Papua New Guinea Compliance Report

Generated 2026-09-22

Comprehensive Framework

Regulatory Overview

Regulatory Status: Dedicated crypto/VA legislation, licensing regime, active enforcement
Key Regulator(s): Bank of Papua New Guinea, Securities Commission of Papua New Guinea
Primary Legislation: e.g., National Payment Systems Act 2013, Papua New Guinea Anti-Money Laundering and Counter Terrorist Financing Act 2015, The primary financial regulators operate under the Central Banking Act 2000 and, The Banks and Financial Institutions Act 2000 establishes the regulatory framewo, The Central Banking Act 2000 governs the operations of the central bank and the, The Companies Act 1997 and Companies Regulation 1998 establish the corporate leg, The Goods and Services Tax Act 2003 and Goods and Services Tax Regulation 2005 c, The National Information and Communications Technology Act 2009 provides the sta, The Constitution establishes that the underlying law of Papua New Guinea include, The country operates a common law legal system inherited from its colonial histo, The Central Banking Act 2000 requires compliance with foreign exchange regulatio, Businesses must register their business names under the Business Names Act 1963, The Dangerous Drugs Act 1952 and related regulations address controlled substanc, The Criminal Code Act 1974 contains general criminal provisions that may apply t, s March 2024 directive prohibiting NICTA from issuing a license to Starlink demonstrates the Commission, The Customs Act 1951 and related customs legislation govern import duties but do, The existing financial regulatory framework under the Central Banking Act 2000 a, The Constitution defines the underlying law as including the Constitution, organ
Travel Rule: Not adopted
Tax Reporting: PNG does not impose a general Capital Gains Tax.. Gains from the sale of assets, including virtual assets, are generally not taxable unless they are considered to be:. Part of a business operation (e.g., regular trading, mining as a business).. Part of a profit-making undertaking or scheme.. If a gain is determined to fall into one of these categories, it would be treated as ordinary income and subject to the applicable income tax rates for individuals or corporations, rather than a separate CGT rate.

Key Facts

aml Anti-Money Laundering and Counter Terrorist Financing Act 2015 (AML/CTF Act 2015): This Act provides the legal basis for identifying, freezing, and confiscating assets related to money laundering and terrorist financing. It obligates financial institutions and designated non-financial businesses and professions (DNFBPs) to implement AML/CTF measures. While it pre-dates specific crypto regulation, its broad definitions and principles are applied to virtual asset activities where deemed appropriate by regulators. Note: Finding a publicly accessible, definitive online link for the most current version of PNG legislation can sometimes be challenging. Often, these are available through official government gazettes or legal databases. Reference: Anti-Money Laundering and Counter Terrorist Financing Act 2015 (No. 4 of 2015). It can often be found on legal databases like PACLII (Pacific Legal Information Institute): http://www.paclii.org/pg/legis/consol_act/amlact2015408/ (This link may lead to an older version, direct legislative publication is preferred). Terrorism Act 2002 (and subsequent amendments): This Act provides specific provisions related to terrorist financing and the designation of terrorist entities. Reference: Terrorism Act 2002. Again, often available via PACLII or official sources. Financial Analysis and Supervision Unit (FASU): As the FIU, FASU issues guidance, receives suspicious transaction reports (STRs), and disseminates information regarding designated persons and entities subject to sanctions. Reference: FASU Website (part of BPNG): https://www.bankpng.gov.pg/financial-analysis-and-supervision-unit-fasu/ Reference: BPNG Public Statements/Press Releases (monitor for specific crypto guidance): https://www.bankpng.gov.pg/media-releases/
enforcement Regulator Name: Bank of Papua New Guinea (BPNG) Entity Targeted: General public, financial institutions, individuals considering or engaging with cryptocurrencies. Violation Type (Implied): Engaging in unauthorized financial activities; lack of consumer protection for speculative investments; potential for financial crime. Penalty Amount: N/A (This was a public warning, not an enforcement action with a specific penalty). Date: August 12, 2021 (The most prominent public warning in recent years) Outcome: The BPNG clarified that cryptocurrencies are not legal tender in PNG. They highlighted risks such as volatility, lack of regulation, potential for scams, and use in illicit activities. The statement advised the public to exercise caution and warned that losses would not be protected by PNG laws. It also indicated the BPNG's intention to develop appropriate regulations for digital assets in the future. This warning has generally underpinned the BPNG's ongoing stance. Bank of Papua New Guinea - Public Notice on Digital Currencies, Virtual Assets and Cryptocurrencies (PDF) Business Advantage PNG - PNG central bank issues warning on cryptocurrencies Entity Targeted: General public, potential market participants, financial sector. Violation Type (Implied): Operating without appropriate licensing once a framework is established; engaging in risky or illicit activities. Penalty Amount: N/A (Ongoing policy development and warnings, no specific penalties). Date: Ongoing, with updates or reiterations appearing in various reports and speeches (e.g., annual reports, statements to media).
licensing BPNG Website: https://www.bankpng.gov.pg/ (You would typically find press releases or advisories under their 'News' or 'Publications' section). FASU Website: Typically integrated within the BPNG site or linked from it. Information on the AML/CTF Act and reporting requirements can be found there. Cryptocurrency Exchanges: Would fall into this gap. If a business sought to offer traditional securities exchange services, it would require licenses under the Securities Commission of Papua New Guinea (if established for this purpose) or relevant financial market laws. However, crypto assets are not typically classified as securities under existing PNG law. Custody Providers: Similarly, no specific license for crypto custody. Traditional trust or financial services licenses might be considered, but these are not designed for digital assets. Payment Processors: While payment services generally require licensing under BPNG (e.g., National Payment Systems Act 2013), this applies to fiat currency payments and remittances. Processing crypto-to-crypto or crypto-to-fiat payments without being a licensed traditional financial institution operating in fiat would be in a grey area. Currently, neither a specific registration nor a licensing regime exists for VASPs. Anticipated Future: Based on FATF recommendations, it is highly probable that PNG will eventually adopt a licensing regime for VASPs. The FATF standards recommend that VASPs be licensed or registered, and subject to effective systems for monitoring and ensuring compliance with AML/CTF requirements. Licensing typically implies a more rigorous pre-approval process and ongoing supervision than simple registration. Capital Requirements: Financial institutions, including future VASPs, are typically required to maintain a certain level of minimum paid-up capital to demonstrate financial stability and ability to absorb losses. The exact amount would be determined by BPNG based on the scope and risk of services offered.
securities Papua New Guinea does not have a specific legal framework for cryptocurrency or digital assets; the Securities Commission of Papua New Guinea (SCPNG) regulates capital markets under the Securities Act 1997, which does not expressly address digital assets. Securities Commission of Papua New Guinea The SCPNG only licenses the Port Moresby Stock Exchange and Trustee Companies involved in the Unit Trust Industry; it does not have powers under the current law to issue licenses to other market intermediaries such as Fund Managers, Stock Brokers/Dealers, Investment Advisors, or Underwriters. Papua New Guinea Registry Services No entity has been licensed to operate a cryptocurrency exchange or digital asset platform in Papua New Guinea, and no specific license type exists for such activities. Securities Commission of Papua New Guinea The practical reality is that digital asset businesses cannot obtain a securities license under current law, and the SCPNG has limited capacity to regulate or license digital asset activities. Securities Commission of Papua New Guinea Legal reforms are underway to expand the SCPNG's licensing powers, but as of 2025–2026, no comprehensive digital asset regulatory framework exists. Papua New Guinea Registry Services The Securities Commission of Papua New Guinea (SCPNG) is the primary regulator for capital markets in Papua New Guinea; it operates as a Division within the Investment Promotion Authority (IPA). Papua New Guinea Registry Services The SCPNG's office is located at MRDC HAUS Lvl 2, Champion Parade, Down Town Port Moresby, with general enquiries directed to ask@scpng.gov.pg and landline +675 3212224. Home - Securities Commission of Papua New Guinea The Bank of Papua New Guinea (BPNG) regulates banking, Savings & Loan Societies, Superannuation Funds, Life Insurance, money markets, and government-issued securities such as Treasury Bills and government bonds. Papua New Guinea Registry Services
stablecoin Most Likely: E-money/Payment Tokens: Given the purpose of stablecoins to maintain a stable value for transactions, they would most likely be classified as a form of e-money or payment tokens under the National Payment System Act 2013 and the National Payment System Regulations 2021. E-money is typically defined as electronically stored monetary value as represented by a claim on the issuer, which is issued on receipt of funds for the purpose of making payment transactions, and which is accepted by a natural or legal person other than the e-money issuer. Fiat-backed stablecoins would fit this definition well. Payment Token could also be a relevant classification, referring to an instrument that enables a payment transaction. Less Likely: Securities: A stablecoin might be classified as a security under the Securities Act 1997 if it grants the holder an ownership interest in an underlying asset, rights to profits, or is structured in a way that represents an investment contract. However, for most fiat-backed stablecoins designed for payments, this classification is less probable than e-money. If a stablecoin is classified as e-money, the BPNG's framework for e-money issuers would likely apply. This typically requires: 1:1 Backing: The issuer must hold an equivalent amount of fiat currency (or highly liquid, low-risk assets) corresponding to the value of e-money in circulation. Safeguarding and Segregation: These reserves must be held in segregated accounts with a licensed financial institution (e.g., a commercial bank licensed by BPNG) to protect customer funds in case of the issuer's insolvency. The National Payment System Regulations 2021 are expected to detail these requirements for e-money issuers.
status The primary financial regulators operate under the Central Banking Act 2000 and the Banks and Financial Institutions Act 2000, but neither statute references digital assets, virtual currencies, or blockchain technology Office of Legislative Counsel :: Papua New Guinea No licensing regime exists specifically for cryptocurrency exchanges, wallet providers, or digital asset service providers, and no entities have been granted licenses to operate crypto businesses in PNG Office of Legislative Counsel :: Papua New Guinea The practical reality is that crypto activities remain unregulated and unlicensed, creating significant legal uncertainty for businesses, while the government has demonstrated regulatory capacity through enforcement actions in adjacent sectors like telecommunications NICTA Clarifies Regulatory Status of Starlink Services in PNG | DICT I PNG No official guidance has been issued on the legal status, treatment, or taxation of virtual assets, leaving businesses operating in a legal gray zone with minimal regulatory clarity Office of Legislative Counsel :: Papua New Guinea The Bank of Papua New Guinea (BPNG) serves as the central bank and primary financial regulator, operating under the Central Banking Act 2000, which grants it authority over monetary policy, currency issuance, and the financial system Office of Legislative Counsel :: Papua New Guinea The Ombudsman Commission of Papua New Guinea holds constitutional authority to issue directives that can restrain regulatory bodies from taking licensing actions, as demonstrated in the Starlink licensing matter NICTA Clarifies Regulatory Status of Starlink Services in PNG | DICT I PNG The Internal Revenue Commission administers tax legislation including the Goods and Services Tax Act 2003 and Goods and Services Tax Regulation 2005, which may have incidental application to digital asset transactions Office of Legislative Counsel :: Papua New Guinea The Constitution of the Independent State of Papua New Guinea, adopted August 15, 1975, and effective September 16, 1975, establishes the supreme legal framework under which all other laws operate and provides for the protection of fundamental rights and freedoms Constitution of the Independent State of Papua New Guinea, Papua New Guinea, WIPO Lex
tax PNG does not impose a general Capital Gains Tax. Gains from the sale of assets, including virtual assets, are generally not taxable unless they are considered to be: Part of a business operation (e.g., regular trading, mining as a business). Part of a profit-making undertaking or scheme. If a gain is determined to fall into one of these categories, it would be treated as ordinary income and subject to the applicable income tax rates for individuals or corporations, rather than a separate CGT rate. Income from Business Activities: If an individual or entity is regularly trading cryptocurrency, mining crypto as a business, operating a crypto exchange, or providing services in exchange for crypto, the profits derived would be considered assessable income. Mining Rewards: Cryptocurrency received from mining activities would generally be considered assessable income at its fair market value (in PGK) at the time of receipt. Staking Rewards/Lending Income: Income derived from staking or lending cryptocurrency would likely be treated as assessable income at its fair market value (in PGK) at the time of receipt.
travel rule No, not fully adopted for VASPs/Travel Rule. PNG's Anti-Money Laundering and Counter Terrorist Financing Act 2015 (AML/CTF Act 2015) and its associated Regulations 2016 do not comprehensively define Virtual Assets (VAs) or Virtual Asset Service Providers (VASPs) in line with FATF Recommendation 15. Consequently, VASPs are not explicitly designated as "reporting entities" or "financial institutions" under the current AML/CTF framework. This means they are generally not subject to AML/CTF obligations, including the Travel Rule. The APG MER specifically notes that PNG needs to take steps to license or register VASPs and subject them to the full range of AML/CTF obligations. Since VASPs are not comprehensively covered by existing legislation, there is no effective date for the FATF Travel Rule as it applies to virtual asset transactions in PNG. Its implementation awaits legislative amendments. Given that the Travel Rule is not yet implemented for virtual assets, there are no specific threshold amounts mandated for virtual asset transfers under PNG law. For traditional financial institutions, PNG's AML/CTF Regulations 2016 prescribe thresholds for reporting: Cash Transactions: Financial institutions must report any cash transaction equal to or exceeding PGK 20,000 (approx. USD 5,000) or its equivalent in foreign currency. Electronic Funds Transfers: Financial institutions are required to record and retain information for electronic funds transfers equal to or exceeding PGK 1,000 (approx. USD 250). However, this is for traditional transfers and does not currently extend to VA transfers.

Sources

This report is AI-generated from publicly available regulatory sources. Last updated: 2026-09-09. View full profile