WORLD TRADE ORGANIZATION  
ORGANISATION MONDIALE DU COMMERCE  
ORGANIZACIÓN MUNDIAL DEL COMERCIO 
WT/TPR/M/239/Add.1 
27 May 2011 
 (11-2659) 
Trade Policy Review Body 
16 and 18 November 2010 Original: English/ 
 anglais/  inglés 
TRADE POLICY REVIEW 
PAPUA NEW GUINEA 
Record of the Meeting 
Addendum 
Chairperson:  H.E. Mr. Bozkurt Aran (Turkey) 
 
 This document contains the advance written questions, and replies provided by Papua New 
Guinea.1 
__________________________________________________________________________________ 
 
Organe d'examen des politiques commerciales 
16 et 18 novembre 2010   
EXAMEN DES POLITIQUES COMMERCIALES 
PAPOUASIE NOUVELLE GUINÉE 
Compte rendu de la réunion 
Addendum 
Président:  S.E. M. Bozkurt Aran (Turquie) 
 
 Le présent document contient les questions écrites communiquées à l'avance et les réponses 
fournies par la Papouasie Nouvelle Guinée.1 
__________________________________________________________________________________  
Órgano de Examen de la s Políticas Comerciales 
16 y 18 de noviembre de 2010  
 
EXAMEN DE LAS POLÍTICAS COMERCIALES 
PAPUA NUEVA GUINEA 
Acta de la reunión 
Addendum 
Presidente:  Excmo. Sr. Bozkurt Aran (Turquía) 
  En el presente documento figuran las pre guntas presentadas anticipadamente por escrito, 
junto con las respuestas facilitadas por Papua Nueva Guinea.
1 
                                                      
1 In English only./En anglais seulement./En inglés solamente.  WT/TPR/M/239/Add.1 
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REPLIES PROVIDED BY PAPUA NEW GUINEA 
UNITED STATES 
WT/TPR/G/239 
Page 21, Paragraph 108:   PNG mentions some legislative improvements, including "significant 
changes to the Copyright & Neighbouring Rights Act to allow for establishment of Collective 
Management Organizations (CMO)".  Have these amendm ents been officially enacted into law?  If so, 
have the new laws been deposited in accordance w ith WTO requirements?  Where can Members find 
the most recent version of PNG’s Copyright Act?  Please provide a summary of the recent amendments to PNG’s Copyright Act.  Please also provide status update on the amendment of the 
Patents and Industrial Design Act.  Where can Members find a draft copy of the amendment? 
Response 
The amendment to the Copyrights and Neighbouri ng Rights Act 2000 is yet to be finalized by 
IPOPNG and is not accessible to the public at this  moment.  However, the current Copyrights and 
Neighbouring Rights Act 2000 can be found on the we bsite at www.ipopng.gov.pg but the website is 
undergoing construction.  PNG laws can be accessed on Pacific Islands Legal Information Institute 
(PACLII) website: www.paclii.org, which also covers  most of the Pacific Island Countries (PICs) 
legislations. 
Summary of Amendments in the Copyrights and Neighbouring Rights Act (2000) and the 
Patents and Industrial Designs Act (2000) 
1. Copyrights and Neighbouring Rights Act 2000 
The amendments to the  Copyrights  and Neighbouring Rights Act 2000 (the  Act) came about as a 
result of the concerns raised by musicians in the country on a fair and equitable compensation for their 
works.  There was essentially a need to amend to Act to cater for collective societies to manage the 
affairs of not only musicians but artists in general. Hence most of the amendments relate to the setting 
up of the Collective Management Societies and th e processes involved in setting up these societies. 
The Regulations have been drafted for prescribed  forms relating to the collective societies.  
The amendment to the Copyrights and Neighbouri ng Rights Act 2000 is yet to be finalized by 
IPOPNG and is not accessible to the public at this moment. However, the summary of the 
amendments covers the following provisions: 
Establishment and Administration of Co llective Management Organisation (CMO) 
- Establishment of a CMO 
- Management of rights 
- Expressions of folklore - Activities of collective management - Users of works - Powers of a CMO Office 
- Qualifications for Incorporation of a CMO Office  
- Qualifications for incorporation of a CMO - Procedure for Application for a permit and of incorporation of a CMO - Functions of Office under this Part - Effect of Revocation of Permit WT/TPR/M/239/Add.1 
Page 4  
 
  - Supervision of activities of CMO 
- Model Constitution - Contents of Constitution 
- Discontinuation of activities of a CMO 
CMO as a licensing authority 
- Membership of CMO upon deed for collective management 
- Exclusiveness of deed - Resignation as member of CMO - Rights of foreign right owners - Licensing contracts 
- Existing foreign CMO 
Notification of Licensing Agreement  
- Notice of Licensing Agreement 
Alternative Dispute Resolution (ADR) 
- Alternate Dispute Settlement 
- Case by Rights Owners 
- Case by CMO - Case by User 
- Office as party to case 
Also, the Provisions for enforcemen t are also captured under the Act. 
2. Amendments to the Patents and Industrial Designs Act (2000) 
With the lack of expertise on Patent Law in PN G, the Patent and Industrial Designs Act 2000 so 
drafted with very little experience therefore it had some many limitations. In the process of applying 
this law to processes, it was brought to light that th ere needed to be improvements made to the law. 
Hence the list below shows some of the amendments  to the patents and Industrial designs Act. The 
amendment to the Patents and Industrial Designs Act is yet to be finalized. However, the amendments 
include following provisions: 
- Opposition to patent applications 
- Recognition of PCT provisions - Parallel imports - interna tional exhaustion of rights 
- Process Patent - Burden of Proof - Exploitation by Government of a patent in the name of public, health interest 
- Special provisions in relation to exploitati on of patents for products of pharmaceutical 
drugs 
- Non-voluntary license. 
If so, have the new laws been deposite d in accordance with WTO requirements?  
No, but the required notifi cations pertaining to the amendments of these laws will be undertaken as 
part of the major effort that will be undertaken  on all notification requirements for Papua New 
Guinea.   WT/TPR/M/239/Add.1 
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  WT/TPR/S/239 
II. TRADE POLICY REGIME:  FRAMEWORK AND OBJECTIVES (5) T
RADE AGREEMENTS AND ARRANGEMENTS  
(i) Multilateral  
Page 21, Paragraph 19:  According to the Secretariat, "PNG has not fully met its WTO notification 
requirements since 2000, creating a lack of transparen cy; 43 notifications relating to agriculture were 
outstanding as at June 2010 (Table II.2).  The aut horities indicated that this reflected a lack of 
coordination among relevant departments and agenci es..."  Please describe the action that PNG is 
taking to address its WTO notification requirements a nd the steps it is taking to improve coordination 
among relevant departments and agencies. 
Response 
Papua New Guinea has attempted to submit notifica tion such as Article 24 of the SCM Agreement, 
Enquiry Point on TBT Agreement, Pre-shipment In spection to the WTO. However given the limited 
manpower; PNG has not been able to consiste ntly undertake its notification obligations. 
Capacity and resource constraints have impacted on line areas responsible for reporting, in particular 
the collection and collation of necessary data and in formation for monitoring and reporting, which has 
been reflected as our non-compliance to report. 
In taking responsibility for overall re porting, under recently approved r estructure of the Department of 
Foreign Affairs and Trade, including the recruitment of additional staff, the Department will dedicate 
officers to be directly responsible for all WTO Notification matters. 
(6) F OREIGN INVESTMENT REGIME  
(ii) Investment incentives Page 33, Paragraphs 49-50:   The Report mentions several tax incentives being provided to the 
manufacturing sector under the Income Tax Act, none of which PNG appears to have notified to the 
SCM Committee.  When will PNG submit the releva nt notification of these incentives in light of 
Article 25 of the SCM Agreement?  The Report al so mentions that these incentives are granted non-
transparently.  Please explain what steps PNG is ta king to make these programs more transparent. 
Response 
PNG has annually notified Section 45B of the Income Tax Act under Article 27.4 of the SCM 
Agreement.  
PNG recognizes that there are other investment incentive programs under the National Investment 
Policy (NIP) and the current review of the NIP w ill consider and work towards addressing the status 
of these incentives.  WT/TPR/M/239/Add.1 
Page 6  
 
  III. TRADE POLICIES AND PRACTICES BY MEASURE 
(1) I
NTRODUCTION  
Page 36, Paragraph 4:   The Secretariat states:  "Applied tariffs on a handful of items seemingly 
exceed bound rates."  What actions is the government taking to align its applied tariffs with its WTO 
bound rates? 
Response 
PNG recognizes that in its tariff structure, there are applied tariffs that are higher than the bound 
tariffs. Although, this is contradictory to WTO ru les, the difference is not very significant in NAMA 
lines where for 27 products bound rates are 11% and the applied rates are at 15%. In agriculture, 
31 products have applied tariffs that are higher than  bound. The applied tariff rate for most of these 
products is 15% while bound tariff is 11%.  
This inconsistency will be considered and addressed through the budgetary process.  
Page 37 :  What is the scientific rationale for the im position of quarantine or SPS restrictions by Papua 
New Guinea on a broad range of agricultural products like meats, fish, milk and dairy products, fruits, 
and vegetables?  Please explain.  
Response 
The National Agriculture Quarantine Inspection Au thority (NAQIA) has been informed and will 
provide the appropriate responses accordingly.  Howe ver, it may note that NAQIA with assistance 
from the Australian Quarantine and Inspection Servi ce (AQIS) has developed a similar risk based 
approach to handling and monitoring of the import and export of goods. 
(2) M EASURES DIRECTLY AFFECTING IMPORTS  
(i) Registration, documentation, and customs procedures Page 38, Paragraph 10:   According to the Secretariat, "...i mplementation of advanced rulings was 
slowed by delays in finalizing the administrative gu idelines, which were expected to be approved in 
August 2010 (delayed from end-2009).  Advanced rulings are due to be introduced by 2011."  Will advance rulings be available for review, have an expiration date, and be available to the public? 
Response 
Advance rulings are available for reviewing as pe r Section 176H of the Customs Act. All Customs 
Rulings has an expiry date of 3 years as per Secti on 176G of the Customs Act. All Customs Decisions 
and Rulings are published on the PNG Customs Service website: www.customs.gov.pg. 
(ii) Tariffs 
Page 39, Paragraph 16:   According to the Secretariat, "the amended 2006 Customs Act still provides 
that ad valorem  duties are to apply to the higher of the good's "actual money price paid by the 
importer plus any special deduction" and its "current domestic value" plus all f.o.b. charges paid or 
ordinarily paid in the port of export (Section 96(2))."  Please explain this provision of the 2006 
Customs Act in light of the WTO Agreement on Customs Valuation.  WT/TPR/M/239/Add.1 
 Page 7 
 
 
  Response 
Division 2 of the Customs Act which covers Sections  95 to 101 deals with Ad Valorem Duties. This 
Division 2 has been repealed and replaced with the Customs Ad Valorem Duties Regulation 1987. 
This legislation deals with all Valuation aspects and it is also compliant with GATT Valuation Agreement. 
Page 39, Paragraph 18:   The Secretariat advises that PNG’s tariff rates "are largely based on 
recommendations from task forces that review reque sts from stakeholders, including the respective 
sectoral departments, rather than any formal ins titutionalized process."  Are the requests reviewed to 
ensure that they do not violate PNG’s WTO bound rates? 
Response 
There is a general awareness amongst the National Stake holders that if tariffs have to be raised, it 
must not exceed the bound rates. 
(v) Import prohibitions, restrictions, and licensing 
Page 47, Paragraph 36:   According to the Secretariat, PNG has not notified its licensing legislation 
to the WTO Committee on Import Licensing."  What pl ans does PNG have to fulfil this requirement? 
Response 
This is a notification issue and therefore; the De partment of Foreign Affairs and Trade will address 
this notification issues as part of its efforts as stated above. 
(3) M
EASURES DIRECTLY AFFECTING EXPORTS  
(iv) Export assistance 
Page 48, Paragraph 42:  The Report mentions an export assistance tax incentive not covered under 
PNG’s Article 27.4 transition procedures, i.e., the "double deduction . . . for expenditure developing 
export markets for manufactured goods."  Please explain this program in light of  Article 3 of the SCM 
Agreement.  When will PNG notify the program pur suant to Article 25 of the SCM Agreement?  
Response 
The program is provided under Income Tax Act and not the Industrial Development (Wage Subsidy) 
Act as referred to in the WTO Report. A clarification has to be made. 
Section 72 C of the Income Tax Act provides th e Export Market Development Deduction is a double 
deduction that is available for expenditures on developing an export market for PNG manufactured products and development of tourism overseas thr ough publicity, sample provision, market research, 
trade fairs, preparation of tenders, certain travel  expenses, technical information provision expenses, 
sales office expenses and expenses incu rred in bringing buyers to PNG. 
Therefore, PNG is of the view that this is an ince ntive, which does not directly result in distortions of 
prices or trade in general but rather for the purposes of research, promotion or establishment of markets. In this context, PNG is of the view th at the incentive provided under Section 72 C does not 
fit the definition of Article 3 of the SCM, which relates to Prohibited Subsidies.   WT/TPR/M/239/Add.1 
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  With regard to the issue of notification, PNG w ill make a concerted effort to address notification 
requirements as stated above. 
(v) Export Processing Zones 
Pages 48-49, Paragraphs 43-45:   According to the Report, the Free Trade Zones Act 2000 allows for 
establishment of export processing zones (EPZs) where exported goods may be exempt from tariffs. 
The Report also indicates that none of the planned zones are currently operational. Could PNG 
provide updated information on any plans to establish these EPZs?  
Response 
The Government has recently endorsed a new concep t to be called as the "Economic Corridor". Under 
the PNG Development Strategic Plan (PNGDSP)  2010-2030 and the Medium Term Development 
Plan (MTDP) 2011-2015, several rural Economic Co rridors have been identified in each of the 
4 regions in the country.  
Economic corridors are proposed to alleviate poverty. Corridors of poverty will be transformed into 
economic corridors. Without the corridor system pe ople in poverty will not be integrated into the 
mainstream economy.  
An economic corridor is a region in which the G overnment provides a well-planned zoning system, a 
comprehensive and effective network of transport and utilities, and quality education and health 
services. Within this region, businesses are able  to operate at low cost and under well designed 
incentives, thereby encouraging foreign a nd domestic private sector investments.  
By concentrating the construction of essential infra structure within certain regions the economic 
corridor approach takes advantage of the substan tial economies of scale and scope associated with 
large service sector infrastructure. This reduces the co st to state owned enterprises and other providers 
of essential infrastructure, while raising their retu rns. Building on this in frastructure, effective 
sequential and spatial planning w ill help to expand economic activiti es like agriculture, tourism and 
manufacturing. The economic corridor concept has been applied between countries with common 
borders, such as the Mekong Economic Corridor, to  promote development and integration.  
It has also been applied within a single country, including China, to attract  investment and thereby 
promote economic development. Ec onomic corridors will be located in  the poorest regions of PNG 
with the aim of extending the benefits of devel opment to the most disadvantaged regions. They will 
be located where the gains are likely to be greatest, pa rticularly where land is fertile or where the three 
modes of transport – air, sea and land – are able to come together to provide efficient trade hubs. The selection of regions is therefore independe nt of provincial or district borders. 
The Report states that PNG is establishing four i ndustrial estates, inter alia, to provide access to 
land facilities, promote investment and facilitate  regional development. When does PNG plan 
to notify the related incentive programs pursuan t to Article 25 of the SCM Agreement?  
Response 
Two out of the four industrial centers are currently in operation now. The other 2 centers are yet to be 
established. 
With regard to the issue of notification, PNG w ill make a concerted effort to address notification 
requirements as stated above.  WT/TPR/M/239/Add.1 
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  With regard to the rural industrial centers, what incentives are being provided to support 
"production of import substitution goods," as men tioned in the Report?  When will PNG notify 
the incentives pursuant to Article  25 of the SCM Agreement?  
Response 
The incentives provided by the Government to comp anies that set up within the rural industrial 
centres include state land being leased to the compan y concerned, building facility, subsidised water 
and electricity. 
The notification issue will be addressed as stated above.  
(vii) Duty drawback 
Page 49, Paragraphs 47-48: 
Could PNG explain its duty drawback program in light of the limitations set forth for such 
programs under Annex I (i) of the SCM Agreement? 
Response 
As stipulated in the report, the drawback system h as not been used and there is currently no intention 
of using the drawback system in the near future.   
The Report states that "drawback is not allo wed on goods whose domestic sales value is 
lower than the amount of the drawback."  Pleas e explain why the drawback is being tied to 
the level of domestic sales. 
Response 
Conditions of drawback are such that they encour age exports. Section 109 of the Customs Act is a 
safe guard that goods entered for drawback shoul d predominantly be used in manufacturing for 
exports, any other parts of goods used for domestic consumption should be of a less value than the 
value of goods used for the export. 
The Report also states that refunds under th e drawback scheme are administered "non-
transparently on a case-by-case basis." Please d escribe the steps that PNG is taking to make 
these programs more transparent. 
Response 
As mentioned above the drawback system has not been  used and there is no intention at all for using 
the system in the future. Moving forward on this  matter, there is currently moves within PNG 
Customs to repeal provisions for drawback.  
(4) I NTERNAL MEASURES  
(iii) Standards and other technical requirements 
Page 53, Paragraph 62:   The Secretariat says that "the government non-profit agency the National 
Institute of Standards and Industr ial Technology (NISIT) is respons ible for developing, adopting, 
reviewing, and publishing PNG National Standards (N ISIT Act, 1993)... However, with no permanent 
Director General or board since 2007, the NSIT h as been unable to conduct its regulatory functions." WT/TPR/M/239/Add.1 
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  When does PNG plan to install a Director Genera l or board so that it can conduct its regulatory 
functions?       
Response 
With regard to the appointment of the Director Ge neral and NISIT Council, this  is a decision that will 
be made by the Minister responsible for NISIT. 
Although, the report claims that in the absence of the NISIT Council and with no permanent Director 
General, NISIT is not carrying out its regulatory fu nctions.  NISIT is carryi ng its mandated functions. 
In the absence of the Director General and NISI T Council, NISIT officers still perform their mandated 
activities. Currently, these officers report directly to  the Minister and if required, necessary approvals 
are sought from the Minister for matters relating to policy and approval of standards. 
(b) Health, sanitary, and Phytosanitary regulations 
Page 55, Paragraph 67 :  We appreciate that Papua New Guinea has moved away from zero tolerance 
measures in the direction of measures based on in ternational standards and science, taking into 
account the circumstances in the exporting country .  We would, however, like to understand how 
Papua New Guinea will regulate in the absence of an international standard?  What is the scientific 
basis for resorting to broad import bans?  
Response 
The National Agriculture Quarantine Inspection Au thority (NAQIA) has been informed and will 
provide the appropriate responses accordingly. 
(vi) State-owned enterprises and privatization 
Page 58, Paragraph 78:   The Secretariat Report states: "PNG's privatization programme has 
progressed slowly... The poor performance of SOEs c ontinues to be a major constraint on private-
sector development by raising costs and damaging competitiveness; some private ownership would improve this situation." What plans does PNG have to privatize its SOE’s? 
Response 
The Government has also recently adopted the Publ ic Private Partnership (PPP) policy to replace the 
Privatization Policy. This Policy is suppor ted by the Asian Development Bank (ADB).  
Under the PNG Development Strategic Plan (PNGDSP), the Private Sector will be the vehicle for 
prosperity and jobs, because it is through this sector that businesses are created and expanded. The 
strategies outlined throughout the PNGDSP will lay the foundation for private businesses to seize new 
opportunities and flourish. Importantly, the private sector  can also be a partner with the government in 
building infrastructure and providing essentia l services to the people of PNG.  
PPP will therefore be a cornerstone of the implementation of the PNGDSP . Innovative approaches to 
PPP will be developed to exploit the potential for th e private sector to contribute to the building of 
infrastructure and the delivery of services. Carefu l planning is paramount to ensure that PPP 
arrangements are designed to achieve the best possi ble outcomes for the people of PNG. Bringing the 
private sector into partnership with the government  brings substantial advantages including access to 
technology and know-how, access to efficient a nd effective operational practices, and access to 
finance and resources.  WT/TPR/M/239/Add.1 
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  INDIA 
SUMMARY 
Page viii, Paragraph 7 
While economic growth, earlier reforms, and the massive LNG project hold promise, PNG faces 
many priorities: improving governance, reducing corr uption, and kick-starting reforms, supported by 
significant improvements to lower the costs of doing business, e.g. promoting efficiency of utilities 
and building public infrastructure, all of which ar e sizable impediments to investment and private 
sector development. 
Question 1 
We would like PNG to share if it has any time bound  programme to overcome these challenges to its 
socio-economic development? 
Response 
There are on-going programmes currently being implemented by the Government to improve 
governance, reducing corruption, kick-starting reform s and promoting the efficiency of utilities and 
building public infrastructure. The ‘Law & Justice Sector Strategy Framework’, an on-going program, 
focuses on improving governance, accountability and reduc ing corruption. Its aim is to achieve ‘a just, 
safe and secure society’ in PNG.  
Public sector reforms are continued to be implemen ted by the Government of PNG. The reforms are 
currently implemented under the Public Expenditure  Review and Rationalization program which will 
continue through 2011. Several projects have been  implemented under this program which includes: 
 - Civil service size and payroll reform; 
- Improving financial management and control; 
- Rightsizing initiative; and - Improving the governance of utilities. 
 
The Government is also focusing on building pu blic infrastructure and has already endorsed a 
National Public Private Partners hip policy to utilise private sector capital to develop its public 
infrastructure. Revenues obtained from the LNG project  will be used to repay the capital invested by 
the private sector on public infrastructure development in PNG.   
a) Private Sector Led Development   
The PNG Government is committed to promoti ng a competitive and dynamic private sector. This 
commitment is reflected in its key strategy documen ts. One of the 7 pillars in the Vision 2050 is 
Wealth Creation and the document states that Visi on 2050 will ensure that PNG has a strong, dynamic 
and competitive economy by 2050 (p.36). PNGDSP 2010-2030 states that the private sector will be the vehicle for prosperity and job creation, because it is through this sector that businesses are created 
and expanded. The Government’s  commitment is further demonstrated through the National 
Executive Council (Cabinet) decision in 2009 to formul ate a Private Sector Growth Strategy (PSGS). 
This decision was in response to requests by th e Consultative Monitoring & Implementation Council 
(CIMC) and the Australia-PNG Business Council. WT/TPR/M/239/Add.1 
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  b) Promoting Efficiency of Utilities and Building Public Infrastructure  
One of the key policy initiatives the PNG Government  has adopted in 2009 to promote efficiency of 
utilities and building public infrastructure is the ad option of the PPP (Public Private Partnership) 
Policy. Innovative approaches to PPP will be develope d to exploit the potential for the private sector 
to contribute to the building of infrastructure and the delivery of services.  Careful planning is 
paramount to ensure that PPP arrangements are desi gned to achieve the best possible outcomes for the 
people of PNG. Bringing the private sector into pa rtnership with the Govern ment brings substantial 
advantages including access to technology and k now-how, access to efficient and effective 
operational practices, and access to finance and resources.  
Some of the key activities that the Government is encouraged to undertake (and is already 
undertaking) in relation to answering some of the is sues highlighted by India is spelled out in more 
detail in the final Private Sector Growth S ector Report (2010), the PNGDSP 2010-2030, and the 
MTDP 2011-2015 documents. 
SEPARATE CUSTOMS TERRITORY OF TAIWAN, PENGHU, KINMEN AND MATSU 
WTO Secretariat Report (WT/TPR/S/239) 
I. ECONOMIC ENVIRONMENT 
(4) K EY STRUCTURAL POLICY CHALLENGES  
(ii) Reducing the costs of doing business, and infrastructure development (Page 8, Paragraph 20) 
It is noted from the Report that, in order to boos t the private investment and management in major 
infrastructure projects worth at least PGK50 million, the Government of Papua New Guinea has 
formed a National Public Private Partnership (PPP) Pi peline.  Private Sector partners will be selected 
through open competitive tenders using output-based specifications.  
i)  We would appreciate knowing whether foreign partners will be able to participate in 
the open tender process of the PPP Pipeline? 
Response 
Yes, foreign partners are able to participate in the open tendering process to  undertake infrastructure 
projects that are already in the PPP pipeline. These projects have to be registered by the PPP centre 
before any preparations for procurement of that  project through a PPP arrangement is made. The 
tender process of PNG’s PPP arrangements is consiste nt with the Government’s existing procurement 
guidelines which encourages foreign partners or i nvestors to bid for PPP projects in the pipeline. 
The National Public Private Partnership Pipeline will  ONLY include projects that are consistent with 
the Government’s strategy including the Medium Term Development Plan, Medium Term Fiscal 
Strategy, Medium Term Debt Strategy, Vision 2050 a nd any future development and fiscal strategies. 
Concept Notes for projects submitted by Line Gove rnment agencies, State Owned Enterprises (SOEs) 
and statutory authorities has to be consistent with  these strategies. Foreign partners have to work 
along with domestic partners to identify projects in a PPP type arrangement but the projects have to be 
in line with these Government strategies.  
  WT/TPR/M/239/Add.1 
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  ii)  If yes, are there any differences between the requirements for foreign partners who 
wish to take part and those for domestic partners? 
Response 
There are no differences between the requirements for foreign partners a nd domestic partners. The 
Government’s procurement practices apply equa lly to both foreign a nd domestic partners.  
As far as development projects are concern, fore ign partners can develo p Country Partnership 
Strategies and assist the domestic partner to develop and implement projects at the sectoral level. Most often the projects proposed by the foreign part ner are considered because of its alignment with 
the domestic partner’s development and fiscal strategies.  
Furthermore, the Public Finance (Management) Act contains provisions for domestic preference only 
for contracts that will fall below the PPP threshold.   It is envisaged that once the PPP Centre is 
established, the Government PPP Taskforce will establish a PNG Infrastructure Plan . The Plan is 
expected to cover various project m odels and contracts. The extent of  private sector (both foreign and 
domestic) participation shall be determined on a case by case basis by the Government. Exemptions 
can be granted from the PPP Policy only upon approv al by the Government through the Cabinet. The 
three key principles of the PNG PPP model are: Value for Money, Competitive Tension, and 
Transparency. 
II. TRADE POLICY REGIME: FRAMEWORK AND OBJECTIVES (4) T
RADE POLICY OBJECTIVES  
(Page 20, Paragraph 15) 
The Report states that, "the Papua New Guinea Government accepts that PNG will benefit 
economically from improved productivity and c onsumer welfare brought about by greater 
competition, including in key service sectors." 
i)  Which key service sectors does Papua New Guinea believe will benefit most from 
improved productivity and consumer welfare?  
Response 
The PNG Government, with assistance and consultati on of our partners name ly Australia, EU, World 
Bank and ADB have identified transport (air, land and sea), electricity, information and 
telecommunications, water, health, education and hos pitality industry as key sectors to address.  These 
Sectors have also been priorities for developmen t in the National Budget and are emphasised in our 
PNG Vision 2050. 
ii)  Is there any liberalization scheduled for these sectors? 
Response 
Yes, at this stage, greater competition in these ser vice sectors is expected to be facilitated under the 
PPP model, which is expected to be implemente d in 2011 through a pilot model before the actual 
PNG PPP model can be implemented by 2013/2014. WT/TPR/M/239/Add.1 
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  BRAZIL 
In Paragraph 45 of document WT/ TPR/G/239, Papua New Guinea states that "[the] Government has 
committed K100 million to fund the implementation of  the National Agriculture Development Plan 
(NADP) annually between 2007 and 2016." Key prior ities of the NADP are listed in Paragraph 44. 
Can you report on progress achieved so far in the areas of research and training? 
Response 
Most of the funds from the NADP are used for ag ricultural extension work, which involves extension 
workers going to the farmers in the villages and teaching them what to do and how to do certain 
things, as well as rehabilitate huge senile and run down plantations by teaching farmers new 
techniques of treating their crops.    
Furthermore, direct support is given to small to large scale local farmers and/or producers to enhance 
their productive capacity as part of the objective to revitalize the agriculture sector in Papua New 
Guinea.  
Although Research and Training are very important, this is one area where the Government through 
the NADP has failed to support since the establishment of the fund. On the other hand, research and 
training is also catered for in the annual budget for individual commodity agencies of Government 
and various donor-funded support programs. One of th e key PNG Government agencies responsible 
for research and training is the National Agriculture  Research Institute (NARI) and it is funded by the 
Government annually as a separate entity.   
EUROPEAN UNION 
I. ECONOMIC ENVIRONMENT 
(1) I NTRODUCTION  
WTO Secretariat's Report, Page 1, Paragraphs 3-4 
The Secretariat's report states th at Papua New Guinea's (PNG) "R elative macroeconomic stability, 
until recently, has helped sustain gr owth […], […]Its su ccess in fostering sustainable broad-based 
growth and a diversified economy will in large pa rt depend on its successfully implementation of 
much-needed policy and related reforms to enc ourage investment, especially foreign, improve 
productivity and therefore competitiveness.[…]". 
1.  Could PNG elaborate further on how it inte nds to encourage sustainable development 
and core labour standards in this context? 
Response 
In terms of sustainable development, PNG has now approved the PNG Vision 2050 and it’s Medium 
Term Development Plans that provides the framework for sustainable development. 
Are there any governmental measures in place to help PNG producers access niche markets overseas 
through adherence to voluntary sustainability standa rds (for example, UTZ Certified, Fair Trade, 
Ethical Tea Initiative)?   WT/TPR/M/239/Add.1 
 Page 15 
 
 
  Response 
Yes, for example New Britain Palm Oil Ltd (NBP OL) is an acknowledged world leader when it 
comes to sustainable palm oil production.  The PNG palm oil industry has a high regard for the importance of its sustainability credentials and is active in proving its performance through RSPO and 
ISO14001 certification. NBPOL has been one the lead companies in developing the RSPO global 
standard and was one of the first three companies in the world to become RSPO certified.  PNG’s 
inclusiveness of smallholders in its RSPO certif ication sets precedence for other palm oil producing 
countries. 
PNG has an active RSPO National Interpretation Working Group that includes participation from 
relevant Government Departments.  The Departme nt of Environment and Conservation is beginning 
dialog with the country’s palm oil industry with a view to developing a nati onal palm oil code of 
practice that will incorporate many elements of the RSPO Principles and Criteria."  
II. TRADE POLICY REGIME: FRAMEWORK AND OBJECTIVES 
(1) O
VERVIEW  
WTO Secretariat' s Report, Page 2, Paragr aph 2, Page 16 Paragraph 3 and Page 22, 
Paragraph 20 
EU would like to point out that the EU's Illegal Unreported and Unregulated (IUU) fishing Regulation 
aims at eliminating IUU- fishing, which puts at st ake the sustainable use of fishery resources and the 
sustainable development of the fishing sectors in cluding in developing countries. The trade and 
development benefits stemming from the special rule s of origin agreed under the interim EPA signed 
by PNG do in no way derogate from the above mentioned objectives. 
Response 
PNG is fully complying with EU Regulations on IUU Fishing. Further, PNG is party to the Western 
and Central Pacific Fisheries Commission and the Parties to the Nauru Agreement (PNA), the sub-
regional body of 8 tuna owning PICs that is fully  committed to the management and conservation of 
tuna stocks in the Convention Area. The PNA has introduced a full suite of management and 
conservation measures under the Third Impl ementing Arrangement that includes: 
 (i) 3 year ban on fishing in the high seas pockets in 10 degrees North and 10 degrees 
South; 
 (ii) 100% observer programme;  (iii) 3 month closure on Fishing Aggregation Device (FAD);  (iv) Full implementation of Vessel Day Scheme (VDS); 
 (v) 100% retention of by-catches;  and 
 (vi) Development of Ca tch Documentation Scheme. 
(3) T
RADE POLICY FORMULATION , IMPLEMENTATION , AND EVALUATION  
WTO Secretariat' s Report, Page 18, Paragraph 12 
According to the Secretariat's report "[…] PNG's trade policy framework remains weak 
institutionally, with insufficient coherence and coordination.  Policy-making is largely ad hoc.2  This 
weakens the mainstreaming of trade policy into ec onomic and development polic ies. However, efforts 
                                                      
2 UNCTAD (2006), p. 27. WT/TPR/M/239/Add.1 
Page 16  
 
  are under way to address this weakness by incor porating trade policy into development policy 
strategies and plans, but implementation problems persist due to financia l and other institutional 
capacity constraints.  An external Trade Advisory Bo ard is planned, as part of the EU's Trade Related 
Assistance Project, to help the Tr ade Division as a platform for dialogue with all stakeholders. […]. 
Government's Report, Pages 7-11 
The Government's report sections II-III refer to the overarching development strategies of PNG: the 
PNG Vision 2050 and the Long Term Development St rategy 2010-2030. Recently, the Government 
has adopted the Medium-Term Development Pl an (MTDP) 2011-2015, which defines several 
initiatives in the trade area, without mentioning the Long Term Developm ent Strategy and the 
activities to pursue these initiatives (either none or  few indicators and baseline). However, in 
Government's report it is acknowledge d that "[…] the formulation of a comprehensive trade policy is 
necessary […]". 
The above necessity was clearly recognised in 2006 during the design of the ongoing 9
th European 
Development Fund's (EDF) programme ‘Trade Re lated Assistance (TRA) to PNG'. Appropriate 
resources were devoted to this result, and inte rnational technical assistants have developed 
frameworks and rules for such a plan. In the desi gn of the TRA programme, requirement for a clearly 
defined mandate of Trade Division in the field of  trade policy formulation, implementation and co-
ordination as well allocation of sufficient staff and ot her resources to the Division by the Government 
was clearly defined. 
2.  Could PNG elaborate why a policy has not been developed in the last four years 
despite the resources provided under that programme?  
Response 
The implementation of the TRAP is currently underw ay and issues raised here are progressively being 
addressed. It is premature at this stage to pre-empt a conclusion. Only when the TRAP is concluded in 
2011, then we can discuss its achievements or otherwise.  
3.  MTDP 2011-2015 focuses almost exclusively on the enabling environment for trade 
(infrastructure, transport and regulations ). What about the activities/strategies to 
implement a trade policy once developed? 
Response 
The formulation of a Trade Policy will include th e necessary institutional framework (policy, legal, 
administration and structure).  
4.  Could PNG inform which actions are undertak en to define the legal mandate of Trade 
Division and provide the planned resources? 
Response 
This is work in progress at the domestic level. 
5.  Could PNG elaborate why creation of the Trade Policy Advisory Board has not been 
approved despite all the necessary documen ts having been prepared under the EU-
funded programme?  WT/TPR/M/239/Add.1 
 Page 17 
 
 
  Response 
This is also work in progress at the domestic level. 
(5) T RADE AGREEMENTS AND ARRANGEMENTS  
(ii) Preferential  WTO Secretariat's Report, Pages 22-28, Paragraphs 20-37 
6.  Could PNG elaborate on the extent to which, and how, social and labour issues are 
addressed within each of the regional prefer ential agreements referred to in the 
Secretariat's and the Government's reports?  
Response 
The preferential trade agreements that PNG is a part y to cover only Trade in Goods at this stage and 
these negotiations have not ex tended to cover these issues. 
(6) F
OREIGN INVESTMENT REGIME  
(i) Overview WTO Secretariat's Report, Pages 29-30 
7.  Does PNG require foreign investors to en sure that any economic activity undertaken 
in relation to an investment respects the fundamental rights at work as embodied by 
the 8 core ILO Conventions and the ILO' s 2008 Declaration on Social Justice for a 
Fair Globalisation? 
Response 
Foreign investors are required to adhere to dom estic labour regulations with respect to minimum 
wages, working hours and so on.  Workers' rights are expected to be upheld and avenues for dispute 
resolution and settlement provided for under the Industri al Registrar’s office within the Department of 
Labour and Industrial Relations.  Investors are e xpected to detail training activities and succession 
plans for local jobs which is also a part of th e requirement for work permit and visa issuance.   
WTO Secretariat' s Report, Pages 29-30, Paragraph 42 
According to the Secretariat's report "[…] The G overnment is trying to raise investment by 
developing a facilitating policy framework, includin g plans to enhance the manufacturing sector and 
boost exports. […]". 
8.  Could PNG introduce its respective plans and ongoing activities?  
Response 
The Department of Commerce and Industry [DCI] target is to raise manufacturing (excluding 
petroleum and minerals processing) from 10% to 30%  of GDP by 2030.  As reported DCI, with the 
assistance of the Australian Aid Agency (AusAID), has developed a Private Sector Growth Strategy, 
that in conjunction with our MTDS and PNG Vision 2050 outlines global strategies to increase investment through manufacturing and downstream processing. WT/TPR/M/239/Add.1 
Page 18  
 
  9.  Could PNG elaborate how investment pr omotion activities are reflected in MTDP 
2011-2015 and what are the concrete actions PNG envisaged?  
Response 
The Ease of Doing Business Report by World Bank highlights a number of issues that impedes FDI 
for instance for poor infrastructure, law and orde r problem, corruption etc... The PNG VISION 2050 
Seven Pillars actually commits the government to ad dress a lot of issues that are usually outside the 
capacity of government departments and agencies.  Ta ke for instance, the Pillar 1.23 on Infrastructure; 
the government recognises the need for high quality  infrastructure to deliver services effectively. 
Infrastructure investment in the road network, co mmunications, airports/airstrips, wharves and jetties 
facilitate manufacturing activities and helps spur the gr owth of export and private sector investment.   
The Government also talks about the Manufactur ing Sector and the Establishment of Special 
Economic Zones such as the Economic Corridor Con cept in Pillar 1.17.5.  The establishment of the 
Special Economic Zones will see the need to improve  infrastructure, transportation services, establish 
utility services which are some of the prerequisite s for the FDI.  Promotional Activities will be 
ineffective without government interven tion in the areas already discussed above. 
WTO Secretariat' s Report, Page 30, Paragraph 43, and Page 31, Table II.3 
The Table II.3 provides the list of activities reserv ed to PNG citizens and national entities. Based on 
the further information in the WTO Secretariat's re port, some other sectors such as insurance and air 
transport have restrictions  to foreign ownership.  
10.  Could PNG provide a full list of economic activities where restrictions exist for 
foreign ownership?  
Response 
Investment Promotion Authority (IPA) will provide responses at a later stage. 
11.  Could PNG provide information on when the Cottage Business Activities List will be 
updated? 
Response 
This List remains and is yet to be reviewed at a later time as currently; we are reviewing or relevant 
legislations under the IPA with the assistance of th e World Bank /IFC. There is  no fixed time frame as 
yet. 
III. TRADE POLICIES AND PRACTICES BY MEASURE 
(2) M
EASURES DIRECTLY AFFECTING IMPORTS  
(ii) Tariffs 
(f) Tariff exemptions and concessions  WTO Secretariat' s Report, Page 44, Paragraph 31 
The Secretariat's report informs that "The Minist er of Finance and Treasury, with National Executive 
Council (NEC) approval, may authorize tariff exem ptions or concessions on imports of specified  WT/TPR/M/239/Add.1 
 Page 19 
 
 
  goods to assist local industry.  Government polic y has been to stop such arrangements, but the 
Internal Revenue Commission (IRC) still considers requests on a case-by-case basis in consultation 
with other relevant departments.  The Chinese-funded Ramu Nickel project, for example, is the first to 
be granted tariff concessions on "consumables".3  […]".   
12.  Could PNG specify further the conditions and procedures of the authorisation of tariff 
exemptions and concessions?  
Response 
Exemptions are granted on impact projects and donor funded projects by the National Executive 
Council (NEC). Exemptions are granted on certain goods ; for example:  particularly on specialized 
equipment not available in PNG to be used in th ese projects and published in the government gazette. 
13.  Are the tariff exemptions and concessions on imports granted to companies or to 
products?  
Response 
Exemptions are granted to prescribed organisations  that in turn use companies to implement the 
project. Exemptions are granted on certain goods that  are published in the government gazette for use 
only in the project.   
(4) I NTERNAL MEASURES  
(iii) Standards and other technical requirements (b) Health, sanitary, and Phytosanitary regulations WTO Secretariat' s Report, Page 55, Paragraph 67 
23. The Secretariat's report notes "The National Quarantine Inspection Authority (NAQIA) 
implements PNG's quarantine measures (NAQIA Ac t 1997).  It endeavours to set quarantine import 
measures based on pest-risk assessments using inte rnational standards to meet its multilateral 
obligations.  It seems that zero tolerance has been  relaxed to "acceptable level of protection" based on 
disease status and case-by-case assessment.  SPS requir ements apparently are most restrictive in the 
case of live animals and fish.  However, owing to very limited resources, there is a large backlog of 
requests for export permission from trading partners; they are treated on a "first-in first-out" basis as 
resources permit.  Due to insufficient laboratory tes ting facilities, import bans are often used instead 
of restrictions.  The authorities noted the need for technical assistance in SPS areas, especially in 
updating laboratories and training personnel." 
It is welcomed that PNG bases import measures on pest-risk assessments using international 
standards.  
14.  Could PNG inform if new legislation and/or  changes in legislation will be notified to 
WTO, before entering into force (as no Sanitary and Phytosanitary (SPS) notifications are in the WTO database)? 
                                                      
3 Scollay (2007b), p. 59. WT/TPR/M/239/Add.1 
Page 20  
 
  Response 
Yes, PNG is obligated to provide notifications on new legislations. However, there are no new pieces 
of legislation introduced as yet.  
15.  Could PNG inform for which products a Phytosanitary certificate is required, and if 
this information has been published? 
Response 
All unprocessed plants/plant materials, nursery stock,  cut flowers, sawn timber, soil, sand, gravel, 
rocks, mud. This information is not published.  
16.  Could PNG inform, if the International Standard on Phytosanitary Measures, 
ISPM 32, has been taken into consideration? 
Response  
It is being considered in our risk assessments. Ther e is need for further familiarisation of ISPM 32.  
17.  On requests of export permissions, could PNG indicate the timeframe of issuance? 
Response 
Phytosanitary certificates are issued  within two (2) weeks of request at the most. The time depends on 
treatment procedures that may be required. 
18.  Could PNG inform for which produc ts export permission is required? 
Response 
NAQIA does not grant export permission so the que ry is now further referred to PNG Customs 
Service and other appropriate agencies. 
19.  Could PNG inform, in which cases, and for which products, an import ban is 
implemented, due to lack of laboratory testing facilities? 
Response 
This is the amended vers ion of Paragraph 67 on Page 55 of WT/TPR/S/239: 
67. The National Quarantine Inspection Author ity (NAQIA) implements PNG's quarantine 
measures (NAQIA Act 1997). It endeavours to set quarantine import measures based on pest-risk 
assessments using international standards to meet  its multilateral obligations. It seems that zero 
tolerance has been relaxed to "acceptable level of  protection" based on disease status and case-by-case 
assessment. SPS requirements apparently are most r estrictive in the case of live animals and fish. 
However, owing to very limited resources, there is  a large backlog of requests for export permission 
from trading partners; they are treated on a "first-in first-out" basis as resources permit. The authorities noted the need for technical assistance in SPS areas, especially in updating laboratories and 
training personnel. 
The sentence making reference to this  has been corrected and therefore this question is not relevant.  WT/TPR/M/239/Add.1 
 Page 21 
 
 
   
(viii) Intellectual Property Rights WTO Secretariat’s Report, Page 59, Paragraph 82 
According to the Secretariat's report "PNG has taken significant initiatives to implement a 
comprehensive and effective system to protect intellectual property. […]" 
20.  Could PNG elaborate on its intentions to become member of international IP 
conventions such as Berne Convention, Ro me Convention, Trademark Law Treaty, 
Patent Law Treaty, etc? 
Response 
In the last 10 years, PNG has taken significant st eps to comply with the obligations under WTO to 
develop appropriate legislation for the protection of intellectual property. The TRIPS Agreement 
further required minimum standards to be set by countr ies to protect IP rights.  The first steps were 
basically enacting new legislation that of Co pyrights and Neighbouring Rights Act 2000 and the 
Patents and Industrial Designs Ac t 2000. These two pieces of legislation together with the Trade 
Marks Act, Chapter 385 provide minimum protecti on of the respective IP rights in the country. 
In addition to enacting these laws, administrativ e processes were improved by deploying the WIPO 
Industrial Property Automated System (IPAS) in 200 6. This assisted the office to become fully 
automated in processing and granting applicati ons. IPOPNG is working towards developing a 
National IP Policy that will give a clear road ma p on how relevant agencies can held strengthen and 
develop IP for the overall economic development. 
Enforcement remains a big challenge but IPOP NG and PNG Customs are working together to 
conclude and MOU basically to share information fo r border protection purposes. We believe this is a 
step in the right direction for enforcement and ho pefully, we can collaborate with other relevant 
agencies to further enforce IP rights. These are some of the significant steps taken by PNG in 
addressing IP protection. 
In relation to the international conve ntions, we do not have any intenti on at this time to accede to the 
Rome Convention, Patent Law Treaty and the Tr ade Mark Law Treaty. We are considering acceding 
to the Madrid Protocol and the Berne Convention. 
The intention to accede to the Bern Convention is b asically to allow for international protection of 
copyright works protected in PNG. When we join th is convention, our copyright  owners can also have 
international protection through the Berne Conven tion. Without this, there is the potential for 
copyright owners works protected in PNG are copied  in another country. Our intention to accede this 
convention is to safeguard works of right owne rs in PNG internationally and vice versa.  
The Madrid Protocol is a suitable protocol to jo in given its cost effective process in applying for 
trademarks internationally. Joining this Protocol will be cost effective for international business to 
lodge trademarks as well local businesses. The Prot ocol provides registrations simultaneously in the 
member countries and does not require member countries to file single applications. WT/TPR/M/239/Add.1 
Page 22  
 
  IV. TRADE POLICIES BY SECTOR 
(2) 
AGRICULTURE , FORESTRY , AND FISHERIES  
(ii) Forestry Government's Report, Pages 13-14, Paragraph 53 
According to the Government's report, PNG Fo rest Authority (PNGFA) has developed its own 
national Logging Code of Practice, and has r eceived assistance from international development 
partners in support of sustainable ma nagement of the forest resource.  
21.  In order to encourage sustainable manage ment of forests and ensuring legality of 
forest operations the EU has adopted Fo rest Law Enforcement, Governance and 
Trade (FLEGT) Action Plan. EU Illegal Timber Regulation has recently been adopted 
for timber and timber products requiring ec onomic operators to demonstrate that 
these products have been made with legally  harvested timber. What is PNG stance 
vis-à-vis FLEGT? 
Response 
The EU’s Forest Law Enforcement, Governance and Trade (FLEGT) is an Action Plan adopted by the 
European Parliament in February 2004 to address illegal logging and trade of illegal timber products 
and prevent them from entering the EU market. It essentially seeks to differentiate legal from illegal 
timber products.  It is a demand-side pressure fo r reform and is part of a broader objective to 
introduce governance reforms and capacity buildi ng in producer countries in order to achieve 
sustainable forest management.  
The trust of the Action Plan is a licensing scheme negotiated through Voluntary Partnership 
Agreements (VPA) on a bilateral basis.  The VPA is a time-bound, legally bi nding inter-governmental 
bilateral agreement between the EU and major ti mber producing countries (EU partner country). It 
aims to implement the scheme by strengthening  governance in the partner country. The licensing 
scheme is currently limited to logs, sawnwood, plywood and veneer.  
The PNG has not considered the EU FLEGT Programme at its current state for possible adoption as 
part of its existing legal, regulatory and on- going monitoring and surveillance programmes in its 
efforts to combat illegal-logging and illegal trad e of timber products in the country.  The major 
considerations attributed to this, among others, are:  
1.  PNG has the legal and regulatory framework in place to ensure all timber production and 
export activities are done within the confines of the National Laws.  
- All log harvesting operations are monitore d by PNGFA and done by legally certified 
timber companies approved by this Authority, where they are issued harvesting 
licences or permits to operate. Their legal entities as Companies and forest industry 
participants are also verified before th ey are given approval to undertake forestry 
operations; 
- All timber processing operations are also legally certified, where both the processing 
operations and the company involved are certified by this Authority;   
  WT/TPR/M/239/Add.1 
 Page 23 
 
 
  - It is the only country in the South East Asia and the Pacific region that has a third-
party internationally recognized auditing firm  that audits all log exports. This is done 
by Société Générale de Surveillance (SGS) PNG Ltd, a member of the global Swiss 
firm, (SGS) Ltd; 
- As part of PNG’s on-going efforts to improve legal assurance of timber production 
and exports, industry participants are now being encouraged to engage in Timber 
Legality and Traceability Verification (TLTV ) certification being undertaken by SGS 
Group to ascertain and ensure the legal origin or legal compliance of timber or forestry projects in the country, which is  a voluntary scheme.  Three major timber 
companies in the country are already in the process of getting their TLTV; and  
- The legality of all exports of timber produc ts are verified by different State entities 
prior to their actual exports, including the Department of Foreign Affairs & Trade and PNG Customs.    
2. Globally, there is a plethora of voluntary schemes and initiatives for timber legality assurance. 
The verification of legality and forest certificati on schemes adhere to a uniform standard with 
specific principles and criteria. More significan tly, these efforts operate purely on a voluntary 
basis.  The EU FLEGT VPA, however, needs to be contextualized to negotiating countries’ 
conditions, and in due process, subject these count ries to restrictive conditionalities. It is a 
voluntary scheme by its ‘cover’ but practically it’s not because of the strict conditionalities. One such conditionality is, for e.g. PNG exporters to apply FLEGT licensing scheme to non-EU markets regardless of whether this particul ar form of legality assurance is demanded by 
other consuming countries. Resultantly, tim ber producing companies will face additional 
administrative and bureaucratic procedures.  Implementing such conditionalities would come 
at a significant adjustment cost s (legal, social, environmental,  etc) to producer countries, 
especially for PNG were the producer market is oligopolistic – there a very few larger 
producers and many small and medium enterprises (SMEs) which do not have the capacity to 
finance these costs – we would basically be ask ing them to go bankrupt. Even engaging in the 
TLTV scheme is a significant costs exercise as cl aimed by one of the three companies who 
are in the process of getting TLTV. Additionally , the EU is not even able to justify 
undergoing these adjustments with attractive market  returns or incentives. It is with this 
protectionist view and lack of incentives that  PNG, as a small developing country, largely 
ignores this EU FLEGT Programme.     
3. Being a party to such legality schemes such as the EU FLEGT Program would act as a 
potential non-tariff barrier to access other market s apart from the EU. No country in the world 
has accepted this scheme, except two in Africa,  which effectively means that there is no 
global recognition and market acceptance of such schemes. It would self-defeat the purpose of engaging in such schemes. In addition, ther e would be the requirement that other countries 
would also want their own legality or certification schemes that PNG would have to comply 
with in other to allow imports of PNG tim ber or wood products. This would violate the 
objective of WTO that seeks to lib eralize international trade.   
4. There is yet to be concrete evidence of a unilateral commitment from all the 27 EU Member 
States to accept FLEGT-licensed timber.  Even if  this unilateral commitment is forthcoming, 
the constitution of the EU allows for Member St ates’ individual interpretation of the EU’s 
Directive. While the definition of legal tim ber will be commonly applied throughout all 
Member States, there will be discrepancies in te rms of implementation procedures. Such lack 
of unilateral commitment among the Member States serves little incentive for countries like PNG to be a party to such schemes.   WT/TPR/M/239/Add.1 
Page 24  
 
  5. There is no differentiation between FLEG T-licensed and non FLEGT-licensed timber and 
timber products. Non FLEGT–licensed timber will c ontinue to be granted access into the EU 
market, which does not create a level playing fi eld for FLEGT-licensed timber within the EU 
market.  
If further clarification is required, please do not hesita te to contact Mr. Bob Tate or Mr. Gabriel Samol 
of PNGFIA on telephone (675) 325 9458 or thro ugh email: bob@fiapng.com or gabriel@fiapng.com 
respectively.  
(iii) Fisheries 
Government's Report, Page 13, Paragraph 57 
The Government's Report states "[…] The total mark et value of Papua New Guinea catch is estimated 
to be PGK 450 – 500 million on averages.[…]".  
22. Could PNG specify which vessels are consid ered in the calculation when referring to 
the market value of the PNG catch - are only vessels operating under PNG flag considered or does the calculation include  vessels operating under other countries' 
flags and chartered to PNG? 
Response 
The figures are based on what our domestic and locally-based foreign flagged vessels are catching and 
processing for export market. What is caught by foreign flagged purse seine fishing vessels are licensed under Bilateral Fishing Access Agreement and the catch are deemed as owned by the foreign 
licensed vessels since fishing access/right is "sold|" to the foreign flagged vessels. 
Government's Report, Page 13, Paragraph 59  
Government's report states "In terms of exports an d market access issues, much of the fisheries 
products (mainly frozen tuna) is exported to Japan  and the European markets under the previously 
Cotonou arrangement with the ACP Countries, which has evolved to what is now known as the Economic Partnership Agreement (EPA). Some of th e challenges that the sector faces with regard to 
its export include stringent trade related measures su ch as Rules of Origin, Sanitary and Phytosanitary 
(SPS), and Technical Barriers to Trade (TBT).[…]" 
Response 
Yes. 
The EU would like to underline in relation to the EU's Rules of Origin applicable to products 
imported from PNG that from March 2008 PNG, benefits  from the less stringent rules ever applied by 
the EU in the preferential relation context. P NG can export to the EU processed fish products 
irrespective of the status (flag, ownership, register, and crew) of the vessel that harvested the fish. As 
recognised by the PNG authorities the changes in Rules of Origin applicable to exports to the EU have 
paved the way for new investments in the fish processing industry in PNG. 
Response 
Yes, there are 6 new tuna processing plants built in PNG. One is already completed in Lae by 
International Food Corporation. Another one by Ma jestic Seafoods Corporation is currently under 
construction in Lae, Morobe Province. There are anot her 3 more in Lae, which are one by Hailisheng  WT/TPR/M/239/Add.1 
 Page 25 
 
 
  Group of China, another one by Trans Pacific J ourney and TSP Marine Indus tries, and one more by 
Dongwon Industries. There is another proposal by  Niugini Tuna Ltd. in Madang Province. 
Government's Report, Pages 13-14, Paragraph 59 
WTO Secretariat’s Report, Page 35, Paragraph 56 
Government's report continues"[…] For instance, the European Union has now adopted the Illegal 
Unreported and Unregulated (IUU) Regulation, which has cross cutting effects from trade and 
development impacts to policy and governance implications that Japan also acknowledges.4" 
Concerning the EU's Illegal Unreported and Unregul ated (IUU) fishing Regulation the EU would like 
to underline that the mentioned regulation does no t impose any new measures related to conservation 
and management of fishery resources. It aims at eliminating IUU-related fishing activities which put 
at stake the sustainable use of fishery resources and the sustainable development of developing 
countries, including PNG. It is also remarked that im portant financial resources have been allocated to 
Pacific ACP countries under the 9th and 10th EDF in order to provide for capacity building in 
implementing the provisions of the EU IUU fishing Regulation. 
Response 
Yes, EU will continue to assist in building the capacity of the NFA as the Competent Authority to 
meet the EU market requirements under the IEPA. EU has donated 3 vehicles to NFA CA plus other 
areas of technical assistance to address IUU Fishing and market access requirement of DG Sanco. 
Government's Report, Page 14, Paragraph 63 
The Government's report states "Fisheries Access Ag reements are license fees charged to Distant 
Water Fishing Nations (DWFN) based on a bilatera l stand. Countries that Papua New Guinea has 
FAA with are the Philippines, Ch ina, Chinese Taipei, Korea, Japan  as well as individual companies 
from the Philippines and Chinese Taipei." 
23. Concerning the above mentioned Fisheries Access Agreements, could PNG provide the 
following additional information on each of the agreements: 
 1. What is the type of legal framework  governing the agreement (e.g. government-to-
 government agreement, government-to-fore ign-fishermen-association, individual 
 private licenses granted to foreign operators)? 
Response 
Access Agreements are negotiated on a bilate ral basis between Government-Government, 
Government-Foreign Fishermen Association and Gove rnment-individual foreign fishing corporations. 
2. In case of agreements with DWFN's governments, do the agreements include 
provisions whereby the DWFN government makes "in kind" (infrastructure, 
development aid, etc) payments for the access rights?   
                                                      
4 Tsamenyi M, et al., The New EC Regulation on Illegal Fishing: Implications for ACP Countries, 
Trade Hot Topics Issue 56, February 2009. WT/TPR/M/239/Add.1 
Page 26  
 
  Response 
Yes 
3. Do foreign private operators pay for access to PNG fisheries resources? If yes, do all 
foreign operators, irrespective of their nati onality, pay the same  fees for comparable 
access rights (e.g. same volumes of harvest)? Are PNG  fishermen being charged the 
same fees as those charged to foreign op erators for comparable fishing rights? 
Response 
Foreign private pay access fees based on set formula. If foreign operators have onshore processing 
facilities which create jobs and ge nerates export income etc... then they are given discounted access 
fees. But if they are domestic, meaning have PN G flagged vessels and pay company and payroll tax 
etc in PNG, then they are exempted from access fees. They only pay domestic licensing and statutory 
fees. 
4. Do fishing rights relate to a maximum volum e of fish that can be harvested, or to a 
geographical area or to a level of fishing effort (e.g. days-at-sea)? 
Response 
Yes, vessels licensed under access ag reement pay for and allocated fishing days under the Vessel 
Days Scheme (VDS). Fishing days is calculated based on vessels’ Catch per Unit of Output (CPUE), Average Bangkok Tuna Price for Skipjack and a rate of return. 
5. Do these fisheries access agreements include provisions whereby foreign operators 
must land part (or the totality) of the catch in PNG?  
Response 
Yes, there is a policy for them to land 10% of thei r catch at a PNG port subject to the right price.  
Are those foreign operators obliged to hire PNG citiz ens, in the context of the "Domestication Policy" 
of 1995, for operations related to the exploitation of  fishing rights in the Exclusive Economic Zone of 
PNG? 
Response 
Yes, foreign fleets are required to employ up to 3 or more PNG nationals per vessel. 
6. Is information (number and nationality of vessels, fees paid, catches) on these 
Fisheries Access Agreements being made publicly available? 
Response 
Yes, within the National Fisheries Authority (NFA ) and can be made available on request to the 
Managing Director. 
7. With regard to the Philippines and Chin ese Taipei, the EU notes that, according to the 
Government's report, in addition to maintaining corresponding Fisheries Access 
Agreements, it also charges fees to indi vidual vessels from these countries. Does this 
mean that a vessel operator from these two countries might choose to fish in waters  WT/TPR/M/239/Add.1 
 Page 27 
 
 
  under PNG jurisdiction either under an FAA or under a private, non-FAA covered, 
licence?  
Response 
Yes, there are Philippines and Chinese Taipei owne d vessels that are licensed by NFA to fish to 
supply local processing canneries. Thes e vessels can fish under their St ate Agreements to catch fish 
both within PNG and within the region under the FSM Regional Access to catch fish to supply PNG’s 
processing requirements. 
8. In the affirmative, are the fees charged to licensed operators under the two different regimes 
the same or do they differ? 
Response 
There are no access fees charged on domestic opera tors supplying local processing plants and also 
locally based foreign operators are charged di scounted access fees. These vessels can apply for FSM 
Regional Access License and pay license fees to the Administrator, FFA. If fish is caught in PNG waters, then PNG gets paid. But if fish is caught out side, then the other PIC where fish is caught gets 
the access fees. 
Government's Report, Page 14, Paragraph 64 
9. In the context of the sustainable use of lo cal fishery resources and the promotion of on shore 
processing activities, as well as of the sustainable use of  relaxed Rules of Origin in the framework of 
the PNG-EU interim Economic Partnership Agre ement could PNG provide information on the 
effective application of the Parties to Nauru Agreement (PNA) Vessel Day Scheme (VDS)?  
Response 
Yes, PNG can provide information on the VDS. Furthe r information/verification can also be obtained 
from the PNA Secretariat in Majuro, Marshall Islands. 
10. More specifically, could PNG explain how th e VDS works and what conservation results it 
achieves? 
Response 
The PNA Secretariat and WCPFC would explain how the VDS works since this is a management 
regime to manage purse seine fishery within the WCPFC Convention Area. 
(3) M
INING   
Government's Report, Page 6, Paragraph 13 
The Government's report focuses exclusively on  the economic benefits stemming from the LNG 
Project and other mineral resources projects. The EU remains concerned that social and 
environmental considerations are not taken into due account considering the outcry provoked by the 
recent amendment of the Environment Act 2000 an d the unrest of landowners in the country. 
11. How is PNG considering social and envi ronmental issues in its economic development 
strategy? Will the amendment of the Environmental Act be repealed? WT/TPR/M/239/Add.1 
Page 28  
 
  Response 
As a developing country, PNG requires foreign direct investment to grow the economy. The 
amendment by the Government is necessary to gi ve investor confidence. There are laws and 
regulations (e.g. Environment Act)  that govern i nvestors’ corporate social responsibilities including 
sustainable environment practices.  PNG recognizes th at the enforcements of this regulations may be 
weak. 
The Environmental Act has just been amended and therefore any further amendments or repeals is 
dependent on the outcome of the recent amendment.  
(6) S
ERVICES  
(i) Telecommunications 
(c) Regulation 
WTO Secretariat' s Report, Page 87, Paragraph 96 
The Secretariat's report claims that a universal  service obligation on telephony market will be 
introduced after 2010 and it will be partially funded by an ad valorem  levy on net revenues of 
licensed operators.  
12. Could PNG elaborate on what the levy will be based on (revenue, turnover etc.)? 
Response 
The National Information and Communication Technology Act 2009 sets out that the industry levy 
will be based on the percentage (%) of the net re venues of each operator licensee at a level, to be 
determined annually, to apply from th e beginning of each fiscal year.   
The maximum % is to be prescribed in a supportin g regulation. Note that National Information and 
Communication Technology Authority (NICTA), wh ich came into force on 29 October 2010, now 
takes charge of making relevant regul ations under the National ICT Act 2009. 
(ii) Financial services 
General Insurance WTO Secretariat’s Report, Page 89, Paragraph 106 
The Secretariat's report states that all risks in P NG must be insured with PNG insurers unless local 
insurers have insufficient capacity as well as that  all reinsurance must be placed through Pacific 
Reinsurance Ltd.  
13. Could PNG elaborate if they have any plans to allow cross-border insurance and remove the 
monopoly of the Pacific Reinsurance Ltd? 
Response 
PNG does not have restrictions on foreign investment  in the insurance industry. However, there is 
certification requirement to assess potential foreign investors on their capital capabilities, taking into 
account the limited products that the foreign in surance companies sell compared to the Pacific  WT/TPR/M/239/Add.1 
 Page 29 
 
 
  Reinsurance Ltd. Examples of foreign insurance companies are AON Insurance, QBE Insurance and 
Asian Pacific Insurance Brokers.  
Pacific Reinsurance Ltd is not a monopoly but has a greater market share because of the following 
reasons: (1) The government has a majority share in the company 52% through Motor Vehicle Insurance Limited (MVIL) and there is no risk of  indemnity; and (2) it offers a broad scope of 
products. For these reasons, most companies purchas e insurance policies from Pacific Reinsurance 
Ltd. 
(iv) Transport 
(a) Air transport WTO Secretariat’s Report, Page 91, Paragraph 114 
The Secretariat's report states that "[…] Internati onal charter passenger, freight, and cargo air services 
will be licensed on a case-by-case basis, to balance the commercial interests of existing operators for 
users and the economy generally.  Majority-forei gn-owned operators will not be licensed unless 
authorized by law or permitted under a state agreement." 
14. Could PNG elaborate what are the criteria and the procedure of this economic needs test to 
license the international passenger, freight and cargo air services? Furthermore, could PNG explain 
what is the procedure and conditions for a majority  foreign owned operator to be licensed through and 
authorization by law or state agreement? 
Response 
The regulation of international air transport services in and out of PNG is governed by a network of 
Air Service Agreements that have been nego tiated over the years. PNG has adopted a phased 
approach towards an open skies regimes by a llowing multi destinations, multiple designation of 
airline, airlines to determine capacity, double disappr oval of airfares, liberal charter arrangements and 
the support for fair and equitable competition with th e overall strategy of seeking to achieve fair and 
equitable opportunities for each countries designated carries. 
WTO Secretariat' s Report, Page 91, Paragraph 116 
According to the Secretariat's report the airport operation services and ground handling services are 
provided by the local providers. 
Response 
All PNG airlines will be treated fairly and equitabl y in access to international markets with equity 
participation set at 51% national ownership and 49% foreign equity. 
15. Does PNG foresee liberalising airport opera tion services and ground handling services in the 
near future? 
Response 
PNG will continue its support for the APEC and Forum policies seeking to further liberalize air 
service arrangements. WT/TPR/M/239/Add.1 
Page 30  
 
  Liberalisation of international  air services under APEC and the Forum will be done as per the phased 
approach PNG is undertaking through a gradual lifti ng of limitations in traffic rights, capacity and 
frequency of flights, routes (limited to specified  routes as opposed to an open route schedule) taking 
into account the volatility of market conditions th at can support open competition and the ability of 
PNG airlines competing in an open skies regime havi ng to compete with bigger airlines in the region. 
An example is the Forum initiative of the Pacific Islands Air Service Agreement to create a single 
aviation market for the Forum Island Countries which PNG has supported and signed. 
AUSTRALIA - Revised  
Report by the WTO Secr etariat (WT/TPR/S/230) 
II. TRADE POLICY REGIME: FRAMEWORK AND OBJECTIVES 
(3 T RADE AGREEMENTS AND ARRANGEMENTS  
(iii) Generalised System  of Preferences (GSP) 
Paragraph 39 
1. The report provides that ‘[t]he authorities were concerned that improved market access 
provided by major developed economies to less developed countries may in future adversely 
affect PNG's export opportunities, including li miting its capacity to diversify both products 
and markets.’   
- Could PNG indicate the products of particular concern where it considers that 
improved access for third countries could adve rsely affect its export opportunities in 
developed countries? 
Response 
Of primary concern are the fish and fish products  under the Interim Economic Partnership Agreement 
(iEPA) with the EU, as well as agriculture products such as palm oil, coffee, and forest products. 
(7) A ID FOR TRADE  
2. The Secretariat notes that PNG authorities see a need for further widespread trade-related 
technical assistance.   
- In which area/s would PNG like to see assi stance provided first, if such assistance 
were to be phased so as to not overburden PNG authorities? 
Response 
Urgent support in the area of Trade Policy and Regul ations, Private Sector Development, particularly 
product and market development for key sustai nable sectors for the downstream processing of 
agriculture, fisheries and forestry, and tourism development  
Trade related infrastructure is also viewed as requiring urgent address.  Transport infrastructure at 
Ports as well as roads and bridges currently constrai n trade.  Other infrastructure requirements noted 
as desirable under AFT are laboratory testing equipment and technical assistance, and heat treatment facilities to aid in the export of agricultural and horticulture goods.  WT/TPR/M/239/Add.1 
 Page 31 
 
 
  3. Welcome PNG’s recognition of the need to "diversify" or broade n its economic activities 
beyond mining.   
- Has PNG considered or developed a stra tegic approach to strengthening other 
sectors? 
 
Response  
Yes, the overarching policy directions are cont ained in the PNG Vision 2050, PNG Development 
Strategic Plan (PNGDSP) 2010 - 2030, and the Me dium Term Development Plan (MTDP) 2011 – 
2015.  
 
However, it is required under the PNG Vision 2050 that all sectors when making sectoral policies 
must ensure to align to the PNG Vision 2050 so  as to contribute to the broad objectives of the 
development policies.  
The PNG Vision 2050 and its Medium Term De velopment Plans provide the direction for 
strengthening other sectors. 
- Has PNG undertaken relevant assessments of  potential measures that might provide 
business with incentives to build other sector s of the economy, and what capacity 
building activities might be required to support such an objective? 
 
Response 
 Yes, some work has been done in collaboration with  development partners such as World Bank, Asian 
Development Bank (ADB), which have identified othe r sectors to be developed such as infrastructure, 
Public Private Partnership and Health. However,   
The Private Sector Study (2010), which had been co -sponsored by AusAID in terms of finance and 
technical advice. The objective of the study was to  identify impediments to business and Government 
intervention measures to address these impediments. The recommendations of the study are now with the NEC for deliberation and decision. 
4. PNG has identified the continuing need to build infrastructure.   
- What does it consider are its short(er)-term priorities e.g. electricity generation, roads, 
ICT, education?   
 
Response  
According to current efforts by the Government, al ready priorities for funding in the National Budget 
are being made in the rehabilitation and improvement s of transport infrastructure (roads, bridges, 
wharves, jetties, airports and air strips, etc… ), Information and Communication Technology (ICT), 
Education. However funding, rehabilitation and deve lopment of transport infrastructure has been 
insufficient, deteriorating transport infrastruct ure has substantially increased the cost of doing 
business and delivering services in PNG and is seen as a major constraint on commerce and trade.  
The PNG Vision 2050 has outlined these, as well as edu cation and health as priority areas for address. 
 
- Does PNG have the opportunity to expedite these infrastructure investments and in 
what period are these likely to be achieved?   
 WT/TPR/M/239/Add.1 
Page 32  
 
  No, the Government is not able to sufficien tly fund the required amounts to ‘expedite’ such 
investments.  The treasury also  warns that that expediting of  such investment would present 
inflationary risks to the economy.  Accordingly the Government, as per its developm ent plans has taken both medium and long-term 
views to address. 
 
- Also what are the key challenges for P NG in investing and building infrastructure 
(e.g. access to finance and skilled labour force)? 
 
It is expected that the private sector will assist in the development of infrastructure improvements 
through the PPP program.  The current LNG project has increase d strain on the gaps in skille d labour.  PNG has revised its 
employment of non-citizens Ac to make more tr ansparent the process for re cruiting labour and has 
streamlined the processes.  The government in part nership with LNG developers and the Australian 
government is building 5 technical training colle ges and is currently reviewing TVET.  The 
government is also working more closely with the pr ivate sector to identify skills gaps, it is expected 
that the training colleges will focus training in these identified areas. 
 
III. TRADE POLICIES AND PRACTICES BY MEASURE 
5. PNG notes (in TPR Paragraph 9) that it has em barked on substantial structural reforms in the 
communication, transportation and financial sectors.   
- Could PNG provide further information on what core regulatory changes that were 
made to encourage greater competition,  and whether these reforms eased any 
restriction on foreign participation? 
Response 
Previous regulatory regime in the Telecommunication Act and Radio Spectrum Act  supports a 
monopoly environment where Telikom PNG Ltd he ld the exclusive rights to provision of 
telecommunication services in PNG. As at the passag e in 2007, the Governme nt introduced partial 
competition in mobile telephone sector. 
Then in 2008, government installed a National ICT Policy. The ultimate policy objective, among 
others, is to increase supply of ICT services to the citizens by enabling effective and sustainable 
competition in the ICT industry.  
The National ICT Act 2009 repealed the Telecommunication Act  and Radio Spectrum Act and gives 
effect to the objective(s) of the National ICT Policy 2008 
Under the new Act, telecommunication industry is NOT a regulated industry. Among others, the key 
Regulatory Principle under the Act calls for the ICT industry in Papua New Guinea to be regulated in 
a manner that recognizes the EFFECTIVENESS OF MARKET FORCES. Given such, the licensing structure under the new regime is design to re duce regulatory barriers to market entry.   
On the question of foreign participation, the ma rket is now open to both nationals and foreign 
investors. Again, an Objective of the National IC T Act is to encourage sustainable investment and 
expansion of the ICT Industry in Papua New Guinea. National Information and Communication 
Technology Authority (NICTA) will be guided by th e Act and its enabling regulations to ensure 
increase investments in the ICT industry of Papua New Guinea.   WT/TPR/M/239/Add.1 
 Page 33 
 
 
  6. PNG has rightly highlighted th e positive impacts of the LNG proj ect but also hinted at certain 
challenges, including high inflation ( see paragraphs 13, 14 and 89).   
- We would be interested to know what po licy options PNG has considered to reduce 
inflation. 
 
Response  
Designing and establishing an appropriate Soverei gn Wealth Fund (SWF) based on the "Generally 
Accepted Principles and Practices" (Santiago Prin ciples) is an essential step building a solid 
foundation for utilising revenues appropr iately.  SWF will help to keep foreign exchange earnings in 
an offshore account to cushion out in flation and exchange rate shocks. 
 
IV. TRADE POLICIES BY SECTOR 
(6) S
ERVICES  
(i) Telecommunications  
Paragraph 88 
7. Australia notes that Papua New Guinea’s fi xed-line telecommunications services are mainly 
supplied by state-owned PNG Telikom. Libe ralisation of mobile telephone services has 
lowered mobile call charges by as much as 60 pe r cent and improved qualit y and coverage.   
 - Will Papua New Guinea’s new Nati onal Information and Communications 
 Technology Act (NICTA) introduce greater competition into fixed-line services? 
Response 
The National ICT Act encourages competition in a ll levels of ICT services provision. The Act 
encourages the industry to become self-regulat ory and driven by the market forces.    
(ii) Financial services 
Paragraph 100 
8. Australia notes that Papua New Guinea Governme nt policy is to maintain an "open" regime 
for establishing banks and othe r financial institutions.   
- Is this open regime policy set out in an y regulations or guidelines issued by the Bank 
of PNG, as prudential regulator of the financial sector? 
Response 
Yes, the Banks and Financial Institutions Act 2000 sp ecifies that as part of the license application, 
foreign owned banks must provide a statement from the relevant home country supervisor that it is 
satisfied with the prudent management of the fore ign parent and consents to its application for a 
banking license in PNG.   WT/TPR/M/239/Add.1 
Page 34  
 
  Report of the Papua New Guinea Government (WT/TPR/G/239) 
III. TRADE POLICIES AND PRACTICES 
9. What exports is the PNG Government seeki ng to increase through improvements in market 
access ( Paragraph 23 of WT/TPR/G/239 )?   
- How does the Government intend to secure  the necessary improvements in market 
access in order to achieve its export goals? 
Response 
This can be achieved through participation in the trade negotiations at the regional and multilateral 
level to gain better and/or preferential ma rket access opportunities, adoption of voluntary 
sustainability standards (VSS), product protocols with importing countries,  
10. We refer to the reductions in tariff revenues since 1999 ( paragraph 24 of WT/TPR/G/239 ).   
- What percentage of government revenue  is currently accounted for by ordinary 
customs duties? 
Response 
In 1998, tariff revenue of PGK 394million accounted for 17.3% of government revenue and in 2006, 
tariff revenue of PGK 96.9 million accounted for 2. 2% of government revenue. (Scollay Study on the 
Tariff Reform Program 2007) 
11. In Paragraphs 31 to 36 of WT/TPR/G/239 , PNG refers to trade agreements to which it is 
currently a party.  However, it does not appear to  refer to trade agreements that it is currently 
negotiating.   
- What trade agreements is PNG currently negotiating? 
 
Response 
Services Agreement to be included under the MS G Trade Agreement, Trade in Services under the 
PICTA, PACP-EU EPA Negotiations, and PACER Plus Negotiations.  
IV. TRADE POLICIES BY SECTOR 
(1) A
GRICULTURE  
12. What steps does PNG intend to take to integrate subsistence agriculture ( paragraph 42 of 
WT/TPR/G/239 ) into the market economy? 
Response 
This is done mainly through the Cooperative Soci eties arrangements to mobilise the supply base, 
research and extension activities to increase production quality,  
(6) M ANUFACTURING  
13. The PNG Government refers to the "urgent need to address trade infrastructure problems, 
roads, ports, power, water, tran sportation and communications" ( paragraph 89 of WT/TPR/G/239; 
also see paragraph 92 ).    WT/TPR/M/239/Add.1 
 Page 35 
 
 
  - Could information be provided on how it proposes to undertake these tasks in these 
areas? 
 
Response  
As noted previously, the Government has rec ognised these issues and has identified reforms to 
address in our PNG Vision 2050 and MTDS.  Further, as previously noted the role out PPP’s will likely focus on trade related infrastructure projects, as well as health and education. 
 
Annex 1. Trade Related Technical Assistance  
14. In paragraph 1 of A nnex 1 of WT/TPR/G/239, PNG refers to its need for "technical assistance 
… [to] … [c]ontinue to build capacity for national and regional institutions dealing with trade".    
- What avenues of such technical assistance are currently available to PNG?  Is PNG 
making full use of those avenues for technical  assistance to ensure that its needs are 
met? 
Response 
Apart from the usual capacity building progra mmes provided by the many donors, PNG is 
implementing the EU funded Trade Rela ted Assistance Programme (TRAP).  
Also available for utilisation is the Trade Resear ch Initiative under PACER Plus. Papua New Guinea 
is yet to submit its proposal for this assistance.  
JAPAN 
Government report (WT/TPR/G/239) 
IV.  TRADE POLICIES BY SECTOR (9)  I
NTELLECTUAL PROPERTY RIGHTS  
(Question 1: Page 22, Paragraph 113) Please explain the National Intellectual Property Stra tegy direction or its roadmap, which are being 
considered by your Government. 
Response 
Papua New Guinea is a nation that is developing ra pidly across a range of activities by creating and 
implementing systems and practices that are releva nt and appropriate to the improvement of the 
quality of life of its citizens. In this context, the National Intellectual Property Strategy has been 
developed to support the development objectives of  the Government as expressed in the National 
Strategic Plan 2010-2050 and to facilitate Papua New Guinea’s continued progress as an innovative, 
creative and productive nation.  
The primary objective of the Plan is to create bene fits for the people of Papua New Guinea (PNG) by 
facilitating and encouraging greater use of the intell ectual property system. In the first instance, these 
benefits will emerge from the use of intellectual pr operty, to manage and exploit the IP they create 
and to be able to derive a fair reward from those who use IP.  Ac hievement of this primary objective 
will also boost PNG’s international and interna tional trade both in tangible and intangible assets 
encouraging increased activity, econom ic growth and wealth creation. WT/TPR/M/239/Add.1 
Page 36  
 
  In light of this, the plan aims to link up (create li nkages) with relevant res ponsible organizations in a 
coordinated manner and approach w ith a guided direction to developi ng better use and transmission of 
IP information to potential users of IP and to  help facilitate arrangements on the use of IP. 
The National Strategic Plan is work in progress and is yet to be finalized but in principle that is the 
overall objective of the plan. 
Secretariat Report (WT/TPR/S/239) III. TRADE POLICIES AND PRACTICES BY MEASURE  (2) M
EASURES DIRECTLY AFFECTING IMPORTS  
(ii) Tariffs (b) Tariff bindings 
(Question 2: Page 41, Paragraph 26) According to the Secretariat report, many applied ta riffs appear to exceed their bound rates. What is 
Papua New Guinea’s view on the conformity of th ese tariffs considering its obligation under the WTO 
agreements, and if any, please explain the plans to review these tariffs.   
Response 
PNG recognizes that in its tariff structure, there are applied tariffs that are higher than the bound 
tariffs. This inconsistency w ill be considered and addressed through the budgetary process.  
IV.  TRADE POLICIES BY SECTOR  
(6) S
ERVICES  
(i) Telecommunications (a) Structure 
(Question3: Page 85, Paragraph 88) The Secretariat Report indicates that Papua New Guin ea once planned to privatize 51% of the equity 
of PNG Telikom to an overseas company and to lib eralize its telecommunications market. Could you 
inform us as to whether or not Papua New Guinea is  considering or planning in the near future the 
privatization and liberalization of this sector? 
Response  
The proposed privatization of Telikom PNG mentione d in the question refers to National Government 
plans that date back to 2002, when there was a ch ange of government after a national election. At the 
time tenders were issued and discussions held on pr oposed privatization of Telikom. However, in the 
end this did not eventuate. 
Nevertheless significant competition has since been introduced into the coun try’s telecommunications 
sector, resulting in a massive increase in the number s of people who own and use mobile phones. The 
government’s regulatory organization, the I ndependent Consumer & Competition Commission  WT/TPR/M/239/Add.1 
 Page 37 
 
 
  (ICCC), issued a licence in 2007 to a fully foreign owned company, Digicel PNG Limited, to operate 
a mobile telephone business in PNG. Following  a tender and appraisal process a consortium 
consisting of international and PN G private sector interests in late 2008 purchased a 50% stake in 
Telikom PNG’s mobile phone company, B Mobile, unde r a public private partnership model, paving 
the way for full competition in this sector. 
More recently the government has adopted an In formation and Communications Technology (ICT) 
policy with a view to providing a regulatory framework for increased competition in the telecommunications sector. In line with this policy in April 2010 the government has set up a new 
regulator for the ICT sector, the National In formation Communication Authority (NICTA). 
It is expected that as a result of the ICT policy and the establishment of NICTA the government will 
soon deal with the controversy surrounding the use of  its own international gateway by Digicel. It is 
anticipated that NICTA will issue Digicel with a ne twork licence to operate an international gateway. 
The Communications and Information Ministry said the issue of a network licence would take away 
the uncertainty that currently surrounds this Digicel  operation. It is understood the decision is also in 
line with a government decision to totally fr ee up satellite communication to full competition. 
(ii) Financial services (b) Regulation and supervision Life Insurance (Question 4: Page 89, Paragraph 105) 
Please clarify the rational for the regulation, which allows only PNG incorporated firms to sell life 
insurance policies or to wo rk as insurance brokers.  
Response 
This question will be clarified by the respective authority at a later stage. 
NEW ZEALAND 
Report by the Secretariat 
II. TRADE POLICY REGIME: FRAMEWORK AND OBJECTIVES 
(1) O VERVIEW  
1. Page 16 Paragraph 2 refers to the current ad  hoc nature of trade po licy-making in Papua New 
Guinea, and reports the intention of officials to  formulate and implement a modern national trade 
policy.  Has Papua New Guinea formulated an offici al ‘trade policy’ and if so can the Papua New 
Guinea delegation provide a brief overview of the prio rities of this policy and whether any change in 
trade policy direction is likely?  
Response 
At this stage, Papua New Guinea has not formulated an official ‘trade policy’ yet. Although, Papua 
New Guinea does not have a Trade Policy, sectoral policies have supported the growth and expansion 
of trade of which has been the tariff policy an d undertaking negotiations on trade agreements.  WT/TPR/M/239/Add.1 
Page 38  
 
  And the Government has recognised the critical impo rtance that international trade plays in creating 
new opportunities for Papua New Guinea producers, service providers and workers by opening new 
markets and providing tangible incentives to the di versification of Papua New Guinea’s economy, and 
in doing so alleviating people out poverty. Give n that exports constitute roughly 90 % of GDP, trade 
liberalisation through both regional and international efforts is an  integral  part of achieving strong and 
sustained economic growth, and poverty reduction.  
In light of these objectives and the growing interests in Papua New Guinea on environmentally-
friendly and sustainable trade, with a particular focu s on sustainable agriculture, forestry and fisheries, 
the review has reinforced the need  for the formulation of a comprehe nsive trade policy to ensure that 
Papua New Guinea reduces its excessive reliance on  mining and petroleum resources and support the 
diversification of PNG’s economy, which must be consistent with Papua New Guinea’s development 
policy and its constitution. 
With the assistance from the Europ ean Union (EU) under the Trade Related Assistance Programme 
(TRAP), the Department of Foreign Affairs and Trade will develop and formulate of a coherent, 
cohesive and comprehensive National Trade Polic y Framework that will provide the strategic 
direction for Papua New Guinea’s integration into  the global economy, as well as adequately respond 
to opportunities in the regional and multilateral trading systems. 
On the basis of this Framework, a trade po licy focussed on economically viable downstream 
processing and value added productio n of its natural resources, as we ll as economic diversification to 
utilise international trade for economic growth and de velopment will be elaborated and formulated for 
Papua New Guinea. 
Report by the Secretariat II. TRADE POLICY REGIME: FRAMEWORK AND OBJECTIVES (5) T
RADE AGREEMENTS AND ARRANGEMENTS  
(ii) Preferential 
2. Page 26 Paragraph 31 discusses the Economic Partnership Agreement with the European 
Union.  Can the Papua New Guinea Delegation a dvice as to progress in these negotiations including 
on the implementation of the interim agreement? 
Response 
The Comprehensive EPA is still under negotiations between the Pacific ACP countries and the EU.  
With regards to the iEPA, PNG and Fiji are only tw o (2) of the fourteen (14) Pacific ACP (PACP) 
countries, who have negotia ted and concluded the iEPA to ensure  that PNG’s canned tuna exports and 
Fijis’ sugar exports were secured to receive the preferential access into the EU markets beyond 
31 December 2007.  
After initialling the iEPA on 23 November 2007, t echnical officials from both parties undertook 
technical and legal reviews of the legal text and its protocols to ensure its correctness and consistency. 
This process was completed and PNG signed the iEPA on 30 July 2009 in London.  
PNG is now provisionally applying  the iEPA pending the completion of the ratification process.  WT/TPR/M/239/Add.1 
 Page 39 
 
 
  Report by the Secretariat 
IV. TRADE POLICIES BY SECTOR (6) S
ERVICES  
(iv) Transport 
3. Page 90 Paragraph 112 discusses the Papua Ne w Guinea’s commitment to "open skies".  Has 
Papua New Guinea formalised any "open skies" agre ements for third-country (fifth freedom) access to 
Papua New Guinea’s international air transport market s yet, or are any under negotiation?  If so, can 
Papua New Guinea provide details? 
Response 
In terms of institutional and structural reform s, the Civil Aviation Authority (CAA) Group has 
undergone further reforms in the separation of the regulatory functions through the establishment of 
the Civil Aviation Safety Authority (CASA); and the commercial aspects through the formation of PNG Air Services Ltd and Airport Development Corporation Ltd. 
Air Services Agreements are in place and at th e operational level; the National Flag Carrier has 
entered into several code share arrangements. 
We have an Open Sky Policy but as a matter of pr inciple, it does not mean that we will allow any 
body to just come and set up shop as they have to meet certain prerequisite conditions i.e. IPA conditions will need to be met.  
UNITED STATES FOLLOW-UP QUESTIONS 
1) The government of Papua New Guinea did not r espond to either of our SPS questions (i.e., 
one on Page 37 and the other on pa ge 55, paragraph 67).  In light of the "RULES OF PROCEDURE 
FOR MEETINGS OF THE TRAD E POLICY REVIEW BODY"  (WT/TPR/6/Rev.2, 
14 November 2008), when can we expect to receive  Papua New Guinea’s responses to these questions 
that address basic obligations under the SPS Agreement? 
2) With regard to export assistance (our question re Page 48, Paragraph 42),  the government of 
Papua New Guinea stated that its export assistan ce tax incentive is for research, promotion or 
establishment of export markets, and therefore does not fit the definition of Article 3 of the SCM 
Agreement on prohibited subsidies. However, if the incentive provides any financial assistance for 
export promotion, the program should be duly notified in accordance with Article 25 of the 
Agreement.  When will PNG notify the program pursuant to Article 25 of the SCM Agreement? 
EU ADDITIONAL AND FOLLOW-UP QUESTIONS 
The EU would like to thank PNG for the replies to our advance questions. Please find below some 
follow-up and some additional comments and questions.  
I. Follow-up comments and questions 
1) Q 1 has been partially replied - in its reply,  PNG refers only to its activities as regards to 
sustainable development. Could PNG also elabor ate further on how it encourages the core labour 
standards in this context? It would be good to have more details about how the Medium Term 
Development Plan will contribute to sustainable economic, environment and social development. WT/TPR/M/239/Add.1 
Page 40  
 
  In addition, could PNG explain how it ensures that the eight fundamental ILO Conventions and the 
ILO's 2008 Declaration on Social Justice for a Fair Globalisation are respected in the informal sector? 
Response 
Reply to this question will be provided at a later stage. 
2) Q-s 7, 9, 11 were replied on the second day of the review and Q 10 will be replied in a later 
stage as stated by PNG. The EU  encourages PNG to send the replies as soon as possible and will 
study the replies of questions provided on the second day review.  
Response 
Reply to Question 10 will be provided at a later stage. 
3) Q 13 needs further explanation – in its reply,  PNG states that "[tariff exemptions are granted 
to prescribed organisations that in turn use comp anies to implement the project]". Could PNG specify 
how in this case granting concessions on a MFN basis is applied?  Also, could PNG elaborate on which are the conditions for government approval and how these concessions "assist local industry"? 
In addition, could PNG explain whether all like produc ts are exempted, independent of their origin or 
only those imported by the company to which approval has been granted?   
Response 
Reply will be provided at a later stage. 
4) Q-s 15, 16, 17, 18, 19 were replied on the sec ond day of the review -  the EU will study the 
replies of questions provided on the second day review.  
Response 
Replies to questions provided above. 5) Q 22 - it its reply, PNG states that the respon se to this question will be provided by the PNG 
Forest Authority (PNGFA) at a la ter stage. The EU encourages P NG to send the replies as soon as 
possible.  
Response 
Reply has been provided above. 6) Q 29 has been partially replied - in its re ply, PNG is explaining how it is considering 
environmental issues in its economic development st rategy; however, also the information on how the 
social issues are considered, would be useful. 
Response 
Reply will be provided at a later stage. 
7) Follow-up on questions on fisheries sector – Could PNG explain how it ensures that vessels 
listed on its shipping register do not engage in IUU fishing? And also, how it ensures that vessels 
listed on its shipping comply with PNG's labour laws and regulations, as well as the relevant ILO 
Conventions relating to maritime workers?  WT/TPR/M/239/Add.1 
 Page 41 
 
 
  Response 
PNG is a leader in the regions in developing inn ovative conservation and management (CMM) tools. 
PNG, through the National Fisheries Authority (NFA) realises the potential impact of IUU fishing on 
fishing stocks as well on economic returns, thus  we have developed institutional mechanisms 
designed to monitor, control a nd provide surveillance on all P NG registered fishing vessels. 
It is a licensing requirement by Law (fisheries Management Act 1998) that all fishing interest must 
comply and have the following: 
 1. Vessel Monitoring Scheme - where all vessels are tracked by transponders 
(Automatic Locating Devices (ALC)) on real  time basis giving the exact position 
(long-lat, timing) and corresponds to a nd complements the Vessel Day Scheme 
(VDS) as well 
 2. 100% Observer Coverage - where all fishi ng vessels must have at any one fishing trip 
an observer on board. the observer is respons ible for collecting catch data indication 
the volume of catch, species caught, weight, size, location of catch (long-lat) and timing. These information are recorded in log sheets. 
 3. Mandatory Port calls/notices- this ensur es that there are no transhipment at sea; all 
transhipment must be on port 
8) Q 33 has not been replied – in its reply, P NG refers to access to international markets, open 
skies and traffic rights. However, question 15 was aimed at receiving information on PNG's plans to 
further liberalise airport operations services and gr ound handling. Could PNG provide information on 
its intentions? 
Response: 
Reply to be provided at a later stage.  
II. EU - Additional questions 
II. TRADE POLICY REGIME:  FRAMEWORK AND OBJECTIVES 
(3) T RADE POLICY FORMULATION , IMPLEMENTATION , AND EVALUATION  
Main trade laws WTO Secretariat’s report, page 19, table II.1 
1. The EU remains concerned that the rece nt amendment to the Environment Act (2000) 
risks to downgrade the environmental standa rds, hence jeopardizing the sustainability 
of specific sectors, such as fisheries or  logging. Has the Government of PNG taken 
into account the potential impact of the amendment to the Environment Act (2000) in 
the long - term?  
Response 
Reply to be provided at a later stage.  WT/TPR/M/239/Add.1 
Page 42  
 
  (5) T
RADE AGREEMENTS AND ARRANGEMENTS  
(ii) Preferential 
(a) Regional agreements (i) EU Economic Partnership Agreement (EPA) 
WTO Secretariat’s report, page 26, para-s 31-32 
The interim Economic Partnership Agreemen t was signed by PNG on 30 July 2009.  
The EU encourages PNG to take the necessary implemen tation steps in order to attain legal certainty 
and benefit fully from the agreement. Could P NG elaborate on implementation process to date 
(institutionalization of EPA Council, Trade and Deve lopment Committee etc) and possible next steps?  
Response 
Reply to be provided at a later stage. 
(6) F
OREIGN INVESTMENT REGIME  
(i) Overview 
WTO Secretariat’s report, pages 29 – 30, para-s 42-43 
3. The approval of new investment projects  by the PNG is subject to a condition of 
"provision of new services". Could PNG elaborate further on the meaning and coverage of this cond ition and explain the respective screening process? 
Response 
Reply to be provided at a later stage.  
(a) Legislative arrangements 
WTO Secretariat’s report, page 30, para. 45  
The Secretariat's report informs that "[The IPA certif ies foreign investors (50% or more ownership or 
control and management by non-PNG citizens) as bona fide investors to conduct business in PNG, 
and screens FDI proposals, mainly acco rding to the authorities, designed to ensure that investors are 
of "good standing[…]".   
 4. Could PNG explain the criteria to assess the good faith and good standing of 
prospective investors?  
 5. Could PNG inform whether these criteria are set out in a public law or in an internal 
rule?  
 6. Could PNG state the percentage of investors rejected per year as the result of this 
screening process?  WT/TPR/M/239/Add.1 
 Page 43 
 
 
  Response 
Replies will be provided at a later stage.  
III. TRADE POLICIES AND PRACTICES BY MEASURE 
(1) I NTRODUCTION  
WTO Secretariat’s report, page 36, para. 4  
24. The Secretariat’s report recognizes that "[PNG bound all tariff items at an (unweighted) 
average rate of 32.8%.  The large 27.7 percentage  point gap between this and average applied MFN 
rates, widened by unilateral tariff reductions, l eaves PNG much scope to raise tariffs within its 
commitments, also contributing to the unpredictability  of the tariff.  However, applied tariffs have 
been raised only occasionally. Applied tariffs on a handful of items seemingly exceed bound rates.]" 
 7. The EU welcomes that the level of app lied tariffs has been steadily reduced along the 
last decade. However, bound tariffs remain much higher, thus generating uncertainty. 
Considering that applied tariffs have been raised only occasionally, has PNG 
considered the possibility of binding most if not all its MFN rates at the applied level? 
Response 
Reply will be provided at a later stage.  
(3) MEASURES DIRECTLY AFFECTING EXPORTS 
(v) Export Processing Zones 
WTO Secretariat's report, pages 48-49, para-s 43-45 and reply by PNG to the question by US in its 
written replies.  
In its replies, PNG explains that "[The Government  has recently endorsed a new concept to be called 
as the "Economic Corridor". Under the PNG Deve lopment Strategic Plan (PNGDSP) 2010-2030 and 
the Medium Term Development Plan (MTDP) 2011-2015, several rural Economic Corridors have 
been identified in each of the 4 regions in the country.[…]". 
 8. Could PNG inform whether national labour laws, the fundamental rights at work as 
embodied by the ILO's 2008 Declaration on Social Justice for a Fair Globalisation 
and the 8 core ILO Conventions will also  apply in free zone s and free economic 
zones?   
Response 
Reply will be provided at a later stage.  WT/TPR/M/239/Add.1 
Page 44  
 
  (4) I
NTERNAL MEASURES  
(ii) Government procurement WTO Secretariat’s report, page 53, para. 61  
30. The Secretariat's report states that "[Despite improvements, public procurement remains 
inefficient, and further reforms could enhance pe rformance and help ensure value for money. The 
private sector has identified sever al weaknesses in public procurement, including:  lack of 
transparency with associated suspicion of corrupt ion (abuse of Certificates of Inexpediency and 
splitting contracts to favour small firms); no sta ndardized documentation a nd evaluation;  poor 
disclosure of awarded contracts; discretionary i ssue of contracts;  poor quality documentation and 
contract management;  and procurement delays.  The authorities indicated that technical assistance 
was needed to assist in implementing government procurement policies, including training of 
officials.] "  
 8. Could PNG elaborate on the steps it is taking to increase efficiency and ensure that 
public resources are properly allocated?  
Response 
Reply will be provided at a later stage.  
IV. TRADE POLICIES BY SECTOR 
(6) S
ERVICES  
(i) Telecommunications (b) Policy WTO Secretariat’s report, page 86, para. 90 
According to the Secretariat's report, "[Uncertain ty in the Government's telecommunications policy 
ended with the NEC approving the National ICT Policy Phase II Reforms Final Report in March 2009 
(in the National Information and Communications  Technology Act of November 2009).  The Act 
provides a comprehensive reform package for introd ucing open competition. Some parts, relating to 
the transition to the new regulator (the Nati onal Information and Communications Technology 
Authority (NICTA)), became operative on 3 March 201 0.  The rest of the Act, regarding the 
succession of functions, will enter into force on 2 August 2010, when the independent industry-
specific telecommunications regulator, NICTA, will replace PANGTEL and take over the ICCC's regulatory functions.[…]".  
 9. Could PNG elaborate on the implemen tation of the National Information and 
Communications Technology Act after it entered into force in August 2010?  
Response 
Reply will be provided at a later stage.
  
 
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