ANNOUNCEMENT 27 Aug 2013In August 2013, the government of Papua New Guinea announced changed rules for foreign investors.
NUMBER OF INTERVENTIONS
Lexology, October 21, 2013, 'PNG Takeovers Code amended to introduce new 'national interest' test: http://www.lexology.com/library/detail.aspx?g=4835de33-0c00-4bbc-9e6a-5688f694e7c2
PNG National Gazette (of August 27, 2013, no. G374), not available online
Affected trading partners: http://elibrary-data.imf.org/public/FrameReport.aspx?v=3&c=11666797&pars=Country,853
On August 27, 2013, the Papua New Guinea (PNG) government gazetted an amendment to the Takeovers Code to include a national interest test for takeovers that has been justified in terms of curbing foreign investment. The restriction reads as follows:
'The Securities Commission shall issue an order preventing a party from acquiring any shares, whether partial or otherwise under this code, ... if the Commission views that such acquisition or takeover is not in the national interest of Papua New Guinea.'
There are no guidelines or tests for determining what is in the national interest of PNG, providing the Securities Commission with a wide discretion to allow or disallow foreign investment. A local newspaper reported the Minister of Trade of PNG as justifying this measure as follows 'It is time the country has to serve the interests of its people and not allow too much control of our resources by foreigners'.