) 2.0

What types of inspections (if any) are required by law to be carried out duringconstruction? (0-2)

Inspections byin-houseengineer;Inspections atvarious phases.

1.0

Do legally mandated inspections occur in practice during construction? (0-1) Mandatoryinspections arealways done inpractice.

1.0

Quality control after construction index (0-3) 3.0

Is there a nal inspection required by law to verify that the building was built inaccordance with the approved plans and regulations? (0-2)

Yes, nalinspection isdone bygovernmentagency; Yes, in-house engineersubmits reportfor nalinspection; Finalinspection is notrequired by law.

2.0

Do legally mandated nal inspections occur in practice? (0-1) Final inspectionalways occurs inpractice.

1.0

Liability and insurance regimes index (0-2) 0.0

Which parties (if any) are held liable by law for structural aws or problems in thebuilding once it is in use (Latent Defect Liability or Decennial Liability)? (0-1)

No party is heldliable under thelaw.

0.0

Which parties (if any) are required by law to obtain an insurance policy to coverpossible structural aws or problems in the building once it is in use (Latent DefectLiability Insurance or Decennial Insurance)? (0-1)

No party isrequired by lawto obtaininsurance .

0.0

Professional certi cations index (0-4) 2.0

What are the quali cation requirements for the professional responsible for verifyingthat the architectural plans or drawings are in compliance with existing buildingregulations? (0-2)

Universitydegree inarchitecture orengineering;Being aregisteredarchitect orengineer;Passing acerti cationexam.

1.0

What are the quali cation requirements for the professional who supervises theconstruction on the ground? (0-2)

Universitydegree inengineering,construction orconstructionmanagement;Being aregisteredarchitect orengineer.

1.0

Getting ElectricityThis topic measures the procedures, time and cost required for a business to obtain a permanent electricity connection for a newlyconstructed warehouse. Additionally, the reliability of supply and transparency of tari s index measures reliability of supply,transparency of tari s and the price of electricity. The most recent round of data collection for the project was completed in June2017. See the methodology for more information.


Procedures to obtain an electricity connection(number)

Submitting all relevant documents and obtainingall necessary clearances and permits

Completing all required notifications andreceiving all necessary inspections

Obtaining external installation works and possiblypurchasing material for these works

Concluding any necessary supply contract andobtaining final supply


Is at least 1 calendar day

Each procedure starts on a separate day


Reflects the time spent in practice, with littlefollow-up and no prior contact with officials



Value added tax excluded

The reliability of supply and transparency oftari s index (0-8)

Duration and frequency of power outages (03)

Tools to monitor power outages (01)

Tools to restore power supply (01)

Regulatory monitoring of utilities performance(01)

Financial deterrents limiting outages (01)

Transparency and accessibility of tariffs (01)

Price of electricity (cents per kilowatt-hour)*

Price based on monthly bill for commercialwarehouse in case study

*Note: Doing Business measures the pr ice ofelectricity, but it is not included in the distance tofrontier score nor the ranking on the ease of gettingelectricity.


To make the data comparable across economies, several assumptions areused.

The warehouse: - Is owned by a local entrepreneur and is used for storage of goods.- Is located in the economys largest business city. For 11 economies thedata are also collected for the second largest business city. - Is located in an area where similar warehouses are typically located and isin an area with no physical constraints. For example, the property is notnear a railway. - Is a new construction and is being connected to electricity for the rsttime. - Has two stories with a total surface area of approximately 1,300.6 squaremeters (14,000 square feet). The plot of land on which it is built is 929square meters (10,000 square feet).

The electricity connection:- Is a permanent one with a three-phase, four-wire Y connection with asubscribed capacity of 140-kilo-volt-ampere (kVA) with a power factor of 1,when 1 kVA = 1 kilowatt (kW). - Has a length of 150 meters. The connection is to either the low- ormedium-voltage distr ibution network and is either overhead orunderground, whichever is more common in the area where thewarehouse is located and requires works that involve the crossing of a 10-meter road (such as by excavation or overhead lines) but are all carried outon public land. There is no crossing of other owners private propertybecause the warehouse has access to a road. - Does not require work to install the internal wiring of the warehouse. Thishas already been completed up to and including the customers servicepanel or switchboard and the meter base.

The monthly consumption:- It is assumed that the warehouse operates 30 days a month from 9:00a.m. to 5:00 p.m. (8 hours a day), with equipment utilized at 80% of capacityon average and that there are no electricity cuts (assumed for simplicityreasons) and the monthly energy consumption is 26,880 kilowatt-hours(kWh); hourly consumption is 112 kWh. - If multiple electricity suppliers exist, the warehouse is served by thecheapest supplier. - Tari s e ective in March of the current year are used for calculation ofthe price of electricity for the warehouse. Although March has 31 days, forcalculation purposes only 30 days are used.

Standardized Connection

Price of electricity (US cents per kWh) 31.5

Name of utility PNG Power Ltd



East Asia &Pacific


Procedures (number) 4 4.5 4.7 2 (United ArabEmirates)

Time (days) 66 71.6 79.1 10 (United ArabEmirates)

Cost (% of income per capita) 27.2 712.0 63.0 0.00 (Japan)

Reliability of supply and transparency of tariffindex (0-8)

0 3.7 7.4 8.00 (28 Economies)

FigureGettingElectricityinPapuaNewGuineaandcomparatoreconomiesRankingandDTF


0 100

79.70: Samoa (Rank: 60)




54.84: Palau (Rank: 140)


Note: The ranking of economies on the ease of getting electricity is determined by sorting their distance to frontier scores forgetting electricity. These scores are the simple average of the distance to frontier scores for each of the component indicators.

FigureGettingElectricityinPapuaNewGuineaProcedure,TimeandCost

Procedures (number)

1 * 2 * 3 40

10

20

30

40

50

60

Time (days)

0

5

10

15

20

25

Cost (%

of incom

e per capita)




FigureGettingElectricityinPapuaNewGuineaandcomparatoreconomiesMeasureofQuality


0

0.5

1

1.5

2

2.5

3

3.5

4

4.5

Index score

0 0 0 0

43.7

DetailsGettingElectricityinPapuaNewGuineaProcedure,TimeandCost



1 Submit application to PNG Power Ltd. and await estimate

Agency : PNG Power Ltd

The customer submits the application in person, by telephone or in writingwith PNG Power LTD requesting electricity service and provides relevantinformation such as power requirement based on electrical equipment ,drawings showing layout of the building, etc.

A minimum of two identi cations for veri cation of the consumer isrequired.

24 calendar days PGK 1,643.96

2 Receive external inspection by PNG Power Ltd.


An external inspection is conducted by the utility. Someone from theapplicant's party has to be present. After the inspection, the utility preparesthe estimate and sends it to the customer.

1 calendar day USD 0

3 Request and receive internal inspection by PNG Power Ltd.


Before undertaking the electrical wiring of the building the customersubmitted a Notice of Intention to start electrical works to PPL. He also paidthe service fee (regulated charge which covers metering and service line)when submitting Notice of Intention form. This fee is regulated and set bythe Regulator annually.

After the electrical works is completed, including installation of meteringequipment, the customer submits a Completion Notice. Upon receiving theCompletion Notice PPL/ICCC inspectors inspect the electrical wiring forconductivity, safety and workmanship standard. Someone from theapplicant party has to be present. If these are met a no Fault Notice is issuedand is passed on to customer service to connect customer.

5 calendar days PGK 462

4 Receive external works and meter installation by PNG Power Ltd.


All external connection works are done by the utility. The utility installs atransformer. Material is usually available. The meter gets installed at thesame time when the connection is done if the connection fee has been paid.

With the Capital Advance Policy the price of the external connection isreimbursed to the customer through o setting of electrical bills. TheConnection Fee/Charge is regulated and set by the Independent Consumerand Competition Commission (ICCC)

42 calendar days PGK 47

DetailsGettingElectricityinPapuaNewGuineaMeasureofQuality

Note:

If the duration and frequency of outages is 100 or less, the economy is eligible to score on the Reliability of supply and transparencyof tari index.

If the duration and frequency of outages is not available, or is over 100, the economy is not eligible to score on the index.

If the minimum outage time considered for SAIDI/SAIFI is over 5 minutes, the economy is not eligible to score on the index.

Answer

Reliability of supply and transparency of tari index (0-8) 0

Total duration and frequency of outages per customer a year (0-3) 0

System average interruption duration index (SAIDI) 136.0

System average interruption frequency index (SAIFI) 88.0

What is the minimum outage time (in minutes) that the utility considers for the calculation of SAIDI/SAIFI 6.0

Mechanisms for monitoring outages (0-1) 1

Does the distribution utility use automated tools to monitor outages? Yes

Mechanisms for restoring service (0-1) 1

Does the distribution utility use automated tools to restore service? Yes

Regulatory monitoring (0-1) 1

Does a regulatorthat is, an entity separate from the utilitymonitor the utilitys performance onreliability of supply?

Yes

Financial deterrents aimed at limiting outages (0-1) 0

Does the utility either pay compensation to customers or face nes by the regulator (or both) if outagesexceed a certain cap?

No

Communication of tari s and tari changes (0-1) 1

Are e ective tari s available online? Yes

Link to the website, if available online http://www.pngpower.com.pg/images/tari 3may2013.pdf

Are customers noti ed of a change in tari ahead of the billing cycle? Yes

Registering PropertyThis topic examines the steps, time and cost involved in registering property, assuming a standardized case of an entrepreneur whowants to purchase land and a building that is already registered and free of title dispute. In addition, the topic also measures thequality of the land administration system in each economy. The quality of land administration index has ve dimensions: reliability ofinfrastructure, transparency of information, geographic coverage, land dispute resolution, and equal access to property rights. Themost recent round of data collection for the project was completed in June 2017. See the methodology for more information.


Procedures to legally transfer title on immovableproperty (number)

Preregistration procedures (for example,checking for liens, notarizing sales agreement,paying property transfer taxes)

Registration procedures in the economy's largestbusiness citya.

Postregistration procedures (for example, fillingtitle with municipality)



Each procedure starts on a separate day - thoughprocedures that can be fully completed onlineare an exception to this rule



Cost required to complete each procedure (% ofproperty value)

Official costs only (such as administrative fees,duties and taxes).

Value Added Tax, Capital Gains Tax and illicitpayments are excluded

Quality of land administration index (0-30)

Reliability of infrastructure index (0-8)

Transparency of information index (06)

Geographic coverage index (08)

Land dispute resolution index (08)

Equal access to property rights index (-20)


To make the data comparable across economies, several assumptionsabout the parties to the transaction, the property and the procedures areused.

The parties (buyer and seller):- Are limited liability companies (or the legal equivalent).- Are located in the periurban area of the economys largest business city.For 11 economies the data are also collected for the second largestbusiness city.- Are 100% domestically and privately owned.- Have 50 employees each, all of whom are nationals.- Perform general commercial activities.

The property (fully owned by the seller):- Has a value of 50 times income per capita, which equals the sale price.- Is fully owned by the seller.- Has no mortgages attached and has been under the same ownership forthe past 10 years.- Is registered in the land registry or cadastre, or both, and is free of titledisputes.- Is located in a periurban commercial zone, and no rezoning is required.- Consists of land and a building. The land area is 557.4 square meters(6,000 square feet). A two-story warehouse of 929 square meters (10,000square feet) is located on the land. The warehouse is 10 years old, is ingood condition, has no heating system and complies with all safetystandards, building codes and legal requirements. The property,consisting of land and building, will be transferred in its entirety. - Will not be subject to renovations or additional construction following thepurchase.- Has no trees, natural water sources, natural reserves or historicalmonuments of any kind.- Will not be used for special purposes, and no special permits, such as forresidential use, industrial plants, waste storage or certain types ofagricultural activities, are required.- Has no occupants, and no other party holds a legal interest in it.

Standard Property Transfer

Property value PGK 396,084.10



East Asia &Pacific


Procedures (number) 4 5.5 4.6 1.00 (4 Economies)

Time (days) 72 74.5 22.3 1.00 (3 Economies)

Cost (% of property value) 5.2 4.3 4.2 0.00 (5 Economies)

Quality of the land administration index (0-30) 4.5 15.8 22.7 29.00 (Singapore)

FigureRegisteringPropertyinPapuaNewGuineaandcomparatoreconomiesRankingandDTF


0 100

75.16: Palau (Rank: 43)

69.51: Samoa (Rank: 66)





Note: The ranking of economies on the ease of registering property is determined by sorting their distance to frontier scores forregistering property. These scores are the simple average of the distance to frontier scores for each of the component indicators.

FigureRegisteringPropertyinPapuaNewGuineaProcedure,TimeandCost

Procedures (number)

1 2 3 40

10

20

30

40

50

60

70

Time (days)

0

1

2

3

4

5

6

Cost (%

of property value)

Time(days) Cost(%ofpropertyvalue)



FigureRegisteringPropertyinPapuaNewGuineaandcomparatoreconomiesMeasureofQuality


0

2

4

6

8

10

12

14

16

18

Index score

4.5

9.0

no practice

12.5 13.0

15.8

DetailsRegisteringPropertyinPapuaNewGuineaProcedure,TimeandCost



1 Conduct pre-completion, title searches and municipal charges searchesat the O ce of the Registrar of Titles, Lands Department

Agency : O ce of the Registrar of Titles, Lands Department (under Ministryof Lands)

The Municipality uses computers and can do this Procedure on the spot. Thechecking is made in the electronic database and also on paper (in casesomething has not been entered into the system). Requests can also bemade by fax. The Lands Department manages 2 parallel systems: it managestitles on paper and also has an electronic database where all operationsrelated to a title are registered (in particular titles and encumbrances). Acompany search can also be made to verify that the company has not beendelisted.

1 day PGK 200

2 The documents must be stamped at the Internal Revenue Commission


Once the documents have been duly executed and exchanged then thedocuments must be stamped at the Internal Revenue Commission. Stampduty is paid by the purchaser. Stamp duty rates table (Stamp Duties Act1952): Value of property less than 35,000 PGK: The greater of PGK 5 or 2%Value of property 35,001 to 70,000 PGK: 3% Value of property 70,001 to140,000 PGK: 4% Value of property over 140,000 PGK: 5%

14 days 5% of property value

3 Documents are lodged for the approval of the Minister for Lands at theDepartment of Lands

Agency : Minister for Lands, Division Land management

Once the documents have been stamped, the Division Land management, inthe 2nd oor of the Minister of lands, receives the le for approval by theMinistry of lands. This division analyses if the land rents have been fully paid,and if the conditions of the lease have been approved (for example if theagreed improvements have been made). There are no physical inspections.The minister has one delegate that signs the les in the name of theminister, and another extra delegate could also be named.

35 days PGK 300

4 The transfer and the title documents are lodged for registration with theDepartment of Lands (The Registrar of Titles)

Agency : Department of Lands (Registrar of Titles)

Following completion of the sale of the property, the transfer and the titledocuments (i.e. the State Lease) are lodged for registration with theDepartment of Lands (The Registrar of Titles). Once the employees of theLand Department verify the transaction and summarize it in a preformattedpage (worksheet), the Registrar of titles will approve the transaction. Thistransaction will then be typed in the paper titles (both in the title thatremains in the Registry and in the title kept by the owner - lessee). Since1996, the transactions are inputted into an electronic system. This system isnot accessible online. Note on the property registry: The registry uses aTorrens titling system, and is centralized for the whole country. Titles aremanaged in paper. There is also a computer system that records theinformation, but the information is not available on-line. The transferdocuments are not scanned and are not included in the system.

22 days PGK 200

DetailsRegisteringPropertyinPapuaNewGuineaMeasureofQuality

Answer Score

Quality of the land administration index (0-30) 4.5

Reliability of infrastructure index (0-8) 1.0

What is the institution in charge of immovable property registration? The Registrar ofTitles(Department ofLands)

In what format are the majority of title or deed records kept in the largest business cityin a paper format or in a computerized format (scanned or fully digital)?

Paper 0.0

Is there an electronic database for checking for encumbrances (liens, mortgages,restrictions and the like)?

No 0.0

Institution in charge of the plans showing legal boundaries in the largest business city: SurveyorGeneral O ce

In what format are the majority of maps of land plots kept in the largest business cityin a paper format or in a computerized format (scanned or fully digital)?

Paper 0.0

Is there an electronic database for recording boundaries, checking plans and providingcadastral information (geographic information system)?

No 0.0

Is the information recorded by the immovable property registration agency and thecadastral or mapping agency kept in a single database, in di erent but linked databasesor in separate databases?

Separatedatabases

0.0

Do the immovable property registration agency and cadastral or mapping agency usethe same identi cation number for properties?

Yes 1.0

Transparency of information index (06) 1.5

Who is able to obtain information on land ownership at the agency in charge ofimmovable property registration in the largest business city?

Anyone whopays the o cialfee

1.0

Is the list of documents that are required to complete any type of property transactionmade publicly availableand if so, how?

Yes, in person 0.0

Link for online access:

Is the applicable fee schedule for any property transaction at the agency in charge ofimmovable property registration in the largest business city made publicly availableand if so, how?

Yes, in person 0.0


Does the agency in charge of immovable property registration commit to delivering alegally binding document that proves property ownership within a speci c time frameand if so, how does it communicate the service standard?

No 0.0


Is there a speci c and separate mechanism for ling complaints about a problem thatoccurred at the agency in charge of immovable property registration?

No 0.0

Contact information:

Are there publicly available o cial statistics tracking the number of transactions at theimmovable property registration agency?

No 0.0

Number of property transfers in the largest business city in 2016:

Who is able to consult maps of land plots in the largest business city? Anyone whopays the o cialfee

0.5

Is the applicable fee schedule for accessing maps of land plots made publicly availableand if so, how?

Yes, in person 0.0


Does the cadastral or mapping agency commit to delivering an updated map within aspeci c time frameand if so, how does it communicate the service standard?

No 0.0


Is there a speci c and separate mechanism for ling complaints about a problem thatoccurred at the cadastral or mapping agency?

No 0.0

Contact information:

Geographic coverage index (08) 0.0

Are all privately held land plots in the economy formally registered at the immovableproperty registry?

No 0.0

Are all privately held land plots in the largest business city formally registered at theimmovable property registry?

No 0.0

Are all privately held land plots in the economy mapped? No 0.0

Are all privately held land plots in the largest business city mapped? No 0.0

Land dispute resolution index (08) 2.0

Does the law require that all property sale transactions be registered at the immovableproperty registry to make them opposable to third parties?

No 0.0

Is the system of immovable property registration subject to a state or privateguarantee?

No 0.0

Is there a speci c compensation mechanism to cover for losses incurred by parties whoengaged in good faith in a property transaction based on erroneous informationcerti ed by the immovable property registry?

No 0.0

Does the legal system require a control of legality of the documents necessary for aproperty transaction (e.g., checking the compliance of contracts with requirements ofthe law)?

No 0.0

If yes, who is responsible for checking the legality of the documents? .

Does the legal system require veri cation of the identity of the parties to a propertytransaction?

No 0.0

If yes, who is responsible for verifying the identity of the parties? .

Is there a national database to verify the accuracy of identity documents? No 0.0

For a standard land dispute between two local businesses over tenure rights of aproperty worth 50 times gross national income (GNI) per capita and located in thelargest business city, what court would be in charge of the case in the rst instance?

National Court

How long does it take on average to obtain a decision from the rst-instance court forsuch a case (without appeal)?

Between 1 and 2years

2.0

Are there any statistics on the number of land disputes in the rst instance? No 0.0

Number of land disputes in the largest business city in 2016:

Equal access to property rights index (-20) 0.0

Do unmarried men and unmarried women have equal ownership rights to property? Yes 0.0

Do married men and married women have equal ownership rights to property? Yes 0.0

Getting CreditThis topic explores two sets of issuesthe strength of credit reporting systems and the e ectiveness of collateral and bankruptcylaws in facilitating lending. The most recent round of data collection for the project was completed in June 2017. See themethodology for more information.


Strength of legal rights index (012)

Rights of borrowers and lenders throughcollateral laws (0-10)

Protection of secured creditors rights throughbankruptcy laws (0-2)

Depth of credit information index (08)

Scope and accessibility of credit informationdistributed by credit bureaus and creditregistries (0-8)

Credit bureau coverage (% of adults)

Number of individuals and firms listed in largestcredit bureau as a percentage of adult population

Credit registry coverage (% of adults)

Number of individuals and firms listed in creditregistry as a percentage of adult population


Doing Business assesses the sharing of credit information and the legalrights of borrowers and lenders with respect to secured transactionsthrough 2 sets of indicators. The depth of credit information indexmeasures rules and practices a ecting the coverage, scope andaccessibility of credit information available through a credit registry or acredit bureau. The strength of legal rights index measures the degree towhich collateral and bankruptcy laws protect the rights of borrowers andlenders and thus facilitate lending. For each economy it is first determinedwhether a unitary secured transactions system exists. Then two casescenarios, case A and case B, are used to determine how a nonpossessorysecurity interest is created, publicized and enforced according to the law.Special emphasis is given to how the collateral registry operates (ifregistration of security interests is possible). The case scenarios involve asecured borrower, company ABC, and a secured lender, BizBank.

In some economies the legal framework for secured transactions will allowonly case A or case B (not both) to apply. Both cases examine the same setof legal provisions relating to the use of movable collateral.

Several assumptions about the secured borrower (ABC) and lender(BizBank) are used:- ABC is a domestic limited liability company (or its legal equivalent).- ABC has up to 50 employees.- ABC has its headquarters and only base of operations in the economyslargest business city. For 11 economies the data are also collected for thesecond largest business city.- Both ABC and BizBank are 100% domestically owned.

The case scenarios also involve assumptions. In case A, as collateral for theloan, ABC grants BizBank a nonpossessory security interest in one categoryof movable assets, for example, its machinery or its inventory. ABC wantsto keep both possession and ownership of the collateral. In economieswhere the law does not allow nonpossessory security interests in movableproperty, ABC and BizBank use a fiduciary transfer-of-title arrangement (ora similar substitute for nonpossessory security interests).

In case B, ABC grants BizBank a business charge, enterprise charge, floatingcharge or any charge that gives BizBank a security interest over ABCscombined movable assets (or as much of ABCs movable assets aspossible). ABC keeps ownership and possession of the assets.


East Asia &Pacific


Strength of legal rights index (0-12) 9 7.2 6.0 12.00 (4 Economies)

Depth of credit information index (0-8) 5 4.2 6.6 8.00 (34 Economies)

Credit registry coverage (% of adults) 0.0 16.0 18.3 100.00 (3 Economies)

Credit bureau coverage (% of adults) 7.0 22.3 63.7 100.00 (23 Economies)

FigureGettingCreditinPapuaNewGuineaandcomparatoreconomiesRankingandDTF


0 100




50.00: Palau (Rank: 90)

45.00: Samoa (Rank: 105)


Note: The ranking of economies on the ease of getting credit is determined by sorting their distance to frontier scores for gettingcredit. These scores are the distance to frontier score for the sum of the strength of legal rights index and the depth of creditinformation index.

FigureLegalRightsinPapuaNewGuineaandcomparatoreconomies


0

2

4

6

8

10

12

Index score

9

4

10 109

7.2

http://dbuat.financeandprivatesector.org/~/media/WBG/DoingBusiness/Documents/Profiles/Country/PNG.pdfhttp://dbuat.financeandprivatesector.org/data/exploreeconomies/profile/~/media/AF824138BBBF4853B9C8C237C3D99FF9.ashxhttp://dbuat.financeandprivatesector.org/reforms/overview/economy/%7BcountryUrlName%7Dhttp://dbuat.financeandprivatesector.org/data/exploreeconomies/profile/~/media/WBG/DoingBusiness/Documents/Methodology/LMR/LMR-2018DB-service-sector-data-points-and-details.xlsxhttp://dbuat.financeandprivatesector.org/methodology/LMR-why-it-mattershttp://dbuat.financeandprivatesector.org/About-Us/FAQ#EWI

Economy ProfilePapua New Guinea

Economy Pro le of Papua New Guinea

Doing Business 2018 Indicators(in order of appearance in the document)

Starting a business Procedures, time, cost and paid-in minimum capital to start a limited liability company

Dealing with constructionpermits

Procedures, time and cost to complete all formalities to build a warehouse and the quality control andsafety mechanisms in the construction permitting system

Getting electricity Procedures, time and cost to get connected to the electrical grid, the reliability of the electricity supply andthe transparency of tariffs

Registering property Procedures, time and cost to transfer a property and the quality of the land administration system

Getting credit Movable collateral laws and credit information systems

Protecting minority investors Minority shareholders rights in related-party transactions and in corporate governance

Paying taxes Payments, time and total tax rate for a firm to comply with all tax regulations as well as post-filing processes

Trading across borders Time and cost to export the product of comparative advantage and import auto parts

Enforcing contracts Time and cost to resolve a commercial dispute and the quality of judicial processes

Resolving insolvency Time, cost, outcome and recovery rate for a commercial insolvency and the strength of the legal frameworkfor insolvency

Labor market regulation Flexibility in employment regulation and aspects of job quality

About Doing BusinessThe Doing Business project provides objective measures of business regulations and their enforcement across 190 economies andselected cities at the subnational and regional level.

The Doing Business project, launched in 2002, looks at domestic small and medium-size companies and measures the regulationsapplying to them through their life cycle.

Doing Business captures several important dimensions of the regulatory environment as it applies to local rms. It providesquantitative indicators on regulation for starting a business, dealing with construction permits, getting electricity, registeringproperty, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts and resolvinginsolvency. Doing Business also measures features of labor market regulation. Although Doing Business does not present rankingsof economies on the labor market regulation indicators or include the topic in the aggregate distance to frontier score or ranking onthe ease of doing business, it does present the data for these indicators.

By gathering and analyzing comprehensive quantitative data to compare business regulation environments across economies andover time, Doing Business encourages economies to compete towards more e cient regulation; o ers measurable benchmarks forreform; and serves as a resource for academics, journalists, private sector researchers and others interested in the businessclimate of each economy.

In addition, Doing Business o ers detailed subnational reports, which exhaustively cover business regulation and reform in di erentcities and regions within a nation. These reports provide data on the ease of doing business, rank each location, and recommendreforms to improve performance in each of the indicator areas. Selected cities can compare their business regulations with othercities in the economy or region and with the 190 economies that Doing Business has ranked.

The rst Doing Business report, published in 2003, covered 5 indicator sets and 133 economies. This years report covers 11indicator sets and 190 economies. Most indicator sets refer to a case scenario in the largest business city of each economy, exceptfor 11 economies that have a population of more than 100 million as of 2013 (Bangladesh, Brazil, China, India, Indonesia, Japan,Mexico, Nigeria, Pakistan, the Russian Federation and the United States) where Doing Business, also collected data for the secondlargest business city. The data for these 11 economies are a population-weighted average for the 2 largest business cities. Theproject has bene ted from feedback from governments, academics, practitioners and reviewers. The initial goal remains: to providean objective basis for understanding and improving the regulatory environment for business around the world.

The distance to frontier (DTF) measure shows the distance of each economy to the frontier, which represents the bestperformance observed on each of the indicators across all economies in the Doing Business sample since 2005. An economysdistance to frontier is re ected on a scale from 0 to 100, where 0 represents the lowest performance and 100 represents thefrontier. The ease of doing business ranking ranges from 1 to 190. The ranking of 190 economies is determined by sorting theaggregate distance to frontier scores, rounded to two decimals.

More about Doing Business (PDF, 5MB)

Ease of Doing Business inPapua New Guinea

Region East Asia & Pacific

Income Category Lower middle income

Population 8,084,991

GNI Per Capita (US$) 2,528


DB2018Rank190 1

109

DB2018DistancetoFrontier(DTF)0 100

59.04

0 100

63.89:Samoa(Rank:87)

62.70:RegionalAverage(EastAsia&Pacific)

59.04:PapuaNewGuinea(Rank:109)

55.58:Palau(Rank:130)

51.45:MarshallIslands(Rank:149)

48.74:Kiribati(Rank:157)


Note: The distance to frontier (DTF) measure shows the distance of each economy to the frontier, which represents the best performance observed on each ofthe indicators across all economies in the Doing Business sample since 2005. An economys distance to frontier is re ected on a scale from 0 to 100, where 0represents the lowest performance and 100 represents the frontier. The ease of doing business ranking ranges from 1 to 190.

Rankings on Doing Business topics - Papua New Guinea

Startinga

Business

Dealingwith

ConstructionPermits

GettingElectricity

RegisteringProperty

GettingCredit


PayingTaxes


EnforcingContracts

ResolvingInsolvency

1

28

55

82

109

136

163

190

Rank

129117

107

122

42

89 91

137

171

141

Distance to Frontier (DTF) on Doing Business topics - Papua New Guinea

Startinga

BusinessChange:+0.51

Dealingwith

ConstructionPermits

Change:+0.53

GettingElectricity

Change:+0.03

RegisteringProperty

Change:+0.11

GettingCredit

Change:0.00


Change:0.00

PayingTaxes

Change:+0.38


Change:0.00

EnforcingContractsChange:0.00

ResolvingInsolvencyChange:+0.16

0

20

40

60

80

100

DTF

81.04

64.42 65.53

55.38

70.00

53.33

71.71

60.47

36.2132.31

Starting a BusinessThis topic measures the paid-in minimum capital requirement, number of procedures, time and cost for a small- to medium-sizedlimited liability company to start up and formally operate in economys largest business city.

To make the data comparable across 190 economies, Doing Business uses a standardized business that is 100% domesticallyowned, has start-up capital equivalent to 10 times income per capita, engages in general industrial or commercial activities andemploys between 10 and 50 people one month after the commencement of operations, all of whom are domestic nationals. Startinga Business considers two types of local limited liability companies that are identical in all aspects, except that one company is ownedby 5 married women and the other by 5 married men. The distance to frontier score for each indicator is the average of the scoresobtained for each of the component indicators.The latest round of data collection for the project was completed in June 2017. See the methodology for more information.


Procedures to legal ly start and operate acompany (number)

Pre-registration (for example, name verificationor reservation, notarization)

Registration in economys largest business city

Post-registration (for example, social securityregistration, company seal)

Obtaining approval from spouse to start businessor leave home to register company

Obtaining any gender-specific permission thatcan impact company registration, companyoperations and process of getting nationalidentity card



Each procedure starts on a separate day (2procedures cannot start on the same day)

Procedures fully completed online are recordedas day





No professional fees unless services required bylaw or commonly used in practice

Paid-in minimum capital (% of income per capita)

Funds deposited in a bank or with third partybefore registration or up to 3 months afterincorporation


To make the data comparable across economies, several assumptionsabout the business and the procedures are used. It is assumed that anyrequired information is readily available and that the entrepreneur will payno bribes.

The business:- Is a limited liability company (or its legal equivalent). If there is more thanone type of limited liability company in the economy, the most commonamong domestic rms is chosen. Information on the most common form isobtained from incorporation lawyers or the statistical o ce. - Operates in the economys largest business city and the entire o cespace is approximately 929 square meters (10,000 square feet). For 11economies the data are also collected for the second largest business city.- Is 100% domestically owned and has ve owners, none of whom is a legalentity; and has a start-up capital of 10 times income per capita and has aturnover of at least 100 times income per capita. - Performs general industrial or commercial activities, such as theproduction or sale of goods or services to the public. The business doesnot perform foreign trade activities and does not handle products subjectto a special tax regime, for example, liquor or tobacco. It does not useheavily polluting production processes. - Leases the commercial plant or o ces and is not a proprietor of realestate and the amount of the annual lease for the o ce space is equivalentto 1 times income per capita.- Does not qualify for investment incentives or any special bene ts. - Has at least 10 and up to 50 employees one month af ter thecommencement of operations, all of whom are domestic nationals. - Has a company deed 10 pages long.

The owners: - Have reached the legal age of majority. If there is no legal age of majority,they are assumed to be 30 years old. - Are sane, competent, in good health and have no criminal record. - Are married and the marriage is monogamous and registered with theauthorities. - Where the answer di ers according to the legal system applicable to thewoman or man in question (as may be the case in economies where thereis legal plurality), the answer used will be the one that applies to themajority of the population.

Standardized Company

Legal form Private Limited Liability Company

Paid-in minimum capital requirement PGK 0



East Asia &Pacific


Procedure Men (number) 6 7.0 4.9 1.00 (New Zealand)

Time Men (days) 41 22.7 8.5 0.50 (New Zealand)

Cost Men (% of income per capita) 11.5 18.4 3.1 0.00 (United Kingdom)

Procedure Women (number) 6 7.0 4.9 1.00 (New Zealand)

Time Women (days) 41 22.8 8.5 0.50 (New Zealand)

Cost Women (% of income per capita) 11.5 18.4 3.1 0.00 (United Kingdom)

Paid-in min. capital (% of income per capita) 0.0 15.1 8.7 0.00 (113 Economies)

FigureStartingaBusinessinPapuaNewGuineaandcomparatoreconomiesRankingandDTF


0 100

92.54: Samoa (Rank: 33)



81.96: Palau (Rank: 124)



Note: The ranking of economies on the ease of starting a business is determined by sorting their distance to frontier scores forstarting a business. These scores are the simple average of the distance to frontier scores for each of the component indicators.

FigureStartingaBusinessinPapuaNewGuineaProcedure,TimeandCost

Procedures (number)

1 2 3 4 * 5 * 60

5

10

15

20

25

30

35

40

Time (days)

0

1

2

3

4

5

6

7

8

Cost (%

of incom

e per capita)




DetailsStartingaBusinessinPapuaNewGuineaProcedure,TimeandCost

Applies to women only.



1 Obtain a company seal

Agency : Seal maker

Although companies are not expressly mandated by law to make a companyseal, they are required to have a seal to meet the Companies Actrequirements for issuing share certi cates for entering into deeds andcontracts. The fee for a seal varies with its size but is about PGK 4080. A sealcan be obtained in a week and can also be applied for online:http://www.theodist.com/print-shop/custom-rubber-stamps .

4 days PGK 60

2 Reserve company name and complete the registration process

Agency : Registrar

A company registration application must be submitted to the Registrar ofCompanies. Using standard Form 1, the application must include 3 proposednames of the company, the postal and street address of the registeredo ce, and the number and names of the directors, the shareholders, andthe secretaries.

Form 1 must also be accompanied by - A certi ed copy of the company constitution, if applicable- Form 6, an application for name reservation

A company is no longer required to have a memorandum or articles ofassociation. A proposed company may opt to have a constitution but is notrequired to do so.

Total fees to register are

Form 1 - PGK 400 (Online) and PGK 500 (Over the counter)Form 6 - PGK 50 (Online) and PGK 100 (Over the counter)

7 days PGK 600

3 Register with the Tax Authorities and the Employment Register


Under the Income Tax Act, a company carrying on business or derivingincome in Papua New Guinea must appoint a Papua New Guinea resident tobe a public o cer. The appointment must be made 3 months from the datethe company starts business operations or derives income in the country, bywritten notice to the Internal Revenue Commission.All tax notices and forms are led to the attention of the Internal RevenueCommissioner. Although di erent o cers in this agency will likely attend tothe separate notices and forms, these forms can be submitted to theCommissioner in a single ling. The procedure takes a week to a month. If a company employs one or more employees in Papua New Guinea with aweekly salary of more than PGK 126 a week, they must register as a groupemployer by submitting a written notice to the Internal RevenueCommission. No fees apply. Any business or individual whose annual turnover exceeds (or is likely toexceed) PGK 100,000, must register for goods and services tax (GST) by lingForm 1 with the Internal Revenue Commission. This standard form requiresthe company business name and a description of its proposed mainbusiness activities along with the street and postal address of the registeredo ce and a statement of its monthly sales and liabilities (approximate). Nofees apply.

9 days no charge

4 Apply for a trade license from the National Capital District Commission

Agency : National Capital District Commission

Companies in Port Moresby must obtain a trading license from the NationalCapital District Commission.

20 days PGK 50

5 Open an account at an Authorized Superannuation Fund (ASF)

Agency : Authorized Superannuation Fund

According to the amendment to the Superannuation (General Provisions)Act 2000, a company with 15 or more employees must contribute to anAuthorized Superannuation Fund (ASF; a superannuation fund that theCentral Bank has approved and licensed).

An employer must remit its employer contributions to the ASF within 14 daysof the end of each calendar month in which the relevant contribution is duefor deduction from an employee's pay. It is an o ence not to makecontributions. Under the act, the Central Bank has the power to instigateproceedings against any o ence by a person. It takes 710 days to open anaccount.


no charge

6 Register workers with the private insurers for work injury

Agency : Insurance company

Although there is no registration requirement, it is an o ence for anemployer to employ any worker without an insurance or indemnity policyissued by a licensed insurer for injury to the worker arising out of or duringemployment. Registration time is 1030 days.


PGK 200

Dealing with Construction PermitsThis topic tracks the procedures, time and cost to build a warehouseincluding obtaining necessary the licenses and permits,submitting all required noti cations, requesting and receiving all necessary inspections and obtaining utility connections. Inaddition, the Dealing with Construction Permits indicator measures the building quality control index, evaluating the quality ofbuilding regulations, the strength of quality control and safety mechanisms, liability and insurance regimes, and professionalcerti cation requirements. The most recent round of data collection was completed in June 2017. See the methodology for moreinformation


Procedures to legally build a warehouse (number)

Submitting all relevant documents and obtainingall necessary clearances, licenses, permits andcertificates

Submitting all required notifications andreceiving all necessary inspections

Obtaining utility connections for water andsewerage

Registering and selling the warehouse after itscompletion



Each procedure starts on a separate daythough procedures that can be fully completedonline are an exception to this rule



Cost required to complete each procedure (% ofwarehouse value)


Building quality control index (0-15)

Sum of the scores of six component indices:

Quality of building regulations (0-2)

Quality control before construction (0-1)

Quality control during construction (0-3)

Quality control after construction (0-3)

Liability and insurance regimes (0-2)

Professional certifications (0-4)


To make the data comparable across economies, several assumptionsabout the construction company, the warehouse project and the utilityconnections are used.

The construction company (BuildCo):- Is a limited liability company (or its legal equivalent) and operates in theeconomys largest business city. For 11 economies the data are alsocollected for the second largest business city. - Is 100% domestically and privately owned; has ve owners, none of whomis a legal entity. Has a licensed architect and a licensed engineer, bothregistered with the local association of architects or engineers. BuildCo isnot assumed to have any other employees who are technical or licensedexperts, such as geological or topographical experts. - Owns the land on which the warehouse will be built and will sell thewarehouse upon its completion.

The warehouse: - Will be used for general storage activities, such as storage of books orstationery. - Will have two stories, both above ground, with a total constructed area ofapproximately 1,300.6 square meters (14,000 square feet). Each oor willbe 3 meters (9 feet, 10 inches) high and will be located on a land plot ofapproximately 929 square meters (10,000 square feet) that is 100% ownedby BuildCo, and the warehouse is valued at 50 times income per capita. - Will have complete architectural and technical plans prepared by alicensed architect. If preparation of the plans requires such steps asobtaining further documentation or getting prior approvals from externalagencies, these are counted as procedures. - Will take 30 weeks to construct (excluding all delays due to administrativeand regulatory requirements).

The water and sewerage connections: - Will be 150 meters (492 feet) from the existing water source and sewertap. If there is no water delivery infrastructure in the economy, a boreholewill be dug. If there is no sewerage infrastructure, a septic tank in thesmallest size available will be installed or built. - Will have an average water use of 662 liters (175 gallons) a day and anaverage wastewater ow of 568 liters (150 gallons) a day. Will have a peakwater use of 1,325 liters (350 gallons) a day and a peak wastewater ow of1,136 liters (300 gallons) a day. - Will have a constant level of water demand and wastewater owthroughout the year; will be 1 inch in diameter for the water connectionand 4 inches in diameter for the sewerage connection.

Standardized Warehouse

Estimated value of warehouse PGK 396,084.10



East Asia &Pacific


Procedures (number) 17 15.2 12.5 7.00 (Denmark)

Time (days) 217 138.2 154.6 27.5 (Korea, Rep.)

Cost (% of warehouse value) 1.2 2.2 1.6 0.10 (5 Economies)

Building quality control index (0-15) 10.0 8.9 11.4 15.00 (3 Economies)

FigureDealingwithConstructionPermitsinPapuaNewGuineaandcomparatoreconomiesRankingandDTF


0 100



68.68: Samoa (Rank: 83)

68.38: Palau (Rank: 85)



Note: The ranking of economies on the ease of dealing with construction permits is determined by sorting their distance to frontierscores for dealing with construction permits. These scores are the simple average of the distance to frontier scores for each of thecomponent indicators.

FigureDealingwithConstructionPermitsinPapuaNewGuineaProcedure,TimeandCost

Procedures (number)

1 2 * 3 * 4 * 5 6 7 8 9 10 11 * 12 13 14 * 15 16 170

50

100

150

200

Time (days)

0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

Cost (%

of w

arehouse value)

Time(days) Cost(%ofwarehousevalue)



FigureDealingwithConstructionPermitsinPapuaNewGuineaandcomparatoreconomiesMeasureofQuality


0

2

4

6

8

10

12

Index score

10.0

6.0

1.0

7.06.0

8.9

DetailsDealingwithConstructionPermitsinPapuaNewGuineaProcedure,TimeandCost



1 Request and obtain planning permission from the NCD PhysicalPlanning Board

Agency : NCD Physical Planning Board

30 days PGK 100

2 Request and obtain certi cate of ownership and site map

Agency : National Department of Land

30 days PGK 100

3 Request and obtain permission from the Fire Authority

Agency : PNG Fire Services

30 days no charge

4 Request and obtain project clearance from the Health Department

Agency : Health Department

29 days no charge

5 Request and obtain project clearance from the Water and SewageAuthority


27 days no charge

6 Request and obtain building permit from the National Capital DistrictCommission (NCDC)

Agency : National Capital District Commission (NCDC)

The building permit is issued after all clearances have been obtained.

90 days PGK 2,516

7 Request and receive foundations work inspection from the Municipality


In some cases, a telephone call is enough to schedule the inspection.However, in other cases, BuildCo might have to provide transportation tothe inspector. Inspections must be requested by BuildCo at each phase ofthe construction work.

1 day no charge

8 Request and receive concrete work inspection from the Municipality


1 day no charge

9 Request and receive steel work for slabs inspection from theMunicipality


1 day no charge

10 Request and receive frame inspection from the Municipality


1 day no charge

11 Request and receive damp-proof course inspection from theMunicipality


1 day no charge

12Request water and sewage connection


1 day no charge

13 Receive plumbing inspection


1 day no charge

14 Connect to water and

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