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Company Law
One hundred and eighty-five questions and answers on the Companies Act 1997 - forming a company, shares and shareholders, directors and their duties, records and reporting, charges, amalgamations, receivership, liquidation, removal from the register, overseas companies and offences - plus the Insolvency Act (Chapter 253) on personal insolvency and the Investment Promotion Act 1992 on foreign investment.
A company is a legal person separate from the people who own it and the people who run it. In Papua New Guinea companies are governed by the Companies Act 1997, which sets out how a company is formed, what its constitution may do, how shares are issued and transferred, what shareholders may decide, what duties directors owe and to whom, what records and accounts must be kept, and what happens when a company is sold, restructured, put into receivership, wound up or struck off. This series works through the Act section by section in plain language.
Jump to a subject
185 questions and answers, grouped by subject.
- What a company is — 8 questions
- Forming a company — 11 questions
- The company constitution — 5 questions
- Shares and distributions — 18 questions
- Shareholders and their rights — 13 questions
- Directors and their duties — 19 questions
- Enforcing rights against the company — 8 questions
- Running the company day to day — 9 questions
- Accounts, reporting and audit — 8 questions
- Charges, amalgamations and compromises — 12 questions
- Receiverships — 9 questions
- Liquidations — 17 questions
- Striking off, restoration and overseas companies — 6 questions
- The Registrar, offences and disqualification — 7 questions
- Personal insolvency under the Insolvency Act — 20 questions
- Foreign investment and the Investment Promotion Authority — 15 questions
What a company is
Separate legal personality, capacity and powers, the solvency test, holding companies and subsidiaries, and how the Act is put together.
What Is a Company?
Sections 11 and 16 of the PNG Companies Act 1997: separate legal personality, the four essential requirements of a company, and what separateness means in practice.
Read the answer → No. 2What Does the Companies Act Cover?
An overview of the PNG Companies Act 1997: its twenty-four Parts, the key definitions, how it interacts with other legislation, and where to find what.
Read the answer → No. 3What Can a Company Do? Capacity and Powers
Sections 17 and 18 of the PNG Companies Act 1997: full capacity and powers, restrictions in a constitution, and why acts outside the company’s powers are still valid.
Read the answer → No. 4Can I Rely on What a Company Tells Me?
Sections 19 and 20 of the PNG Companies Act 1997: dealings between a company and outsiders, the five things a company cannot assert, and the abolition of constructive notice.
Read the answer → No. 5What Is the Solvency Test?
Section 4 of the PNG Companies Act 1997: the two-limb solvency test, what directors must have regard to, contingent liabilities, and every transaction that depends on it.
Read the answer → No. 6What Is a Holding Company and a Subsidiary?
Sections 5, 6 and 7 of the PNG Companies Act 1997: the four control tests, what “control of the board” means, shares that are disregarded, and why the definition matters.
Read the answer → No. 7What Are Shareholders Liable For?
Sections 79 to 85 of the PNG Companies Act 1997: the limits of shareholder liability, liability of former shareholders, calls, personal representatives and trustees.
Read the answer → No. 8Who Is the Registrar of Companies?
Part XXI of the PNG Companies Act 1997: the Registrar and Deputy Registrars, the register, registration of documents, inspection and investigation powers, and appeals.
Read the answer →Forming a company
Essential requirements, the application, the certificate of incorporation, company names, and pre-incorporation contracts.
How Do I Register a Company?
Sections 12 to 15 of the PNG Companies Act 1997: who may apply, what the application must contain, the signed consents required by section 13A, and the effect of the certificate.
Read the answer → No. 10How Do I Choose and Reserve a Company Name?
Sections 21 and 23 of the PNG Companies Act 1997: the reservation requirement, how to apply, what the Registrar must tell you, and how a company name relates to business names and trade marks.
Read the answer → No. 11What Names Can a Company Not Have?
Section 22 of the PNG Companies Act 1997: the compulsory ending “Limited”, the absolute prohibitions, the Minister’s consent, and the offence of improper use of “limited”.
Read the answer → No. 12How Do I Change a Company Name?
Section 24 of the PNG Companies Act 1997: the special resolution requirement, the new certificate of incorporation, and why a change of name changes nothing about the company itself.
Read the answer → No. 13Can the Registrar Make Me Change My Company Name?
Section 25 of the PNG Companies Act 1997: directions to change a company name, the minimum notice period, the Registrar’s power to select a name, and how to respond.
Read the answer → No. 14Where Must a Company Display Its Name?
Section 26 of the PNG Companies Act 1997: where the company name must appear, personal liability for misstating it, permitted abbreviations, and the twelve-month former-name rule.
Read the answer → No. 15What Are Pre-Incorporation Contracts?
Sections 157 and 158 of the PNG Companies Act 1997: the definition, ratification, the implied warranties given by the promoter, and the measure of damages.
Read the answer → No. 16What Happens if a Pre-Incorporation Contract Is Not Ratified?
Sections 159 and 160 of the PNG Companies Act 1997: the Court’s power on a failure to ratify, validation of the contract, and orders against the person who made it.
Read the answer → No. 17How Does a Company Enter Into a Contract?
Sections 155 and 156 of the PNG Companies Act 1997: the three methods of contracting, the common seal, official seals for use overseas, and company attorneys.
Read the answer → No. 18What Must I Do After My Company Is Incorporated?
A practical checklist of the first obligations of a new PNG company under the Companies Act 1997 — shares, registers, records, accounts, the annual return and external requirements.
Read the answer → No. 19What Happened to Companies Registered Before the 1997 Act?
Part XXIV of the PNG Companies Act 1997: election to register, deemed registration, compensation for prejudiced members, and the continuity of existing documents, registers and appointments.
Read the answer →The company constitution
Whether you need one, what it may contain, how it binds, and how it is adopted, altered and revoked.
Does a Company Need a Constitution?
Sections 27 to 29 of the PNG Companies Act 1997: the optional constitution, what the Act supplies by default, and how to decide whether your company needs one.
Read the answer → No. 21What Can Go in a Company Constitution?
Sections 30 and 31 of the PNG Companies Act 1997: the form a constitution takes, what it may contain, the section 17(2) restriction, and what cannot be included.
Read the answer → No. 22Who Is Bound by a Company Constitution?
Section 32 of the PNG Companies Act 1997: the statutory contract, who can enforce it, who is not bound, and the effect of inconsistency with the Act.
Read the answer → No. 23How Is a Constitution Adopted, Altered or Revoked?
Sections 33 and 34 of the PNG Companies Act 1997: adopting, altering and revoking a constitution, the one-month notice, the consolidated document, and the protections for minorities.
Read the answer → No. 24Can the Court Alter a Company Constitution?
Section 35 of the PNG Companies Act 1997: when the Court will alter a constitution, who may apply, the one-month filing obligation, and the alternative remedies.
Read the answer →Directors and their duties
Who is a director, the powers of the board, major transactions, the four core duties, self-interested transactions, appointment, removal, remuneration and indemnity.
Who Is a Director?
Sections 107 and 108 of the PNG Companies Act 1997: the extended definition of director, shadow and de facto directors, the professional adviser exclusion, and the meaning of “board”.
Read the answer → No. 55Who Runs a Company?
Section 109 of the PNG Companies Act 1997: the board’s management power, the difference between managing and supervising, and the limits imposed by the Act and the constitution.
Read the answer → No. 56What Is a Major Transaction?
Section 110 of the PNG Companies Act 1997: the three limbs of the definition, valuing contingent liabilities, the floating charge exception, and the receiver exception.
Read the answer → No. 57Can the Board Delegate Its Powers?
Section 111 of the PNG Companies Act 1997 and Schedule 3: the power to delegate, the non-delegable powers, and the two conditions for escaping responsibility.
Read the answer → No. 58What Duties Do Directors Owe?
Sections 112, 113 and 114 of the PNG Companies Act 1997: the duty of good faith and best interests, the group and joint venture exceptions, employees’ interests, and the duty to comply.
Read the answer → No. 59What Standard of Care Does a Director Owe?
Section 115 of the PNG Companies Act 1997: the objective care and diligence standard, the four-limb business judgment rule, rationality, and criminal negligence.
Read the answer → No. 60Can a Director Rely on Advice From Others?
Section 116 of the PNG Companies Act 1997: the three permitted sources of reliance, the three conditions that must be satisfied, and how the section interacts with the duty of care.
Read the answer → No. 61What Must a Director Disclose About an Interest?
Sections 117 and 118 of the PNG Companies Act 1997: when a director is “interested”, the security exception, the disclosure obligation, general notices and the ordinary-course exemption.
Read the answer → No. 62What Happens if a Director Was Interested in a Transaction?
Sections 119 and 120 of the PNG Companies Act 1997: avoidance of interested transactions, the fair value defence, the onus of proof, and protection of third parties.
Read the answer → No. 63Can a Director Use Company Information?
Section 123 of the PNG Companies Act 1997: the restriction on disclosing or using company information, the nominee director exception, and board-authorised use.
Read the answer → No. 64What Is a “Relevant Interest” in Shares?
Sections 124 and 125 of the PNG Companies Act 1997: the six limbs of “relevant interest”, the 20 per cent look-through, the width of “power”, and the five exclusions.
Read the answer → No. 65Can Directors Trade in the Company’s Shares?
Sections 126 and 127 of the PNG Companies Act 1997: disclosure of share dealing, the fair value restriction on insider trading, and personal liability to the counterparty.
Read the answer → No. 66Who Can Be a Director?
Sections 128, 129 and 130 of the PNG Companies Act 1997: the number and residence of directors, the four disqualifications, the ban on corporate directors, and the written consent.
Read the answer → No. 67How Are Directors Appointed?
Sections 131, 132 and 133 of the PNG Companies Act 1997: appointment of first and subsequent directors, the Court’s power to appoint, and the rule against bundled appointment resolutions.
Read the answer → No. 68How Is a Director Removed?
Sections 134 and 135 of the PNG Companies Act 1997: removal by ordinary resolution, the notice requirement, the five ways an office is vacated, resignation, and continuing liability.
Read the answer → No. 69How Do I Notify a Change of Directors?
Sections 136 and 137 of the PNG Companies Act 1997: validity of a director’s acts despite a defective appointment, the notice of change, the time limits, and the signed consent to be kept.
Read the answer → No. 70How Does a Board Make Decisions?
Section 138 of the PNG Companies Act 1997 and Schedule 4: chairman, notice, methods of holding meetings, quorum, voting, minutes and unanimous written resolutions of the board.
Read the answer → No. 71How Are Directors Paid, and Can the Company Lend Them Money?
Section 139 of the PNG Companies Act 1997: authorising directors’ remuneration, benefits, loans and guarantees, the fairness certificate, and personal liability to repay.
Read the answer → No. 72Can a Company Indemnify or Insure Its Directors?
Section 140 of the PNG Companies Act 1997: the general prohibition, the permitted indemnities, insurance and the certificate, the interests register, and personal liability for improper insurance.
Read the answer →Enforcing rights against the company
Injunctions, derivative actions, personal and representative actions, the prejudiced shareholder remedy, and ratification.
Can I Get an Injunction Against a Company?
Sections 141 and 142 of the PNG Companies Act 1997: prohibitory and mandatory injunctions, who may apply, interim orders, and the rule that completed conduct cannot be restrained.
Read the answer → No. 74What Is a Derivative Action?
Section 143 of the PNG Companies Act 1997: leave to bring proceedings in the company’s name, the four factors, the two gateways, and the exclusive nature of the remedy.
Read the answer → No. 75Who Pays for a Derivative Action?
Sections 144, 145 and 146 of the PNG Companies Act 1997: costs of a derivative action, the Court’s powers over the conduct of the proceedings, and control of settlement.
Read the answer → No. 76Can a Shareholder Sue a Director Directly?
Sections 147 and 148 of the PNG Companies Act 1997: personal actions against directors, the reflective loss bar, which duties are owed to whom, and orders requiring a director to act.
Read the answer → No. 77Can a Shareholder Sue the Company?
Sections 149, 150 and 151 of the PNG Companies Act 1997: personal actions against the company, orders requiring the company to act, and representative proceedings.
Read the answer → No. 78What Can a Shareholder Do if Treated Unfairly?
Section 152 of the PNG Companies Act 1997: the prejudiced shareholder remedy, who may apply, the eight orders, and the conduct the Act deems unfairly prejudicial.
Read the answer → No. 79Can the Court Change or Undo an Alteration to the Constitution?
Section 153 of the PNG Companies Act 1997: the effect of a Court-ordered alteration to a company’s constitution, the entrenchment, and the filing obligation.
Read the answer → No. 80Can Shareholders Ratify What the Directors Did?
Section 154 of the PNG Companies Act 1997: ratification of a purported exercise of a shareholder power, the retrospective effect, the preservation of the Court’s powers, and the general law.
Read the answer →Running the company day to day
Contracting, the registered office, company records, the address for service, the secretary, the annual return, and inspection of records.
What Is a Registered Office?
Sections 161, 162 and 163 of the PNG Companies Act 1997: the registered office requirement, how the address must be described, changing it, and the Registrar’s power to require a change.
Read the answer → No. 82What Records Must a Company Keep?
Sections 164, 165 and 166 of the PNG Companies Act 1997: the company records, keeping them elsewhere, the form they must take, anti-falsification measures, and inspection by directors.
Read the answer → No. 83What Is an Address for Service?
Sections 167 and 168 of the PNG Companies Act 1997: the address for service, how it must be described, changing it, and how it differs from the registered office.
Read the answer → No. 84Does a Company Need a Secretary?
Sections 169 and 170 of the PNG Companies Act 1997: the optional secretary, residence, who may act in the secretary’s absence, appointment and removal, and the notice obligations.
Read the answer → No. 85What Is the Annual Return?
Section 215 of the PNG Companies Act 1997: the annual return, the allocated month, the exemptions, the audited accounts, and the offences for failing to file.
Read the answer → No. 86Who Can Inspect a Company’s Records?
Sections 216, 216A, 217 and 218 of the PNG Companies Act 1997: shareholder and public inspection rights, the inspection period, and the right to copies.
Read the answer → No. 87What Information Can a Shareholder Demand?
Section 219 of the PNG Companies Act 1997: a shareholder’s request for information, the four possible responses, the grounds of refusal, charges, and the Court’s power to compel.
Read the answer → No. 88Can a Court Order an Investigation of a Company?
Section 220 of the PNG Companies Act 1997: Court-ordered inspection of company records, the good faith and proper purpose test, the report, control of disclosure, and costs.
Read the answer → No. 89How Are Documents Served on a Company?
Sections 431 to 436 of the PNG Companies Act 1997: service on companies and overseas companies, service on shareholders and creditors, deemed receipt, and proving service.
Read the answer →Accounts, reporting and audit
Financial statements, group accounts, accounting records, the annual report, auditors and the Accounting Standards Board.
Which Companies Must Prepare Financial Statements?
Sections 171 to 180 of the PNG Companies Act 1997: reporting and exempt companies, the K5 million and 25 shareholder thresholds, what financial statements are, and the true and fair view.
Read the answer → No. 91What Are Group Financial Statements?
Sections 178, 181, 182 and 183 of the PNG Companies Act 1997: when group accounts are required, the exception, what they must contain, mismatched balance dates, and registration.
Read the answer → No. 92What Accounting Records Must a Company Keep?
Sections 188 and 189 of the PNG Companies Act 1997: the four objectives, the specific entries required, the form, the ten-year retention, and where the records may be kept.
Read the answer → No. 93Does My Company Need an Auditor?
Sections 190 to 198 of the PNG Companies Act 1997: appointment of auditors, fees, partnerships, qualifications and disqualifications, automatic reappointment, replacement and resignation.
Read the answer → No. 94What Does an Auditor Do?
Sections 199 to 203 of the PNG Companies Act 1997: the auditor’s report on reporting and exempt companies, the duty to report non-compliance to the Registrar, access to information, and attendance at meetings.
Read the answer → No. 95What Must Go in a Company’s Annual Report?
Sections 209 to 214 of the PNG Companies Act 1997: the annual report obligation, the waiver, sending it to shareholders, its contents, and the effect of a failure to send.
Read the answer → No. 96What Is the Accounting Standards Board?
Sections 204 to 208 of the PNG Companies Act 1997: the Accounting Standards Board, its membership, functions, approval and revocation of standards, and certificates.
Read the answer → No. 97What Happens if the Accounts Are Not Prepared or Audited?
Sections 183 to 187 of the PNG Companies Act 1997 and the surrounding consequences: the offences, filing failures, section 348A liability, and what a director should do to fix a lapse.
Read the answer →Charges, amalgamations and compromises
Registering charges and their priority, amalgamations, compromises with creditors, and court-approved arrangements.
What Is a Charge, and Why Must It Be Registered?
Sections 221 and 222 of the PNG Companies Act 1997: the registrable charges, the two-month deadline, the consequence of non-registration, debenture series and the anti-avoidance rule.
Read the answer → No. 99What Is the Register of Charges, and What Is a Provisional Entry?
Sections 225, 226, 228, 229 and 230 of the PNG Companies Act 1997: the register of charges, the certificate, provisional entries, extension of time and rectification.
Read the answer → No. 100How Are Assignments and Variations of Charges Registered?
Sections 223 and 224 of the PNG Companies Act 1997: charges on property acquired, charges of an overseas company on registration, assignment of a charge, and registrable variations.
Read the answer → No. 101How Is a Charge Released From the Register?
Section 227 of the PNG Companies Act 1997: memoranda of satisfaction and release, who may lodge one, the evidence required, and how to correct the register if a release is refused.
Read the answer → No. 102Who Has Priority Between Competing Charges?
Section 231 of the PNG Companies Act 1997: the Schedule 15 order of priorities, consent and agreement, the deemed postponement of floating charges, and mixed property.
Read the answer → No. 103What Is an Amalgamation?
Sections 232, 233 and 234 of the PNG Companies Act 1997: what an amalgamation is, what the proposal must contain, the board resolutions and certificates, and the approval process.
Read the answer → No. 104What Is a Short Form Amalgamation?
Section 235 of the PNG Companies Act 1997: the two short form routes, the required content of the board resolutions, notice to secured creditors, and the certificate.
Read the answer → No. 105What Happens When an Amalgamation Takes Effect?
Sections 236 to 240 of the PNG Companies Act 1997: registering the amalgamation proposal, the certificate, universal succession, the effect on other registers, and the Court’s power to stop an unfair amalgamation.
Read the answer → No. 106What Is a Compromise With Creditors?
Sections 241 to 244 of the PNG Companies Act 1997: what a compromise is, who may propose one, the notice and statement to creditors, and the binding effect of approval.
Read the answer → No. 107Can a Compromise Be Varied or Challenged?
Sections 245, 246 and 247 of the PNG Companies Act 1997: varying a compromise, the Court’s procedural and stay powers, challenging approval, and the effect in a later liquidation.
Read the answer → No. 108What Is a Court-Approved Arrangement?
Sections 249 to 253 of the PNG Companies Act 1997: Court approval of arrangements, amalgamations and compromises, the preliminary orders, the additional powers, and the subsidiarity rule.
Read the answer → No. 109Which Restructuring Route Should a Company Use?
A comparison of the restructuring and insolvency routes in the PNG Companies Act 1997 — amalgamation, compromise, Court-approved arrangement, receivership and liquidation — and how to choose between them.
Read the answer →Receiverships
Appointing a receiver, the receiver's powers and duties, reports, preferential claims, liability and court supervision.
What Is a Receivership?
Sections 254 to 258, 263 and 266 of the PNG Companies Act 1997: what a receiver is, how one is appointed, the agency relationship, and the validity of a receiver’s acts.
Read the answer → No. 111Who Can Be Appointed a Receiver?
Sections 256 and 261 of the PNG Companies Act 1997: who is disqualified from acting as a receiver, the Court’s power to override, and how a vacancy in the office of receiver is filled.
Read the answer → No. 112What Notice Must Be Given of a Receivership?
Sections 259, 260 and 278 of the PNG Companies Act 1997: the receiver’s notice of appointment, the requirement to disclose receivership on company documents, and notice of the end of a receivership.
Read the answer → No. 113What Powers Does a Receiver Have?
Sections 262, 264, 265 and 267 of the PNG Companies Act 1997: obtaining documents and information, the statutory powers of a receiver, calls on shares, and Court-authorised sales.
Read the answer → No. 114What Duties Does a Receiver Owe?
Sections 268 to 272 of the PNG Companies Act 1997: the receiver’s general duties, the duty on sale, the bar on contracting out, and the duties in relation to money and accounting records.
Read the answer → No. 115What Reports Must a Receiver Prepare?
Sections 273 to 277 of the PNG Companies Act 1997: the receiver’s first report, further reports, extensions of time, who is entitled to copies, and the duty to notify breaches of the Act.
Read the answer → No. 116Is a Receiver Personally Liable?
Sections 281, 282 and 289 of the PNG Companies Act 1997: the receiver’s personal liability on contracts, wages and rent, the statutory indemnity, relief from liability, and essential services.
Read the answer → No. 117How Does a Court Supervise a Receiver?
Sections 283 to 288 of the PNG Companies Act 1997: Court directions, review of remuneration, termination of a receivership, orders to enforce a receiver’s duties, and prohibition orders.
Read the answer → No. 118Who Gets Paid First in a Receivership?
Sections 279 and 280 of the PNG Companies Act 1997: the priority of preferential claims in a receivership under a floating charge, and a receiver’s position once the company goes into liquidation.
Read the answer →Liquidations
Putting a company into liquidation, the liquidator's duties and powers, inability to pay debts, statutory demands, voidable transactions, insolvent trading and creditors' claims.
What Is a Liquidation?
Sections 290 to 292, 298 and 299 of the PNG Companies Act 1997: how a liquidation commences, the three appointment routes, the effect of commencement, and when a liquidation is complete.
Read the answer → No. 120Who Can Apply to Put a Company Into Liquidation?
Sections 291(2)(c), 296, 297 and 300 to 302 of the PNG Companies Act 1997: applying to the Court for the appointment of a liquidator, interim liquidators, stays, termination, and creditors who have started execution.
Read the answer → No. 121Must a Liquidator Call a Meeting of Creditors?
Sections 293 to 295A, 362 and 363 of the PNG Companies Act 1997: the first meeting of creditors, dispensing with it, related-creditor voting, and liquidation committees.
Read the answer → No. 122What Does a Liquidator Do?
Sections 303 to 310A of the PNG Companies Act 1997 and Schedule 8: the liquidator’s principal duty, reporting obligations, duty to report offences, and statutory powers.
Read the answer → No. 123How Is a Liquidator Appointed and Paid?
Sections 324 to 331 of the PNG Companies Act 1997: the liquidator’s remuneration, qualifications and disqualifications, consent to appointment, validity of acts, and vacancies in office.
Read the answer → No. 124What Powers Does a Liquidator Have to Get Information?
Sections 311 to 318 of the PNG Companies Act 1997: the liquidator’s notice powers, examination on oath, liens over documents, examination before the Court, and self-incrimination.
Read the answer → No. 125Can a Liquidator Disclaim Onerous Property?
Sections 319 and 320 of the PNG Companies Act 1997: the power to disclaim onerous property, what counts as onerous, the effect of a disclaimer, and forcing the liquidator to elect.
Read the answer → No. 126Can a Liquidator Pool the Assets of Group Companies?
Sections 320A to 320C of the PNG Companies Act 1997: contribution orders against related companies, pooling of related liquidations, the notice requirement, and the statutory guidelines.
Read the answer → No. 127How Does a Court Supervise a Liquidator?
Sections 321 to 323 and 332 to 334 of the PNG Companies Act 1997: prohibited conduct in a liquidation, essential services, Court supervision, and orders enforcing a liquidator’s duties.
Read the answer → No. 128When Is a Company Unable to Pay Its Debts?
Sections 335 and 336 of the PNG Companies Act 1997: the presumptions of inability to pay debts, the one-month rule for statutory demand evidence, contingent liabilities, and applications by contingent creditors.
Read the answer → No. 129What Is a Statutory Demand?
Sections 337 to 339 of the PNG Companies Act 1997: the requirements of a statutory demand, setting one aside, defects and irregularities, and the Court’s additional powers.
Read the answer → No. 130What Is a Voidable Transaction?
Sections 340, 340B, 341 and 342 of the PNG Companies Act 1997: transactions having preferential effect, the specified and restricted periods, the set-aside procedure, the Court’s orders, and the good faith defence.
Read the answer → No. 131What Other Transactions Can a Liquidator Set Aside?
Sections 340A, 343, 344, 345 and 347 of the PNG Companies Act 1997: voidable charges, uncommercial transactions, transactions with directors and related persons, insider charges, and late floating charges.
Read the answer → No. 132Can a Liquidator Recover From a Related Company?
Sections 346 and 349 of the PNG Companies Act 1997: recovery from a related entity of the benefit of a voidable transaction, and holding company liability for a subsidiary’s insolvent trading.
Read the answer → No. 133What Happens if a Company Trades While Insolvent?
Sections 348, 348A and 350 of the PNG Companies Act 1997: director liability for insolvent trading, liability where accounting records were not kept, and the Court’s power to order repayment.
Read the answer → No. 134How Do Creditors Claim in a Liquidation?
Sections 351 to 359 of the PNG Companies Act 1997: admissible claims, unsecured and secured creditors’ claims, valuation, set-off, contingent claims, and interest.
Read the answer → No. 135What Is the Order of Priority in a Liquidation?
Sections 360, 361 and 364 of the PNG Companies Act 1997 and Schedules 9 and 10: preferential claims, the ranking of ordinary creditors, the payment procedure, and the Liquidation Surplus Account.
Read the answer →Striking off, restoration and overseas companies
Removal from the register, what happens to the property, restoration, and the rules for overseas companies carrying on business here.
When Can a Company Be Struck Off the Register?
Sections 365 and 366 of the PNG Companies Act 1997: what removal from the register is, and the seven grounds on which the Registrar may remove a company.
Read the answer → No. 137How Is a Company Removed From the Register?
Sections 367 to 372 of the PNG Companies Act 1997: the notice procedures for removal from the register, objections, the Court’s power, and the Registrar as representative of a defunct company.
Read the answer → No. 138What Happens to the Property of a Struck-Off Company?
Sections 373 to 377 of the PNG Companies Act 1997: vesting of property in the Registrar, disclaimer, liabilities attaching to the property, continuing liability of directors and shareholders, and liquidation of a removed company.
Read the answer → No. 139Can a Struck-Off Company Be Restored?
Sections 378 to 381 of the PNG Companies Act 1997: restoration by the Registrar, restoration by the Court, the effect of restoration, and the revesting of property including land.
Read the answer → No. 140Does a Foreign Company Need to Register in PNG?
Sections 382 to 387 of the PNG Companies Act 1997: what counts as carrying on business, the duty to register, name reservation, registration for name protection, and the application requirements.
Read the answer → No. 141What Must an Overseas Company Do in PNG?
Sections 388 to 393 of the PNG Companies Act 1997 and Schedule 12: name disclosure, notifying changes, financial reporting, annual returns, ceasing to carry on business, and liquidation of PNG assets.
Read the answer →The Registrar, offences and disqualification
The Registrar's powers, inspections and appeals, penalties, false statements, fraudulent trading, disqualification from managing companies, and phoenix companies.
What Are the Penalties Under the Companies Act?
Sections 413 to 418 of the PNG Companies Act 1997 and Schedule 13: the penalty tiers, additional penalties for benefits derived, the general penalty provision, summary and indictable offences, and prosecutions.
Read the answer → No. 143What Defences Are Available Under the Companies Act?
Section 419 of the PNG Companies Act 1997, with the related relief and reliance provisions in sections 116, 282, 286, 332 and 334: the statutory defences available to directors and office-holders.
Read the answer → No. 144What Happens if Someone Makes a False Statement?
Section 420 of the PNG Companies Act 1997: false statements in documents and in reports about a company’s affairs, who they may be made to, and the deemed authorisation by voting.
Read the answer → No. 145What Happens if a Director Uses Company Property?
Sections 421, 422 and 424 of the PNG Companies Act 1997: fraudulent use or destruction of company property, falsification of records including electronic records, and improper use of the word “Limited”.
Read the answer → No. 146What Is Fraudulent Trading?
Section 423 of the PNG Companies Act 1997: carrying on business fraudulently, the director-specific offences, and how it relates to insolvent trading and voidable transactions.
Read the answer → No. 147Who Is Banned From Managing a Company?
Sections 425 to 429 of the PNG Companies Act 1997: automatic prohibition, Court disqualification orders, Registrar prohibition notices, and personal liability for acting in contravention.
Read the answer → No. 148What Is a Phoenix Company?
Sections 429A to 429F of the PNG Companies Act 1997: the phoenix company prohibition, the definitions, personal liability for the phoenix company’s debts, and the three exceptions.
Read the answer →Personal insolvency under the Insolvency Act
The Insolvency Act (Chapter 253): creditors' petitions and debtors' petitions, acts of insolvency, the Official Receiver and trustees, the property divisible among creditors, priority of debts, discharge and compositions.
What Is Personal Insolvency?
An introduction to the PNG Insolvency Act (Chapter 253): who it applies to, how an adjudication is made, the relation back rule, and the effect of adjudication on property and on creditors.
Read the answer → No. 152What Is an Act of Insolvency?
Sections 21 and 22 of the PNG Insolvency Act (Chapter 253): the thirteen acts of insolvency, and the six-month rule limiting which of them may found a petition.
Read the answer → No. 153What Is a Debtor's Summons?
Sections 23 and 24 of the PNG Insolvency Act (Chapter 253): obtaining a debtor’s summons, what it must say, and the debtor’s application to dismiss or stay it.
Read the answer → No. 154How Does a Creditor's Petition Work?
Sections 25 to 33 of the PNG Insolvency Act (Chapter 253): who may petition, the debt thresholds, secured creditors, the form and verification of the petition, service, and failure to appear.
Read the answer → No. 155What Happens at the Hearing of a Petition?
Sections 34 to 38 and 40 to 42 of the PNG Insolvency Act (Chapter 253): the hearing, contested debts, costs, the forfeiture rule for preferred petitioning creditors, and pre-adjudication examinations.
Read the answer → No. 156What Property Is Divisible Among Creditors?
Section 4 of the PNG Insolvency Act (Chapter 253), with sections 68, 71 to 74, 81 and 82: the property divisible among creditors, what is excluded, vesting in the trustee, execution proceeds, salaries and pensions, and property held abroad or by bankers.
Read the answer → No. 157Who Is the Official Trustee?
Sections 5 to 14 of the PNG Insolvency Act (Chapter 253): the appointment of the official trustee, security, payments to the Consolidated Revenue Fund, immediate functions on a petition, and oversight of elected trustees.
Read the answer → No. 158How Is a Trustee in Insolvency Appointed?
Sections 50 to 61 of the PNG Insolvency Act (Chapter 253): notice and conduct of the first meeting of creditors, voting, election of the trustee and committee of inspection, and the certificate of appointment.
Read the answer → No. 159What Does a Trustee in Insolvency Do?
Sections 62 to 67 and 91 to 107 of the PNG Insolvency Act (Chapter 253): the trustee’s status, discretion and directions, general and sanctioned powers, banking, books, and appeals.
Read the answer → No. 160What Duties Does an Insolvent Debtor Have?
Sections 49, 90, 108, 109 and 129 of the PNG Insolvency Act (Chapter 253): the insolvent’s duties, contempt for wilful failure, allowances for support and services, apprentices, and the last examination.
Read the answer → No. 161Can a Trustee Set Aside Transactions?
Sections 75 to 80 of the PNG Insolvency Act (Chapter 253): void transfers, voluntary settlements, fraudulent preferences, other preferences, transactions defeating creditors, and the savings for good faith dealings.
Read the answer → No. 162How Does a Trustee Find Hidden Assets?
Sections 83 to 89 of the PNG Insolvency Act (Chapter 253): orders to attend and produce documents, examinations, incriminating questions, orders for payment, rewards, seizure and search warrants, and redirection of letters.
Read the answer → No. 163Can a Trustee Disclaim Onerous Property?
Sections 102 to 105 of the PNG Insolvency Act (Chapter 253): disclaimer of onerous property, its effect, forcing an election, retaining leased premises, transfers of shares, things in action, and redemption rights.
Read the answer → No. 164How Do I Prove a Debt in an Insolvency?
Sections 110 to 118 of the PNG Insolvency Act (Chapter 253): provable debts, the manner of proof, future debts, rents, distinct contracts, secured creditors, interest, expunging proofs, and set-off.
Read the answer → No. 165Who Gets Paid First in a Personal Insolvency?
Sections 119, 120 and 128 of the PNG Insolvency Act (Chapter 253): preferential debts, the landlord’s priority for rent and the bar on distress, the equal-rate rule, and the insolvent’s right to any surplus.
Read the answer → No. 166How Are Dividends Paid in an Insolvency?
Sections 121 to 128 of the PNG Insolvency Act (Chapter 253): declaring and notifying dividends, provision for distant creditors and undetermined claims, late proofs, future debts, actions for dividends, forfeiture, and the final dividend.
Read the answer → No. 167How Is an Insolvent Discharged?
Sections 130 to 138 of the PNG Insolvency Act (Chapter 253): the close of the insolvency, the four routes to a certificate of discharge, conditional certificates, and the effect of discharge.
Read the answer → No. 168What Happens to an Undischarged Insolvent?
Sections 139 to 145 of the PNG Insolvency Act (Chapter 253): payments to influence creditors, the position of undischarged insolvents, annulment on payment in full, and the release of the trustee.
Read the answer → No. 169What Is a Liquidation by Arrangement or a Composition?
Part XIV of the PNG Insolvency Act (Chapter 253), sections 181 to 199: liquidation by arrangement, compositions with creditors, registration, the effect on creditors, and conversion to insolvency.
Read the answer → No. 170What Happens to an Insolvent Partnership?
Sections 19, 39, 114, 146 to 148 and 171 of the PNG Insolvency Act (Chapter 253): petitions against partnerships, amalgamation of proceedings, proof by joint creditors, joint and separate dividends, and proceedings in a partner’s name.
Read the answer →Foreign investment and the Investment Promotion Authority
The Investment Promotion Act 1992: who needs an IPA certificate, what counts as carrying on business, how to apply, reserved activities, changes of ownership, cancellation, participation in a national enterprise, investment guarantees, appeals and offences.
What Is the Investment Promotion Act?
An overview of the PNG Investment Promotion Act 1992: its purposes, the certification requirement, the Authority, and how the Act fits with the Companies Act 1997.
Read the answer → No. 172Who Is a Foreign Enterprise?
The definitions in section 3 of the PNG Investment Promotion Act 1992: enterprise, citizen, national enterprise, foreign enterprise, foreign investor and investment.
Read the answer → No. 173What Counts as Carrying on Business in PNG?
The definition of “carrying on business” in section 3 of the PNG Investment Promotion Act 1992 — what triggers the certification requirement and what does not.
Read the answer → No. 174What Is the Investment Promotion Authority?
The Investment Promotion Authority under the PNG Investment Promotion Act 1992: its functions, powers, Board, Managing Director, and its power to unblock delays in other agencies.
Read the answer → No. 175Does a Foreign Company Need an IPA Certificate?
When a foreign enterprise needs an IPA certificate under the PNG Investment Promotion Act 1992, the consequences of not having one, and the section 26 exemption.
Read the answer → No. 176How Do I Apply for an IPA Certificate?
How to apply for a certificate under section 28 of the PNG Investment Promotion Act 1992: the requirements, the 35-day decision period, the deposit power, and the duty to notify changes.
Read the answer → No. 177How Does the IPA Decide an Application?
Section 28(4) and 28(4A) of the PNG Investment Promotion Act 1992: how the Authority reviews an application, and the four grounds on which it may refuse.
Read the answer → No. 178What Does an IPA Certificate Contain?
Sections 29, 30 and 31 of the PNG Investment Promotion Act 1992: the contents of a certificate, the Register of Certificates, and public inspection.
Read the answer → No. 179What Are Reserved Activities?
Section 27 of the PNG Investment Promotion Act 1992: reserved activities, the review obligation, the grandfathering rules, and the offences for breach.
Read the answer → No. 180What Happens if Ownership of a Certified Enterprise Changes?
Section 32 of the PNG Investment Promotion Act 1992: when a change of ownership triggers a fresh application, the thresholds, the exclusions, and variation under section 33.
Read the answer → No. 181When Can an IPA Certificate Be Cancelled or Suspended?
Section 36 of the PNG Investment Promotion Act 1992: the grounds for cancelling or suspending a certificate, the notice requirements, and winding up after cancellation.
Read the answer → No. 182What Is Certification to Participate in a National Enterprise?
Part IVA of the PNG Investment Promotion Act 1992: sections 36A to 36G, relevant interests, applications, certificates and the transitional rules.
Read the answer → No. 183What Guarantees Does a Foreign Investor Have?
Sections 37 to 39 of the PNG Investment Promotion Act 1992: investment guarantees, the MIGA convention, and ICSID arbitration of investment disputes.
Read the answer → No. 184What Are the Offences Under the Investment Promotion Act?
Sections 41 to 44B of the PNG Investment Promotion Act 1992: the offences, the reversed burden of proof, void contracts, false statements, prosecutions and cease orders.
Read the answer → No. 185How Do I Appeal an IPA Decision?
Section 40 of the PNG Investment Promotion Act 1992: the five appellable decisions, the 20-working-day deadline, the Minister’s duties, and judicial review.
Read the answer →Acts are amended, and figures and time limits change. Every article names the sections it relies on so you can read them. If a decision matters to you, get advice — start with the Office of the Public Solicitor, or find a firm in the law firms directory.