PNG’S KEY INDUSTRIAL SECTORS
4.9 Building and construction 4.9.1 Overview Investment in construction has been fuelled by a sustained and acute shortage of real estate since the mid-2000s, due in part to the resources boom and the consequent increased presence of expat workers in PNG. Increased liquidity, especially from local superannuation funds Nasfund and Nambawan Super Ltd, has freed up capital for real estate development. Major office, retail and accommodation developments in Port Moresby include Steamships’ Grand Papua Hotel and office development, Harbour City near the centre of Port Moresby and the Malaysian Rimbunan Hijau Group’s Vision City in Waigani. The advent of the ExxonMobil liquefied natural gas (LNG) project is also expected to fuel continued growth in PNG’s economy and construction sector, including a new accommodation village for ExxonMobil project workers in Port Moresby.
4.9.2 Acquisition of land for building The majority of land in PNG is either leasehold or customary land. To ascertain if land is zoned for building, developers need to check the Subdivisional Code in their municipality. The two largest municipal authorities in PNG are the National Capital District Commission (Port Moresby) and the Lae City Council (Lae). Building developments in PNG must comply with the Building Act and Physical Planning Acts. Major centres have their own Building and Physical Planning Boards.
4.9.3 Physical Planning Approval
Included in the submission must be stamped approvals from the local fire department and water authority (in Port Moresby, the local water authority is Eda Ranu). Developments costing in excess of 50 million kina (US$18.82 million) must also obtain additional approval from the Department of Environment and Conservation, as stipulated by the Environment Act 2000. A Structural Adequacy Certificate issued by a PNG-registered structural engineer is also required for Building Board approval. Under PNG’s Engineers Act, all construction design work must be done by a PNG-registered structural engineer. Once Building Board approval is obtained, construction must commence within 18 months, although extensions may be obtained.
4.9.5 Building workers and materials Employment of building labourers should follow Department of Labour and Industrial Relations guidelines. There is no requirement to use PNG-produced material on PNG building projects. All foreign contractors must be registered with the Investment Promotion Authority.
4.9.6 Certification during and after construction It is a requirement to notify the Building Board’s inspectors before pouring a building’s concrete footings, and a pre-pour inspection may occur. A Certificate of Occupancy must be issued by the municipal authority before the building can be occupied. A Certificate of Practical Completion must be issued by the contractor prior to the owner taking possession, followed by a Certificate of Final Completion.
Before building can commence, a developer must obtain Physical Planning Approval from PNG’s Department of Lands and Physical Planning. Application forms and fee structures are available from the relevant municipal council.
4.9.7 Further information/contacts
Material submitted should include architectural concept drawings of the proposed development.
Eda Ranu www.edaranu.com.pg
The Department of Lands and Physical Planning may stipulate certain conditions for the development in its letter of approval.
Lae City Council http://morobepng.com/id13.html
4.9.4 Building Board
National Capital District Commission Regulatory Services www.ncdc.gov.pg
Department of Labour and Industrial Relations www.workpermits.gov.pg
Once Physical Planning Approval has been obtained, a submission must be made to the local municipality’s Building Board including complete documentation on the project. Outside municipal boundaries, applications should go the relevant provincial building board.
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THE PNG INVESTORS’ MANUAL - SECOND EDITION